TaxTMI 
TaxTMI 
2017 (7) TMI 375
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.... in violation of the principles of promissory estoppel as well as natural justice. {B} This Hon'ble Court be further pleased to issue the writ of mandamus, or any other writ, order or direction in the nature of mandamus directing the respondents to modify the final eligibility certificate issued on 16th February 2008 restricting the petitioners entitlement to Sales-tax exemption only upto 71.80 Crores and not taking into consideration the further investment made by the petitioners to the extent of Rs. 91.45 crores upto 31st December 2007, being the extended period of the Scheme. {C} During the pendency and final disposal of this petition, this Hon'ble Court may be pleased to restrain the respondents from enforcing any demand of Sales tax that may be raised against the petitioners as a result of unlawful restriction on the petitioners claim of incentive benefits. {D} This Hon'ble Court may be pleased to grant any other and further relief that may be deemed just and necessary in the interest of justice." 3. That, the petitioner no.1-Company is engaged in manufacturing of high-end application tubes and pipes in stainless steel, welded as well as seamless constructi....
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.... said investment of Rs. 50.37 Crores towards the factory buildings, tube-mills, spiral plants, chamfering machines, overhead cranes, hydro-testing machines, extrusion press, etc., as a part of project and required to attend planned capacity. According to the petitioners, the petitioner no.1-Company had, as a part of Phase II, made investment of Rs. 65.73 Crores towards balancing equipments and wind-mills to be installed upto 30th April 2007. According to the petitioners, as per the Scheme, Phase II is to be considered as a pipe-line project, and therefore, any investment made upto 31st December 2007, the petitioners shall be eligible for incentive under the Scheme on the amount invested during the extended period ie., 31st December 2007. 3.5 It is the case on behalf of the petitioners that, however, the Industries Commissioner when issued and granted Final Eligibility Certificate dated 16th December 2008 for Rs. 71.80 Crores only and the Provisional Eligibility Certificate was accordingly amended as per the decision taken by the State Level Committee in its meeting dated 29th January 2008. That thereafter, by the impugned decision dated 29th March 2014 of the High Power Committee ....
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.... 2005. It is submitted that the petitioner-Company had made investment of Rs. 50.36 Crores towards Factory Building, Tube Mills, Spiral Plants, Chamfering machines, Overhead cranes, Hydro-testing machines, Extrusion press, etc., were brought as a part of Project and required to attain the planned capacity. It is submitted that the petitioner- Company had, as a part of Phase-II, made investment of Rs. 65.73 Crores towards Balancing equipments and Wind Mills to be installed upto 30th April 2007. It is submitted that therefore, it can be said that the aforesaid investment made after 31st December 2005 was in pipeline, even on the date of commencement of the production which has been completely set up during the year 2007. It is submitted that for the pipeline project, the State Government has taken a decision of extending the Scheme upto 31st December 2007, and therefore, as Phase-II can be said to be a pipeline project, the petitioners are entitled to incentive on the investment made upto 31st December 2007. 6. Mr. Puj, learned advocate for the petitioner has further submitted that even otherwise the case of the petitioners will fall under the third category of Industrial Units; as ....
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....dustrial Units having project cost exceeding Rs. 10 crores. 6.2 It is submitted that in case of Industrial Units having project cost exceeding Rs. 10 crores, the words, "whichever is earlier between the two" are missing, and therefore, the assets acquired within the period of 18 months from the date of commencement of production or till the completion of the said scheme, shall be considered eligible for the purpose of incentives. It is submitted that therefore, on reading Clause 3.8 of the Scheme as it is, as in the present case the date of commencement of commercial production is 30th October, 2005, and therefore, the petitioner is entitled to Sales-tax exemption/incentives on the total assets acquired within the period of 18 months from 30th October, 2005 ie., up to 30th April, 2007. It is submitted that therefore, as such, the petitioner- Company is entitled to Sales-tax incentives/benefits on the total expenditure incurred and paid-up to 30th April, 2007. It is further submitted by Shri Puj, learned advocate for the petitioner that the decision of the respondents not to consider any investment/expenses incurred after 31st December 2005 as eligible for incentives is just contra....
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....en the two" is missing, like in the case of Small Industrial Units and Medium Industrial Units. It is submitted that therefore, the petitioners cannot be permitted to take undue advantage of the mistake in printing in Gujarati version. He has submitted that in the English version, which is referred to in the Additional Affidavit-in-Reply, it has been specifically mentioned that in case of Industrial Units having project cost exceeding Rs. 10 Crores, the assets acquired within the period of 18 months from the date of commencement of production or till the completion of the said Scheme [whichever is earlier than the two], shall be considered eligible for the purpose of incentives. It is submitted that therefore, the understanding on the part of the authority ie., the State Government was to consider investments/assets acquired by the industrial undertaking within a period of 18 months from the date of commencement of production, or till the completion of the said Scheme ie., 31st December, 2005 [whichever is earlier between the two]. 7.1 It is submitted by Shri Kamal Trivedi, learned Advocate General that the Incentive Scheme cannot be treated like a Statute or a plenary legislation....
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....verybody; including the petitioner understood that the capital investment made only upto 31st December, 2005, or 18 months from the date of commencement of production; whichever is earlier, the benefit under the Scheme shall be available. It is submitted that none of the 105 projects like that of the petitioners have ever applied for investment made beyond 31st December, 2005 and/or none of the 105 projects like the petitioners have ever been given benefit under the incentive Scheme for investment made after expiry of the Scheme ie., 31st December, 2005. It is further submitted that even in the present case also, the petitioners even applied for Provisional Eligibility Certificate only with respect of expenses incurred upto 31st December, 2005 ie., Rs. 78.96 Crores. It is further submitted that even thereafter also, when in the year 2008, the petitioners applied for Final Eligibility Certificate, the petitioners applied for the same for the investment made upto 31st December, 2005 ie., Rs. 76.68 Crores. 7.4 It is submitted that, therefore, the said application for Final Eligibility Certificate, with respect to investment made, upto 31st December, 2005 (even as applied by the petit....
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....arly once the petitioners had gone for commercial production on 30th October 2005. It is submitted that therefore, extension of the period applicable to pipeline projects shall not be applicable to the petitioners who had already started commercial production admittedly on 30th October 2005, and therefore, the petitioners are not eligible to get incentives on the investment made after 31.12.2005 and before 31.12.2007; as claimed by the petitioners. 7.7 Making above submissions and relying upon the decision of the Supreme Court in the case of Bharat Aluminium Company v. Kaiser Aluminium Technical Services Inc., reported in [2016] 4 SCC 1265, and another decision in case of Secretary, Ministry of Chemicals & Fertilizers, Government of India v. CIPLA Limited & Ors., reported in [2003] 7 SCC 1 [on interpretation of Statute and/or Resolution and/or Scheme] and yet another decision in case of Afcon Infrastructure Limited v. Nagpur Metro Rail Corporation Limited & Anr., AIR 2016 SC 4305 and the decision of Division Bench of this Court in case of Sal Steel Limited & Anr. vs. Union of India & Ors. [SCA No. 6299 of 2008], it is requested to dismiss the present writ petition. 8. Heard learn....
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.... before 31st December 2004 [as per G.R dated 13th September 2004], and even thereafter before 31st December 2005 [as per G.R dated 7th January 2005]. Therefore, only those Units/Industries/Projects which had not gone in production before 31st December 2005 are considered as pipeline projects. In the present case, the petitioner- Company had already gone in production w.e.f 29th/30th October 2005, and therefore, as per the Scheme/Government Resolutions amended from time to time and lastly amended vide G.R dated 7th January 2005, the case of the petitioners shall not fall under the category of pipeline project. 10. At this stage, it is required to be noted that even when the petitioners submitted application in the prescribed format to the office of Industries Commissioner for issuance of Provisional Eligibility Certificate on 10th February 2006, the petitioner no.1 Company claimed Sales Tax Exemption on the fixed Capital Investment incurred upto 31st December 2005 ie., Rs. 78.96 Crores. Even subsequently, when the petitioners submitted Chartered Accountant Certificate on 4th April 2006, the petitioner no.1-Company declared total investment of Rs. 76.68 Crores upto 31st December 200....
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....incurred after 31st December 2005, but within a period of 18 months from th date of commencement of commercial production is concerned, it is the case on behalf of the petitioners that in Clause 3.8 of the Scheme, the words, "whichever is earlier between the two" are not there in the case of Industrial Units having project cost exceeding Rs. 10 Crores, which words though are there in case of Small Scale Industrial Units, Medium and Large scale Industrial Units. Therefore, it is the case on behalf of the petitioners that in case of Industrial Units having project cost exceeding Rs. 10 Crores, the assets acquired within period of 18 months from the date of commencement of commercial production or till completion of the Scheme ie., 31st December 2005, shall be considered eligible for the purpose of incentives. Therefore, it is the case on behalf of the petitioner that as the date of commencement of commercial production in their case is 30th October 2005, all the expenses incurred by the petitioner- Company upto 30th April 2007 ie., 18 months from the date of commencement of commercial production are eligible for grant of incentives. 12. On the other hand, it is the specific case on ....
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....ed in detail, while narrating the sequence which led to introduction of Incentive Scheme in paras 5 to 7 of the affidavit dated 6th December 2016 filed on behalf of the respondent no. 1, which read as under :- "5. In this behalf, as is discernible from the Government file, I clearly suggests that originally, the Incentive Scheme in question was intended to be extended to all the industrial units regardless of any distinction like Small, Medium and Large Scale Units vis-avis the project cost involved therein, with a categorical condition that the project cost, i.e. capital expenditure incurred and paid during the period of operation of the Incentive Scheme, would be taken into account. This clearly shows as to what was intended by the State Government. However, thereafter, in the initial draft of the Resolution, clause No. 3.8 thereof carried only Small Scale, Medium Scale and Large Scale Units without there being any mention as regards the Units having project cost exceeding Rs. 10 Crore. It is only after further deliberation that the provision of the Units having project cost exceeding Rs. 10 crore came to be incorporated in the said clause 3.8. Though, the said provision was mad....
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....ion in clause 3.8 referred to above, relating to Units having project cost exceeding Rs. 10 crore was added later on, as a result of the further deliberation. It is pertinent to mentioned that none of the 105 projects like that of the petitioners have ever been given the benefits under the Incentive Scheme after the expiry of 31st December, 2005 even though the specified periods viz. 6 months, 1 year and 18 months, as the case may be from the date of commencement of commercial production in those cases, had spread over beyond the last date of the operation period of the said Incentive Scheme i.e. 31st December, 2005 (except pipe-line cases). 13.1 Nobody can be permitted to take undue advantage/ disadvantage of the beneficial Scheme due to inadvertent mistake in publication. 13.2 Even otherwise, it is required to be noted that even considering Clause 3.8 of the Scheme, in case of Industrial Units having project cost exceeding Rs. 10 Crores, it is mentioned that the assets acquired within a period of 18 months form the date of commencement of production, or till the completion of the said Scheme, shall be considered eligible for the purpose of incentives. Therefore, the submission....
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....od from the very beginning the Scheme in the manner as suggested by the State Government and they also understood that on the assets acquired within a period of 18 months from the date of commencement of commercial production or till the completion of the Scheme ie., 31st December 2005 [whichever is earlier between the two], shall be considered eligible for the purpose of grant of incentive and that is how, when the petitioners applied for Provisional Eligibility Certificate, they considered assets acquired only upto 31st December 2005 amounting Rs. 78.96 Crores/Rs. 76.68 Crores. While submitting application for grant of Provisional Eligibility Certificate, the petitioners submitted a Certificate issued by Chartered Accountant with respect to the investment made upto 31st December 2005 ie., Rs. 76.68 Crores and accordingly, Provisional Eligibility Certificate was issued, considering the investment made of Rs. 76.68 Crores only. 14.2 At this stage, it is required to be noted that even at no point of time till the present petition is filed, the petitioners claimed benefit of incentives/Sales-tax Exemption on the investment made after 31st December 2005, but within a period of 18 mon....
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....38 of 2011 was also with respect to the assets acquired/investment made upto 31st December 2005 only. No such case was pleaded before the Division Bench with respect to investment made during 18 months from the date of commencement of commercial production. As such, there was no controversy before the Division Bench with respect to the assets acquired/investment made after 31st December 2005 and made during 18 months from the date of commencement of commercial production. Under the circumstances, as such there was no lis between the parties with respect to the said controversy. Even otherwise in the said decision, while disposing of Special Civil Application No. 5638 of 2011, the Division Bench has nowhere held that the investment/assets acquired during 18 months from the date of commencement of commercial production and after 31st December 2005 may be considered eligible for incentive. No such prayer is granted. It appears that while deciding the question involved in the said petition, some submissions were made with respect to Investment made during 18 months from the date of commencement of commercial production and without any specific finding on the same, the Division Bench ha....