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TMI Blog2015 (3) TMI 476X X X X Extracts X X X X X X X X Extracts X X X X ..... claim exemption from the payment of sales tax only on the basis of exemption certificate to be issued by the Excise and Taxation Department which was then to be attached along with e-return under Rule 3(2) of the 1991 Rules. When the unit of the petitioner was on the negative list in terms of the 1991 Rules and was not eligible for the grant of sales tax exemption, claim of the petitioner that it had satisfied all the requirements, is misleading. Perusal of paper book reveals that the application of the petitioner for grant of exemption from sales tax was not lying pending but had remained actively under consideration of the respondents all through but the petitioner itself had rather been postponing such proceedings as it had not been producing account books despite having been asked to do so and had all through making endeavour for bringing the unit within the provisions of the 1991 Rules. Even the case of the petitioner was not considered favourably in the meetings held on 10.12.1993 (Annexure R-6) and on 31.3.1995 (Annexure R-7). In the meeting of 31.3.1995, the Department of Excise and Taxation had declined to accept the claim of the petitioner for sales tax exemption noticin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s had figured in the list of items not eligible for sales tax exemption and incentives. However, Annexure-II of the 1989 policy was subsequently amended on 23.5.1991 whereby the words expelling and crushing were deleted from Item No.9 of Annexure-II. 4. Driven by the notification of the State of Punjab, the petitioner had set up an industrial unit. Though amendment had been effected in the notification, the petitioner as an abundant precaution on 16.3.1992 wrote a letter to the Udyog Sahayak Directorate of Industries seeking information regarding the eligibility of 'expelling and crushing' industries for the incentives under the 1989 policy. Vide reply of 25.3.1992, the petitioner was informed that industrial units engaged in expelling and crushing of edible mustard oil seeds are eligible for 15% State Capital Subsidy in Rajpura Tehsil. Industrial unit established by the petitioner went into production on 29.7.1992. The promoters had spent ₹ 42,84,832/- on setting up the industrial unit as per break up, given below:- Land Rs.03,93,863 Building Rs.15,80,229 Other expen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f sales tax exemption certificate started directly impacting profitability of the petitioner because huge amounts were held up in the market due to non-grant of certificate by respondents No.1 and 3. Ultimately, the petitioner company started incurring losses and defaulted in the payment of loan resulting in enforcing the company to re-schedule the loan instalments and also permission to sell the vacant land etc. Nonparticipatory attitude from the Punjab Financial Corporation also went against the petitioner. Instead of supporting and sustaining the unit, the Punjab Financial Corporation took over the possession of the unit, release of which came only on further undertakings given by the petitioner. 8. When prolonged silence of respondents No.1 and 3 in the matter of grant of exemption certificate forced the petitioner to file CWP No.17856 of 1997 in which the respondents on 17.4.1998 gave an undertaking that final decision on the issues would be taken within three months and further that no recovery of the sales tax arrears would be effected till a decision was taken on the request of the petitioner. Subsequently, on 3.7.1998, Assistant Excise and Taxation Commissioner rejected ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1948. It has, thus, been claimed that the petitioner was not entitled for exemption even if the unit of the petitioner was taken out of the negative list of the Industries Department since list of the Department of Excise and Taxation is relevant for the purpose. 11. It is further explained that on 23.5.1991 during inspection of the business premises of the petitioners, it was found that there was suppression of purchase/sales turn over and claim of exemption even otherwise was liable to be rejected under Rule 5 (5) of the 1991 Rules (Annexure R-5). It has been made clear that the petitioner could claim exemption from payment of sales tax only on the basis of exemption certificate to be issued by the Excise and Taxation Department and otherwise it was not eligible for grant of exemption under the rules. It has also been explained that application of the petitioner was not lying dormant but proceedings therein had been continuing all along and the petitioner had not produced the account books despite seeking various adjournments and efforts at the front of the petitioner on the other hand all through were being made for bringing the unit within the provisions of 1991 Rules. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certificate, which was to be issued by the Excise and Taxation Department, Punjab. 16. In fact, the petitioner could claim exemption from the payment of sales tax only on the basis of exemption certificate to be issued by the Excise and Taxation Department which was then to be attached along with e-return under Rule 3(2) of the 1991 Rules. When the unit of the petitioner was on the negative list in terms of the 1991 Rules and was not eligible for the grant of sales tax exemption, claim of the petitioner that it had satisfied all the requirements, is misleading. Perusal of paper book reveals that the application of the petitioner for grant of exemption from sales tax was not lying pending but had remained actively under consideration of the respondents all through but the petitioner itself had rather been postponing such proceedings as it had not been producing account books despite having been asked to do so and had all through making endeavour for bringing the unit within the provisions of the 1991 Rules. Even the case of the petitioner was not considered favourably in the meetings held on 10.12.1993 (Annexure R-6) and on 31.3.1995 (Annexure R-7). In the meeting of 31.3.1995, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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