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TMI Blog2021 (8) TMI 433X X X X Extracts X X X X X X X X Extracts X X X X ..... and deprive the assessee of sales tax exemption. Indeed it is trite that it is the DIC which is the appropriate authority to determine whether a certain SSI unit needs to be granted eligibility from payment of sales tax in terms of the IPR 1989. The certificate so issued by the DIC cannot be brushed aside by the Sales Tax Department - In the present case, despite a clarification issue by the DIC that the Petitioner was eligible for the grant of exemption from payment of sales tax, notwithstanding the differing quantities of raw material consumption and finished product manufactured, there was no justification for the Sales tax Department to invoke Rule 80 of the OST Rules and issue the impugned SCN and the consequential fresh assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the IPR 1989 as well as Entry 30 FFF and 26-F of List-A of the OST rate chart, the District Industries Centre (DIC), Koraput issued a certificate dated 18th November 1997 by which the Petitioner was eligible for exemption from payment of sales tax on the purchase of raw materials as well as on the finished products and packing materials as mentioned therein. The said certificate was valid for a period of two years from 7th December 1995 to 6th December 1997 i.e. the 6th and 7th years from the date of commercial production. 4. The original sales tax assessment of the Petitioner for 996-97 was completed under Section 12(4) of the Orissa Sales Tax Act (OST Act) at nil taxable turnover by the assessment order 17th December, 1997. After re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd to the finished products. Affirming the availability of sales tax exemption, the STO for the second time determined the taxable turnover to be Nil for the year 1996-97. 7. Thereafter the DIC issued a clarification on 2nd September, 2002 to the Commercial Tax Officer, Koraput-I Circle, in relation to the exemption available to the Petitioner, as a small scale unit, from the payment of sales tax on raw materials as well as finished products. The said clarification reads as under: Sir, It is represented by the above captioned unit that the sales tax authorities raised some audit objections regarding the quantum of production made by the unit relating to the period 1996-97. In this connection I would like to clarify that the uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the finished products were also in excess of quantities mentioned in the certificate of the DIC. 10. The appellate authority by the order dated 9th December, 2005 confirmed the order of the ACST on the ground that the Petitioner did not produce sufficient documentary evidence to substantiate its contentions. 11. When the present petition was first heard on 19th January, 2006 an interim order was passed by this court to the effect that no coercive action shall be taken against the Petitioner for recovery of the extra demand of sales tax for 1996-97. On 27th January, 2006 it was directed that subject to the Petitioner depositing ₹ 10,000/- with the Opposite Parties before 15th February, 2006 against the extra demand raised by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the sales tax authority in that case ignoring the certificate issued by the DIC. The Supreme Court took the view that it was not open to the sales tax authorities to cancel the eligibility certificate issued by the DIC and deprive the assessee of sales tax exemption. Recently this Court in its order dated 20th April 2021 in STREV No.28 of 2006 (M/s. Bajrangballi Wire Products Pvt. Ltd. v. State of Orissa) noted the aforementioned decision in Vadilal Chemicals Ltd. (supra) and upheld a similar contention of the assessee. 16. Indeed it is trite that it is the DIC which is the appropriate authority to determine whether a certain SSI unit needs to be granted eligibility from payment of sales tax in terms of the IPR 1989. The certif ..... X X X X Extracts X X X X X X X X Extracts X X X X
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