1989 (8) TMI 319

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....c granules which is taxable at 8 per cent under entry 145 of the First Schedule to the Sales Tax Act. The assessees' units were entitled to the benefits of the Government Order S.R.O. No. 968 of 1980 under which all small-scale industrial units set up after 1st April, 1979, are entitled to exemption from payment of sales tax on the turnover of the sale of goods produced and sold by them for a period of five years from the date of commencement of sales of such goods by them subject to the limit prescribed therein of which we are not concerned. Therefore, the goods manufactured and sold by the assessees are exempt from payment of sales tax for a period of five years under the said Government Order. Section 5(3) of the Sales Tax Act gives c....

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....t the judgment in the original petition, the writ appeal is filed by the respondents in the original petition-the Revenue. 4.. We heard counsel. 5.. There is no dispute that the assessees are small-scale industrial units set up after 1st April, 1979, and they are entitled to the benefit of S.R.O. No. 968 of 1980. That notification is issued under section 10(2) of the Act which reads: "10. Power of Government to grant exemption and reduction in rate of tax. (1) ........................ (2) Any exemption from tax, or reduction in the rate of tax, notified under sub-section (1),- (a) may extend to the whole State or to any specified area or areas therein,  (b) may be subject to such restrictions and conditions as may ....

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....f such sale on complying with the conditions mentioned in the notification. 6.. Section 5 of the Act is the charging section which imposes a levy of tax on every dealer. It says that every dealer shall pay tax on his taxable turnover for that year at the rate and at the point specified against such goods in the First or Second Schedule of the Act. Subsection (3) of section 5 of the Act reads: "Notwithstanding anything contained in sub-section (1) or subsection (2), the tax payable by a dealer in respect of any sale of industrial raw materials, component parts or packing materials which is liable to tax at a rate higher than two per cent when sold to industrial units for use in the production of finished products inside the State for s....