SCA/15730/2007 29/ 37 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No. 15730 of 2007 With SPECIAL CIVIL APPLICATION No. 19369 of 2006 For Approval and Signature: HONOURABLE THE CHIEF JUSTICE Y.R.MEENA HONOURABLE MR.JUSTICE J.C.UPADHYAYA ======================================
1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To
be referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
======================================
BHARAT
FOODS CO-OPERATIVE LTD. & 1 – Petitioner(s)
Versus
STATE
OF GUJARAT & 3 – Respondent(s)
======================================
Appearance
:
MR KS NANAVATI for NANAVATI
ASSOCIATES for Petitioner(s) : 1 – 2.
MR KAMAL TRIVEDI, ADVOCATE
GENERAL with MS SNAGEETA VISHEN, AGP for Respondent(s) : 1,
NOTICE
SERVED for Respondent(s) : 1 –
4.
======================================
CORAM
:
HONOURABLE
THE CHIEF JUSTICE Y.R.MEENA
and
HONOURABLE
MR.JUSTICE J.C.UPADHYAYA
Date
: 27/06/2008
CAV
COMMON JUDGMENT
(Per
: HONOURABLE MR.JUSTICE J.C.UPADHYAYA)
Rule.
Service of rule is waived by Ms. Sangeeta Vishen, Ld. AGP for the
respondents.
Learned
counsels for the parties requested to hear and decide both the
matters by way of common judgment as the facts and issues involved in
the petitions are identical and common. Hence both the petitions are
being decided and disposed by this CAV Common Judgment.
The
petitioners filed present petition ý Special Civil Application No.
15730 of 2007 under Article 226 of the Constitution of India to seek
the following reliefs against the respondents :-
ýS(A) Your
Lordships may be pleased to issue a writ of mandamus or writ in the
nature of mandamus or direction or order quashing and setting aside
the decision taken by the State Level Committee, respondent no. 3, in
its meeting dated 5.6.2007 [Annexure-Y] and conveyed to the
society by the Additional Industries Commissioner, vide its letter
dated 5.6.2007 [Annexure-A] and be further pleased to direct
the respondents to grant Sales Tax exemption to the petitioners for
the amount of Eligible Capital Investment made by the petitioners.
(A1) Your
Lordships may be pleased to quash and set aside the resolution dated
9.11.2005 [Annexure-M1] or in the alternative be pleased to
hold and declare that the said resolution is not applicable to the
case of the present petitioners.
(B) Pending
admission and final disposal of this petition, Your Lordships may be
pleased to restrain the respondent No. 4 from levying and collecting
or recovering sales tax from the petitioners;ýý
1.1. The
petitioner no. 1 is Bharat Foods Cooperative Ltd., and petitioner no.
2 Mr. S K Handa, is Member and Managing Director of the petitioner
no. 1 ý Cooperative Ltd.
2. The
facts leading to the petition, in nut-shell, are as under :-
2.1. The
petitioner no. 1 is a Cooperative Society registered and incorporated
under the Multi State Cooperative Societies Act, 2002 [for short ‘the
Act’]. On 26.01.2001 there was a devastating earthquake which hit
District Kutch of the State of Gujarat. Because of the said natural
calamity, the economic activities in Kutch District came to a
standstill. With a view to create new employment opportunity and for
attracting industries in Kutch District, the respondent no. 1 ý
State of Gujarat and its Department of Industries and Mines, by way
of resolution No. INC-10200-903-1 dated 9.11.2001 announced a scheme
of sales tax incentive titled as ýSIncentive Scheme 2001 for the
Economic Development of Kutch Districtýý and by way of the said
scheme, any existing industrial undertaking or a new industry setting
up a unit in Kutch District was eligible for the benefit of sales tax
exemption or sales tax deferment on eligible fixed capital
investment. As per the scheme, a cooperative society setting up a
unit for refining of edible oil/hydrogenation of edible oil is
eligible for sales tax incentive. Initially the scheme was operative
till 31.12.2004. However, by subsequent resolution, it was extended
till 31.12.2005.
2.2. The
Government of Gujarat issued notification under section 49 of the
Gujarat Sales Tax Act [for short ‘GST Act’] on 31.12.2001 whereby
exemption from sales tax was granted to eligible unit as defined in
the scheme. The petitioner no. 1 society was registered and
incorporated on 11.09.2003 under the Act. The area of operation of
the society extended upto the States of Gujarat, Maharashtra and
Madhya Pradesh. On 10.11.2003 the petitioner society applied to the
State Government for obtaining certain clarifications regarding the
scheme before constructing a plant for refining of edible
oil/hydrogenation of edible oil in Kutch District. Pursuant to the
application of the petitioner, vide order dated 10.11.2003 passed in
exercise of powers under section 62 of the GST Act, the Deputy
Commissioner of Sales Tax [Legal] held that the petitioner was
eligible for availing the sales tax incentives under the scheme.
Thereupon, on 16.09.2004 the petitioner society applied for
registration under the scheme. Since no prompt action was taken by
the State, the petitioner society sent reminders for registration on
1.11.2004, 2.11.2004, 28.1.2005, 9.2.2005, 16.2.2005, 7.3.2005,
29.4.2005, 2.5.2005, 13.6.2005, etc. Yet the respondents did not
grant registration to the petitioner society to avail the benefits of
the scheme. However, in the month of December 2004, the plant of the
petitioner society was ready to start commercial production. The
plant was set up by investing more that Rs.32 crore. The State Level
Committee [for short ‘SLC’] in its meeting held on 5.5.2005 held
that Industries Commissioner would send a proposal to the State
Government to amend the scheme so as to restrict the benefits only
to the cooperative societies of edible seed growers. Accordingly,
Industries Commissioner had sent a proposal to the State Government,
but no such amendment was made by the State Government in its
original scheme. As no decision was taken by the respondent ý State
on application for registration made by the petitioners, the
petitioners were constrained to prefer Special Civil Application No.
13040 of 2005. In the said petition, on 21.07.2005 a statement was
made by the Ld. AGP who was representing the respondents, upon
instructions from the Joint Industries Commissioner that the
Government will take decision in the matter as early as possible and
preferably by 31.08.2005. Thereafter, vide different letters,
respondents sought for certain information from the petitioner
society regarding the members of the society, their vocation, source
of earnings of the society, etc. The said details were immediately
supplied to the respondents. Despite this, no decision was taken till
30.09.2005. In the result, the petitioners preferred Civil
Application No. 9355 of 2005 in Special Civil Application No. 13040
of 2005. In the said Civil Application, this Court directed that the
petitioners would be entitled to enter into commercial production
without payment of any sales tax till final disposal of the main
petition. Pursuant to the said order passed by this Court, the
petitioner society commissioned the plant and vide letter dated
21.10.2005 applied for eligibility certificate for eligible capital
investment of Rs.30,93,76,043/-. However, on 21.10.2005 the
respondent no. 2 ý Joint Industries Commissioner informed the
petitioners that their application for registration under the scheme
was rejected by the respondent no. 3 ý SLC on the ground that under
section 29 of the Act, a person whose business is in conflict or
competitive with business of society is not eligible to be a
member of the society. However, in the pending petition, the
aforesaid decision of the respondent no. 3 – SLC was withdrawn by
the respondents by way of a statement made before this Court on
28.10.2005 and this Court disposed of Special Civil Application No.
13040 of 2005 on 28.10.2005 with a direction that the Industries
Commissioner shall issue eligibility certificate to the petitioner
latest by 11.11.2005 and thereafter, the parties would be entitled to
proceed in accordance with law.
2.3. On
29.10.2005 the registration was granted to the petitioner society as
contemplated under the scheme and on 11.11.2005 eligibility
certificate was issued in favour of the petitioner. Eligible
investment was considered to the tune of Rs.27,76,06,000/-. However,
in para. 4 of the eligibility certificate it was mentioned that the
certificate was issued provisionally at the rate of 25% of the
tentative eligibility as detailed verification of assets was to be
carried out. On 30.11.2005 exemption certificate under section 49(2)
of the GST Act was issued by the Sales Tax Commissioner in favour of
the petitioners. Thereafter, a team comprising of Additional
Industries Commissioner, Joint Industries Commissioner, etc.,
visited the plant of the petitioner at Kutch and its registered
office situated at Mumbai and administrative office situated at
Indore for inspection. They also visited and met the members of the
petitioners, the financial institution that had granted loans,
dealers, etc., and recorded their statements. On the basis of the
said inquiry, report was submitted by the team to SLC on 27.09.2006.
From the report, it was evident that an extensive and detailed
inquiry was conducted by the respondents to find out whether the
society was genuine or was promoted by any company as a firm to
obtain tax exemption benefits. At the end of such inquiry, the
committee concluded that it has not found that the society was not
genuine or it has been set up by any company or group. Despite the
fact that the petitioner society was found to be genuine, the SLC in
its meeting dated 30.03.2007 decided that prima-facie the petitioner
society was not entitled to the benefits under the scheme, there was
only one farmer member in the society and the purpose of the scheme
was to give benefit to the society formed by farmers. Despite the
fact that the SLC took the said decision on 30.03.2007, the
Industries Commissioner did not convey the same nor called the
petitioner no. 2 for hearing. Thereafter, on 16.5.2007 the
Industries Commissioner informed the petitioners that the SLC was of
the prima-facie opinion that the petitioner society was not eligible
for the benefit under the scheme as it had no farmer member.
Meanwhile, the petitioners were constrained to file Special Civil
Application No. 12776 of 2007 and in said petition, on behalf of
respondents, statement was made before this Court that the
petitioners shall be heard on 31.5.2007 by the Industries
Commissioner and till then, the respondents will not make any
coercive recovery. This Court in its order observed that it was
accepted that the order passed by the SLC would be communicated to
the petitioners and before initiating coercive recovery, the
petitioners would be granted reasonable time for challenging order of
the committee in case the same was adverse to the petitioners. The
petitioners appeared before the Industries Commissioner and submitted
its reply/representation. On 8.7.2007 the petitioner society received
a letter from the Additional Industries Commissioner stating that the
representation of the petitioners was considered by the SLC on
5.6.2007 and the SLC was of the opinion that the benefit under the
scheme was available only to such cooperative society of farmer
members and as there was no agriculturist member in the petitioner
society, the petitioner society was not eligible under the scheme
and, therefore, the application of the petitioner under the scheme
was rejected. Hence, the present petition is filed.
3. Learned
senior counsel Mr. KS Nanavati for the petitioners submitted that the
impugned decision of the SLC taken in its meeting held on 5.6.2007
holding that the petitioners are not eligible for the incentives
under the scheme is not only contrary to the scheme itself but the
same is illegal, void and violative of Article 14 of the Constitution
of India. That by impugned decision, the SLC tried to interpret the
scheme in the manner not provided in the scheme itself, but contrary
to the objectives of the scheme. That the main ground on which the
petitioners are denied the benefits under the scheme is that none of
the members of the petitioner society are farmers. That as a matter
of fact, considering the scheme, copy of which is produced at
Annexure-C in this petition, in the definition of ýSindustrial
enterprisesýý, ‘registered
cooperative society’ is also
included. Annexure-C attached to the scheme contains list of banned
industries. As per entry no. 3 ý solvent extraction of oil from
edible seed/edible oil cake processing and/or hydrogenation of edible
oil falls within the purview of ‘banned industries’. But the
exception is , ‘a cooperative sector’. Therefore, if the unit is a
cooperative sector, dealing with the item referred in item no. 3 in
the schedule, such cooperative society is eligible for the benefit of
the scheme. That neither in the scheme itself nor in any of the
schedules attached to the scheme, it is referred that the cooperative
society having farmers as its members can only avail benefits of the
scheme. Considering the objects behind introducing the scheme, it is
clearly set forth in the scheme itself that because of the
devastating earthquake occurred on 26.1.2001 in the State of Gujarat,
the adversely affected area was district of Kutch. That in the area
of Kutch new employment opportunities could be created if new
investment takes place. That the Government was committed to attract
the industries in Kutch district to make industrial and economic
environment live. That even Government of India has announced excise
duty exemption for new industries to promote large-scale investment
in the district. That, therefore, State Government has also decided
to announce the scheme of sales tax incentives. It is further stated
in the scheme that since the scheme is aimed at making economic
environment of Kutch district live, it has been decided to confine
the same only to Kutch district. That, therefore, the object behind
the scheme was not to promote agricultural activities in the district
or to render benefits only to farmers adversely affected by
earthquake in the district. The main object was to create new
employment opportunities and to make the industrial and economic
environment live in the district. That therefore, to deny the
benefits of the scheme solely on the ground that none of the members
of the petitioner society is farmer can be said to be an illegal and
arbitrary exercise of powers by the State contrary to the scheme
promulgated by the State itself. That if at all the object behind
floating of the incentive scheme was to give benefits to such
cooperative society having farmer members, then there was no reason
whatsoever by subsequent amendment in the scheme dated 9.11.2005 to
delete cooperative sector mentioned at item no. 3 in Annexure-C
attached to the scheme. If at all the intention of the State was to
benefit the farmers, instead of deleting the cooperative sector as a
whole dealing in oil seeds unit, the State could have further
qualified the word ýScooperative sectorýý
by stating that such cooperative sector having farmers as its members
dealing in oil seeds unit, are only entitled to the benefits of the
scheme. That instead of this, by subsequent amendment in item no. 3
of list of banned industries Annexure-C attached to the scheme, the
entire cooperative sector itself is deleted.
3.1. Mr. Nanavati
further submitted that before erecting a plant in Kutch district the
petitioner society sought for further clarification from the State
Government and as a matter of fact, the Deputy Commissioner of Sales
Tax in an order dated 10.11.2003 passed under section 62 of the GST
Act, has determined that the benefit of the scheme was available to
the petitioner cooperative society. The petitioner society has
complied with all the conditions incorporated in the scheme. That,
therefore, the respondents cannot deny the benefits of the scheme.
Even the respondent ý State is estopped from denying the benefits
to the petitioner society. That even doubt was raised by the
respondents regarding the genuineness of the formation of the
petitioner cooperative society, but upon inquiry it was revealed
that the petitioner society was genuinely formed cooperative society
and was not backed by any company. Mr. Nanavati further submitted
that the impugned order dated 6-8.6.2007 is also illegal in view of
the fact that the same was passed contrary to the statement made by
the Industries Commissioner before this Court on 28.10.2005. The
Special Civil Application No. 13040 of 2005 was pending. While
disposing of said petition by order dated 28.10.2005 Mr. Agarval,
Industries Commissioner and Mr. Mehta, Joint Commissioner ý
Industries, submit that the eligibility certificate shall be issued
in favour of the petitioners latest by 11.11.2005. It was further
stated before this Court that earlier order passed by the SLC may be
ignored and the authorities be allowed to proceed in the matter as
suggested by them. That surprisingly thereafter, by the impugned
order the benefit was denied to the petitioner by the State
authorities. That relying upon the scheme as well as the clear
opinion expressed in writing by the responsible officer of the Sales
Tax Department of the State, the petitioner invested more than Rs.32
crore in erecting the plant. The plant was ready for production by
December 2004. Subsequently, despite the fact that clear directions
were issued by this Court in earlier writ petition and unconditional
statements made by responsible officers of the State Government
before this Court, by virtue of the impugned decision, the State
denied the benefits of the scheme to the petitioner. That the
authorities of the State acted upon the order passed by this Court on
28.10.2005 in earlier writ petition and eligibility certificate was
issued, said order was not challenged by the State before the Hon’ble
Apex Court, therefore, said order has become final. Yet surprisingly
the request of the petitioner to accord sales tax benefits to the
petitioner society in accordance with the scheme was denied solely on
the flimsy ground that its members are not farmers. That thus, a very
discriminatory treatment is given to the petitioners by the State.
Therefore, it is submitted that the petition be allowed as prayed
for.
4. Learned Advocate
General Mr. Kamal Trivedi vehemently opposing the petitions,
submitted that the petitioners are not at all entitled to obtain the
relief as prayed for by them in the petition. In this petition, this
Court is concerned with the scheme dated 9.11.2001. The very object
behind the scheme was to motivate the cooperative societies, which
are formed by the farmers connected with/engaged in the activities of
agricultural production of oil seeds in Kutch district. In para. 9 of
the scheme, it is clearly provided that the resolution with regard to
any interpretation, dispute or argument of the scheme shall be made
by the SLC. That therefore, any interpretation of the scheme made by
any officer of the Sales Tax Department of the State cannot be looked
into. The only power was that of the SLC to interpret any of the
provisions of the scheme and its decision can be said to be final. In
the instant case, denying the benefits of the scheme to the
petitioner society, SLC in its meeting dated 5.6.2007 clearly opined
that none of the members of the petitioner society is connected
with or engaged in the agricultural production of oil seeds and,
therefore, even though the petitioner society is a cooperative
society having solvent extraction plant, it is not entitled to the
incentive benefits. That this interpretation is final and given by
the authority empowered to interpret in the scheme itself. That while
exercising judicial review under Article 226 of the Constitution,
this Court cannot substitute its own interpretation that the
provision of the scheme should have been interpreted in the manner
requested by the petitioners. That subsequently, the cooperative
sector was removed as a whole from the purview of the scheme by
amendment dated 9.11.2005. That the interpretation of the scheme made
by the SLC in its 3rd meeting held on 5.5.2005 was
immediately conveyed to the petitioner society. That thus, the
petitioner society was conveyed right from the inception that it
would not be entitled to the said incentive benefits. That
therefore, in the instant case there is no question of any
promissory estoppel to be applied against the respondents.
4.1. Mr. Trivedi further
submitted that the scheme promulgated by the Government Resolution
dated 9.11.2001 is not a notification issued under any statutory
provisions and that therefore, the same cannot by any stretch of
imagination be considered to be a statutory instruction granting
exemption. That while interpreting any non-statutory instruction
like the present Government Resolution, the understanding of the
authority issuing such an instruction or the authority responsible
for executing the policy, propounded by such instruction, should
always be relied upon, as per the well established rule of
ýScontemporanea expositioýý. It is submitted that even otherwise
public interest requires that a cooperative society like the
petitioner society should not be allowed to earn the incentive
benefits of sales tax exemption since the same is not meant for such
a cooperative society. That the doctrine of promissory estoppel
shall not apply in the present case, but assuming without admitting
that doctrine of promissory estoppel is applicable, then in that case
also, such a direction would not be enforceable against the State
Government when it comes in the way of public interest, since public
interest has to prevail over the private interest. That in a
judicial review, this Court cannot sit in appeal over the decision of
the SLC regarding the interpretation of the scheme. This Court
cannot examine whether particular policy is desirable or not.
4.2. Mr. Trivedi further
submitted that admittedly the figures given in the ad-hoc eligibility
certificate in respect of capital investment made by the petitioner
society in its solvent extraction plant are figures supplied by the
petitioner society itself and no inquiry as regards its correctness
or otherwise has so far been made and, therefore, such figures should
not be presumed to be correct figures unless inquired into and
certified to that effect by the State authorities, which may have to
be done only in the event of the petitioner finally succeeding in
this petition. While concluding the arguments, Mr. Trivedi submitted
that none of the actions on the part of the State Government and its
authorities is violative of Article 14 of the Constitution and,
therefore, the petition does not survive. It would be in the public
interest to reject the petition since other cooperative societies
which have also applied during the pendency of the scheme for the
incentive benefits of sales tax exemption are waiting for the outcome
of the proceedings and that, therefore, grant of any relief in favour
of the petitioners would open up the flood gate and also would invite
huge burden on the State exchequer. Therefore, it is submitted that
the petition be rejected.
5. Considering the
petition as well as reply affidavit filed by Mr. G.C. Bhavsar, Under
Secretary to the Government of Gujarat, Industries and Mines
Department and the scheme dated 9.11.2001, the admitted fact is that
in the scheme it is nowhere expressly provided that so far as the
cooperative sector is concerned, only such cooperative sector having
farmers as its members can only avail of the benefits of the scheme.
Considering para. 3 of the scheme, definitions are given and while
defining ‘industrial enterprises’, ‘a legally registered cooperative
society’ is also included in the definition of ‘industrial
enterprises’. There is also no dispute that the petitioner no. 1
society is a registered society, registered and incorporated under
the Act. The petitioner no. 1 society was registered as such on
11.9.2003 under the Act. Annexure-C attached to the scheme contains
list of banned industries. Item no. 3 reads as under :-
ýS1. xxx xxx xxx xxx
2. xxx xxx xxx xxx
3. Solvent extraction of
oil from edible seed/edible oil cake processing and/or hydrogenation
or edible oil ( except in co-operative sector),
4 to 10. xxx xxx xxxýý
[emphasis supplied].
5.1. Thus, the solvent
extraction of oil from edible seed/edible oil cake processing and/or
hydrogenation of edible oil falls within the sweep of ‘banned
industries’ contained in Annexure-C, but the only exception is if the
unit dealing in such items is a cooperative sector, then such
cooperative sector will not fall within the purview of ‘banned
industries’.
6. There is no dispute
that before the petitioner no. 1 society commenced establishment of
its unit in Kutch district, on 25.9.2003, petitioner sought for
certain clarifications regarding its eligibility to get sales tax
exemption in accordance with the scheme and, therefore, an
application was forwarded by it to the concerned Department of the
State Government. The application was replied by the Deputy
Commissioner of Sales Tax [Legal], Government of Gujarat, on
10.11.2003, copy of which is produced at Annexure-E at page 63 along
with the petition. It is stated therein that although the industries
manufacturing products specified in item 2 and 3 referred to in
Annexure-C containing list of ‘banned industries’ attached to the
scheme dated 9.11.2001 fall within the purview of ‘banned
industries’, but if the unit is in cooperative sector, then
production by such cooperative sector cannot be construed as ‘banned
industries’. That the applicant [petitioner no. 1 ý society herein]
was engaged in manufacturing of Vanaspati [hydrogenated oil],
Soyabean oil, edible refined oil and allied products which
commodities prima-facie fall under the list of banned industries as
specified in Annexure-C to the scheme dated 9.11.2001, but if the
products specified in item 2 and item 3 of the list are manufactured
by a unit which is in a cooperative sector, then such unit shall
not be construed as banned industries. Thus, the query raised by the
petitioner society regarding applicability of the provisions of the
scheme to the petitioner society was satisfactorily replied by the
competent authority of the State Government and the petitioner
society was held to be entitled to the benefits of the scheme.
7. In the rejoinder
affidavit, much is said that as per the scheme only the SLC is
competent to interpret any of the provisions of the scheme as per
para. 9 of the scheme and, therefore, any interpretation of the
scheme arrived at by any authority of the State other than the SLC
shall have to be ignored. Perusing para. 9 contained in the scheme,
it is true that SLC is authorized to interpret any provision
contained in the scheme. In the instant case, considering Annexure-E
page 63 annexed with the petition, clarificatory application of the
petitioner was replied by the Deputy Commissioner of Sales Tax
[Legal], Government of Gujarat vide its letter dated 10.11.2003. The
matter pertains to the scheme regarding the sales tax exemption and
the reply was given by none other than the competent authority of the
Sales Tax Department of the State itself. The concerned Deputy
Commissioner of the Sales Tax Department interpreted the scheme as it
is revealed by the bare reading of the scheme itself and reproduced
only certain averments made in the scheme as well as in item no. 2
and item no. 3 in Annexure-C containing list of banned industries. We
need not repeat here the relevant contents of Annexure-C attached to
the scheme, but suffice it to say that solvent extraction of oil from
edible seed/edible oil cake processing and/or hydrogenation of edible
oil fall within the purview of banned industries, but the only
exception is a cooperative sector. In other words, cooperative
sector manufacturing products as specified above cannot be
construed as banned industries.
8. Ld. Advocate General
Mr. Trivedi for the respondents relied upon a case of Bavishi &
Sons v/s. State of Gujarat reported in 1992 Sales Tax Cases page
161, wherein this Court, in a sales tax reference pertaining to
certain order passed by the Deputy Commissioner, Sales Tax, in a
particular assessment period, observed as under :-
ýSEach assessment period
is distinct and a decision in respect of one cannot operate as res
judicata in respect of another period. Therefore, the determination
of the rate of tax payable on a particular sale, on an application
made to the Deputy Commissioner under section 62 of the Gujarat Sales
Tax Act, 1969, would not be final for all time to come.ýý
There cannot be any
dispute regarding the principle established by this Court in this
ruling. However, the facts of our case are totally different. As
stated above, by way of caution, before setting up the unit,
petitioner sought for clarification regarding the applicability of
the scheme. The query was replied by the competent authority of the
Sales Tax Department itself. It is true that as per para. 9 of the
scheme, SLC is the final authority to interpret any provision of the
scheme. However, as stated above, the competent authority, who
replied the query did nothing more than reproducing certain
averments made in the scheme as well as in the list attached to the
scheme containing list of banned industries. Therefore, there is no
question of interpretation of any of the provisions of the scheme.
Despite this, if at all the competent authority who replied the
query of the petitioner felt that some interpretation was required to
be made pertaining to any provision of the scheme, then before
replying the query, said authority could have referred the matter to
the SLC. Since nothing whatsoever was done and the query was replied
in the form of only reproduction of certain clauses contained in the
scheme and contained in the list of banned industries. As there was
no question of interpreting any of such provisions, instead of
referring the matter to SLC, the competent authority of the Sales Tax
Department itself thought it fit to reply the query. Therefore,
for such act of the competent authority of the Sales Tax Department,
can the petitioner society be blamed?
9. Perusing the reply
affidavit, it transpires that the only short controversy which is
involved in this petition is as to whether such cooperative sector
should be consisting of farmers as its members or not. According to
the stand taken by the respondents, it is submitted that it is not
sufficient that any cooperative sector is entitled to the exemption
from the sales tax, but it is further qualified that only such
cooperative sector having farmers or agriculturists as its members,
then only such cooperative sector is entitled to the exemption of
sales tax dealing in the production of solvent extraction of oil from
edible seed/edible oil cake processing and/or hydrogenation of edible
oil. Therefore, the question of controversy centers round the
objectives sought to be achieved by the scheme itself. Whether the
scheme was promulgated by the State for any agrarian reforms? Or
whether the scheme was promoted for industrialization?
10. To reply this, it is
necessary again to consider the opening paragraph of the scheme dated
9.11.2001, copy annexed at Annexure-C at page 38/1 with this
petition. The very reason for launching the scheme was the
devastating earthquake occurred on 26.1.2001 which caused
comparatively serious damage in the district of Kutch. Therefore, it
is stated that the entire financial activities of Kutch district came
to a standstill. The State Government thought that new employment
opportunities could be created if new investment takes place. The
State Government was committed to attracting industries in Kutch
district to make the industrial and economic environment live.
Reference was also made to certain steps which were taken by the
Government of India and it is stated that Government of India has
announced excise duty exemption for new industries to promote large
scale investment in Kutch district. Therefore, the State Government
has also decided to announce the scheme of sales tax incentives.
Since the scheme was aimed at making economic environment of Kutch
district live, it has been decided to confine the same only to Kutch
district.
10.1. Therefore, it can
very well be said that the object of the scheme was to create new
employment opportunities and that object can be achieved if new
investment takes place. By giving such sales tax incentives, the new
investment can be attracted to and thereby the industrial and
economic environment in Kutch district would become live. Therefore,
neither in the preamble of the scheme nor in the entire incentive
scheme, there is any mention of giving the benefit only to
cooperative societies of farmer members. Further it is pertinent to
note that as submitted by Ld. Senior Counsel Mr. Nanavati for the
petitioners, if the object behind introducing the scheme was
agrarian reform as suggested by the respondents, then the respondents
could have introduced suitable amendment in the scheme as well as in
the list of ‘banned industries’ attached to the scheme to the effect
that the cooperative sector should be such having only farmer
members. That nothing whatsoever was done, but on the contrary, by
resolution dated 9.11.2005 [Annexure-M-1 at page 87/B annexed with
the petition], the scheme was amended and the words mentioned at
serial nos. (2), (3) and (5) in the list of ‘banned industries’
attached to the scheme ýSexcept in cooperative sectorýý were
deleted. Thus, the cooperative sector itself was deleted by the
amendment dated 9.11.2005. However, the amendment was operative
with immediate effect i.e., from 9.11.2005 and onwards. How far this
amendment would concern to the petitioners shall be discussed
hereafter in this judgment, but in context with the present
discussion as to whether the object behind introducing the scheme
was to promote such cooperative sector having farmer members or not,
it would be pertinent to note that the State Government deleted the
entire cooperative sector by introducing the amendment dated
9.11.2005. Thus, instead of making suitable amendment in the scheme
by further qualifying the cooperative sector having farmer members
only, the entire cooperative sector was deleted out from the purview
of the scheme. Therefore, if at all the object behind introducing the
scheme was to promote cooperative sector having only farmer members
as suggested by the respondents, then suitable amendment to that
effect would have been carried out in the scheme. But here is a case
wherein on one hand the respondents interpreted the words
‘cooperative sector’ as such sector having farmer members only and
on the other hand by subsequent amendment the cooperative sector
as a whole has been deleted out from the purview of the scheme.
Therefore, this amendment, which is subsequently carried out in the
scheme, acts counter to the arguments advanced by the respondents
that the object of the scheme was to promote cooperative sector
having farmer members and certain agrarian reforms.
10.2. Ld. Advocate
General Mr. Trivedi for the respondents relied upon a case of Hind
Plastics v/s. Collector of Customs, Bombay reported in [1994] 5
S.C.C. Page 167. In para. 17 of said judgment it is observed as
under about interpretation of statutes and legislative intent :-
ýS17. In this
connection, it is well to remind ourselves that every instrument,
statutory or otherwise, has to be so interpreted as to accord with
the intention of its maker having regard to the language used. True,
one cannot ignore the actual words used and go after the supposed
intention of the maker ý as pointed out in Hansraj Gordhandas v.
H.H. Dave, Assistant Collector of Central Excise and Customs ý
since that would amount to entering the arena of speculation but all
the same the principle is unexceptionable that whether it is statute,
statutory instrument or an ordinary instrument, the interpretation
placed has to accord with the intention of the maker as evidenced by
the words/language used. The decision in Hansraj Gordhandas
does not lay down any contrary proposition.ýý
10.3. Thus, according to
the ratio laid down in this case by the Hon’ble Apex Court, it is
true that every instrument, statutory or otherwise, has to be so
interpreted as to accord with the intention of its maker, but at the
same time such interpretation has to be arrived at having regard to
the language used. It has also been observed by the Hon’ble Apex
Court that one cannot ignore the actual words used and go after the
supposed intention of the maker. In the present case on hand, as
discussed in detail above, considering the plain language used in the
scheme, there is nothing that the words ‘cooperative sector’ are
defined as the sector having only farmer members. Needless to say
that the arguments advanced by the respondents that the object and
intention of the scheme was to promote cooperative sector having
farmer members only go contrary to the subsequent amendment carried
out in the scheme by deleting the words ýScooperative sectorýý as a
whole from the scheme. The plain reading of the scheme, as discussed
above, would clearly establish that the main object or intention of
the scheme was to create new employment opportunities in Kutch
district by attracting industries to be established in the district
and thereby to make the industrial and economic environment live in
Kutch district. Therefore, the principle established in the case of
Hind Plastics [supra] does not help the respondents considering the
facts of our case.
10.4. Mr. Trivedi, Ld.
Advocate General relied upon a case of State of Karnataka v/s.
Balaji Computers reported in [2007] 2 S.C.C. Page 743. In
the said case, the State of Karnataka issued certain notification
under the Karnataka Sales Tax Act, 1957 regarding certain tax
exemption wherein ýScomputer and parts of computer peripheralsýý
was the subject matter of controversy. Hon’ble the Apex Court held
that the parts of computer and parts of computer peripherals were
covered and, therefore, stand exempted from turnover tax. In para.
39 the Hon’ble Apex Court observed as under :-
ýS39. This Court in K.
P. Varghese v. ITO while considering the binding nature of the
circulars issued by the Central Board of Direct Taxes on the
Department, has also observed that the rule of construction by
reference to contemporanea expositio is a well-established rule for
interpreting a statute by reference to exposition it has received
from contemporary authorities, though it must give way where a
language of the statute is plain and unambiguous. …….ýý
10.5. Thus, though the
Hon’ble Apex Court observed that contemporanea expositio is a well
established rule for interpreting the statute by reference to
exposition it has received from contemporary authorities, it is
further observed that it must give way where a language of the
statute is plain and unambiguous. IN the case on hand, as stated
above, there is no ambiguity whatsoever in the language used in the
scheme dated 9.11.2001. Cooperative sector simplicitor is made
eligible for avail of the incentive benefits. The object behind
introduction of the scheme was to create new employment opportunities
by attracting new investment by giving incentives to certain
industries referred in the scheme including the cooperative sector.
Thus, in the present case on hand, there is nothing that there is any
ambiguity or any confusion in any of the words used in the scheme
which will require any further interpretation. What is required to be
read is the plain language used in the scheme.
11. Ld. Senior Counsel
Mr. Nanavati for the petitioners relied upon a case Hansraj
Gordhandas v/s. H.H. Dave, Assistant Collector, Central Excise and
Customs, Surat, reported in AIR 1970 S.C. 755. In that case,
certain notification was issued under the Central Excise Rules, 1944,
granting exemption from excise duty on cotton fabrics. As revealed
from the plain reading of said notification, for claiming exemption
the cotton fabrics must be produced on power-looms owned by a
cooperative society. However, the Customs Department intended to
interpret the notification in the manner that such cotton fabrics
should be produced by cooperative society ýSfor itselfýý. On
behalf of the Customs Department it was also argued that the object
of granting exemption was to encourage the formation of cooperative
societies which not only produced cotton fabrics, but which also
consisted of members, not only owning but having actually operated
not more than four power looms during the three years immediately
preceding their having joined the society. The Hon’ble Apex Court
observed in para. 5 of the judgment as under :-
ýS ………… We are
unable to accept the contention put forward on behalf of the
respondents as correct. On a true construction of the language of
the notifications dated 31 July, 1959 and April 30, 1960 it is clear
that all that is required for claiming exemption is that the cotton
fabrics must be produced on power-looms owned by the co-operative
society. There is no further requirement under the two notifications
that the cotton fabrics must be produced by the Co-operative Society
on the power looms ýSfor itselfýý. It is well established that in a
taxing statute there is no room for any intendment but regard must
be had to the clear meaning of the words. The entire matter is
governed wholly by the language of the notification. If the tax-payer
is within the plain terms of the exemption it cannot be denied its
benefit by calling in aid any supposed intention of the exempting
authority. …..ýý
11.1. Almost identical
is the factual scenario in our case. In Hansraj Gordhandas [supra],
the Department wanted to interpret the words ýScooperative societyýý
as such having produced cotton fabrics ýSfor itselfýý. As per the
notification the only requirement was that the cotton fabrics must
be produced on power looms owned by the cooperative society. The
production may be ýSfor itselfýý or for any third party.
Interpreting language used in the notification, the Hon’ble Apex
Court held that the cotton fabrics must be produced on power looms by
the cooperative society and there was no further requirement under
the notification that the cotton fabrics must be produced by the
cooperative society on power looms ýSfor itselfýý. The Hon’ble Apex
Court, therefore, held that in a taxing statute there is no room for
any intendment but regard must be had to the clear meaning of the
words. That the entire matter is governed wholly by the language of
notification. Therefore, ultimately the Hon’ble Apex Court held that
if the tax payer is within the plain terms of the exemption, it
cannot be denied its benefit by calling in aid any supposed intention
of the exempting authority. Under such circumstances, in our case,
the plain reading of the scheme clearly reveals that the only
requirement for exemption is that the unit must be cooperative sector
and nothing more. There cannot be any supposed intention as
suggested by the respondents that such cooperative sector must be
ýShaving farmer members only.ýý
12. Therefore, in the
nut-shell, the scheme is required to be considered in accordance with
the language used in the scheme. Hence the words ýScooperative
sectorýý should be considered in accordance with their plain
meaning. Under such circumstances the report of the SLC stating that
out of the total 215 members of the petitioner no. 1 ý cooperative
society, 117 members are businessmen, 87 members are doing job, 5
members are housewives, 4 members are professionals, 1 member is
retired person and only 1 member is agriculturist and, therefore,
the petitioner society is not entitled to the sales tax incentives,
cannot be accepted as a correct interpretation of the scheme. In the
scheme nothing whatsoever is mentioned about the qualification of a
member of the cooperative society made eligible for the sales tax
incentives.
13. It is pertinent to
note that the genuineness of the petitioner no. 1 ý cooperative
society was also doubted by the respondents. Thorough investigation
was carried out by the respondents. Verification was made as to
whether the said cooperative society is constituted only for getting
the benefit of the benevolent scheme by any big industry or not.
Detailed report was prepared and as per the agenda note regarding the
meeting no. 8 of the SLC dated 3.8.2006, copy produced at Annexure-S
at page 112/1 with the petition, it was observed that during the
inquiry nothing had come-out against the genuineness of the
petitioner society or that it was established and backed by any big
industrial unit so as to get the benefit of the scheme. Under such
circumstances, by this report itself it becomes clear that the
petitioner society was genuinely formed society and was not backed by
any big industrial undertaking only with a view to illegally or
improperly get benefit of the scheme.
14. Perusing the papers
produced along with the petition, it transpires that even in past
the petitioners were constrained to file petition in this Court.
Considering the copy of order dated 4.10.2005 passed in Civil
Application No. 9355 of 2005 in Special Civil Application No. 13040
of 2005, this Court observed that Joint Industries Commissioner
[Sales Tax] and Industries Commissioner had assured this Court that
preferably by 31.8.2005 the orders regarding entitlement of the
present petitioner would be passed. Despite such assurance, nothing
whatsoever was done and, therefore, the present petitioners had to
prefer Civil Application No. 9355 of 2005. Hence in para. 4 of the
said order dated 4.10.2005 this Court ordered that the petitioner
would be entitled to enter into commercial production without payment
of any sales tax till final disposal of the writ petition [Special
Civil Application No. 13040 of 2005]. Ultimately, Special Civil
Application No. 13040 of 2005 came to be disposed of by this Court by
order dated 28.10.2005 [copy annexed at Annexure ý M at page 86].
Considering para. 3 of said order, it transpires that Mr. Agrawal,
Industries Commissioner and Mr. Mehta, Joint Commissioner ý
Industries stated that the eligibility certificate shall be issued
in favour of the present petitioners latest by 11.11.2005. They also
submitted that after issuing eligibility certificate, the
petitioners, in accordance with the scheme, may make an application
for grant of permanent certificate to the SLC and the SLC in its
discretion may pass final orders. Ld. Advocate General submitted that
earlier order passed by the Committee may be ignored and the
authorities be allowed to proceed in the matters, as suggested by
them. Accordingly, the petition was disposed of with direction that
latest by 11.11.2005 the Industries Commissioner shall issue
necessary eligibility certificate and thereafter the parties would be
entitled to proceed in accordance with law and the rule was made
absolute. Thus, it is pertinent to note that as per the assurance
given by the competent authorities of the State Government, the
eligibility certificate in favour of the petitioners was stated to be
issued by 11.11.2005 with further assurance that the earlier order
passed by the SLC shall be ignored and the authorities shall proceed
in the matters as suggested by them. Ld. Senior Counsel Mr. Nanavati
for the petitioners submitted that the said order has become final
and was not challenged by the respondents before the Hon’ble Apex
Court. Upon unconditional statements made by the competent
authorities, this Court disposed of said Special Civil Application
No. 13040 of 2005 on 28.10.2005.
15. Perusing the papers
produced along with the petition and more particularly Annexure-O at
page 89 being copy of eligibility certificate for sales tax incentive
dated 11.11.2005, it is certified that the petitioner no. 1 M/s.
Bharat Foods Coop. Ltd., has started new unit at Mithi Rohar in
Taluka Gandhidham, Dist. Bhuj for sales tax incentives under the
scheme. It is further clearly mentioned that the unit has commenced
commercial production from 22.10.2005. The marketable items produced
by the unit are ‘refined edible oil’. It is further stated in para.
5 of the certificate that this eligibility certificate is effective
for the period from 22.10.2005 to 21.10.2012. However, in para. 4 of
said certificate, it is stated that this certificate is issued
provisionally at the rate of 25% of its tentative eligibility since
the detailed verification of the assets is to be carried out. Thus,
the eligibility certificate was issued on 11.11.2005. On behalf of
respondents it was submitted that since the certificate was issued
pursuant to the direction issued by this Court, therefore it was
issued provisionally and on ad-hoc basis. However, there is nothing
mentioned in the certificate that it is issued subject to the
directions issued by this Court vide order dated 28.10.2005 passed in
Special Civil Application No. 13040 of 2005. On the contrary, as
stated above, considering the said order dated 28.10.2005 the
competent authorities stated before this Court that the eligibility
certificate shall be issued on or before 11.11.2005. Relying upon the
statements of the competent authorities, the above Special Civil
Application came to be disposed of. However, considering para. 4 of
the eligibility certificate, it clearly transpires that since the
detailed verification of assets of the petitioner no. 1 society was
yet to be carried out and, therefore, on the basis of the figures of
the assets provided by the petitioner, the certificate was issued
provisionally at the rate of 25% of its tentative eligibility. Ld.
Senior Counsel Mr. Nanavati submitted that nothing prevented to the
respondents till date to carry out detailed verification of assets,
but even after issuance of eligibility certificate dated 11.11.2005
vide impugned directive dated 6-8.6.2007 as per the decision taken by
SLC in its meeting dated 5.6.2007, the incentive benefits to the
petitioner was denied solely on the ground that the members of the
petitioner society are not farmers.
15.1. However, the
important aspect which emerges from the eligibility certificate dated
11.11.2005 is that the respondents accepted the factual position that
the petitioner unit has commenced the commercial production from
22.10.2005. As observed earlier in this judgment, with effect from
9.11.2005 the respondent – State amended the scheme by deleting the
words ýScooperative sectorýý from the list of banned industries
attached to the scheme. However, while refusing the benefits of the
scheme to the petitioners, considering the letter dated 6-8.6.2007
addressed to the petitioner by the Additional Industries Commissioner
and Member Secretary, SLC, the only reason for denying the benefit of
the scheme to the petitioner assigned is that the members of the
petitioner society are not farmer members. The benefit is not denied
on the ground that by virtue of the resolution dated 9.11.2005
regarding the amendment in the scheme, now the cooperative sector as
a whole came to be deleted and, therefore, the petitioners are not
entitled to the incentive benefits. As stated earlier, considering
the resolution dated 9.11.2005, it is clearly stated that the
amendment in the scheme regarding deletion of cooperative sector as a
whole from the purview of the scheme shall be implemented with
immediate effect, meaning thereby from 9.11.2005 and thereafter. As
stated above, in our case the petitioner society had applied for the
tax exemption and for registration under the scheme on 16.9.2004.
Thus, when the petitioner society applied for the registration under
the scheme, there was no such amendment and the amendment was
subsequently made on 9.11.2005. Moreover, no retrospective effect was
given to the resolution dated 9.11.2005 carrying out amendment in the
scheme. Prospective effect was given to the amendment. Under such
circumstances, it can very well be said that since the petitioner
society had applied much earlier from 9.11.2005 for registration
under the scheme, it can very well be said that the said resolution
containing the amendment is not applicable to the case of the
petitioner society. When such is the situation, we are of the opinion
that it is not necessary to enter into arena of discussion as to
whether the amendment dated 9.11.2005 resolved by the respondents can
be said to be illegal, improper and violative of any of the
fundamental rights of the petitioner or not since the case of the
petitioner is required to be adjudicated in accordance with the
scheme which was in effect at pre-amendment stage. Even considering
the letter ý Annexure ý Q at page 96/1 produced along with the
petition, addressed to the petitioner by Commissioner for Industries
dated 6.12.2005 and in the letter it is clearly stated that the
petitioner unit has been registered from 29.10.2005 for motivation of
sales tax incentives. Under such circumstances, not only the
petitioner society had applied for registration under the scheme
before the date of amendment, but even the petitioner society was
registered under the scheme with effect from 29.10.2005, which is
also before the date of the amendment in the scheme.
16. Ld. Senior Counsel
Mr. Nanavati for the petitioners relied upon a case of MRF Ltd.,
Kottayam v/s. Asstt. Commissioner [Assessment], Sales Tax
reported in [2006] 8 S.C.C. 702. According to the facts of said
case, certain sales tax exemption was granted by notification, but
subsequently by subsequent notification the earlier exemption
notification came to be amended. The question of applicability of
principle of promissory estoppel against the State and the doctrine
of legitimate expectation arose in said case. As per the initial
notification granting exemption for expansion in the manufacture of
certain products including rubber based goods, the appellant started
commercial production after investing huge amount. Eligibility
certificate was also obtained by said appellant from the competent
authority. Exemption certificate was also granted for a fixed period
of 7 years. In the eligibility certificate the date of commencement
of the production was specifically stated. During the currency of
the period of exemption, the State Government issued amendment
notification excluding the formation of a compound rubber from the
definition of ýSmanufactureýý for the purpose of the original
exemption notification. The Hon’ble Apex Court held that in such
circumstances the enforcement of the said subsequent notification
from the date of issuance thereof to the assessee manufacturer in the
present case was barred by the principle of promissory estoppel as
well as by doctrine of legitimate expectation. Moreover, such
premature deprivement to the assessee manufacturer of the benefit of
excise was held to be arbitrary, unjust, unreasonable and violative
of Article 14 of the Constitution of India. One important aspect
which emerges perusing said case is that on behalf of the respondents
Assistant Commissioner, it was submitted before the Hon’ble Apex
Court that section 10(3) of the Kerala General Sales Tax Act enabled
the State to withdraw or cancel any exemption even retrospectively.
It was also submitted that where public interest was involved, no
rule of estoppel could bind the Government. The Hon’ble Apex Court
observed that commercial production of the appellant had already
commenced prior to the date of subsequent notification. That by
virtue of the certificate of eligibility, the appellant ý MRF Ltd.,
had acquired right to avail tax exemption for a fixed period of 7
years from 30.12.1996 to 29.12.2003 in respect of products
manufactured from raw rubber including compound rubber. That in the
eligibility certificate the date of commencement of the production
was stated to be 30.12.1996. Thus, the Government itself had
recognized that the benefit of tax exemption for the fixed period of
7 years would remain available to the units which had fulfilled the
prescribed conditions and had obtained the eligibility certificate,
etc., and had commenced commercial production before the date of any
amendment. It was observed that the principle underlying legitimate
expectation was based on Article 14 of the Constitution.
17. Considering the
facts of our case, it is clear that the petitioner society had
applied for registration on 16.9.2004. The petitioner unit was
registered with effect from 29.10.2005. In the eligibility
certificate issued in favour of the petitioner, it is clearly stated
that the petitioner unit commenced commercial production from
22.10.2005. It is further stated in para. 5 of the eligibility
certificate that this eligibility certificate was effective for the
period of 7 years from 22.10.2005 to 21.10.2012. However, the
resolution regarding the amendment was subsequently passed on
9.11.2005. Thus, the facts and circumstances of our case are almost
identical to the facts and circumstances of the case of MRF Ltd.
[supra]. Under such circumstances, it can very well be said that the
said resolution of amendment is not applicable to the case of the
present petitioners.
18. Ld. Advocate General
Mr. Trivedi for the respondents submitted that it would be in public
interest to reject the petition since other cooperative societies
which have also applied during the currency of the scheme for the
incentive benefits of sales tax exemption, are waiting for the
out-come of this proceedings and that, therefore, grant of any relief
in favour of the petitioners would open up the flood gate and also
would invite huge burden on the State exchequer. In this respect so
far as the present petition is concerned, we have observed that the
language used in the scheme shall have to be considered in its true
perspective. We need not repeat here the entire above discussion,
but suffice it to say that the reasons assigned by the State
Government in refusing to grant the sales tax exemption to the
petitioner society that there are no farmer members in the society
and, therefore, the benefits are not admissible to the petitioner
society, cannot be accepted. Such decision of the State Government
can very well be said to be illegal, arbitrary, discriminatory and
violative of Article 14 of the Constitution of India. Even such
decision can be said to be contrary to the averments made in the
scheme itself. No detailed particulars are supplied by the
respondents as to how many other cooperative societies have been
denied the benefits of the scheme. Of-course, there may not be any
relevance in this petition of such details for the simple reason that
each case has to be decided on its own merits.
19. In the result, the
decision taken by the State Level Committee ý respondent no. 3 in
its meeting dated 5.6.2007 [Annexure-Y page 140/1 annexed with the
petition] and conveyed to the petitioner no. 1 society by the
Additional Industries Commissioner and Member Secretary, State Level
Committee, vide its letter dated 6-8.6.2007 [Annexure-A page 23/1
annexed with the petition], is hereby quashed and set aside; and
the petitioner no. 1 society is hereby held to be entitled to the
sales tax exemption in accordance with the scheme of the State of
Gujarat, respondent no. 1, titled as ýSIncentive Scheme 2001 for
Economic Development of Kutch Districtýý dated 9.11.2001.
It is hereby declared
that the resolution dated 9.11.2005 passed by Section Officer, Mines
and Industry Department of the State of Gujarat, pertaining to the
amendment in the scheme [Annexure- M/1 page 87/B annexed with the
petition] is not applicable to the case of the present petitioner no.
1 society. However, the entitlement of the petitioner no. 1 society
to get the benefits of the ýSschemeýý is subject to strict
compliance of all the terms and conditions laid down in the said
scheme dated 9.11.2001 as well as subject to the strict compliance of
the terms and conditions laid down in eligibility certificate for
sales tax incentives dated 11.11.2005 and in the annexure attached to
said certificate [Annexure ý O pages 89 to 91 annexed with the
petition], by the petitioner no. 1 society. The respondent no. 1 ý
State through its competent authority is empowered to carry out due
enquiry for detailed verification of assets of the petitioner no. 1
society as referred to in para. (4) of the eligibility certificate
for sales tax incentives [Annexure ý O referred above]. The sales
tax exemption benefits which the petitioner no. 1 society shall be
entitled to get in accordance with the ýSschemeýý and the
ýSeligibility certificateýý referred to above, shall be subject to
the adjustment of any such benefits, the petitioner no. 1 society
received in pursuance of any interim orders passed by this Court.
Special Civil
Application No. 15730 of 2007 is allowed to the aforesaid extent.
Rule made absolute accordingly.
20. The petitioner filed
Special Civil Application No. 19369 of 2006 on 14.8.2006 mainly
challenging the resolution pertaining to the amendment of the scheme
passed by the respondent no. 1 State Government dated 9.11.2005. As
discussed in detail in this judgment above, after such petition was
filed, the exemption certificate was issued in favour of the
petitioner society on 13.11.2005. We have also discussed in this
judgment that the resolution regarding amendment of the scheme dated
9.11.2005 cannot be made applicable to the case of the present
petitioner society. In short, in view of the detailed discussion made
in this judgment, according to our opinion, the Special Civil
Application No. 19369 of 2006 does not survive. Hence it is disposed
of accordingly.
(
Y. R. MEENA, C.J.)
(
J .C. UPADHYAYA, J. )
*Pansala.