TaxTMI 
TaxTMI 
2008 (11) TMI 383
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....nt Corporation (UPSIDC) on or about March 14, 1991 and July 11, 1991 allotted plot Nos. C-28 and C-29, Industrial Area, Orai, in the district of Jalaun in favour of respondent. An agreement for lease was executed in its favour on September 18, 1992 by the UPSIDC for setting up a unit for manufacture of fire bricks and B.P. sets. The appellant commenced production in the said unit on and from September 15, 1992. It was registered as a small-scale unit with effect from September 29, 1992. The first sale of the finished product was made on October 24, 1992. It filed an application claiming exemption from payment of trade tax on the turnover of manufactured products in form 46 before the sales tax authorities on March 12, 1993 said to be within the stipulated period of six months from the date of first sale. The sales tax authorities, however, asked for a copy of the deed of lease. The application was also returned to the appellant by the said authority on June 4, 1993 purportedly for the purpose of removing the said objection. A copy of the deed of lease was furnished to him only on or about April 16, 1994. The fact that the appellant is entitled to exemption from payment of trade....
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....be evident that when an allotment is followed by a lease for a period of more than five years, it is incumbent for the applicant to supply a copy thereof, failing which the application would be treated to be incomplete, the consequence whereof is that eligibility certificate could be granted only from the date when the application became complete in all respects and not from a date prior thereto. The State of Uttar Pradesh enacted the U.P. Trade Tax Act, 1948 ("the Act") to provide for the levy of tax on the sales or purchase of goods in Uttar Pradesh. Section 4A of the Act provides for exemption from payment of trade tax in certain cases. We may notice the relevant provisions thereof: "Section 4A. Exemption from trade tax in certain cases.-(1) Notwithstanding anything contained in this Act, where the State Government is of the opinion that it is necessary so to do for increasing the production of any goods or for promoting the development of any industry in the State generally or in any district or parts of district in particular, it may on application or otherwise, in any particular cases or generally, by notification, declare that the turnover of sales in respect of such goods....
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....hich shall be computed from the date of the application and not from the relevant date of commencement of the period of facility referred to in sub-section (1) till the end of the period of facility; (c) in relation to a new unit referred to in Explanation (1), where the conditions specified in clauses (a) to (d) of the said Explanation (1) are fulfilled on a date later than the date of commencement of the period of facility notified under sub-section (1), then subject to the provisions of clause (b), only for part of the period, notified under sub-section (1), which shall be computed from the date on which all the conditions referred to in the said clauses (a) to (d), have been fulfilled on July 20, 1992 whichever is later, till the end of the period of such facility, so, however, that a manufacturer who was eligible for such facility under clause (c) as it stood prior to July 20, 1992 and had applied for the facility prior to the said date, shall be entitled to the facility in accordance with the said clause (c). (d) in relation to a new unit manufacturing same goods established on or adjacent to the site of an existing factory or workshop by a person who has interest in the ex....
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....ads as under: "10. Title of land or building - (a) Self-owner Enclose the attested copy of title deed. (b) Taken on lease Enclose the attested copy of the registered lease deed. (c) Allotted by Government or a Corporation or a company owned or controlled by the Government. Enclose the attested copy of such allotment letter" The State of Uttar Pradesh issued a notification on or about July 27, 1991 for grant of exemption, inter alia, from payment of tax to new units set up, the relevant provisions whereof read as under: "2. The facility of exemption from or reduction in the rate of tax shall be subject to the following conditions in addition to the condi- tions referred to in section 4A of the Act: (i) that the 'new unit' is licensed or in respect whereof a letter of intent has been issued, or which is registered, permanently or otherwise, by the appropriate authority in accordance with any law for the time being in force relating to licensing or registration of such units; (ii) that the new unit is established on land or building or both owned or taken on lease for a period of not less than fifteen years by such unit or allotted to such unit by the State or the Centra....
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....ithin six months from the date of starting production, the benefit of the exemption shall be given from the date of first sale. Clause (d) of sub-section (2) of section 4A, however, empowers the State Government to specify in the notification issued under sub-section (1) that the exemption from payment of trade tax would be admissible, inter alia, only if the manufacturer furnishes to the assessing authority an eligibility certificate granted by such officer in accordance with such procedure as may be specified. Clause (a) of sub-section (5) of section 4A stipulates that a manufacturer shall be entitled to the facility of exemption for the entire period notified under sub-section (1) only if the application is filed within six months from the relevant date of commencement of the period of facility referred to in sub-section (1) or within six months from the date of notification issued under that sub-section, or by September 30, 1992 whichever expires later. Clause (c) of sub-section (5) provides that in relation to a new unit referred to in Explanation (1) where the conditions specified in clauses (a) to (d) of the said Explanation (1) are fulfilled on a date later than the date of....
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.... receipt of intimation in this behalf is also not in dispute. Clause (c) of sub-rule (1) of rule 25 of the Rules assumes importance as the only bone of contention between the parties is as to whether the additional information required was furnished within the time specified. If the unit in terms of clause (c) fails to complete the application or fails to furnish the additional information within the prescribed time, the date on which the application is completed or the additional information is furnished shall be treated as the date of application of such unit. There cannot, however, be any doubt that the said rule has to be read with section 4A, particularly, clauses (b) and (d) of sub-section (2) thereof. The incidental question which would arise for our consideration is as to whether if in terms of the Act or the Rules framed thereunder, the appellant was not required to supply a copy of the deed of lease, failure on his part to supply a copy of the deed of lease would attract clause (c) of sub- rule (1) of rule 25 or not. The eligibility criteria is contained in the notification. Sub-clause (ii) of clause 2 of the notification envisages three contingencies, i.e., (i) the un....
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....which, as noticed hereinbefore, provide for three contingencies. They are disjunctive in nature and not conjunctive. It is now a well-settled principle of law that a subordinate legislation must be read in the context of the main statutory enactment. It is also well-established that when a Form is prescribed in terms of the Rules, in case of doubt or dispute, the requirements laid down in the Form may also be taken into consideration for proper construction of the provisions of the Rules and consequently the statutory enactment. Paragraph 10 of the form XLVI relates to the title of the land or building. Whereas in the case of lease an attested copy of the registered deed of lease is required to be enclosed along with the application, in the case of allotment by Government or a Corporation owned or controlled by the Government, only enclosure of the attested copy of such allotment letter subserves the purpose. The letter of allotment dated March 14, 1991, inter alia, provides that the said date was to be treated as the date of allotment of the plots referred to therein in favour of the appellant. One of the terms of the said letter of allotment refers to entering into a licence/agr....
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....ed by the learned counsel for the respondent that section 4A must be literally (sic liberally) construed to further the object underlying it. In case of any ambiguity, it is submitted, the construction favouring the assessee should be adopted. We cannot agree. Section 4A provides for exemption from tax. It is repeatedly held by this court that a provision providing for an exemption or an exception, as the case may be, has to be construed strictly. . ." However, in Commissioner, Trade Tax, U.P. v. DSM Group of Industries [2005] 1 SCC 657 [2005] 139 STC 269 (SC)., another Bench of this court opined that when an application for exemption is filed for an expansion or diversification, Explanation 5 appended to section 4A(6) specifying the word "unit" must receive a liberal construction to include not only a new unit but also a unit which is sought to be expanded, modernised or diversified, stating: "25 See Para 26 of 139 STC.. . . . As seen above, the term 'unit' has the meaning as defined in section 4A. As we have already seen, section 4A defines the term 'unit' to mean an industrial undertaking, which has undertaken expansion, modernisation and diversification. Even under the Genera....
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.... would be as set out hereinabove." We do not see any conflict in the ratio laid down in the aforementioned two decisions. The question of applying the principle of strict or liberal interpretation would arise only when the plain meaning attached thereto is found to be absurd or anomalous. If a plain meaning given to the provision for the purpose of considering as to whether the applicant had fulfilled the eligibility criteria as laid down in the notification or not is found to be clear, purpose and object the notification seeks to achieve must be given effect to. The State by enacting section 4A of the Act and rule 25 of the Rules intended to encourage setting up of new industries. Such industrial units, however, were required to be set up either on the land owned by the applicant or taken on lease for a period of not less than five years or on the land allotted. However, so far as the land allotted in favour of the applicant by the State or State-owned Corporation or statutory Corporation is concerned, no period is required to be fixed under the law. What is required is an allotment of land by issuance of a letter of allotment. Execution of a deed of lease may be a condition for....