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TMI Blog2011 (12) TMI 464X X X X Extracts X X X X X X X X Extracts X X X X ..... d is a "second hand" item ; to the extent its value is duly certified as correct. The respondents are directed to re-fix the liability, if any, granting the benefit of exemption to the above extent as well. X X X X Extracts X X X X X X X X Extracts X X X X ..... cluded in the definition of "fixed capital investment of the notification. However, the third respondent reckoned the eligibility of the petitioner only to an extent of ₹ 3,15,46,833 vide exhibit P2; aggrieved of which exhibit P6 appeal was preferred before the State Level Committee headed by the second respondent, on August 13, 2003. It was contended among other things, that the petitioner was entitled to have exemption in respect of the entire value of the machinery certified by the chartered accountant to an extent of ₹ 4,46,47,211, in the light of relevant bills and documents certified by the auditor, as produced along with the application. The case of the petitioner was that, exemption allowed by the notification contemplates only the investments of the industry and the fact that the machinery was a "second hand" one has no significance, as the value of the same to the extent as certified was liable to be counted as capital investment for setting up the unit. Since nothing transpired after filing the appeal, the petitioner approached this court by filing W.P.(C) No. 1065 of 2004, which was disposed of as per exhibit P7 judgment directing to have the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel submits that there is absolutely no basis for rejection of the claim in so far as the Notification SRO. No. 1729/93 does nowhere stipulate that exemption is not available in respect of second hand machinery of medium and large scale industrial units. It is also stated that the adverse entry in this regard specified in the notification is only in respect of such second hand machinery of "sick industrial units". The learned senior counsel also submits that no reliance can be placed by the respondents on the manual for the obvious reason that the Notification SRO. No. 1729/93 is a statutory notification, which cannot be overridden or re-written or watered down by a circular or manual or by such other proceedings. Reliance is mainly sought to be placed on the decisions rendered by the Supreme Court in [2008] 14 SCC 336 (Sandur Micro Circuits Limited v. Commissioner of Central Excise, Belgaum), [2007] 5 VST 120 (SC); [2007] 2 SCC 743 State of Karnataka v. Balaji Computers). It is further submitted that the manual (G.O. (MS) 169/95/ID dated November 1, 1995) was never notified and that the same cannot bar the way of the petitioner in claiming exemption under any circumst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fixed capital investment of a unit" which reads as follows: "(vii) 'Fixed capital investment of a unit' shall mean the total investment of land including land development cost, building, plant and machinery, power generating system, facilities and equipments for research and development and quality control, standby equipments like standby generator, standby steam boiler, pollution control system delivery vehicles and the like required for the industrial purpose." On the other hand, the only stipulation wherein exemption is stated as not available in respect of "second hand machinery", is in the case of "sick small scale industrial units", as given under sub-clause (viii) of clause 11, which reads as follows: "In computing the cumulative gross fixed capital investment of the sick small scale industrial units, second hand machinery and equipments procured within the State shall not be considered." From the above, it is clear that incorporation of the clause excluding the "second hand" machinery in respect of sick small scale industrial units was pursuant to a conscious exercise pursued by the Government, who did not t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... G.O. (MS) No. 169/95/ID dated November 1, 1995 suggests something contrary, which reads as follows: " All brand new identifiable items of plant and machinery including tools, jigs ,dies, and moulds shall be eligible for tax exemption. All claims in this regard shall be supported by a certificate by the chartered accountant. In case if items where materials are bought and fabricated in house, the cost should be certified by the chartered accountant with regard to cost of materials and fabrication charges and by a chartered engineer with regard to the value of the fabricated plant and minimum of these shall be taken (plant and machinery on hire purchase from NSIC shall be eligible for tax exemption on the basis of original value). No vehicles, other than delivery vehicles, items of office equipment and furniture, crates, pallets and consumable stores will be eligible for tax exemption. Second hand machinery items will not qualify for tax exemption." But the question to be considered is whether the said manual can have any overriding effect on the statutory notification. G.O.(M.S) No. 169/95/ ID dated November 1, 1995 approving the manual for sales tax exemption reads as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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