Bombay High Court
M/S Graphite India Limited And Anr vs The State Of Maharashtra on 24 January, 2017
Author: S. C. Dharmadhikari
Bench: S.C. Dharmadhikari, B.P.Colabawalla
904.wp.2517.16.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 2517 OF 2016
M/s Graphite India Limited and Another ..Petitioners
Vs.
The State of Maharashtra ..Respondent
Mr. Prakash V. Surte a/w Mr. Subhash P. Surte, for the
Petitioners.
Mr. V. A. Sonpal, Special Counsel a/w Ms. Jyoti Chavan
Asst.Govt. Pleader, for the Respondent.
CORAM :- S.C. DHARMADHIKARI &
B.P.COLABAWALLA , JJ.
DATE :- JANUARY 24, 2017.
ORAL JUDGMENT (Per. S. C. Dharmadhikari, J.)
Rule. Respondent waives service. By consent, rule made returnable forthwith.
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904.wp.2517.16.doc
2 By this Writ Petition under Article 226 of the
Constitution of India, the Petitioners are seeking a direction to the State Government, firstly to issue a Notification to amend Rule 31B in the same manner as amended Rule 31AA and remove a discrimination which according to them is to be found between similarly situated industrial units. The Petitioners claim that they are entitled to the same benefits and which would accrue to them in the event their request is granted.
3 Alternatively, it is prayed that two Notifications dated 1st November, 2004 be declared as ultra-vires Article 14 of the Constitution of India.
4 The Petitioners claim these reliefs on the footing that Petitioner No.1 is a public limited company and engaged in the business of manufacture and sale of Graphite Electrodes. It is registered under the Bombay Sales Tax Act, 1959 ("BST Act") and holds a registration certificate. It also holds a registration certificate under the Central Sales Tax Aswale 2/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc Act, 1956. It is situated in the backward area of the State. Hence, the State Industrial and Investment Corporation of Maharashtra Limited ("SICOM") granted an Eligibility Certificate dated 12th February, 2002 under the Package Scheme of Incentives, 1993 valid for a period from 1 st April, 2002 to 31st March, 2007 with sales tax incentive for Rs.990.90 Crores for manufacture of Electrodes. Pursuant to this certificate, the Deputy Commissioner of Sales Tax, Maharashtra State, Mumbai issued an Entitlement Certificate dated 18th March, 2002 effective from the above dates. The eligible industrial unit has to exercise an option to claim exemption from payment of sales tax or deferral of tax collected which is required to be paid after 10 years. The Petitioners opted for deferral and in terms of Rule 31B of the Bombay Sales Tax Rules, 1959. The Petitioners claimed deferral of total tax payable as per the returns filed from 1st April, 2002 onwards.
5 For the year / period from 1st April, 2003 to 31st March, 2004, the first Petitioner was assessed by the Deputy Aswale 3/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc Commissioner of Sales Tax, Nasik Division, Nasik. He passed an assessment order dated 26th March, 2009. It is claimed by the Petitioners that in the said unit and during this period in addition to the sale of Electrodes manufactured by them, they sold Duty Entitlement Pass Book ("DEPB") licenses granted to them as and by way of incentives for the export of Electrodes. The said licenses could be sold to another exporter who could utilize them for payment of import duty. The sales of DEPB were to the tune of Rs. 1,69,90,203/- and the tax thereon at Rs. 10,02,422/- was shown as payable. The payment thereof was deferred. However, the Assessing Officer did not allow deferral in respect of the tax on DEPB. In addition to the tax, he charged interest under Section 36 (3) (b) and issued a notice of demand for Rs. 38,61,622/-. He also passed an assessment order under the Central Sales Tax Act, 1956 for the same period and rejected the claim for deferral of Central Sales Tax in respect of inter-State sales of DEPB to the tune of Rs. 2,84,08,414/- and charged interest under Section 9(2) read with Section 36 (3) (b) of the Act. That is how he issued a notice of demand for Rs. 20,14,134/-. Aswale 4/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc 6 Being aggrieved by these orders, Appeals were preferred to the Joint Commissioner. However, he dismissed these Appeals on 30th June, 2015 but modified certain tax demands.
7 Thereafter, further Appeals were preferred before the Tribunal and during the course of arguments, it was submitted before the Tribunal that the State Government on 1st November, 2004 issued a Notification and amended Rule 31AA of the Bombay Sales Tax Rules, 1959 ("BST Act"), by adding an Explanation with effect from 1st April, 1997. Thus, that Explanation enables those who claim exemption from duties under similar package scheme of incentives on sale of DEPB to claim certain benefits and in terms thereof. 8 Similarly, another Notification was issued on 1st November, 2004, in exercise of the powers conferred by Section 41 (1) of the BST Act. By this Notification, Entry 3 of Group-E of the Schedule was amended by inserting Explanation-V with effect from 1st April, 1997. For the Aswale 5/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc purpose of sub-Entries 2 and 3 certain words were added. 9 It is in the light of these two Notifications, the Petitioners contended that they have similarly situated industrial units. Merely because the amendment appeared by way of Explanation-V, it does not mean that it was applicable only to dealers holding Eligibility Certificates and opting for exemption. The industrial units like the Petitioners who opted for deferral could not have been excluded. Their exclusion is arbitrary and discriminatory. Though these submissions were rejected by the Tribunal and the Appeals of the Petitioners were dismissed, it is stated that the Tribunal at the instance of the present Petitioners referred for opinion of this Court the issue of discrimination as projected in the present Petition.
10 However, the Petitioners having been advised on the basis of the information obtained under Right to Information Act, 2005 to file substantive proceedings that in this Writ Petition the afore referred reliefs are claimed. Aswale 6/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc 11 Mr. Surte, learned counsel appearing on behalf of the Petitioners would submit that the Petitioners have pointed out from the Notification that the differentiation is clearly arbitrary. That has no nexus with the object sought to be achieved. The object that is sought to be achieved is to encourage industries to set up their units in backward areas. The purpose is to grant them benefits and incentives so that they set up such units. The benefits that accrue to such units are in terms of payment of the applicable taxes. Either the unit can claim exemption or deferral. However, in the instant case according to Mr. Surte, the Eligibility Certificate holders who have opted for exemption and those who have opted for deferral are both dealing with the DEPB. That DEPB licence itself has been sold and by both of them. However, the DEPB is declared as "finished product"
exempted in the hands of the industrial units who opt for exemption. But that DEPB is treated as taxable in the hands of the dealers who opted for deferral. This discrimination is, therefore, apparent. The classification as purportedly made Aswale 7/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc has no nexus with the object sought to be achieved. For any classification to be justified, it must have such nexus and those grouped in and those left out ought to be on an intelligible differentia and which can be ascertained from the classification itself. In the instant case, there is no such intelligible differentia. Therefore, both units which are equally placed in every manner, cannot be differentiated and discriminated. This is a clear case of hostile discrimination, and therefore, the mandate of Article 14 of the Constitution of India is flouted.
12 There is an affidavit-in-reply filed on behalf of the Respondent and in which in paragraphs 5 and 6, this is what is stated:-
"5.I say that if the prayers are perused, it will be clear that are not capable of being granted. The prayer Clause (a) seeks direction to the Government to issue Notification and amend Rule 31AA. The rules and Notification are delegated legislation and have the colour of law. The Honorable Court cannot in writ jurisdiction direct the State to make a law or issue Notification. In absence of any provision permitting deferment of the sales tax on DEPB License sales as per Section 38 of the BST Act Rule or Rule 31B or any notification Aswale 8/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc for treating the sales of DEPB License as manufactured goods in law relating to deferral benefit of deferral cannot be granted. So far the quashing to the Notifications dt 1.11.2004 on the ground of violation of fundamental provisions (sic rights) the elaborate submissions explainaing that it is not warranted is mentioned in ensuing paragraphs.
6. I say that the notification No. SAT 1104/CR-38-A/Taxation- 2 dt 1.11.2004 is "finished product" for which exemption is notified by entry E-3 shall mean and include the "Duty Entitlement Pass Book" which is earn by the dealer by exporting out of territory of India the goods manufactured in the eligible unit. The effect of the notification is that the DEPB itself is goods manufactured and if dealer sells the same it will be exempted from sales tax. The Notification Entry E 3 is for exemption in which case no tax comes to treasury from sale of goods in eligible unit. It cannot be equated with deferral unit where the eligible unit collects the tax and defers payment by 10 years payable in six yearly installments. There is no escape from payment of tax by the deferral unit. It is different class by itself. Therefore when two categories are different classes, rule of extending benefit to incentive differently cannot be said to be discriminatory or violative of Article 14. The classification is reasonable and rational. Not extending the benefit to deferral unit for treating DEPB License is conscious decision based on intelligible differentials. In the matter of taxation there is larger latitude permissible for classification and State can choose whom to tax and whom not to tax in the best interest of the State. There is no scope for judicial review as held in the case of Amin Merchant v/s Chairman CBER (AIR 2016 SC 392) in decision of the Supreme Court on 22/07/2016. The same view Aswale 9/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc is held after examining various authorities in case of Associated Cement Companies v/s Government of A. P. 2006 (1) SCC 597."
13 Mr. Sonpal, appearing on behalf of the Respondents submits that there is a basic fallacy in the arguments of Mr. Surte. Mr. Sonpal would submit that there is a distinction between those who are exempted from paying the sales tax for certain period and those seeking deferral under the package scheme of incentives. There are similar packages extended but they are not on par with each other. The Petitioners defer the payment of the sales tax. After having collected the tax on the sales, all that is required is to deposit it in the Government Treasury. However, that obligation is deferred in the case of parties like the Petitioners. Therefore, it may be that sale of DEPB licence is by both but the underlying distinction is the basis on which the Notification is issued. Therefore, the plea of discrimination has no substance. The classification is, therefore, both reasonable and rational and has nexus with the object sought to be achieved. Hence, the Writ Petition be Aswale 10/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc dismissed.
14 We have perused the Petition and all Annexures thereto with the assistance of both advocates. We have also perused the affidavit-in-reply. The Petitioners do not dispute that they are holding eligibility and entitlement certificate under the 1993 package scheme of incentives under deferral mode. The Notification that is issued and copy of which is annexed to the Petition is firstly on the satisfaction of the Government that circumstances exist which render it necessary to take immediate action to amend the BST Rules, 1959. The Rules styled as BST Rules, 2004 amend the BST Rules, 1959 to the extent that below Rule 31AA of the 1959 Rules with effect from 1st April, 1997, following Explanation is added:-
"Explanation-For the purpose of calculation of Cumulative Quantum of Benefits under the 1988 Package Scheme of Incentives and the 1993 Package Scheme of Incentives, the expression "finished products", shall be deemed to include Credit of Duty Entitlement Pass Book which is earned by the said dealer by exporting out of the territory of India, the goods manufactured in the eligible unit, whether Aswale 11/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc mentioned or not in Eligibility Certificate granted to the said dealer and on the sale of which no tax either in part of full has been paid."
15 Then, there is another Notification of that date and which seeks to amend the Government Notification dated 22nd September, 1995. That is a Notification issued in exercise of the powers conferred by sub-section (1) of Section 41 of the BST Act. The insertion is that with effect from 1 st April, 1997, the inserted words shall be taken to have been appearing in the Explanation-V. Thus, the Explanation-V would emerge on the statute book after the Explanation-IV and with effect from 1st April, 1997. Thus, the Petitioners understood this to mean that the Notification refers to Entry- 3 of Group-E to which Explanation-V has been added with retrospective effect. Therefore, for the purpose of Entries-2 and 3 the words "goods manufactured" and "finished products" shall be deemed to include credit of duty entitlement pass book which is earned by the dealer by exporting the goods manufactured in the eligible unit, whether mentioned or not in the Eligibility Certificate granted to the dealer and on the sale of which no tax has been Aswale 12/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc levied. Thus, the argument was that the deferral of the sales tax and which is the mode chosen by the Petitioners is left out and even if the units like the Petitioner choosing deferral mode, sold the DEPB, that would not be covered by the Notification.
16 To our mind, the Government of Maharashtra has declared various package scheme of incentives from time to time with the aim of dispersal of industries and for promoting industrial activities in the backward units of the State. Under the package scheme of incentives various benefits are available to the eligible units. One of the benefit being exemption from sales tax for certain period or deferment of payment of tax collected for a specified period. To give effect to the sales tax benefit under package scheme, the reference to this scheme stands incorporated in the sales tax legislation. The package scheme of incentives are therefore defined in the BST Rules, 1959. To give effect to the exemption mode under the package scheme, the Notifications were issued under Section 41 of the BST Act and they were Aswale 13/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc amended from time to time. Since the Entries were limited to the extent of financial ceilings incorporated in the scheme, Rule 31AA prescribes the method of computation of the cumulative quantum of benefits enjoyed by the eligible units over a specified period. It is, therefore, clear that a separate regime was provided for those who have opted or chosen the deferral mode of incentives. For that purpose, there is not only a ceiling provided but what has been incorporated, is Rule 31B. Rule 31B reads as under:-
"(1) Notwithstanding anything contained in rule 29, the commissioner may subject to the conditions in sub-rule (2)
(a) Permit an eligible industrial unit which is a dealer registered undertheAct and which has been granted an eligibility certificate under the 1979 Scheme, the 1983 Scheme or as the case may be the Electronic Scheme, falling under the Package Scheme of incentives, to defer the payment of purchase tax payable on purchases of raw materials as mentioned in Explanation II to this rule and sales tax payable on sales of finished goods manufactured by such industrial unit, covered by the eligibility certificate, beyond the period prescribed under rule 29.
(b) permit an eligible industrial unit which is a dealer registered under the Act and which has been granted an eligibility certificate under the 1988 Scheme, falling under the Package Scheme of Incentives, to defer the payment of purchase tax and additional tax (if applicable) payable on purchases of raw materials as mentioned in Explanation II to this rule and sales tax, additional tax (if applicable) [surcharge and turnover tax (if applicable)] payable on sales of goods manufactured by such industrial unit and of scrap goods, and of by-products covered by the eligibility certificate, beyond the period prescribed in rule 29.
(c) permit eligible industrial unit which is a dealer registered under the Act and which has been granted an eligibility certificate under the 1993 package scheme, falling under the Package Scheme of Incentives, Aswale 14/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc to defer payment of purchase tax and additional tax (if applicable) payable on purchases of raw materials as specified in Explanation II to this rule and sales tax, additional tax, (if applicable) and surcharge and turnover tax (if applicable) payable on sales of finished products as defined in the Package Scheme of Incentives, 1993 and mentioned in the Eligibility Certificate, which are manufactured in the said unit up to the period by which monetary ceiling gets exhausted or till the last day of the period mentioned in the entitlement certificate whichever event occurs first beyond the period prescribed in rule29.] "Rule.31B-Conditions for permission to defer payment of total amount of tax as per the return for a specified period being incentives to certain eligible Industrial Units-
(d) permit an eligible Industrial unit which is a dealer Registered under the Act and which has been granted an Eligibility Certificate by the Maharashtra Energy Development Agnecy under the Power Generation Promotion Policy, 1998, to defer the payment of purchase tax payable on Purchase of raw materials as mentioned in Explanation II of this rule and sales tax payable on sales of finished products, as mentioned in Eligibility Certificate, which were manufactured in the said unit, upto the period by which monetary ceiling, specified in the Entitlement Certificate, gets exahausted or till the last day of the period mentioned in the Entitlement Certificate whichever events occurs first beyond the period prescribed in rule 29.
(2) The permission to defer the payment of taxes under sub-rule (1) shall be subject to the following conditions,-(a) such deferment shall be permitted only to those eligible industrial units, which have filed the returns by the dates prescribed.
(b) in respect of clause (a) of sub-rule (1), such deferment shall be restricted to the purchase tax payable on purchases of raw materials as mentioned in Explanation II to this rule and sales tax payable on sales of finished good made by such industrial unit. In respect of clause (b) of the said sub-rule (1), such deferment shall be restricted to the purchase tax and additional tax (if applicable) payable on purchases of raw materials as mentioned in Explanation II to this rule and sales tax, additional tax (if applicable) mum-5 surcharge and turnover tax (if applicable) mum-5 payable on sales of goods including scrap goods and of by-products made by such industrial unit. The deferment in respect of sub-rule (1) shall be restricted for the period covered by the eligibility certificate issued by SICOM or the relevant Regional Development Corporation, as the case may be or to such shorter period as may be determined by the SICOM or as the case may be the relevant Regional Development Corporation;
(bi) in respect of clause (c) of sub-rule (1) such deferment shall be restricted to the purchase tax and additional tax (if applicable) Aswale 15/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc payable on purchases of raw materials as specified in Explanation II to this rule and sales tax, additional tax (if applicable) mum-6 surcharge and turnover tax (if applicable) mum-6 payable on sales of finished products as defined in the Package Scheme of Incentives, 1993 and mentioned in the eligibility certificate which are manufactured in the said unit. The deferment in respect of sub-
rule (1) shall be restricted to the period by which monetary ceiling gets exhausted or till the last day of the period covered by the eligibility certificate issued by SICOM or the relevant Regional Development Corporation or the relevant District Industries Centre, as the case may be, or to such shorter period as may be determined by the SICOM or the relevant Regional Development Corporation or, as the case may be, the relevant District Industries Centre; (c) the Commissioner may initially permit the eligible Industrial Unit to defer the payment of such tax in respect of the period specified in conditions (b) and (bi) till the assessment of the period covered by the return is completed. (d) The payment of such tax according to the assessment order for the returns in respect of the period specified in condition (b) and condition (bi), or as the case may be, such tax payable according to the order, if any, that may have been passed under sections 35, 55, 57 or 62 in respect of the said assessment shall be deferred for a period not exceeding twelve years in respect of industrial units covered by clause (a) of sub-rule (1) or for a period not exceeding ten years in respect of industrial units covered by clauses (b) and (c) of sub-rule (1), and that such period would be computed from the last date for furnishing the last return or the period under assessment. After expiry of such period the amount payable according to the said order shall be payable by the eligible industrial unit in equal annual instalments not exceeding six such instalments in respect of the units covered by clause (a) of sub-rule (1) and not exceeding five such instalments in respect of units covered by clauses (b) and (c) of the said sub-rule (1), as the case may be, specified in the order that would be passed by the Commissioner in this behalf;
(e) the eligible industrial unit shall maintain separate books of account in respect of the transactions pertaining to the sales and purchases made by said industrial unit. (f) the eligible industrial unit shall file returns covering all the sales and purchases relating to the said unit for the period and by the dates prescribed by these rules, only with the concerned Sales Tax Officer or the Assistant Commissioner or Senior Assistant Commissioner of Sales Tax, as the case may be, mentioned in the certificate of entitlement to be issued by the Commissioner in this behalf. (g) the eligible industrial unit shall not file consolidated return covering the sales and purchases pertaining to the deferment of tax by the said unit along with other transactions of sales and purchases not covered by the eligibility certificate granted to the said unit;
(h) no authorization and/or permit shall be obtained by the eligible industrial unit where the unit has no additional place or places of business. Where, however, the unit has an additional place or Aswale 16/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc places of business and such unit has obtained authorization and/or permit in regard to activities not pertaining to the eligible industrial unit it shall not use the authorization or permit for making any purchases for the purposes of the business and activities pertaining to the said eligible industrial unit;
(i) the tax which is deferred under the provisions of this rule shall be immediately recoverable at any time prior to the expiry of the period of deferment in any one or more of the following circumstances, namely,-
(i) if the SICOM or the relevant Regional Development Corporation (or the relevant District Industrial Centre, which issues the eligibility certificate, for reasons to be recorded in writing, a copy of which shall be forwarded to the Commissioner, requires the eligible industrial unit to pay forthwith such amount as may be determined by the concerned implementing agency on the said unit contravening any of the provisions of the Package Scheme of Incentives,or the conditions of the eligibility certificate, or the stipulations or undertaking as per the agreement made in connection with the grant of incentive, under the said Packages Scheme of Incentives, or on the eligibility certificate issued being cancelled or revoked by the implementing agency;
(ii) if the eligible industrial unit contravenes any of the provisions of the Act or the rules made thereunder;
(iii) Omitted
(iv) if the certificate of entitlement issued by the Commissioner is cancelled or revoked; (j) the Commissioner shall issue a certificate of entitlement for availing the benefit of deferment of the tax payable by the eligible industrial unit on the basis of the eligibility certificate issued by the SICOM or the relevant Regional Development Corporation or the relevant District Industrial Centre, being the implementing agency for the said Package Scheme of Incentives of the government; (k) the certificate of entitlement issued by the Commissioner shall be liable to be canceled or revoked in the following circumstances, namely, -
(i) the eligibility certificate issued by the implementing agency being cancelled or revoked; (ii) the eligible industrial unit contravenes any of the provisions of the Act or the rules made thereunder.
Explanation I : For the purposes of this rule and rule 31C, "eligible industrial unit" means an industrial Unit eligible to draw the sales tax incentives, by way of deferment pursuant to the eligibility certificate issued by the SICOM or the relevant Regional Development Corporation or the relevant District Industries Centre, under the Package Scheme of Incentives of the government as may be in force from time to time and to whom the certificate of Aswale 17/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc entitlement is granted by the Commissioner under the above provisions with effect from such date as may be specified therein, Explanation II : For the purposes of this rule and rule 31C "raw materials", includes components, intermediate goods, substances, consumables, stores, newsprint purchased on or after the 1st January 1990 and natural gas purchased on or after the 1st July, 1995 and packing materials which are utilised by the eligible industrial unit in the process of manufacture and packing of finished goods.
Explanation III : The words "manufacture" or its cognate expressions for the purposes of clauses (b) and (c) of sub-rule (1) of rule and for the purposes of clause (b) of sub-rule (1) of rule 31C would include the processes specified in clauses (i), (vii), (xviii) and (xviii-a) of rule 3.
Explanation IV : For the purposes of this rule and rule 31C, the permission to defer the payment of taxes granted under any of these rules shall be construed as a permission to defer payment of any of such tax or taxes as reduced by set-off, refund, or, as the case may be, draw-back to which the eligible unit is entitled under the Act or the rules.
Explanation V : The word "manufacture" or its cognate expressions, used, in this rule and rule 31C in respect of units certified by the State Industrial and Investment Corporation of Maharashtra Limited (SICOM) would include the following processes, namely, - (1) Conversion of hot rolled sheets/strips into cold rolled sheets/strips;
(2) Conversion of steel sheet/strips into galvanized sheets/strips;
(3) Conversion of thicker Gauages of iron and steel sheets into thinner garage of iron and steel;
(4) drawing of wire from wire rods or galvanised wire;
(5) Drawing tubes and pipes; and (6) Giving heat treatment, threading and casing of seamless pipes;]"
17 Hence, perusal of both Rules, namely, 31AA which provides for calculation of the cumulative quantum of Aswale 18/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc benefits and Rule 31B, which provides for conditions for permission to defer payment of total amount of tax as per the return for a specified period being incentives to certain eligible industrial units and falling in Chapter-V-A of the BST Rules, 1959, are not comparable. Rule 31B is specific and clear in terms. Once the underlying difference as pointed out cannot be lost sight of, then, the argument based on discrimination has no merit. It may be that there is a credit of DEPB. That is an incentive provided under the Foreign Trade Policy and to an exporter. It may be a transferable benefit and treated as intangible goods liable to tax under the Sales Tax Act. That is capable of being transferred by both, namely, the holders and beneficiaries of package scheme of incentives under exemption and deferral mode. However, insofar as the amendment and now incorporated by the Notification is concerned, that is restricted in its application to the beneficiaries of exemption mode. There is no compulsion that any such amendments have to be incorporated in Rule 31B. That is a distinct condition and restricted in its application to the unit holders choosing a Aswale 19/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::
904.wp.2517.16.doc deferral mode. If Rule 31B is not touched and has not been amended that does not mean that the Petitioners can seek a writ of mandamus directing the State to either amend it or modify it in tune with their submissions. That is not a writ which this Court can issue. The Court in this case cannot even issue a declaration as prayed as an alternate relief once it finds that the fundamental and underlying difference between the two schemes and the two modes is the factor and which has weighed with the State. That is the real basis and which distinguishes the case of the Petitioners from those units under the exemption mode. Once this difference is noted, then, we do not see any reason to interfere with the impugned Notifications. We do not see how we can grant a declaration that the mandate of Article 14 of the Constitution of India is violated and breached 18 As a result of the above discussion, the Writ Petition fails. It is dismissed but without any order as to costs.
(B. P. COLABAWALLA, J.) (S. C. DHARMADHIKARI, J.) Aswale 20/20 ::: Uploaded on - 04/02/2017 ::: Downloaded on - 27/08/2017 14:16:40 :::