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2004 DIGILAW 1152 (PAT)

Gaya Coke Company Pvt. Ltd. v. State Of Bihar

2004-11-23

NAGENDRA RAI, S.N.HUSSAIN

body2004
Judgment 1. The petitioner-a Company registered under the Companies Act, having established its industrial unit for manufacture of Special Smokeless Fuel, got itself registered with the Department of Industries through the District Industries Centre, Gaya. It is an admitted fact that the Government of Bihar came out with an Industrial Policy Resolution, 1993, making a promise to grant exemption from payment of sales tax to the new Industrial Units of a particular category. 2. Thereafter, the Commercial Taxes Department in pursuance of the aforesaid Policy issued notification no. 96 dated 4.4.1994, laying down the guidelines for filing an application for grant of exemption. A copy of the said notification has been annexed as Annexure 1. The petitioner established an industry for manufacturing the aforesaid variety of coal and commenced its production on 11.5.1995 and made an application on 15.5.1995 in terms of the aforesaid Industrial Policy by post (under certificate of posting Annexures 2 series). It had already applied for registration certificate as a Small Scale Industrial Unit (SSI Unit) to the Industries Department through the District Industries Centre, Gaya, which was issued on 3.11.1995 and received by the petitioner on 23.11.1995. When no decision was taken, it again filed a fresh application on 14.12.1995 before the Deputy Commissioner of Commercial Taxes, Gaya Division, Gaya (Respondent no. 4) along with the entire enclosures, including the registration certificate, stating therein about the filing of the earlier application on 15.5.1995. Thereafter, the matter was taken up and an enquiry was entrusted in regard to the matter of grant of exemption to the Commercial Taxes Officer, Gaya Circle, Gaya and after inspection, the Commercial Taxes Officer submitted a report on 12.4.1996 mentioning therein that the petitioner-Unit is eligible for grant of exemption in view of the notification dated 4.4.1994, a copy of the report has been annexed as Annexure 5. The Deputy Commissioner of Commercial Taxes, Gaya Circle, Gaya i.e. the original authority (respondent no. 4) rejected the application by order dated 21.6.1996 on the ground that the same was filed beyond the period prescribed under the Policy and also on the ground that apart from producing Special Smokeless Fuel, the petitioner was also producing Coal Tar and as such not entitled to the exemption. 3. 4) rejected the application by order dated 21.6.1996 on the ground that the same was filed beyond the period prescribed under the Policy and also on the ground that apart from producing Special Smokeless Fuel, the petitioner was also producing Coal Tar and as such not entitled to the exemption. 3. The petitioner filed an application before the higher authority i.e. the revisional authority-Joint Commissioner of Commercial Taxes (Appeal), Gaya Division, Gaya, who, by order dated 20.1.1999, set aside the order of the Deputy Commissioner, Commercial Taxes, and held that the application was to be treated within time as earlier application was filed within thirty days under certificate of posting and secondly that the Coal Tar is a by-product and as such the Unit is producing only Special Smokeless Fuel and Coal Tar is not being produced as a separate product and directed for grant of exemption certificate. Thereafter, the Deputy Commissioner, Commercial Taxes, instead of granting exemption certificate, sat over the order of the Joint Commissioner and held that he has no power to pass order and in any view of the matter, as the said application was filed before the grant of registration certificate by the District Industries Centre in violation of the Industrial Policy, no exemption certificate would be granted. 4. Having heard learned counsel for the parties, we are of the view that once the superior authority has accepted the case of the petitioner and issued a direction then the subordinate authority should not have sat over his order and the matter would have been challenged before the higher Court. If the subordinate authority starts making defiance of the order of the superior authority on the ground that he has not taken a correct view, then that will be a bad day for the system. The conduct of the Deputy Commissioner, Commercial Taxes, is, accordingly, deprecated. The petitioner has produced material showing that it has sent an application for grant of exemption certificate within the period of thirty days i.e. on 15.5.1995 under certificate of posting, but no action was taken. There is no counter-version on behalf of the authority. The conduct of the Deputy Commissioner, Commercial Taxes, is, accordingly, deprecated. The petitioner has produced material showing that it has sent an application for grant of exemption certificate within the period of thirty days i.e. on 15.5.1995 under certificate of posting, but no action was taken. There is no counter-version on behalf of the authority. In that view of the matter, that has to be accepted and even assuming that the Joint Commissioner, Commercial Taxes, has no jurisdiction to hear the revision application, the materials on the record clearly show that that application was filed within time and on that ground it cannot be rejected. It is also found from the report appended and filed before the authorities of the expert body that the Coal Tar is a by-product of the Special Smokeless fuel and in that view of the matter, the petitioner-Unit was covered by the exemption clause though the registration of the Unit by the District Industries Centre was done subsequently though it was applied by the petitioner within time and for the same it cannot be allowed to suffer as registration certificate was not granted because of inaction on the part of the authorities. 5. Accordingly, we are of the view that the Joint Commissioner, Commercial Taxes, was right in coming to the conclusion that the exemption is to be granted to the petitioner even if, as stated above, it is treated that he has no revisional jurisdiction. The facts clearly show that the defects pointed out by the Deputy Commissioner of Commercial Taxes, are unfounded and too technical and will stand in the way of propagation and implementation of the Industrial Policy. 6. In the result, this writ application is allowed and the order passed by the Deputy Commissioner, Commercial Taxes, Gaya Circle, Gaya, dated 16.11.1999 is quashed and a direction is issued to grant exemption certificate to the petitioner.