TaxTMI 
TaxTMI 
1993 (2) TMI 287
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.... levied in the course of assessment proceedings under section 41 of the Act, 1969? (3) Whether, on the facts and in the circumstances of the case, the Tribunal was wrong in holding that penalty under section 45(6) of the Gujarat Sales Tax Act, 1969, should be imposed at half the amount determined by the sales tax authorities?" 2.. These questions have been referred in the background of the following facts: The applicant, M/s. Pamila Agro Processing, is a new small-scale industrial unit commissioned after November 1, 1977, at Vapi in south Gujarat, which is a registered dealer under the Act, manufacturing dyes and at the relevant time sending manufactured goods to its branch office at Bombay for being sold at Bombay. In order to earn exemption from sales tax under suitable package of incentives for encouragement of industries in the State as per the relevant Government Resolution, the applicant had applied for and was holding exemption certificate under entry 94 of the Government Notification dated June 22, 1978, issued under section 49 of the Gujarat Sales Tax Act, 1969, pursuant to which he was required to furnish a certificate in form "NN" appended to the notifica....
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.... (iv) The specified manufacturer actually uses the goods within the State as machinery, raw materials, processing materials, or consumable stores in the manufacture of any goods for sale, which shall not take place outside the State of Gujarat. The other conditions are not material for deciding the aforesaid questions. 4.. In the present case, the applicant, M/s. Pamila Agro Processing, was a specified manufacturer; it established a new small-scale industry after November 1, 1977, in the designated area; it obtained eligibility certificate from the Industries Commissioner of the Gujarat State; it also furnished a certificate in form "NN"; it used the raw materials, processing materials and consumable stores in the manufacture of goods inside the State of Gujarat, but it sold the manufactured goods outside the State of Gujarat. The main question is, therefore, whether such a sale is the breach of undertaking given in form "NN", and whether the purchase of machinery and raw materials by the applicant from a registered dealer in such a case, would not entitle him to any exemption. 5.. The form in which the specified manufacturer purchasing goods for use in manufacture of good....
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....ls or consumable stores, inside the State of Gujarat as per the undertaking and the language of entry 94(2), but he is not bound to sell the manufactured goods within the State of Gujarat. He submits that the phrase immediately follows the term "sale" and, therefore, it would qualify the said term and not a remote term "manufacture" (sic). He further submits that the purpose of granting an exemption to new small-scale industries in the State would be frustrated if such industrialists are prevented from selling the manufactured goods outside the State as they would not be able to stand in competition with the giant industrialists of the State who do not need any financial incentives and who would be able to sell their goods all throughout the country without any restriction. 7.. Mr. D.C. Dave, learned Assistant Government Pleader appearing for the State on the other hand submits that a literal interpretation has to be placed on entry 94(2) of the notification as well as form NN, and any inquiry about the object of the legislation would be outside the scope of interpretation when the language is clear and not capable of different meanings. He further submits that even if the court....
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....thin the State of Gujarat; and so it would not be necessary for the Government to use the phrase "not outside the State of Gujarat" so far as the activity of manufacturing by such a dealer is concerned. The term "specified manufacturer" itself involves the concept of manufacturing inside the State. Naturally, therefore, the phrase "which shall not take place outside the State of Gujarat qualifies the term "sale", and not the term "manufacture". 9.. So far as the form NN containing the certificates furnished by the specified manufacturer is concerned, the dealer has to give an undertaking to use machinery, raw materials, processing materials, or consumable stores within the State in the manufacture of goods which shall not take place outside the State. Therefore, the certificate in form NN contains a specific double undertakingone to use the goods purchased by it within the State; and to sell the manufactured goods within the State. Having given such an undertaking in form NN it would not be open to the applicant-dealer to contend that the language of the relevant entry was capable of any other interpretation. In the form NN in which the applicant had given the certificate, there....