9911796707
TMI Blog2006 (9) TMI 516X X X X Extracts X X X X X X X X Extracts X X X X ..... ourth respondent, issued a Scheme called remission of sales tax payable by new industries set up in 30 Most Backward Taluks in certain districts. Under that scheme, which grants benefit in the matter of payment of sales tax, by exercising the power under section 17A of the Tamil Nadu General Sales Tax Act, 1959 (for short, "the TNGST Act"), the Government deferred payment of tax on the sale of products manufactured by the units situated in the backward areas, for a period of nine years from the date of commencement of the production on or after May 14, 1990 up to a ceiling of total investment made in fixed assets, after deducting the quantum of tax under the Central Sales Tax Act, 1956 for the same period subject to the condition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earned counsel appearing for the petitioner as well as Mr. Devaraj, learned counsel for the first respondent and Mr. Shanmuga Sundaram, the learned Government Advocate representing the respondents 2 to 4, and perused the records. The contention of the learned counsel for the petitioner is that the said steel scrap is a by-product of the main product which they are manufacturing and they have also approached the Government pleading that the by-product also should be included as part of deferral scheme which they are enjoying. It is seen from the records that the Government directed the Standing Committee on Incentives for Industrial Promotion in respect of this issue. Even though the first respondent is the authority to grant certificate a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manner and also having in mind the purpose behind the grant of deferral benefit. The learned counsel for the petitioner brought to the notice of this court the decision reported in Commercial Tax Officer, Thirupparangundram Assessment Circle v. Thiagarajar Mills Ltd. [2004] 134 STC 58 (Mad). A division Bench of this court had an occasion to consider whether the cotton waste is a by-product in a spinning mill. After elaborately setting out the manufacturing process in a cotton mill, the division Bench in paragraphs 5 and 6 of the judgment held as follows: "5. The word 'product' has not been defined in G.O. P. No. 92. It only refers to the products manufactured by the new units established in the backward taluks to which the G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the deferral scheme, the Supreme Court had an occasion to consider a similar issue in the decision reported in ITC Bhadrachalam Paper Boards Ltd. v. State of A. P. [2002] 126 STC 541 (SC), wherein the main production activity was manufacture of paper and paper products and the coal ash, which was left over as a residue because burning coal was used as fuel, would be a by-product was considered and the Supreme Court found that the coal ash was produced as a result of burning of the coal as part of the activities of the appellant-industry and held that though it may not be the principal product for which the industry was established but, yet, it will be a by-product qualifying for the concessional scheme. When there is a clear authoritativ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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