TaxTMI 
TaxTMI 
2024 (1) TMI 823
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...., Writ Petition(C) No. 2660 of 2019, Writ Petition(C) No. 2662 of 2019, Writ Petition(C) No. 2659 of 2019, Writ Petition(C) No. 2661 of 2019, Writ Petition(C) No. 2677 of 2019, Writ Petition(C) No. 1936 of 2019, Writ Petition(C) No. 4375/2020, For the Petitioners : Dr. Ashok Saraf, Sr. counsel assisted by Mr. P. Baruah, Advocate For the Respondents : Mr. S.C. Keyal, SC, GST JUDGMENT & ORDER (CAV) These bunch of writ petitions have been filed by the petitioners who had setup their factories in various industrial growth centers in State of Assam in pursuance to the incentives offered under the Industrial Policy by the Government of India by Notification dated 24.12.1997. As per the Office Memorandum brought about by the Government of India notifying the New Industrial Policy Resolution, a slew of packages were notified containing various incentives and concessions with the avowed object of development of industries in the Northeastern Region. These industrial zones setup under the Industrial Policy in the State of Assam offered completely tax free zones for the period of ten (10) years. It was announced by the Government of India under the Industrial Policy that all indus....
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....ourage development of industries in the Northeastern Region announced a new package of fiscal incentives and other concessions for the Northeastern Region to continue the exemptions and benefits as was promised. This new package was known as North East Industrial Investment Promotion Policy, 2007 (NEIIPP). This policy was came effect from 01.04.2007. The said incentives were available to new industrial units or existing industrial units undergoing substantial expansion on or after 01.04.2007. Amongst the various incentives announced, there was Central Excise duty exemption to the extent of 100% which was to be continued on finished products made in the Northeastern Region which was earlier available under the North East Industrial Policy, 1997. The petitioners set up new industrial units pursuant to the NEIIPP, 2007 in the various industrial growth centres and certificates of registrations were issued to these petitioners by the Directorate of Industries under NEIIPP 2007. After setting up their industries, they applied for registration and were granted certificate of issuance by the General Manager, DICC. Along with the NEIIPP, 2007 announced by the Government of India, the Govern....
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.... Biocoal/Briquette 8 W.P(C) No. 2660/2019 (M/S Hometek India Snacks Manufacturing Co Vs. Union of India and Ors.) DICC KAMRUP/EIIPP 2007/01790/NU/2013 24.06.2013 Namkeen/Fried Grams, Snacks and Confectionery (Soan Papdi) 9 W.P(C) No. 2661/2019 (Nano Steel Pvt. Ltd. Vs. Union of India and Ors.) DICC/KAMRUP/EM(PT- 2)/01103/2011 16.06.2011 Bamboo Ply & Board 10 W.P(C) No. 2673/2019 (M/S Kishlay Savoury Foods Vs Union of India and Ors.) DICC/AKMRUP9EM(PT- 2)/02662/2016 03.12.2016 Extruded Namkeens and Popcorn 11 W.P(C) No. 2703/2019 (Amiker Enterprise Pvt. Ltd. Vs. Union of India & Ors.) DICC/KAMRUP/NEIIPP2007/ 01175/EU/2013 25.12.2013 12 W.P. (C) No. 2762/2019 (Prataap Snacks Ltd. Vs Union of India and Ors.) DICC/KAMRUP/NEIPP2007/0 1912/NU/2014 17.02.2014 Extruded Snack 13 W.P(C) No. 2764/2019 (Prataap Snacks Ltv Vs. Union of India and Ors.) DICC/KAMRUP/NEIPP2007/02071/NU/2016 13.01.2016 Common Salt, Sugar et 14 W.P(C) No. 4375/2020 (M/S Keshari Udyog Vs. Union of India and Ors. ) - - Manufacturers, Processors, Exporter, Importer, Dealers, Contractors, Agents, Suppliers, Sto....
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....facturing exempted goods but are required to now pay GST under the GST regime. The claims of the petitioners were thus negated on the basis of a circular issued dated 10.01.2019 under which the claims for budgetary support raised by the petitioner were rejected on the ground that such units were not registered under the Central Excise Act prior to introduction of the GST Act and were not availing any benefits under Notification No. 20/2007. It is this claim of the petitioners which have been rejected which is assailed in these bunches of writ petitions. The petitioners have prayed for Writ of Mandamus to direct the authorities to consider their cases like other similarly situated units and industries and extend the benefit of budgetary support as have been done in cases of other industries who were eligible and availing benefits under the Industrial Policies. 5. Dr. A. Saraf, learned Sr. Counsel assisted by Mr. P. Baruah, learned counsel for the petitioner submits the aforesaid writ petitions have been filed challenging the Notification dated 05.10.2017 issued by the Ministry of Commerce and Industry (Department of Industrial Policy and Promotion) framing a Scheme of budgetary s....
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.... India by a notification dated 24th December, 1997 was pleased to announce a new Industrial Policy Resolution containing a package of incentives and concessions for the entire North Eastern Region. The said Policy Resolution amongst others declared all industrial activity in growth centers, integrate infrastructural development centers, export promotion and industrial parks, export processing zone, industrial estates and industrial areas as completely tax free zones for a period of 10 years. It was announced and promised by the Government of India that all industrial activities for such areas would be free from inter alia income tax, central excise for a period of 10 years from the date of commencement of production and also that the State Government would be moved for exemptions of sales tax, municipal tax and other such local taxes on industrial activity in the said areas. It was further stated in the aforesaid office memorandum dated 24th December, 1997 that the Ministry of Finance, Government of India, would be moved to amend the existing rules/notifications for giving effect to the decisions embodied in the Industrial Policy Resolution. Apart from exemption from inter alia, in....
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.... and promised for the new industrial units as well as existing industrial units undergoing substantial expansion on or after 01.04.2007. In the said policy, amongst others, it was also announced that amongst others 100% excise duty exemption will be continued, on finished products made in the North Eastern Region, as was available in the NEIP, 1997. 9. It is submitted that being inspired and encouraged by the North East Industrial and Investment Promotion Policy (NEIIPP), 2007, the petitioner set up a new industrial unit at Industrial Growth Centre, Chaygaon, Vill. No- 2, Jambari in the District of Kamrup, Assam for manufacturing of nails, nut bolts, hinges and other hardware goods. The petitioner thereafter applied for registration under the NEIIPP, 2007 for availing the benefits of the different incentive schemes announced in the NEIIPP, 2007 and the General Manager, DICC, Kamrup accordingly vide certificate dated 01.02.2011 granted Certificate of Registration to the petitioner under the NEIIPP, 2007 bearing the registration number DICC/KAMRUP/ NEIIPP2007/01180/NU/2011 dated 01.02.2011. After the establishment of new industrial unit, the petitioner firm applied for registratio....
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....nufacturing goods which were exempted under the Central Excise Act, 1944, they were not registered under the Central Excise Act. However, after enactment of the Goods and Service Tax Act, 2017, the items dealt in by the petitioners became taxable under the GST Act and thereby the petitioners got itself registered under the GST Act and started collecting tax and making payment of the same. 12. The Ministry of Commerce and Industry (Department of Industrial Policy and Promotion) thereafter vide Notification dated 05.10.2017 framed a Scheme of budgetary support under the GST Regime to the units located in States of Jammu and Kashmir, Uttarakhand, Himachal Pradesh and North East including Sikkim. The said Scheme was in pursuance to the decision of the Government of India to provide budgetary support to the existing eligible manufacturing units operating in the States of Jammu and Kashmir, Uttarakhand, Himachal Pradesh and North East including Sikkim under different Industrial Promotion Schemes of the Government of India, for a residual period for which each of the units were eligible. The new Scheme was offered, as a measure of goodwill, only to the units which were eligible for dra....
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...., where manufacturing activity under exemption notification no. 49/2003-CE dated 10.06.2003 and 50/2003-CE dated 3 10.06.2003 were being carried prior to 01.07.2017 and the unit was not registered under Central Excise." 14. The determination of the amount of budgetary support was laid down in Clause 5 of the said Scheme. It was provided in the said Scheme that sum total of (i) 58% of the Central tax paid through debit in the cash ledger account maintained by the unit in terms of sub-section(1) of section 49 the Central Goods and Services Act, 2017 after utilization of the Input tax credit of the Central Tax and Integrated Tax. (ii) 29% of the integrated tax paid through debit in the cash ledger account maintained by the unit in terms of section 20 of the Integrated Goods and Services Act, 2017 after utilization of the Input tax credit Tax of the Central Tax and Integrated Tax shall be the amount of budgetary support under the scheme for specified goods manufactured by the eligible unit. The manner of budgetary support is laid down in Clause 7 which is as under: "7. MANNER OF BUDGETARY SUPPORT 7.1 The manufacturer shall file an application for payment of budgeta....
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....ircular dated 30.11.2017 also laid down the manner of transfer of the budget by DIPP to DDOs and the manner of sanction and payment. Since there was some difference of opinion as regards the eligibility of units under the Scheme of budgetary support which were under threshold exemption or manufacturing exempted goods but were required to pay GST under the GST regime, the Government of India, Ministry of Finance, Department of Revenue, Central Board of Excise and Custom vide Circular dated 10.01.2019 confirmed that the Scheme of Scheme seeks to provide benefits to the eligible units for the residual period which were availing exemption under erstwhile exemption notifications issued under Central Excise regime and as such the benefit would not be available to units which were under threshold exemption or manufacturing exempted goods but are required to pay GST under the GST regime. 16. Before coming into force of the GST regime, the petitioners due to having turnover of less than 1.5 crores, which was the threshold limit, were not registered under the central excise law as was provided vide Notification No. 8/2003 dated 01.03.2003 and as such the petitioners were not collecting an....
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....central excise law and after the issuance of the budgetary support scheme in the GST regime have become ineligible for benefits for the reason that the same were not registered under the erstwhile central excise law. Similarly industries who were manufacturing goods that were exempted under the Central Excise Act were not required to be registered under the central excise law and after the issuance of the budgetary support scheme in the GST regime have become ineligible for benefits for the reason that the same were not registered under the erstwhile central excise law. If the same is allowed, small industries like that of the petitioner's will become uncompetitive in the market, which was neither the object nor the scheme of the NEIIPP, 2007. 18. In support of his contentions, the learned Sr. Counsel for the petitioners relied upon the following Judgments: Reasonable Classification-Article 14 (i) Budhan Choudhury Vs. State of Bihar, reported in AIR 1955 SC 191 (ii) Ram Krishna Dalmia Vs. S.R. Tendolkar, reported in AIR 1958 SC 538 (iii) Nagpur Improvement Trust Vs. Vithal Rao, reported in (1973) 1 SCC 500 (iv) E.P. Royappa Vs. State ....
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....malafide exercise of power (xxix) Noida Enterpreneurs Assn. Vs. NOIDA, reported in (2011) 6 SCC 508 19. Per contra, Mr. S.C. Keyal, learned counsel representing the Union of India and Central Excise Department strongly disputes the claims of the petitioners and the submissions of the learned counsel appearing for the petitioners. Mr. Keyal refers to the affidavit-in-opposition filed by the respondent authorities and submits that the Government was not legally obliged to compensate the affected industrial units in NER and other Himalayan States due to the change in Tax policy and structure. It is submitted that there was no relation between Central Excise Duty and GST. The GST council in it's wisdom had left it to the discretion of the Central and State Government to notify schemes of budgetary support to such units you may want to continue with such schemes. During the deliberation held between the concerned departments, it was proposed to Department for Promotion of Industry and Internal Trade (DPIIT) that it should provide budgetary support to eligible units for the residual period stipulated under the Scheme of NEIIPP-SPS by way of reimbursement of Goods and Service ....
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....Excise Duty, they cannot be extended the benefit of budgetary support which is restricted to only those units who had their registration under Central Excise and had paid Central Excise Duty and had collected their refunds as applicable. The learned counsel for the respondents submits that in that view of the matter, there is no merit in the writ petitions and the prayers made in the writ petitions ought not to be allowed and the writ petitions should accordingly be dismissed as being devoid of any merit. Mr. Keyal has relied upon the following Judgments to buttress his submissions: Validity of Budgetary support scheme upheld (i) Hero Motocrop Ltd. Vs. Union of India (W.P.(C) No. 505/2022); Meaning of eligible industries (ii) State of Gujarat Vs Arcelor Mittal Nippon Steel India, reported in (2022) 6 SCC 459; Interpretation of taxing Statute (iii) State of Maharashtra Vs. Shri Vile Parle Kalvani Mandal & Ors., reported in (2022) 2 SCC 725 (iv) Krishi Upaj Mandi Samiti Vs. Comm. Of Central Excise & Service Tax, reported in (2022) 5 SCC 62 (v) Commissioner of Customs Vs Dilip Kumar & Co. (2018) 9 SCC 1 20. In rejoinder....
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....he Apex Court in support of the said contention, the learned Senior counsel for the petitioner submitted that the aforesaid argument of the Respondents is not applicable in the present case inasmuch as in the present case the challenge is basically to the denial of the benefit of the Budgetary Support Scheme although the Petitioner industrial units were eligible for the excise duty exemption as per the Industrial Policy and Excise Notification and also denial is hit by Article 14 of the Constitution of India and thereby the aforesaid submissions of the Respondents have no bearing in resolving the disputes raised in the present set of Writ Petitions. 23. It is submitted by the learned counsel for the petitioners that not only under the Doctrine of Promissory Estoppel but even under the Doctrine of Legitimate Expectation, the petitioners cannot be denied the benefits under the Budgetary Support Scheme on ground that the petitioners were not registered under the Central Excise Act, 1944 prior to 01.07.2017 as their total turnover of the industrial unit was below threshold limit and/or that the industrial unit was manufacturing exempted goods and as such respondent authorities are l....
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....ime there is no such exemption and all existing units who are availing exemption from payment of Central Excise duty prior to 01.07.2017 were required to pay CGST and SGST/IGST like normal unit. The manner of providing the budgetary support is described in the clause 7. According to the petitioners, the turnover of the petitioner units being below 1.5 crores, which was the threshold limit and they were therefore not required to be registered under the Central Excise law as provided under notification number 8/2003 dated 01.03.2023. The petitioner units were therefore was not collecting and paying taxes under the central excise law. Other manufacturing units whose turnovers were above the threshold limit of 1.5 crores were registered under central excise law and were paying taxes and consequently became eligible for a refund under NEIIPP 2007 read with the notification issued under Central Excise Act. However, after introduction of the GST those units like the petitioners which were earlier not required to pay excise duty by virtue of their turnover being below the threshold limit of 1.5 crores, became liable to pay GST. These units who were not paying central excise duties although....
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....ion under NEIIPP and had satisfied all the requirements is also not disputed by the respondent authorities. 27. However, the criteria for extending the budgetary support scheme is only in respect of those industries who had been paying central excise duties by virtue of their turnover exceeding the threshold limit of 1.5 crores. This will have the effect of taking away the promise extended to by the Government of India by its policy brought in through the NEIIPP. These industries were promised to be given a tax free environment to set up their industries for next ten years under the NEIIPP. The very scheme of the budgetary support was brought in to provide a relief to those industries who were availing the benefits under the area based exemption schemes like the NEIIPP. 28. Consequently, the respondent authorities could not have arbitrarily created a class within a class by permitting budgetary support scheme to be provided only to those industries who were willing benefits under the area based exemption schemes and who were paying Central excise duty under the erstwhile Central Excise law. The essence of the budgetary scheme which has been brought out is to provide budgetary....
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....acturing units to the exclusion of other units like the petitioners. The petitioners urge that this is a classification which is not reasonable and is therefore hit by Article 14 and consequently, this court should issue appropriate writ direction or order to the respondent authorities to include the claims of the petitioners units also for grant and benefit of the budgetary support scheme. 30. Mr. S.C. Keyal, learned CGC on the other hand disputed the claims of the learned counsel for the petitioners and submits that the claims of the petitioners are not maintainable in the eye of law. Therefore the writ petitions should be dismissed. At the outset. Mr. Keyal submits that the scheme of budgetary support dated 5.10.2017 was put to challenge before the Delhi High Court in WP(C) No. 505/2022 (Hero Motocrop Ltd. Vs. Union of India). This writ petition was dismissed by judgment and order dated 02.03.2020. The SLP filed against the Judgment was also dismissed by the Apex Court on 17.10.2022 in Civil Appeal no.7405/2022 reported in (2023) 1 SCC 386. Mr. Keyal submits that in view of the authoritative finding by the Apex court negating the challenges made to the budgetary scheme, the e....
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....respondents there is no violation of Article 14 in providing budgetary support scheme and restricting it to only those units who were paying central excise duty and availing exemption under the erstwhile Central excise law 31. In rejoinder, the petitioners submits that the decision of the Apex court in Hero Motor Corp (Supra) is on the issue of the validity of the scheme, which has not been questioned by the present petitioners in the present proceedings. On the contrary, it is the claim of the petitioners to extend the benefit of budgetary support to the petitioners as have been done in cases of other similarly situated units. Therefore, the contention of the respondents that in view of the authoritative finding of the Apex court in Hero Motocorp(Supra), the matter does not require any further consideration inasmuch as the Apex court has upheld the validity of the budgetary scheme, is thoroughly misplaced and not applicable to the issues raised by the present petitioners in the present proceedings. The fact that the Apex Court had upheld the validity of the budgetary scheme is all the more reason why the petitioners should also be granted and extended the benefit of the budgeta....
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.... benefit of granting budgetary support to only those units who had paid central excise duty under the erstwhile central excise laws and excluding the same benefit to the petitioner units by creating their artificial classification, the same is certainly not based on any reasonable classification and if that classification which is sought to be projected by the respondents is to be accepted, then the same is contrary to the statute itself and therefore, the said classification is arbitrary on contrary to the provisions of the GST laws and therefore the same needs to be suitably interfered with, set aside and quashed, and the respondents be directed to extend the benefit of budgetary scheme to the petitioners. 33. On the basis of the contentions made before this Court, the writ petitioners can be broadly classified into two groups:- a) One category are those units which were not paying central excise Duty because their annual turnover was below the threshold limit of rupees 1.5 crores per annum. b) The second category comprises of the writ petitioners who are manufacturing exempted goods which were exempted from the duty under the Central Excise and Salt Act 1944....
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....otification number 32/1999-CE dated 08.07.1999 was issued by the Government of India. Under the said notification at Clause-3, it was provided that the exemptions contained in that notification shall apply only to the following units, namely clause (a) New Industrial units which have commenced their commercial production on or after the 24th day of December, 1997 and (b) Industrial units existing before the 24th day of December, 1997 but which have undertaken substantial expansion by way of increase in installed capacity by not less than twenty five per cent on or after the 24th day of December, 1997. The said notification also contained the particulars of the various integrated infrastructure development centers and growth centers, export promotion Industrial Park, Industrial estates, industrial area, commercial estate for the various states of the Northeastern Region including the State of Assam. The procedure prescribed for claiming the exemption is detailed in clause 2 of the said notification. 36. This was followed by another Notification being notification number 33/1999-CE dated 08.07.1999. This notification was in respect of the goods of the specified newly expanded unit....
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....ble manufacturing units operating inter alia in the States of Northeast under different industrial policy schemes of the Government of India for a residual period for which each of the units is eligible. This new scheme of budgetary support was offered as a measure of goodwill only to the units who were eligible for drawing benefits under the earlier excise duty exemption/refund schemes. However, the scheme otherwise has no relation to the earlier industrial policy schemes. The pleaded case of the petitioner units is that although at the relevant point in time the petitioner units were not required to claim exemption as they were not required to pay central excise duty under the statute either because the manufactured goods were exempted from excise duty or their total turnover fell below the threshold limit of 1.5 crores. However, post introduction of GST, all these items which were manufactured by the petitioner units became taxable under GST and they were not exempted on that basis or on the basis of their turnover falling below 1.5 crores. However, their claim for the benefit of budgetary financial support was clarified by the government by notification dated 10.01.2019 whereby....
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....ons issued by the Department of Revenue in the Ministry of Finance, as listed under para 2 below would be considered eligible under this scheme. All such notifications have ceased to apply w.e.f. 01.07.2017 and stands rescinded on 18.07.2017 vide notification no. 21/2017 dated 18.07.2017. The scheme shall be limited to the tax which accrues to the Central Government under Central Goods and Service Act, 2017 and Integrated Goods and Services Act, 2017, after devolution of the Central tax or the Integrated tax to the States, in terms of Article 270 of the Constitution. 2. The erstwhile Schemes which were in operation on 18.07.2017 were as follows: 2.1 Jammu & Kashmir- Notification nos. 56/2002-CE dated 14.11.2002, 57/2002-CE dated 14.11.2002 and 01/2010-CE dated 06.02.2010 as amended from time to time; 2.2 Himachal Pradesh & Uttarakhand- Notification nos. 49/2003-CE dated 10.06.2003 and 50/2003-CE dated 10.06.2003 as amended from time to time; 2.3 North East States including Sikkim- Notification no 20/2007-CE dated 25.04.2007 as amended from time to time. 3. SHORT TITLE AND COMMENCEMENT 3.1 The scheme shall be called Scheme of Bud....
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....otifications, listed in paragraph 2, which were eligible for exemption under the said notifications, and which were being manufactured and cleared by the eligible unit by availing the benefit of excise duty exemption, from: (a) The premises under Central Excise with a registration number, as it existed prior to migration to GST; or (b) The manufacturing premises registered in GST as a place of business from where the said goods under exemption notification no. 49/2003-CE dated 10.06.2003 and 50/2003-CE dated 10.06.2003 were being cleared 4.3 'Residual period' means the remaining period out of the total period not exceeding ten years, from the date of commencement of commercial production, as specified under the relevant notification listed in paragraph 2, during which the eligible unit would have been eligible to avail exemption for the specified goods. The documentary evidence regarding date of commercial production shall be submitted in terms of para 5.7. 5. DETERMINATION OF THE AMOUNT OF BUDGETARY SUPPORT 5.1 The amount of budgetary support under the scheme for specified goods manufactured by the eligible unit shall be sum total of - ....
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.... 5.4 Budgetary support under this scheme shall be worked out on quarterly basis for which claims shall be filed on a quarterly basis namely for January to March, April to June, July to September & October to December. 5.5 Any unit which is found on investigation to over-state its production or make any mis- declaration to claim budgetary support would be made in-eligible for the residual period and be liable to recovery of excess budgetary support paid. Activity relating to concealment of input tax credit, purchase of inputs from unregistered suppliers (unless specifically exempt from GST registration) or routing of third party production or other activities aimed at enhancing the amount of budgetary support by mis-declaration would be treated as fraudulent activity and, without prejudice to any other action under law may invite denial of benefit under the scheme ab-initio. The units will have to declare total procurement of inputs from unregistered suppliers and from suppliers working under Composition Scheme under CGST Act, 2017. 5.6 The grant of budgetary support under the scheme shall be subject to compliance of provisions relating to any other law in....
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....ely, ferro chrome, ferro manganese or silico manganese 75 Chrome ore or manganese ore 14. 72 or 73 All goods 39 Any goods, other than iron ore 15. 72 or 73 Iron and steel products 75 Iron ore 16. 74 All goods 15 Any goods 17. 76 All goods 36 Any goods 18. 85 Electric motors and generators, electric generating sets and parts thereof 31 Any goods 19. Any chapter Goods other than those mentioned above in S. Nos. 1 to 18 36 Any goods Explanation: For calculation of the value addition the procedure specified in notification no 01/2010-CE dated 06.02.2010 of the Department of Revenue as amended from time to time shall apply mutatis-mutandis. 5.9.1 In cases where an entity is carrying out its operations in a State from multiple business premises, in addition to manufacture of specified goods by the eligible unit, under the same GST Identification Number (GSTIN) as that of the eligible unit, the eligible unit shall submit application for reimbursement of budgetary support alongwith additional information, duly certified by a Chartered Accountant, relating to receipt of inputs, ....
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....elates. 7.2 The Assistant Commissioner or Deputy Commissioner of Central Taxes, as the case may be, after such examination of the application as may be necessary, shall sanction reimbursement of the budgetary support. The sanctioned amount shall be conveyed to the applicant electronically. The PAO, CBEC will sanction and disburse the recommended reimbursement of budgetary support. 8. BUDGETARY PROVISION AND PAYMENT OF AMOUNT OF BUDGETARY SUPPORT 8.1 The budgetary support shall be disbursed from budgetary allocation of Department of Industrial Policy& Promotion (DIPP),Ministry of Commerce & Industry. DIPP shall keep such budgetary allocation on the disposal of PAO, CBEC. The eligible units shall obtain one time registration on the ACES-GST portal and obtain a unique ID which is to be used for all processing of claims under the scheme. The application by the eligible unit for reimbursement of budgetary support shall be filed on the ACES-GST portal with reference to unique ID obtained and shall be processed by the Deputy Commissioner or Assistant Commissioner of the Central Tax for sanction of the admissible amount of budgetary support. 8.2 The appl....
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....Department of Revenue, necessary action would be initiated and concluded in the individual case by the Office of concerned Assistant Commissioner or Deputy Commissioner of Central Taxes, as the case may be. 9.3 The procedure for recovery: Where any amount is recoverable from a unit, the Assistant Commissioner or Deputy Commissioner of Central Tax, as the case may be, shall issue a demand note to the unit (i) intimating the amount recoverable from the unit and the date from which interest thereon is due and (ii) directing the manufacturer to deposit the full sum within 30 days of the issue of the demand note in the account head of DIPP and submit proof of deposit to him/her 9.4 Where the amount is not paid by the beneficiary within the time specified as above, action for recovery shall be taken in terms of the affidavit -cum- indemnity bond submitted by the applicant at the time of submission of the application, in addition to other modes of recovery. 9.5 Where any amount of budgetary support and/or interest remains due from the unit, based on the report sent by the Assistant Commissioner or Deputy Commissioner of Central Tax as the case may be, the author....
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....d goods but are required to pay GST under the GST regime: Under the erstwhile regime, the benefit was made available to such units if excise duty was imposed at a later date. 2. The scheme seeks to provide benefit to the eligible units for the residual period which were availing exemption under erstwhile exemption notifications issued under Central Excise regime, As such the benefit would not be available to such units. Procurement of inputs for supply as a part of Kit A cosmetics manufacturer has sought clarification as to whether its hair colour kit, would be considered as manufacture. The kit consist of colourant tube manufactured in their own factory at Baddi and other items manufactured by third parties situated in area based exempt locations and are procured to be part of the kit. This finished hair colour kit is cleared by their factory. 3. As long as, the sourced goods from third party are in the nature of inputs for the kit in respect of which some of the goods are being manufactured by themselves, the kit would be considered to be a product which is being supplied. The benefit for the kit would be available so long as the sourced products are in....
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....mit for disposal of the claims filed by the eligible units was discussed as at present no time limit is provided in the scheme itself. 7. It was decided that the claims should be disposed off within 2 weeks since the applicant has already incurred liability and paid the tax and in no case, it should be later than 30 days. Jurisdictional Chief Commissioner is to monitor the same and ensure expeditious disposal. Insistence on ink signed copy by PAO, of sanction order, creates delay in the sanction of refund. It was suggested that there should not be any requirement of ink signed copy of the sanction order to the PAO by the DC/AC especially in areas where Commission rates are located in far flung areas. 8. It was clarified that in the manual mode there is a requirement for the same. However, in the automated mode after roll out of the third phase of the automation, there will not be any requirement of ink signing of the sanction order. Provision for appeal: There is no provision for appeal for the unit in case the unit is aggrieved with the findings of sanctioning authority / Inspection team. 9. The support under the scheme is in the nature....
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....y way of refund of the excise duty paid through account PLA after availing the CENVAT credit available; vide Notification Nos. 49/2003-CE dated 10.06.2003 and 50/2003-CE dated 11.06.2003 in the state of Himachal Pradesh and Uttarakhand, the eligible industrial units were exempted from whole of the duty of excise or additional duty of excise as the case may be leviable thereon. Since the excise duty and additional excise duty was totally exempted in respect of the goods cleared by eligible industrial units in the State of Himachal Pradesh and Uttarakhand, the said eligible industrial units were not required to be registered under the Central Excise Act. Keeping in view the position as reflected above, though Clause 4.1(a) of the Budgetary Support Scheme provides that the eligibility of the unit shall be on the basis of the application filed for budgetary support under the Budgetary Support Scheme with reference to the Central Excise registration number, for the premises of the eligible manufacturing unit, as it existed prior to migration to GST, Clause 4.1(b) provides for requirement of only GST registration in respect of the industrial units covered by Notification Nos. 49/2003-....
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....g activities for the entire period of 10 years for example if an industrial unit which was established in the year 2014 and continued manufacture activities upto 2015 and for some reason the industrial unit was closed thereafter but again started from 01.08.2017 i.e. after the introduction of the GST, it will not be entitled to the benefit of the Budgetary Support Scheme though the said industrial unit was entitled to the exemption as per the Industrial Policy and Notification No. 20/2007 dated 25.04.2007 for a period of 10 years from the date of the commencement of the production. A similar situation came up before the Tripura High Court in the case of Sukhamoy Paul Vs. State of Tripura & Others, reported in 2021 SCC OnLine Tri 273, in respect of the claim of transport subsidy wherein the eligible industrial units after commencing its production got engaged into the same activity as job worker and subsequently was not entitled to the transport subsidy, held as under: ".......The eligibility period for claiming subsidy may be 5 years, the scheme nowhere provides that only if a new industrial unit continues such manufacturing activity for a period of 5 years that it can cla....
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.... any refund under Notification No. 20/2007 cannot be construed to mean that the said industrial unit was not eligible for benefits of Notification No. 20/2007 if the said the industrial unit was established after fulfilling the conditions of the Industrial Policy of 2007 and is an eligible industrial unit for claiming the benefits as provided in the Industrial Policy including the excise benefits as granted by Notification No. 20/2007. In the present set of cases, the industrial units, though eligible for benefits under the Industrial Policy of 2007 in so far as excise benefits was concerned, the said benefit could not be claimed inasmuch as either the goods manufactured were exempted from payment of excise duty or the total turnover of these units were below the threshold limit. On the above two grounds, it cannot be said that the said industrial units were not eligible units for claiming benefits under Notification No. 20/2007. The aforesaid Clarification dated 22.02.2023 reinforces the submission of the petitioners that not claiming of any refund of excise duty as per Notification No. 20/2007 cannot be a ground to hold that the said industrial units were not eligible and/or not ....
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....l established that while Article 14 forbids class legislation, it does not forbid reasonable classification for the purposes of legislation. In order, however, to pass the test of permissible classification two conditions must be fulfilled, namely, (i) that the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group and (ii) that differentia must have a rational relation to the object sought to be achieved by the statute in question. The classification may be founded on different bases; namely, geographical, or according to objects or occupations or the like. What is necessary is that there must be a nexus between the basis of classification and the object of the Act under consideration. It is also well established by the decisions of this Court that Article 14 condemns discrimination not only by a substantive law but also by a law of procedure. 47. In Ram Krishna Dalmia Vs. Sri Justice S.R. Tendolkar and Ors, reported in AIR 1958 SC 538. While the examining the validity of a notification issued by the Government of India under the Commission of Inquiry Act, 1952. The earlier ....
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.... the object sought to be achieved by the legislation in question. In this connection it must be borne in mind that the object itself should be lawful. The object itself cannot be discriminatory, for otherwise, for instance, if the object is to discriminate against one section of the minority the discrimination cannot be justified on the ground that there is a reasonable classification because it has rational relation to the object sought to be achieved. 49. In E.P. Royappa Vs. State of Tamil Nadu, reported in (1974) 4 SCC 3, the Apex Court held that "the equality and arbitrariness are sworn enemies". Where the act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is therefore violative of Article 14, and if it effects any matter relating to public employment, it is also violative of Article 16. Articles 14 and 16 strike at arbitrariness in State action and ensure fairness and equality of treatment. They require that State action must be based on valid relevant principles applicable alike to all similarly situate and it must not be guided by any extraneous or irrelevant considerations because that would be denial of....
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....e 14 of the Constitution of India. 53. Again in Associated Cement Companies Ltd. Vs. Government of Arunachal Pradesh, reported in (2006) 1 SCC 597, the Apex Court negated the classification sought to be made by the government that that all other patent or proprietary medicinal preparations belonging to different systems of medicine were taxed at the rate of 7%. Only, arishtams prepared under the Ayurvedic system were made subject to a levy of 30%. Arishtams and Asavas contained alcohol which are essential for effective and easy absorption of the medicine by the human system and also because it acted as preservative. This classification was negated by the Apex Court on the ground that it is not based on a reasonable classification. 54. While examining the decision in Ayurveda Pharmacy (Supra), the Apex Court in Associated Cement Companies Ltd. vs. Government of Andhra Pradesh, (2006) 1 SCC 597, observed as under: ""29. In Ayurveda Pharmacy v. State of T.N. [(1989) 2 SCC 285 : 1989 SCC (Tax) 273] which is the sheet anchor of the appellants' submission the facts were: that the appellants were manufacturers of ayurvedic drugs and medicines, including arishtams and as....
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.... to be achieved. 57. In Re: the Special Courts Bill, 19778, reported in (1979) 1 SCC 380, after examining various judgments of the Apex Court after examining various earlier judgments of the Apex Court laid down certain propositions culled out from these judgments in respect of the principle applicable and arising under Article 14 of the Constitution of India. Those propositions may be stated thus: "(1) The first part of Article 14, which was adopted from the Irish Constitution, is a declaration of equality of the civil rights of all persons within the territories of India. It enshrines a basic principle of republicanism. The second part, which is a corollary of the first and is based on the last clause of the first section of the Fourteenth Amendment of the American Constitution, enjoins that equal protection shall be secured to all such persons in the enjoyment of their rights and liberties without discrimination of favouritism. It is a pledge of the protection of equal laws, that is, laws that operate alike on all persons under like circumstances. (2) The State, in the exercise of its governmental power, has of necessity to make laws operating differently on....
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....e arbitrary but must be rational, that is to say, it must not only be based on some qualities or characteristics which are to be found in all the persons grouped together and not in others who are left out but those qualities or characteristics must have a reasonable relation to the object of the legislation. In order to pass the test, two conditions must be fulfilled, namely, (1) that the classification must be founded on an intelligible differentia which distinguishes those that are grouped together from others and (2) that that differentia must have a rational relation to the object sought to be achieved by the Act. (8) The differentia which is the basis of the classification and the object of the Act are distinct things and what is necessary is that there must be a nexus between them. In short, while Article 14 forbids class discrimination by conferring privileges or imposing liabilities upon persons arbitrarily selected out of a large number of other persons similarly situated in relation to the privileges sought to be conferred or the liabilities proposed to be imposed, it does not forbid classification for the purpose of legislation, provided such classification is ....
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.... (13) A rule of procedure laid down by law comes as much within the purview of Article 14 as any rule of substantive law and it is necessary that all litigants, who are similarly situated, are able to avail themselves of the same procedural rights for relief and for defence with like protection and without discrimination." 58. In Subramanian Swamy Vs. Director, CBI, reported in (2014) 8 SCC 682, the Apex Court examined the principles applicable to Article 14 held as under: 38. Article 14 reads: "14. Equality before law.-The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India." The first part of Article 14, which was adopted from the Irish Constitution, is a declaration of equality of the civil rights of all persons within the territories of India. It enshrines a basic principle of republicanism. The second part, which is a corollary of the first and is based on the last clause of the first section of the Fourteenth Amendment of the American Constitution, enjoins that equal protection shall be secured to all such persons in the enjoyment of their rights and liberties without discr....
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....le differentia which distinguishes persons or things that are grouped together from others left out of the group, and (ii) that that differentia must have a rational relation to the object sought to be achieved by the statute in question. The classification may be founded on different bases; namely, geographical, or according to objects or occupations or the like. What is necessary is that there must be a nexus between the basis of classification and the object of the Act under consideration. It is also well established by the decisions of this Court that Article 14 condemns discrimination not only by a substantive law but also by a law of procedure." 41. In Ram Krishna Dalmia [Ram Krishna Dalmia v. S.R. Tendolkar, AIR 1958 SC 538 : 1959 SCR 279] , the Constitution Bench of five Judges further culled out the following principles enunciated in the above cases: (AIR pp. 547-48, para 11) "11. ... (a) that a law may be constitutional even though it relates to a single individual if, on account of some special circumstances or reasons applicable to him and not applicable to others, that single individual may be treated as a class by himself; (b) that there is ....
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....such persons or things may appear on the face of the statute or may be gathered from the surrounding circumstances known to or brought to the notice of the court. In determining the validity or otherwise of such a statute the court has to examine whether such classification is or can be reasonably regarded as based upon some differentia which distinguishes such persons or things grouped together from those left out of the group and whether such differentia has a reasonable relation to the object sought to be achieved by the statute, no matter whether the provisions of the statute are intended to apply only to a particular person or thing or only to a certain class of persons or things. Where the court finds that the classification satisfies the tests, the court will uphold the validity of the law. (ii) A statute may direct its provisions against one individual person or thing or to several individual persons or things but no reasonable basis of classification may appear on the face of it or be deducible from the surrounding circumstances, or matters of common knowledge. In such a case the court will strike down the law as an instance of naked discrimination.... (i....
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.... 44. In Vithal Rao [Nagpur Improvement Trust v. Vithal Rao, (1973) 1 SCC 500], the five-Judge Constitution Bench had an occasion to consider the test of reasonableness under Article 14 of the Constitution. It noted that: (SCC p. 506, para 26) "26. ... the State can make a reasonable classification for the purpose of legislation [and] that the classification in order to be reasonable must satisfy two tests: (i) the classification must be founded on intelligible differentia, and (ii) the differentia must have a rational relation with the object sought to be achieved by the legislation in question." The Court emphasised that in this regard object itself should be lawful and it cannot be discriminatory. If the object is to discriminate against one section of the minority, the discrimination cannot be justified on the ground that there is a reasonable classification because it has rational relation to the object sought to be achieved. 45. The constitutionality of the Special Courts Bill, 1978 came up for consideration in Special Courts Bill, 1978, In re [(1979) 1 SCC 380] as the President of India made a reference to this Court under Article 143(1) of the ....
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....d liabilities imposed. Equal laws would have to be applied to all in the same situation, and there should be no discrimination between one person and another if as regards the subject-matter of the legislation their position is substantially the same. (5) By the process of classification, the State has the power of determining who should be regarded as a class for purposes of legislation and in relation to a law enacted on a particular subject. This power, no doubt, in some degree is likely to produce some inequality; but if a law deals with the liberties of a number of well-defined classes, it is not open to the charge of denial of equal protection on the ground that it has no application to other persons. Classification thus means segregation in classes which have a systematic relation, usually found in common properties and characteristics. It postulates a rational basis and does not mean herding together of certain persons and classes arbitrarily. (6) The law can make and set apart the classes according to the needs and exigencies of the society and as suggested by experience. It can recognise even degree of evil, but the classification should never be arbitra....
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....onary powers on an administrative authority is constitutionally valid or not should not be determined on the assumption that such authority will act in an arbitrary manner in exercising the discretion committed to it. Abuse of power given by law does occur; but the validity of the law cannot be contested because of such an apprehension. Discretionary power is not necessarily a discriminatory power. (11) Classification necessarily implies the making of a distinction or discrimination between persons classified and those who are not members of that class. It is the essence of a classification that upon the class are cast duties and burdens different from those resting upon the general public. Indeed, the very idea of classification is that of inequality, so that it goes without saying that the mere fact of inequality in no manner determines the matter of constitutionality. (12) Whether an enactment providing for special procedure for the trial of certain offences is or is not discriminatory and violative of Article 14 must be determined in each case as it arises, for, no general rule applicable to all cases can safely be laid down. A practical assessment of the oper....
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....e a rational nexus to the object sought to be achieved by the statute in question." 48. In E.P. Royappa [E.P. Royappa v. State of T.N., (1974) 4 SCC 3 : 1974 SCC (L&S) 165], it has been held by this Court that the basic principle which informs both Articles 14 and 16 are equality and inhibition against discrimination. This Court observed in para 85 as under: (SCC p. 38) "85. ... From a positivistic point of view, equality is antithetic to arbitrariness. In fact equality and arbitrariness are sworn enemies; one belongs to the rule of law in a republic while the other, to the whim and caprice of an absolute monarch. Where an act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is therefore violative of Article 14, and if it affects any matter relating to public employment, it is also violative of Article 16. Articles 14 and 16 strike at arbitrariness in State action and ensure fairness and equality of treatment." 59. After elaborate discussion of the earlier judgments, the Apex Court culled out the principle which should be adopted by the courts for application of the principle of Article 14. The A....
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.... must be sound and must have reasonable relation to the object of the legislation. If the object itself is discriminatory, then explanation that classification is reasonable having rational relation to the object sought to be achieved is immaterial. 61. In Union of India Vs. NS Ratnam, reported in (2015) 10 SCC 681, the Apex Court held that in the context of reasonable classification and/or hostile discrimination that although in the field of taxation, the legislature has an extremely wide discretion to classify items for tax purposes, so long as it refrains from clear and hostile discrimination against particular persons or classes (see State of Madras v. P.R. Sriramulu [(1996) 1 SCC 345]). However, at the same time, when a substantive unreasonableness is to be found in a taxing statute/notification, it may have to be declared unconstitutional. Although the Court may not go into the question of a hardship which may be occasioned to the taxpayers but where a fair procedure has not been laid down, the validity thereof cannot be upheld. A statute which provides for civil or evil consequences must conform to the test of reasonableness, fairness and non-arbitrariness. 62. In Stat....
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....t is under an obligation or a liability imposed by law to act differently. 65. In Century Spinning and Manufacturing Co. Ltd and Anr. Vs. The Ulhasnagar Municipal Council and Anr, reported in (1970) 1 SCC 582, the Apex Court held that public bodies are as much bound as private individuals to carry out representations of facts and promises made by them, relying on which other persons have altered their position to their prejudice. The obligation arising against an individual out of his representation amounting to a promise may be enforced ex contracts by a person who acts upon the promise: when the law requires that a contract enforceable at law against a public body shall be in certain form or be executed in the manner prescribed by statute, the obligation may if the contract be not in that form be enforced against it in appropriate cases in equity. In Union of India v. Indo-Afghan Agencies Ltd. [(1968) 2 SCR 366] this Court held that the Government is not exempt from the equity arising out of the acts done by citizens to their prejudice, relying upon the representations as to its future conduct made by the Government. The Apex Court also observed that in appeal from that judgme....
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....exemption to a new industry and if on the basis of the representation made by the Government an industry is established in order to avail the benefit of exemption, it may then follow that the new industry can legitimately raise a grievance that the exemption could not be withdrawn except by means of legislation having regard to the fact that promissory estoppel cannot be claimed against a statute. In order to claim the benefit of promissory estoppel the appellants must establish: (i) that a representation was made to grant the exemption for a particular period to a new industry established in view of the representation held out by the State Government; and (ii) that the appellants had established the new industry acting upon the representation made by the State Government. 68. In Pawan Alloys & Casting Pvt. Ltd, Meerut Vs. U.P. State Electricity Board and Ors, reported in (1997) 7 SCC 251, the Apex Court held that the it may be found that the Government or any other competent authority had held out any promise on the basis of which the promise might have acted, if public interest required recall of such a promise and such a public interest outweighed the intere....
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....blic authority "to carry out a representation or promise which is contrary to law or which was outside the authority or power of the officer of the Government or of the public authority to make". There is preponderance of judicial opinion that to invoke the doctrine of promissory estoppel clear, sound and positive foundation must be laid in the petition itself by the party invoking the doctrine and that bald expressions, without any supporting material, to the effect that the doctrine is attracted because the party invoking the doctrine has altered its position relying on the assurance of the Government would not be sufficient to press into aid the doctrine. The withdrawal of exemption "in public interest" is a matter of policy and the courts would not bind the Government to its policy decisions for all times to come, irrespective of the satisfaction of the Government that a change in the policy was necessary in the "public interest". The courts, do not interfere with the fiscal policy where the Government acts in "public interest" and neither any fraud or lack of bona fides is alleged much less established. The Government has to be left free to determine the priorities in the m....
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....versity, unfairness or unreasonableness or which does not violate any fundamental or other enforceable rights vested in the respondents. In the case in hand, the Government has, as a matter of policy, decided to lower the age profile of officers serving in Combat Arms and Combat Arms Support pursuant to the recommendations made by the Expert Committees. 73. In State of Jharkhand and Ors. Vs. Brahmaputra Metallics Ltd., Ranchi and Anr, reported in 2020 SCC OnLine SC 968, the Apex Court held that the scope of the doctrine of legitimate expectation is wider than promissory estoppel because it not only takes into consideration a promise made by a public body but also official practice, as well. Further, under the doctrine of promissory estoppel, there may be a requirement to show a detriment suffered by a party due to the reliance placed on the promise. Although typically it is sufficient to show that the promisee has altered its position by placing reliance on the promise, the fact that no prejudice has been caused to the promisee may be relevant to hold that it would not be "inequitable" for the promisor to go back on their promise. However, no such requirement is present under th....
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....aw. The power vested by the State in a public authority should be viewed as a trust coupled with duty to be exercised in larger public and social interest. Power is to be exercised strictly adhering to the statutory provisions and fact situation of a case. "Public authorities cannot play fast and loose with the powers vested in them." A decision taken in an arbitrary manner contradicts the principle of legitimate expectation. An authority is under a legal obligation to exercise the power reasonably and in good faith to effectuate the purpose for which power stood conferred. In this context, "in good faith" means "for legitimate reasons". 76. In this context, it is also trite to refer to another important judgment of the Apex Court rendered in Manuelsons Hotels Private Limited Vs. State of Kerala, reported in (2016) 6 SCC 766. In that case, the State Government of Kerala offered certain fiscal incentives as tourism was declared to be an "industry". These fiscal incentives that were promised included exemption from building tax levied by the Revenue Department of the State of Kerala. There was a Government order whereby it was proposed to amend the Kerala Building Tax Act 1975. Pu....
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....er by blood, by estate or by contract. That being so, an estoppel by conduct can be the origin of primary rights of property and of contract. 2. The central principle of the doctrine is that the law will not permit an unconscionable-or, more accurately, unconscientious-departure by one party from the subject-matter of an assumption which has been adopted by the other party as the basis of some relationship, course of conduct, act or omission which would operate to that other party's detriment if the assumption be not adhered to for the purposes of the litigation. 3. Since an estoppel will not arise unless the party claiming the benefit of it has adopted the assumption as the basis of action or inaction and thereby placed himself in a position of significant disadvantage if departure from the assumption be permitted, the resolution of an issue of estoppel by conduct will involve an examination of the relevant belief, actions and position of that party. 4. The question whether such a departure would be unconscionable relates to the conduct of the allegedly estopped party in all the circumstances. That party must have played such a part in the adoption o....
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....promissory estoppel or proprietary estoppel). 7. Estoppel by conduct does not of itself constitute an independent cause of action. The assumed fact or state of affairs (which one party is estopped from denying) may be relied upon defensively or it may be used aggressively as the factual foundation of an action arising under ordinary principles with the entitlement to ultimate relief being determined on the basis of the existence of that fact or state of affairs. In some cases, the estoppel may operate to fashion an assumed state of affairs which will found relief (under ordinary principles) which gives effect to the assumption itself (e.g. where the defendant in an action for a declaration of trust is estopped from denying the existence of the trust). 8. The recognition of estoppel by conduct as a doctrine operating consistently in law and equity and the prevalence of equity in a Judicature Act system combine to give the whole doctrine a degree of flexibility which it might lack if it were an exclusively common law doctrine. In particular, the prima facie entitlement to relief based upon the assumed state of affairs will be qualified in a case where such relief wo....
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....hold that the State therefore will have to affirmatively satisfy the court that the twin tests have been satisfied. It can only be satisfied if the state establishes not only the rational principle on which a classification founded, but correlates it to the objects to be achieved. 80. While there is no quarrel with the fact that the government can resile from any promises made, however, the government will be under a bounden duty to justify as to why they had to resile from the promises made earlier. However, in the present case, this Court is not called upon to decide the question of the correctness of the government's decision vis-à- vis its position earlier as is reflected under the industrial policy resolution. In the context of the present proceedings, the question which is to be decided is whether the decision of the government and the respondent authorities in excluding the present petitioners from being extended the benefit of the budgetary support scheme is violative of Article 14 as the same is stated to be not based on a reasonable classification. From the elaborate pleadings on record and the extensive submissions made by the learned counsels for the parti....
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....s newly extended units of an already existing unit. No material has been placed by the respondents to show that these petitioners at any point in time were declared to be ineligible to avail the benefits offered under the NEIIPP because of non fulfilment of any conditions. Further, the position which is also not disputed is that one group of petitioners before this Court have turnovers which are below the threshold limit of 1.5 crores and thereby they are not required to pay any Central Excise Duty as per the law as it existed then. The other group of petitioners produce items which are already exempted under the erstwhile Central Excise Law and were therefore not required to pay any duty and consequently there was no necessity for claiming any exemption offered under the NEIIPP. These facts are not disputed by the respondents. Consequently, notwithstanding that these petitioners fall into these two categories, they were considered to be eligible industries to avail the benefits under the NEIIPP subject to their necessity and requirement of payment of the excise duty. With effect from 01.07.2017, the GST had subsumed many of the taxes, including central excise. All industries and u....
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....requirement of showing Central Excise Duty paid under the erstwhile Central Excise Act. It is, therefore, evident that only particulars of tax paid under GST is to be submitted by the units claiming budgetary support. It is clear that under the scheme itself there is no scope or provision to work out or calculate the component of Central Excise Duty under the GST paid as such a situation is not even conceived of under the GST Laws. Therefore, as on date, all the petitioners are also admittedly paying GST on the grounds which were earlier exempted or excluded from payment of Central Excise. As such denial of the benefit of Budgetary Support cannot be supported by any reasonable clarification which was made by the respondents to offer the financial support to Industries/units who were considered eligible to avail the benefits under the NEIIPP cannot be held to be valid in law. Such classification to exclude units/industries who were not paying Central Excise duty earlier is opposed to the very purpose of the Industrial Policies and also contrary to the Budgetary Support scheme itself as is evident from the recital in the Circular dated 27.11.2007. 82. Under such circumstances, the....
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....ced goods which were already exempted under Central Excise Duty, they were not considered to be eligible industries to avail the benefits offered under the NEIIPP industry policy. 84. In the absence of such specific averments and contentions on behalf of the respondents or in the absence of such specific clauses being available under the industrial policy itself, the petitioner industries will have to be considered to be eligible industries to avail the benefits as applicable and as conferred under the NEIIPP. 85. The judgment of the Apex Court in Hero Motocrop (Supra), relied upon by the respondents, had upheld the validity of budgetary scheme support. However, the question of the manufacturing units, like the petitioners, who, although were eligible to avail the benefits under the industrial policies, were not required to avail those benefits by virtue of their manufactured goods being exempted or their turnover fell below the threshold limit, was not at all an issue before the Apex Court in the said Judgment. The issue before the Apex Court was the validity of the budgetary scheme and which was upheld by the Apex Court. The Apex Court however although rejected the challeng....