TaxTMI 
TaxTMI 
TaxTMI 
2019 (4) TMI 1250
X X X X Extracts X X X X
X X X X Extracts X X X X
....that respondent-assessee established a new unit, and exemption was granted under Section 4-A of the U.P. Trade Tax Act (hereinafter called as "Trade Tax Act") on 6.3.2000 for a period 19.3.1999 to 18.3.2014. The exemption limit was Rs. 98,27,23,972/-. As the respondent dealer/assessee was availing benefit upto 31.12.2007. From 1.1.2008 provisions of U.P. VAT Act came into force. 5. Section 42 of the VAT Act provided "treatment of industrial units availing exemption or reduction in the rate of tax under erstwhile Act" for which the dealer had to apply for issuance of Certificate of Entitlement. On the basis of certificate issued by the Divisional Level Committee (DLC) under Section 4-A of the Trade Tax Act on 6.3.2000, the Certificate of Entitlement under Section 42 of the Act was granted on 10.11.2008. Subsequently the dealer/assessee made further investment in the unit and had applied for enhancement of exemption limit, as per notification issued by the State Government. Application so filed was allowed by the Additional Director Industries (DLC) on 13.2.2009 and additional limit was increased by Rs. 6,48,78,870/-. After the grant of eligibility certificate the dealer/assessee ap....
X X X X Extracts X X X X
X X X X Extracts X X X X
....unit availing or granted benefit of exemption from, or reduction in the rate of tax under the erstwhile Act or under the Central Sales Tax Act, 1956 on the turnover of sales of manufactured goods or turnover of purchase of any raw material, processing material, consumable stores, fuel other than petrol and diesel, lubricant required for use in manufacture of goods or in the packing of goods manufactured by such industrial unit or both, and (i) whose facility of exemption or reduction in the rate of tax is base on the fixed capital investment as provided under the erstwhile Act or notification issued thereunder; or (ii) an industrial unit purchased from the State Government or any corporation or undertaking owned or controlled by the State Government and to whom exemption or reduction in the rate of tax has been granted under the erstwhile Act, may apply to the Commissioner for issue of the Certificate of Entitlement in the prescribed form and in prescribed manner.] (4)........ (5)......... (6)......... (7)......... (8)......... (9) Where the amount or the period for exemption or reduction in the rate of tax changes on account of any valid reason otherwise, the Commi....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... corporate circle empowered to exercise the power of an assessing authority. Rule 3 defines power to create Zone, Region, Range and Circle as under:- 3. Power to create Zone, Region, Range and Circle.- (1) The State Government may by notification in the Gazette- (a) create or abolish the - (i) Zone of an Additional Commissioner; (ii) Region of a Joint Commissioner (Executive), a Joint Commissioner (Appeals); (iii) range of a Deputy Commissioner (Check Post), a Deputy Commissioner (Enforcement) or a Deputy Commissioner (Special Investigation Branch); and notify the circles or part of a circle or sector that are included in such zone, region or range, as the case may be. (b) specify the circles or part of a circle or a sector that are included in the jurisdiction of a member Tribunal. (2)............... (3)............... Rule 4 of the Rules provides for Authorities under the Act. It reads as under:- (1).......... (2).......... (3).......... (4)......... (5) The Commissioner shall exercise the powers and perform the duties assigned to him under the Act and the rules framed there under and shall have all powers exercisable by subordinate authorities oth....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 60 days from the date of publication of this rule whichever is later; PROVIDED ALSO that if the Commissioner is satisfied that there is sufficient cause which prevented the dealer to submit the application within the stipulated period, he may condone the delay in filing the application. (2) Before submitting the application under sub-rule (1) a copy of the application along with enclosures, if any, shall be served to the concerned assessing authority and certified copy of such receipt shall be annexed to the application. (3) The assessing authority shall, after examining relevant record and after giving the dealer a reasonable opportunity of being heard if necessary, send to the Commissioner a report in Form XLVI within a period of thirty days from the date of receipt of the application. (4).......... (5).......... (6).......... (7).......... (8).......... (9).......... (10)........ (11)......... (12)......... 11. Sri Bipin Kumar Pandey, learned standing counsel has submitted that under Section 42(3)(a)(i) the dealer/assessee was required to apply for Certificate of Entitlement pursuant to grant of Eligibility Certificate under Section 4-A of the Trade Tax....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... 14. In the present case, as the DLC had already granted the eligibility certificate on 13.2.2009 whereby additional benefit of Rs. 6,48,78,870/- was granted to the dealer, it was for the Commissioner to suo moto issued the amended certificate of entitlement to the respondent-assessee without waiting for any application. He further submitted that the order of the DLC had attained finality and copy of the same was already forwarded to the Commissioner, so it was only a routine exercise and the Commissioner should have granted amended certificate of entitlement, as no further adjudication was required, and it was just an endorsement of the decision taken on 13.2.2009. He further submitted that as far as the application filed before the Joint Commissioner on 25.2.2009 is concerned, Section 2(g) of the Act, which is the charging Section defines Commissioner, which includes Joint Commissioner. He further submitted that Section 2(k) provides for any Act done in pursuance of the earlier Trade Tax Act was to continue under the new Act. 15. Sri Agarwal, further invited attention of the Court to Rule 70(1), Third Proviso, which provided that the Commissioner had the power to condone the d....
X X X X Extracts X X X X
X X X X Extracts X X X X
....erson and the letter of allotment granted by the State or statutory Corporation . The reason for making such a distinction is not far to seek. Whereas in the case of the former, a registered deed of lease is required to be executed if it is for a period of more than one year, in the latter it is not. 35. It is not a case where the application was incomplete by itself. It was also not a case where having regard to the provisions of the Act, Rules, Notifications as also the information required to be furnished in terms of paragraph 10 of Form 46, any other or further information was necessary to be obtained or furnished. If the appellant, thus, had fulfilled the eligibility criteria for grant of exemption, it had acquired a right in respect thereof and we see no reason why it should have been deprived therefrom. It is in that sense the exemption notification was required to be construed liberally in favour of the appellant. {See State of Orissa V. TATA Sponge Iron Ltd. [(2007) (8) SCC 189 para 21]." 16. Having heard learned counsel for the parties and after going through the relevant provisions of Law, the question which arises for consideration is whether the eligibility certific....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ificate so granted under the old Act or said to be a recognition of the earlier certificate by the new Act. 19. Argument of Sri Agarwal that the case of assessee/dealer is covered under Section 42(9) of the Act has force as sub-Section (9) categorically provides that the amount or the period for exemption or reduction in the rate of tax, the Commissioner shall suo moto or an application of the industrial unit amend the certificate of entitlement. Meaning thereby the duty is cast upon the Commissioner to suo moto exercise his power and grant amended certificate of entitlement, which is recognition of the earlier eligibility certificate granted under Section 4-A of the Trade Tax Act by the DLC, and in case the Commissioner fails to exercise such power, the industrial unit is also granted a liberty to make an application. 20. In the present case, certificate of entitlement was already granted by the Commissioner to the assessee on 10.11.2008, it was the subsequent exemption which was granted by the DLC and additional limit was increased by Rs. 6,48,78,870/- that the assess applied for amended certificate of entitlement. As, DLC has already forwarded the additional grant to the Commi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iling the appropriate application before him by the dealer. 26. It is not in dispute that the assessee/dealer after the grant of exemption certificate by the DLC on 13.2.2009, immediately applied for the grant of certificate of entitlement before the Joint Commissioner on 25.2.2009, and thereafter an application by the dealer before the Commissioner on 18.4.2017/9.5.2017 cannot be scored off on the ground of placing the same before the wrong forum, as the dealer had approached the Joint Commissioner within time and it was for the Joint Commissioner to take action either by rejecting it or by forwarding it to the Commissioner which was not done by him. The order rejecting the application for certificate of entitlement by the Commissioner on the ground that it was highly barred by time, by 8 years, two months and 5 days is not sustainable as the Commissioner should have considered the fact that the application was in time before the Joint Commissioner and if the same was wrongly filed then the same should not have been rejected or had been referred to him. 27. The finding recorded by the Commissioner to the extent that grant of certificate of entitlement only by Commissioner in vie....