Separate industrial unit status governs deferred sales tax benefits where the rules require independent registration.

A cement division with a separate industrial licence from the Government of India qualified as an industrial unit under the Bihar Sales Tax Supplementary (Deferment of Tax) Rules, 1990, and could not be denied separate sales tax registration merely because it formed part of an existing company. The HC held that section 14 of the Bihar Finance Act, 1981 did not bar separate registration where the deferment scheme required it. Refusal of separate registration would defeat the deferred payment benefit, so the rejection of both registration and deferment relief was unsustainable and the matter had to be reconsidered afresh.

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Issues: Whether the petitioner's cement division was entitled to be treated as a separate industrial unit for the purpose of separate sales tax registration and consequential consideration for benefits under the deferred payment of sales tax scheme, and whether the orders rejecting registration and deferment benefits were sustainable.

Analysis: The scheme under the Bihar Sales Tax Supplementary (Deferment of Tax) Rules, 1990 required an industrial unit opting for deferment to be a separate entity for sales tax registration and to obtain a separate registration certificate. The definition of industrial unit included a new industrial unit registered or licensed by the Government of Bihar or the Government of India. On the facts, the cement division possessed industrial licence/registration from the Government of India, and therefore answered the definition of industrial unit under the Rules. The Court further held that section 14 of the Bihar Finance Act, 1981 permitted registration with respect to goods or classes of goods, but did not bar separate registration where the deferment scheme required it. Refusal to grant separate registration effectively defeated the deferment benefit and the rejection of the petitioner's request on the footing that the cement division was only part of the existing company was not accepted.

Conclusion: The petitioner's cement division was entitled to be treated as an industrial unit for purposes of the Deferment Rules, and the orders refusing separate registration and deferment benefits were not sustainable. The matter had to be reconsidered afresh by the authorities.

Final Conclusion: The writ petition succeeded, the impugned orders were set aside, and the authorities were required to reconsider the petitioner's claim in accordance with law.

Ratio Decidendi: Where a deferred tax incentive scheme requires a separate industrial unit and separate registration, a newly licensed or registered manufacturing unit cannot be denied consideration merely because it is owned by an existing company, if the governing rules otherwise treat it as an independent industrial unit.

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