TaxTMI 
TaxTMI 
TaxTMI 
1983 (2) TMI 274
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....ntioned that though the. date from which such recognition was given effect is stated as 6th January, 1976, in clause (vi) of the conditions annexed to the grant, the certificate is deemed to be valid from 28th February, 1975, till the date of cancellation. 2.. On 12th May, 1978, a show cause notice was issued by the Commissioner as per annexure D calling upon the petitioner-firm to show cause why the recognition certificate issued on 23rd March, 1976, should not be cancelled. The first paragraph of the said notice is extracted below: "Please take notice that you had been granted recognition certificate for the purpose of entry 28 of V Schedule to 'the K.S.T. Act, 1957, in respect of your bricks and tiles industry, vide this office R.C. No....
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....ry, after consultation with the Khadi and Village Industries Commission constituted under the Khadi and Village Industries Act, 1956." Explanation (1)(a) to the said schedule explains what is a "village industry" for purposes of entry 28. According to the explanation, a village industry means a village industry as defined in the Karnataka Khadi and Village Industries Act, 1956, if the number of persons employed in, or the number of units of production of, each industry does not exceed such number as may be prescribed. 6.. So far as entry 28 is concerned, at the time the recognition was granted by the Commissioner on 23rd March, 1976, the relevant rule which governed the issue of certificate was rule 25-A of the Karnataka Sales Tax Rules, ....
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.... follows: "25-A. The village industries for purposes of serial number 28 of the Fifth Schedule shall be as specified in column (2) of the table below provided that the annual sales turnover thereof does not exceed one lakh rupees. .......................................". 10.. The main issue that arises for determination in this writ petition is whether "brick making" industry can be classified as an industry falling under the category "pottery" which is one of the village industries in the table annexed to rule 25-A of the Rules. 11.. In his order granting certificate, the Commissioner has relied upon entry 28 in the Fifth Schedule to the Act as well as rule 25-A of the Rules. Entry 28 relates to "products of village industries". Expla....
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....also drew my attention to entry 28 as substituted by the Amendment Act of 1976. She has also pointed out to rules 25-A and 25-B as substituted by the Amendment Rules of 1977. 13.. It is significant to note that "pottery" continued to be a village industry in the table given to rule 25-A of the Amendment Rules of 1977. The only ground on which the show cause notice was issued by the Commissioner as per annexure D, was that entry 28 had been amended by Act 78 of 1976 with effect from 7th December, 1976, and in the table of village industries annexed to rule 25-A of the Amendment Rules of 1977, bricks and tile industry had not been included among the industries prescribed by it. 14.. It is necessary to examine whether after substitution of e....
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..... Vanaja that even in common parlance "pottery" does not include "brick-making" and it means "earthenware" or "earthen vessels". I am unable to agree that the Commissioner was justified in withdrawing the recognition placing reliance on the amended entry 28 or rule 25-A, he having once held that "pottery" includes and covers "brick-making" and issuing the certificate of recognition therefor. Though the State had perhaps this object in view while amending entry 28 in the Fifth Schedule and inserting new rule, rule 25-A, it has not been made in the manner which was required to be done in the context of the confusion that prevailed and the view the authorities had taken earlier in that behalf; nor is there any other convincing reason given eit....