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TMI Blog1996 (2) TMI 524X X X X Extracts X X X X X X X X Extracts X X X X ..... ated August 27, 1980 issued by the Industries, Mines and Power Department of respondent No. 1, that a scheme of the sales tax incentive from June 1, 1980 for a period of five years has been introduced and the sales tax exemption incentive has been granted by entry No. 118, vide notification dated February 5, 1981 issued under the provisions of section 49(2) of the Act. The petitioner took steps to obtain shed of the Gujarat Industrial Development Corporation, the Government of Gujarat undertaking ( GIDC , for short) at Sachin on April 4, 1984 and obtained possession of a shed being C1-B 3702 from GIDC by incurring cost of Rs. 2,97,760. Thereafter she invested huge amount towards construction of factory building, plant and machinery with electrical installations by investing more than Rs. 10 lacs. It is her case that the area of the factory shed is beyond 10 kms. of the municipal limit of Surat and as such she is entitled to benefit of the Government resolution. She complied with all the requirements and conditions to make herself eligible for sales tax exemption incentives envisaged by the Government resolution read with entry No. 118 of the notification issued under section 49(2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 1989 was filed by one Khukri Packaging Private Ltd. and another. That petition was admitted and it was ordered to be heard along with this group of petitions, namely, Special Civil Application Nos. 7738 to 7741 of 1988. That petition (Special Civil Application No. 3823 of 1989) came up for hearing before us and by a judgment and order dated April 4, 1995 [Khukri Packaging Private Ltd. v. State of Gujarat [1998] 109 STC 117 (Guj)], it was allowed and rule was made absolute by quashing revised eligibility certificate and holding that action of tax incentive benefit was illegal and unlawful. 6. It was not disputed by and between the parties that the point agitated in Special Civil Application No. 3823 of 1989 [Khukri Packaging Private Ltd. v. State of Gujarat [1998] 109 STC 117 (Guj)] was of an identical nature. In fact, that petition was ordered to be heard along with this group of petitions but somehow this group of petitions could not be heard with Special Civil Application No. 3823 of 1989. In that petition, after hearing the parties, and considering the expression "designated area" vide entry No. 118 which was added by a notification dated February 5, 1981, we held that the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n have not been fulfilled by the petitioner. In our view under the notification what is required to be seen for getting benefits under the notification is whether new industry has been commissioned in any of the designated areas . The notification makes it clear that as to what designated areas means. It defined designated areas as an area beyond 10 kms. from the city of Surat. It is the case of the petitioners which is not disputed and really there is sufficient evidence on record including the certificate issued by the Deputy Executive Engineer, GIDC, Sachin at annexure A/3-A dated April 25, 1987 that the shed No. A1/3502 in GIDC of the petitioner is situated beyond 10 kms. boundary line from Surat city. Thus, as per the definition of designated area and the notification granting exemption, the petitioner can be said to be eligible to get benefits. When such benefits have already been granted in favour of the petitioner, it should not have been modified by the department, on the ground that Sachin is situated within 10 kms. from the city of Surat. In our opinion, therefore, action taken by the respondent-authorities is unlawful and all consequential orders require to be quas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... position cannot override statutory definition and the case must be decided on the basis of notification of February 5, 1981. It is pertinent to note in this connection that according to the respondents that the definition of designated area under the scheme was understood by all concerned in the same way as discussed above and in fact benefit thereof was allowed to all concerned who had, taken effective steps to set up a new industrial unit before June 15, 1982 as per clarificatory letter, dated May 16, 1982, annexure III to the affidavit-in-reply. Definition of designated area has not been altered in the scheme. Without amending the scheme which is in the nature of subordinate legislation, the meaning of definition cannot be altered by executive fiat. 9.. In our opinion, the point is directly concluded by our earlier decision in Khukri Packaging Pvt. Ltd. [1998] 109 STC 117 (Guj). Mr. M.G. Doshit, learned counsel for the respondents, submitted that in his opinion even earlier case could not have been decided in favour of the petitioner. He maintained the stand taken by the respondent-authorities that the designated area referred in the notification must be interpreted as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... court is of the view that the earlier decision was completely and totally erroneous. 12.. In our opinion, the question raised in the present group of petitions is directly covered by our earlier decision in Special Civil Application No. 3823 of 1989 [Khukri Packaging Private Ltd. v. State of Gujarat [1998] 109 STC 117 (Guj)]. In that case also a similar contention was raised and after due deliberation, we negatived the contention of the department and held that in the light of relevant provisions of the Act, resolutions and the notification, which is of statutory nature, the petitioner was entitled to tax benefit incentives to the extent of 50 per cent. We do not see any justifiable reason to take a contrary view. As per earlier view, the petitioners are entitled to 50 per cent on the sales tax incentives which was granted in their favour. The impugned action of reducing the said benefit to 25 per cent is, therefore, contrary to law and requires to be quashed and set aside. 13.. For the aforesaid reasons, the petitions require to be allowed and are accordingly allowed. Rule is made absolute. The impugned orders revising eligibility certificates and of curtailing tax benefits ..... X X X X Extracts X X X X X X X X Extracts X X X X
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