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TMI Blog2013 (2) TMI 688X X X X Extracts X X X X X X X X Extracts X X X X ..... g unit and there being nothing in the notification to fix such cut-off date. 2. In short, the investment made by the petitioner prior to 1st of April, 1994 was disallowed by fixing a cut-off date into the said notification although no such cut-off date has been specified in the notification. It is submitted by the petitioner that fixing such cut-off date was arbitrary exercise of power on the part of the respondent. 3. It may be appropriate to take note of list of dates and events leading to filing of present writ petition, which are as under: 1984 The petitioner-company commenced its commercial production at industrial unit in village Ganga Honi, Dist.-Rajgarh, M. P. 01-04-1992 In the process of modernization and sophistication the petitioner-company undertook another phase of expansion with a view to convert its unit as an exporting unit. Factual position in this respect not disputed at any stage. 06-10-1994 Notification No. A-3-24-94-ST-V(108) issued by the State Government for implementing the above industrial policy and action plan, (annexure P3). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order dated June 30, 2008 and quashed the decision of State Appellate Forum as being a cryptic and non-speaking order. Case remanded to appellate forum for fresh decision-(annexure P11) 22-09-2009 The petitioner-unit appeared before the State Appellate Forum in remand proceedings as directed by this honourable court vide its order dated June 30, 2008 and further submitted a written submission in support of its contentions.-(annexure P12). The State Appellate Forum vide its order dated September 22, 2009 has again dismissed the appeal of the petitioner-unit and held that capital investment made prior to April 1, 1994 has been rightly disregarded/ ignored by the State Level Committee-(annexure PI). 4. As per the aforesaid eligibility certificate, the exemption of the tax which was required to be 250 per cent, of the total capital investment was granted only with respect to Additional Capital Investment on fixed assets amounting to ₹ 104.11 lacs whereas the claim of the petitioner was to grant exemption by taking into consideration the total investment towards fixed assets as on the date of the eligibility certificate w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... During the course of arguments, Shri P. M. Choudhary, learned counsel for the petitioner-company, has pointed out that the appellate order, annexure P15, passed by the appellate forum was totally a cryptic and non-speaking order and does not contain any reasons for rejecting the appeal filed by the petitioner-company. A perusal of the order, annexure P15, does support the contentions raised by Shri Choudhary. It is apparent that the appeal filed by the petitioner-company has been rejected by a forum merely by saying that it was not entitled to the exemption, but without discussing the various claims made by the petitioner-company in the grounds of appeal. Consequently, without commenting on the claim made by the petitioner-company qua the exemption claimed by it, the present petition is allowed to the extent that the appellate order dated June 25, 2007 passed by the State Appellate Forum shall stand quashed. The appeal filed by the petitioner-company before the appellate forum shall stand revived to its original number and shall be decided afresh by the State Appellate Forum, by passing a detailed and speaking order within a period of four months from the date a certifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that perusal of the notification dated June 6, 1995 does not show that there is any cut-off date to calculate the exemption. It is submitted that such notification at the most puts some limits on the investment made after the commencement of commercial production. It is submitted that the notification dated 6th of June, 1995 although specifies various cut-off dates for the reasons of commercial production either after the particular specified date or before the specified date. Such notification does not specify a date as an anterior date for restricting the capital investment. It is submitted that no power is vested either with the State Level Committee or with State Appellate Forum to fix a cut-off date and restrict the claim of a dealer who has in fact invested huge amount for conversion of its unit into exporting unit. There is no such express or implied delegation in favour of State Level Committee or the State Appellate Forum. It is thus submitted that bringing a cut-off date by the State Level Committee and its approval from the State Appellate Forum is patently illegal, bad in law and without jurisdiction. Hence this writ petition. 12. Arguments have been hear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t investment is available to the petitioner only between May 6, 1994 to December 31, 2009. 9. The answering respondents further submit that the notification dated May 6, 1995 has been issued by the State Government in exercise of the powers conferred upon it under the provisions of Commercial Tax Act. The quantum of exemption h?s already been strictly determined in accordance with the conditions of the notification and in light of the aforesaid notification the jurisdiction lies with the respondents either to refuse or to grant the exemption on the basis of the conditions mentioned in the notification including clause No. 3 which speaks about the cut-off date. However, the petitioner has not challenged the validity of the notification issued by the State Government, wherein clause 3 has been specified and cleared the controversy involved in the petition. Therefore, unless and until the validity of the notification is being challenged, the present petition is devoid of merit and substance and liable to be dismissed on this ground. 16. It is further submitted that as per the notification dated 6th of June, 1995, clause 3 speaks about cut-off date. 17. To appreciate the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch exemption is granted. 2 Dealer who establishes a hundred per cent, export oriented industrial unit or converts his existing industrial unit into a hundred per cent, export oriented industrial unit 250 per cent, of the capital investment in fixed assets. 11 years Schedule-II 9. (1) For the purpose of determination of the cumulative quantum of tax in respect of dealer specified in serial numbers 1 and 3 of Schedule I and the dealer specified in serial number 2 of the said Schedule who establishes a hundred per cent, export oriented unit the capital investment made by such dealer:- (i) up to a period of three years from the date of commencement of commercial production in the NRI industrial unit or a hundred per cent. export oriented industrial unit established by him or in his exporting industrial unit. If his capital investment in such industrial unit up to that date is up to rupees one hundred crores ; or (ii) up to a period of five years from the date of commencement of commercial production in any of his industrial units specified in (i) above, if his capital invest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rting the unit as 100 per cent. unit. In so far as the benefits earlier available are concerned, it is not the case of the respondent that any particular exemption had been availed of and that the said exemption is required to be deducted out of the claim for exemption. 20. The learned counsel appearing for the petitioner has relied upon the 20 judgment delivered by the honourable Supreme Court in the case of State of Orissa v. Tata Sponge Iron Ltd. reported in[2007] 9 VST 415 (SC) ;[2007] 9 RC 539 ;[2007] 11 STJ 785 (SC), wherein notification dated September 23, 1992 (Serial No. 44) issued in terms of Orissa Industrial Policy Resolution, 1992 came up for consideration with respect to capital investment in plant initiated. In that case, notification provided deferment of investment to the extent to 75 per cent, but did not provide for any limitation or period. 21. It will be appropriate to take note of relevant para Nos. 18, 21, 22 of the aforesaid judgment (pages 423 and 424 in 9 VST):- 18. It is not in dispute that in the said entry, during which the same would remain operative, no period far less the period of five or seven years had been mentioned. The only limitati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whereas for the next three years, it provides exemption only for investment up to ₹ 300 crores, but it is not so for the purpose of qualifying investment prior to the date of the recognition of the unit as an exporting unit. It is also clear that exemption does not relate to the unit which was in existence. If new unit is set up, then also exemption is to be granted on fixed capital assets which have been invested from the date of instalment till the date of recognition of unit as a 100 per cent. exporting unit. On the same analogy, it can also be said in case the existing unit if on the basis of the efforts made by the incumbent, becomes 100 per cent. exporting unit and as such the fixed capital investment till the recognition took place shall qualify for exemption if other condition which made, i.e., the period within which, the unit must be become 100 per cent. exporting unit. 24. We are therefore, satisfied that in this case, the orders of the State Level Committee and the State Appellate Forum are not in accordance with the notification dated 6th of June, 1995 or in accordance with the industrial policy of the State of M. P. made by the State for the purpose of incen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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