HIGH COURT OF JUDICATURE AT ALLAHABAD ?Court No. - 10 Case :- SALES/TRADE TAX REVISION No. - 1517 of 2003 Petitioner :- M/S Paswara Petrochem Ltd. Respondent :- Commissioner Of Trade Tax, U.P. Lucknow Petitioner Counsel :- Rakesh Ranjan Agrawal,Suyash Agarwal Respondent Counsel :- C.S.C. Hon'ble Arun Tandon,J.
Heard Sri Bharatji Agrawal, Senior Advocate assisted by Sri R.R. Agrawal, Advocate on behalf of the assessee.
This trade tax revision has been filed against the order of the Tribunal passed in Appeal No. 40 of 2003 decided on 19th June, 2003.
Facts, in short, giving rise to the present trade tax revision are as follows:
The assessee before this Court, on the strength of being a new industrial unit made an application for grant of exemption/eligibility certificate in terms of the Government Notification dated 31st March, 1995. This application was granted and the assessee was granted eligibility certificate dated 11.11.1999 for a period of 8 years w.e.f. 25.04.1999 to 24.04.2007. The extent of the tax, for which it was granted, was to the extent of 150% of the total fixed capital investment of Rs. 2,76,00,000/- and odd. The installed annual production capacity of the unit was mentioned as 25,200 M.T. Up to this stage there was no dispute.
The assessee, however, opted for further expansion of the unit. On the allegation that it has increased the production capacity by more 50%, to be precise up to 40,000 M.T., and further that it has incurred additional fixed capital investment of more than 20%, to be precise Rs. 3,03,15,000/-, the assessee sought further eligibility certificate. This application of the assessee was processed and the Divisional Level Committee vide its order dated 30.01.2003 granted an eligibility certificate on the basis of the expansion undertaken to the 100% of the additional fixed capital investment i. e. 100% of Rs. 3,03,15,000/-. The figure of the production capacity was, however, transcribed in the order as Rs. 21,160 M.T.
This Court may at this stage itself clarify that between the assessee and the department it is an admitted position that the figure 21,160 M.T. was wrongly transcribed in the eligibility certificate. It should have been 20,160 M.T. and for the purpose correction application has been made both by the assessee as well as by the department.
The issue is left at this stage with the direction upon the Divisional Level Committee to consider and decide the application for correction made by the parties, preferably within one month from the date a certified copy of this order is filed before it.
Now turning to the main controversy between the parties. The order of the Divisional Level Committee to the extent it granted exemption only up to 100% of the additional fixed capital investment made, the assessee was not satisfied. It was claimed that this exemption should be 150% and in any case 100% of the fixed capital investment should be determined with reference to the original amount spent as well as the additional amount spent towards fixed capital investment.
The Tribunal, after noticing the aforesaid two objections, by means of the order dated 19.06.2003 has upheld the first part of the objection of the assessee and has recorded that in terms of the Notification No. 780 and 781 dated 31.03.1995 the exemption limit has to be fixed at 150% of the additional fixed capital investment made by the assessee i. e. Rs. 3,03,15,000/-. However, the second contention raised on behalf of the assess, qua the value of fixed capital investment being calculated after adding the original investment made along with additional fixed capital investment, has been answered against the assessee. It has been held that the assessee is entitled to eligibility certificate for 150% of the additional fixed capital investment made only. The plea that the original investment should also be taken into consideration has been answered in negative.
Challenging the order of the Tribunal, senior counsel for the assessee Sri Bhart Ji Agrawal contended that the legal position was examined by this Court in the case of M/s. Kajaria Ceramics Limited vs. Commissioner of Trade Tax ; 2000 U.P.T.C.-154 and it was held that the exemption under the notifications dated 31.03.1995 and dated 27.07.1991 should be calculated after adding the original fixed capital investment made along with additional fixed capital investment under the expansion scheme. Reliance has also been made upon the amendments made vide the U.P. Act No. 26 of 1998.
Sri B.K. Pandey, Standing Counsel however submits that the dispute is no more res integra and controversy stands decided against the assessee under the judgment of the Supreme Court in the case of Commissioner Trade Tax, U.P. and Another v Kajaria Ceramics Ltd.; (2005) 11 SCC 149.
Although an attempt was made by the counsel for the assessee to distinguish the law so laid down by the Supreme Court but on examination of judgment, this Court finds hardly any good ground to take any different view. The reliance placed upon U.P. Act No. 26 of 1998 is also of not much substance.
In view of the aforesaid, the order of the Tribunal is affirmed. The trade tax revision is dismissed subject to the observational made herein above.
Order Date :- 11.8.2011 Pkb/