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TMI Blog2009 (11) TMI 872X X X X Extracts X X X X X X X X Extracts X X X X ..... nomic and unviable. How can an assessee who has not collected sales tax be directed to deposit the sales tax? The only logical interpretation which can be given to sales tax notification to make it workable in accordance with the incentive policy is that the eligible units will be entitled to the exemption/concession up to the prescribed limit of ₹ 60 lacs and ₹ 45 lacs and if the turnover exceeds the aforesaid prescribed limits then it will have to pay full sales tax on the sales exceeding the prescribed limit. This will lead to certainty in the mind of the entrepreneur. He knows that up to ₹ 45 lacs or ₹ 60 lacs, he is entitled to either a concessional rate of sales tax or full exemption. Thereafter, he has to p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ector; and up to sales turnover of Rs. 45 lacs per annum for a period of five years in industrially developing areas. This concession will not be admissible to the produce of breweries/distilleries, non-fruit/ vegetable based wineries and bottling plants (both for country liquor and Indian-made foreign liquor). It would be pertinent to mention that the units in question would also be entitled to concession on GST on the raw material, processing and packaging material, etc. The notification under the Himachal Pradesh General Sales Tax Act was published in the H.P. Rajpatra on July 27, 2009 wherein the concessional rates were fixed. Relevant portion of the same reads as follows: 1. In exercise of the powers conferred by sub-section (1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tiny industrial units, (i) for a period of eight years in case the unit is located in the industrially backward areas or in case the unit is a priority industrial unit, and (ii) for a period of five years in case the unit is located in the industrially developing areas, from the date of commencement of commercial production or from the date of this notification, whichever is later. from the date of commencement of commercial production or from the date of this notification, whichever is later. 3.. The Governor is further pleased to direct that the concession of partial exemption contained in para 2 of this notification shall be admissible only if, (i) the annual turnover, in respect of the unit located in the industrially b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the sale of products up to Rs. 60 lacs per annum for a period of eight years if the unit is located in industrially backward areas and produces goods mentioned in the priority sector and for a period of five years up to sales turnover of Rs. 45 lacs per annum in case of industrially developing areas. The State contends that in terms of clause 3 of the said notification, the concession shall not be admissible in case the annual turnover of the unit located in industrially backward areas and in priority sector exceeds Rs. 60 lacs or Rs. 45 lacs in case of a unit located in industrially developing areas. When we read the Incentive Policy along with the notification of the Government including clause 2, it is apparent that the intenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee who has not collected sales tax be directed to deposit the sales tax? The only logical interpretation which can be given to sales tax notification to make it workable in accordance with the incentive policy is that the eligible units will be entitled to the exemption/concession up to the prescribed limit of Rs. 60 lacs and Rs. 45 lacs and if the turnover exceeds the aforesaid prescribed limits then it will have to pay full sales tax on the sales exceeding the prescribed limit. This will lead to certainty in the mind of the entrepreneur. He knows that up to Rs. 45 lacs or Rs. 60 lacs, he is entitled to either a concessional rate of sales tax or full exemption. Thereafter, he has to pay full sales tax on the sales exceeding over an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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