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TMI Blog2021 (5) TMI 697X X X X Extracts X X X X X X X X Extracts X X X X ..... alled capacity of 13500MTs, had to be different from the approach in respect of the sales tax payable by the Petitioner on cement for the period subsequent thereto. Likewise for the additional capacity of 22500MTs, the approach in respect of the issue of the exemption with effect from 16th July 1992, had to be separately dealt with - It is interesting that the ACST while partly allowing the Petitioner s appeals came to the conclusion that even for 1992-93 and 1993-94, the penalty imposed by the STO was very high and excessive and that there was no direct proof of collection of sales tax by the Petitioner. With regard to the period 1994-95 and 1995-96, the ACST, in the appellate order waived the penalty imposed on the Petitioner on the ground that it had deposited the amount of sales tax realized. The fact of the matter is that as far as the installed capacity was concerned, with the exemption on payment of sales tax on the finished product having come to end on 1st December 1993, the Petitioner was bound to collect the sales tax on the finished product which in fact it did. It was this tax that the Petitioner deposited with the Department - the explanation offered by the Peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted in 87 ITR 370? 4. The background facts are that the Petitioner is a small scale industrial (SSI) unit engaged in the manufacturing and sale of cement. It was registered with the District Industries Centre, Sundargarh. It was registered as an SSI Unit with effect from 28 th January 1987 with an installed capacity of 13500MTs of cement. 5. The Petitioner was also registered as a dealer under the Orissa Sales Tax Act, 1947 (OST Act) as well as the Central Sales Tax Act, 1956 (CST Act). After setting up its industrial unit at Industrial Area Kalunga, commercial production commenced with effect from 1 st December, 1986. It is stated by the Petitioner that as a continuing unit under the Industrial Policy Resolution (IPR), 1989, the Petitioner was eligible for sales tax exemption both on purchase of raw materials for a period of five years as well as on sale of finished product i.e. cement, for a period of seven years from the date of commercial production i.e. 1st December, 1986. The seven year period accordingly came to an end on 1st December, 1993. 6. Availing of the scheme declared under IPR 1989, the Petitioner made an additional investment in plant and machineries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In similar manner, the penalty was imposed for the years 1992-93, 1993-94 and 1995-96. 11. Aggrieved by these orders, the Petitioner preferred appeals before the Assistant Commissioner of Sales Tax (ACST), Sundargarh Range, Rourkela. By a common order dated 18th August 1998 for the years 1992-93 to 1995-96, the ACST waived the penalty for the year 1995-96 completely as there was no proof of the Petitioner having illegally collected the sales tax. For the years 1992-93 to 1994-95, the penalty was reduced from ₹ 37,36,724/- to ₹ 2,77,785/-. 12. Aggrieved by the above order of the ACST, the Petitioner as well as the State filed the aforementioned appeals before the Tribunal. 13. The Tribunal by the common impugned order dated 6th March 2006, allowed the Petitioner s appeal for the assessment years 1992-93 and 1993-94 while allowing the appeals filed by the State for the assessment years 1994-95 and 1995-96. 14. This Court has heard the submissions of Mr. Damodar Pati, learned counsel for the Petitioner and Mr. Sunil Mishra, learned Additional Standing Counsel for the Opposite Party-Sales Tax Department. 15. The Court at the outset notes that the approach for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the dealer has collected sales tax in the guise of Basic Excise duty or Special duty . Unless and until there is a definite finding that the dealer realized tax on the sales of cement, penalty cannot be imposed on the dealer. Consequently, the order imposing penalty on the dealer in respect of the transactions taking place during the year 1992-93 and 1993-94 is not sustainable. 18. The above finding has become final with the Department not challenging it by filing any revision petition in this Court. 19. Consequently, it is only in so far as the Tribunal has sustained the penalty against the Petitioner for the years 1994-95 and 1995-96 that these revision petitions require to be considered. 20. With regard to the period 1994-95 and 1995-96, the ACST, in the appellate order waived the penalty imposed on the Petitioner on the ground that it had deposited the amount of sales tax realized. The fact of the matter is that as far as the installed capacity was concerned, with the exemption on payment of sales tax on the finished product having come to end on 1st December 1993, the Petitioner was bound to collect the sales tax on the finished product which in fact it did. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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