2000 (1) TMI 942 - HC - VAT and Sales Tax

Tribunal Upholds Eligibility Certificate for Edible Oil Manufacturer

The Tribunal upheld the grant of eligibility certificate to M/s. Nagauri Industries for benefits under the Sales Tax Incentive Scheme, 1987, for a new ... - Issues:Challenge to order of Rajasthan Tax Board regarding eligibility certificate under Sales Tax Incentive Scheme, 1987 for new industrial units for manufacturing edible oil.Analysis:The case revolves around the eligibility of M/s. Nagauri Industries to claim benefits under the Sales Tax Incentive Scheme, 1987 for a new industrial unit manufacturing edible oil. The District Level Screening Committee sanctioned the eligibility certificate for the respondent, but the assessing authority's appeal was rejected by the Board, leading to the revenue filing this revision. The respondent claimed benefits under the scheme for oil extraction or manufacture, which was eligible as per notifications issued under the Rajasthan Sales Tax Act and the Central Sales Tax Act.The notifications issued in 1987 exempted new industrial units, including oil extraction units, from payment of tax on sales within Rajasthan and on inter-State sales. However, subsequent amendments in 1990 withdrew the benefits for oil extracting and manufacturing industries, which were later partially restored. The High Court's judgment in Lokendra Industries v. State invoked the principle of promissory estoppel to uphold the exemption under the Incentive Scheme for industries that started production before March 1992. The Supreme Court affirmed this judgment regarding the Central Sales Tax Act benefits but set aside the State Sales Tax Act benefits.In the present case, the respondent established a new unit for oil extraction and manufacture during the discontinuation of the scheme under the Central Sales Tax Act. The Tribunal, following the Supreme Court's decision in Gopal Oil Mills, directed the grant of eligibility certificate to the respondent. The judgment highlights the absence of public interest justifying the withdrawal of benefits during the specified period and the risk of discrimination against units starting production in that period. Ultimately, the revision was dismissed, upholding the Tribunal's decision based on the Supreme Court's rulings.This comprehensive analysis of the legal judgment concerning the eligibility for Sales Tax Incentive Scheme benefits provides a detailed understanding of the issues, relevant legal provisions, notifications, judicial precedents, and the final decision reached by the Tribunal.