TaxTMI 
TaxTMI 
2013 (12) TMI 1440
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....ra vires the Articles 14 and 19 (1) (g) of the Constitution of India and violative of the doctrine of promissory estoppel and quash the same. (ii) A writ of certiorari striking down the Assessment Order dated 08.02.211 for the period of April 2003 to March 2005 issued by third respondent. (iii) A writ of certiorari striking down order dated 25.04.2011 issued by third respondent on the Review Petition filed by the petitioner holding that the amount of sale declared in Form-C is a primary information received from party of transaction while the amount of sale declared in the return is only report of the actual sale, therefore, in case of any variation, the former should prevail over the purpose of assessment of tax. (iv) A writ of certiorari striking down impugned Notice of Demand No. 115/CT dated 04.07.2011 issued by third respondent to the petitioner directing the petitioner to pay a sum of Rs. 46,00,657/- to the Bank (Annexure P-47 Notice). (v) Issue a writ of certiorari striking down Annexure P-48 revised Assessment Order dated 16.07.2011 for the period from April, 2003 to March. 2005. (vi) Issue a writ of certiorari quashing down Annexure P-51 letter issued by the third res....
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.... first respondent issued Annexure P-4 notification on 03.10.2000 exempting new industrial units other than negative industries set up after enactment of Incentive Act from payment of sales tax for a period of 5 years from the date of going in for commercial production. Copy of this notification is referred to as exemption notification and produced as Annexure P-4. 3. According to the petitioner, inspired by the Industrial Policy of 1996, the Incentive Act, 2000 and Annexure P-4 exemption notification, the petitioner found it feasible to set up an industry in the State of Sikkim and started investing money for the purpose of establishing the petitioner's company in the State of Sikkim in the year 2001 itself. Annexure P-5, Lease Deed dated 21.09.2011 was entered into by the petitioner company with the State of Sikkim for the above purpose. Thereafter, the petitioner obtained the requisite registration and certificate under the Sikkim Sales Tax Act and Central Sales Tax Act and Annexure P-6 collectively are the copies. According to the petitioner, during the period from 2001 to 2003, they invested an amount of more than Rs. 7.00 crores for the purpose of establishment of the petitio....
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....003, the exemption under the Central Sales Tax Act, 1956 which was granted to the industries by way of the Incentive Act, 2000 read with Exemption Notification, 2000 and State Scheme of Incentives for Industries, 2003 continued to be in operation. In this connection, it is pointed out that the said amendment Act, 2003 did not specifically repeal the earlier Exemption Notification, 2000 or state that the Central Sales Tax shall not be exempted. According to the petitioner even after the amendment in the absence of any contradictory notifications of the Government of India, it has to be presumed that the Exemption Notification, 2000 and the State Scheme of Incentives for Industries, 2003 will continue to be in operation. The petitioner has pointed out that even after the commencement of the Incentive Act, 2003 the official web-site of the Government continued to represent that Central Sales Tax and State Sales Tax shall be exempted for a period of 9 years from the date of commencement of actual commercial production. According to the petitioner, the State Government has been enjoying the benefits from the investment made by the petitioner in the form of industrial development in the ....
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....roduction. 8. The petitioner annexed Annexure P-12 letter dated 04.05.2005 to the second respondent informing the second respondent that the petitioner had already exempted to collect and deposit Sate Sales Tax as well as Central Sales Tax as per Sikkim Industrial Policy and therefore they are not collecting or charging any VAT/CST from their customers. Pursuant to Annexure P-12 some of the officials of the second respondent visited the petitioner's factory premises and asked the petitioner to furnish certain documents. The petitioner submitted Annexure P-13 letter in response and requested that necessary Exemption Certificate be issued at the earliest. The petitioner points out that by Annexures P-13A and P-13B the second respondent granted exemption from payment of Central Sales Tax under section 8(5) of the Central Sales Tax Act, 1956 for the period from 11.03.1999 to 14.11.2000 and 11.3.1999 to 10.03.2006 to M/s Mount Distilleries Ltd., Majitar, Rangpo and it is pointed out that Annexures P- 13A and P-13B were issued even after Sikkim Promotion and Incentive Act, 2000 amended by incorporating section 12A. As the Exemption Notification in the case of the petitioner was not issu....
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.... Thereafter, the petitioner submitted Annexure P-19 letter dated 27.03.2008 to the Chief Minister of the State demanding justice in the matter of withdrawal of Central Sales Tax Exemption by the Government. To Annexure P-19 letter the first respondent gave Annexure P-20 reply. Thereafter, vide notice dated 06.06.2009, the third respondent informed the dealers engaged in inter-State trade and commerce that all dealers engaged in sale in course of inter-State trade or commerce are required to obtain separate declaration Form-C from the buying dealers of other States for all the sales effected during each quarter of a financial year. 11. It was further informed that in pursuance of Rule 12 (5) of the Central Sales Tax (R&T) Rules, 1957 separate declaration Form-F is to be obtained from consignee for stock transfer effected during each month. The petitioner on 23.06.2009 requested the third respondent vide Annexure P-22 letter for issuance of Way Bills to enable the petitioner to dispatch its goods outside the State. On the same day (23.06.2009) the third respondent vide its show cause notice dated 23.06.2009 informed the petitioner that the petitioner has refused to pay the CST which....
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....rds non-payment of Central Sales Tax together with one-tenth of tax assessed as CST and penalty. According to the petitioner Annexure P-33 is illegal. Annexure P-33 is followed by Annexure P-34 final hearing notice. The petitioner filed application for review under section 9(2) of the Central Sales Tax Act read with section 21 of the Sikkim Sales Tax Act praying therein for review of the Assessment Order. Annexure P-35 is a copy of the application for review. The third respondent sent hearing notice Annexure P-36 in respect of review application. The petitioner submitted Annexure P-37 for time extension application for hearing on review application. To that the third respondent sent Annexure P-38 finally fixing time for hearing of review application. The petitioner vide Annexure P-39 once again seeking extension of time for hearing. At last on 25.04.2011 the review petition was heard and Annexure P-40 impugned order dismissing the review petition was passed on 25.04.2011. Based on Annexure P-40, Annexure P-41 demand-cum-notice was sent to the petitioner. To Annexure P-41, the petitioner addressed Annexure P-42 to the third respondent contending that Annexure P-42 was not valid. The....
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....se would be decided ex-parte. 15. On receiving Annexure P-52 the petitioner informed the third respondent vide Annexure P-53 letter dated 21.09.2011 that the Hon'ble Chief Minister had been moved and that the matter may be kept in abeyance till the Chief Secretary takes decision pursuant to the direction given to him by the Chief Minister. The petitioner then submitted that on 27.09.2011 there was a fire incident in the premises of the petitioner wherein the entire stock of finished and semi finished goods which are kept in the finished storage area, and even account documents were destroyed in this fire incident. The information regarding this was sent by the petitioner to the third respondent vide Annexure P-54 letter dated 27.09.2011. On the same day petitioner sent another letter to the third respondent seeking for further time for hearing the matter of Central Sales Tax assessment. Annexure P-55 is a copy of that letter. 16. The third respondent vide its letter dated 10.10.2011 informed the petitioner to appear for hearing on 07.11.2011 with relevant books of accounts and documents for assessment. Annexure P-56 is a copy of that letter. In the meanwhile, on 10.10.2011 the th....
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....ith other two companies who are exempted from paying Central Sales Tax as the petitioner does not fall within the same footing of those companies. 19. Along with the counter affidavit a copy of State Scheme of Incentives of for Industries, 1996 is produced as Annexure R-1 also produced as Annexure R-2 is a copy of the Government Gazette dated 07.07.2000 notifying the Sikkim Industrial Promotion and Incentive Act, 2000 (Act No. 18 of 2000). Section 13 (1) of the above Act is also highlighted in the counter affidavit. A copy of Government notification dated 03.10.2000 notifying concession or exemption towards State Excise Duty and Sales Tax is produced as Annexure R-3. 20. Also produced along with the counter affidavit is the notification by which the Sikkim Industrial Promotion and Incentive (Amendment) Act, 2003 incorporating section 12A was notified by the Government in the Gazette (Annexure R-4). Along with the counter affidavit a copy of Sikkim Industrial Promotion and Incentive (Amendment) Act, 2007 granting section 12 A and declaring that the Central Sales Tax shall not be exempted, is produced as Annexure R-5. The counter affidavit refers to section 20 of the Central Sales ....
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....petitioner's request for issuance of notification granting Central Sales Tax exemption. 24. Each and every allegation, averment and claim of the petitioner in the writ petition has been strongly repudiated in the counter affidavit, wherein parawise replies to the averments in the writ petition are given. To the above counter affidavit, the rejoinder affidavit which was later amended, has been filed by the petitioner. In the rejoinder affidavit the petitioner has reiterated the contentions raised by them earlier and along with the same Annexure P-61. Copy of the notification bearing No. G.O./2/DI96-97 dated 18.12.1996 announcing the industrial policy of the Sikkim Government from the official web-site of the first respondent is also produced. 25. We have heard the submissions of Mr. B. R. Pradhan, learned senior counsel for the petitioner and Mr. J. B. Pradhan, learned Additional Advocate General for the State and its public offices. 26. Mr. B. R. Pradhan, would expatiate the principles of promissory estoppel and legitimate expectation. According to him these two principles would bar the Government from contending now that the petitioner company is not entitled for Central Sales ....
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....ce on the Supreme Court judgment in State of Bihar vs. Kalyanpur Cement Ltd. (supra) in this context. He also relied on Supreme Court judgment in Assistant Commissioner (CT) LTU vs. Amara Raja Batteries Ltd : (2009) 8 SCC 209. 29. Mr. Pradhan also argued on malice in law and malice in fact. As regards, malice in law, Mr. Pradhan submitted that the petitioner was lured to establishing its factory in an industrially under developed State and investing huge amounts of monies by making a promise of exemption from Central Sales Tax and State Sales Tax for specific period and having thereafter enjoyed benefits from its investments not only failed to keep its promise but in spite of repeated requests and reminders declined to grant such exemption and instead, first sought to wriggle out of its promise by issuing the Sikkim Industrial Promotion and Incentive (Amendment) Act, 2003 and providing that the exemption of Central Sales Tax would be governed by notifications/orders issued by the Government of India, although under section 8(5) of the Central Sales Tax Act, 1956 it was the State which had the power to grant such exemption. Thereafter, on 24.07.2006 the petitioner specifically poin....
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....records by the parties." The learned senior counsel further stated that the State is guilty of suppression of materials documents and also of misleading this Court by making false statements. Adverse inference against the State under section 114(g) of the Indian Evidence Act must be taken. In the context of the above averments Mr. Pradhan relied on judgment of the Supreme Court in S.R. Venkataraman vs. Union of India : (1979) 2 SCC 491 and Punjab SEB Ltd. vs. Zora Singh : (2005) 6 SCC 776. 31. Mr. Pradhan advanced arguments on the principle of doctrine of parity also and referred Annexures R-7, R-8 and R-6. Mr. Pradhan submitted that M/s Denzong Laboratories Pvt. Ltd. and M/s Mount Distilleries Ltd. were issued with exemption order under section 8(5) of the Central Sales Tax Act even after the commencement of the Amendment Act. On the principle of parity the petitioner company also deserves exemption. Lastly, Mr. Pradhan also referred to rules 11 and 12 of the Central Sales Tax (Sikkim) Rules, 1983 and section 13 of the Sikkim Sales Tax Act, 1983 and submitted that the present Assessment Order are barred by limitation. According to him, on the ground of limitation also the assessm....
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....ers issued by the Government of India in this regard. Learned Additional Advocate General has submitted that the petitioner-company was well aware of the above position of law and the learned counsel referred to Annexure R-10 letter dated 30.03.2004 issued by the petitioner-company to the Special Secretary, Department of IT & ST, Government of Sikkim in this regard. The learned Additional Advocate General submitted that even after undertaking through the above letter that they would avail sales tax exemption as per Annexures R-2, R-3 and R-4 notifications, wherein it is clearly stated that the Central Sales Tax and Central Excise Duty will be governed by notifications issued by the Government of India, the petitioner is now taking a completely contrary stand of being exempted under the 1996 Industrial Policy. Annexure R-10, letter dated 30.03.2004 was deliberately suppressed by the petitioner while filing this writ petition and therefore, according to the Addl. Advocate General the writ petition is liable to be dismissed on that score alone. Referring to Annexure P-14, a letter of the petitioner dated 24.07.2006 addressed to the Law Secretary, Government of Sikkim wherein the petit....
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....he various materials placed on record on either side. We have considered the principles emerging from the decisions cited at the bar. We find ourselves unable to grant any reliefs to the petitioner. 40. The petitioner is seeking relief on principles of promissory estoppel on the ground that after perusing the Industrial Policy of 1996 of the Government of Sikkim notified in the web-site of the Department of Commerce and Industries, under the caption "Concession on State and Central Sales Tax" wherein it was provided that "Central and State sales tax shall be exempted for a period of 9 (nine) years, from the date of commencement of actual commercial production", the petitioner made a huge investment of Rs. 7.00 crore to establish his industry in East Sikkim. The petitioner is now slapped with an assessment order directing him to pay a staggering amount of Rs. 46,00,657/- towards the Central Sales Tax. The stand of the Government of Sikkim is that the petitioner the very grievance voiced by the petitioner is misconceived, the petitioner is not entitled for the benefits and concessions granted under the Industrial Policy of 1996 as this industry is not established during the currency....
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....ure R-3 notification ought to be perused and analyzed for appreciating the rival contentions in this regard. Those clauses are quoted below: - "1. For the purpose of concessions and incentives existing units are classified as those industrial units set up prior to 18.12.1996 and the period of concession beings from the date of prior approval accorded for their expansion/diversification/ modernization programmes by the Industries Department whereas the new industrial units are classified as industrial units set up after 18.12.1996 and the period of concessions begins from the date of going into commercial production. 2. Concessions on State Excise Duty would be for a period of 3 (three) years and for Sales Tax would be for 5 (five) years for both existing and new industries units as classified in paragraph 1 above. 3. Levy of State Excise Duty and Sales Tax on the products of industrial units manufacturing/bottling liquors and beer would be as follows: - Product Levy of State Duty Rate of Sales Tax (a) Liquor products manufactured by existing units other than beer. 100% 15% (b) Liquor products manufactured by new units other than beer. 85% 10% (c) Beer manufactured by e....