- (1.) P. K. JAIN, J. The revisionist-company, M/s. Modipon Fibres Co. , revisionist T. T. R. Nos. 1071 of 1997 and 1072 of 1997 deals in production and sale of nylon and polyester yarn. It was granted an eligibility certificate under 73ection 4-A of the U. P. Trade Tax Act, 1948 under notification No. 1093 dated July 27, 1991. For the assessment year under consideration the revisionist disclosed total production at 1,22,22,826 metric tonnes. It disclosed sales of 3,13,206 metric tonnes in State of U. P. and 1,008. 55 metric tonnes as inter-State sales, 10,461,189 metric tonnes of goods were shown as stock transfer. The assessee thus claimed that total sale of the goods was equal to 1,17,82,945 metric tonnes. The base production according to the eligibility certificate granted to the dealer was 9,460 metric tonnes. It claimed exemption from payment of tax on turnover of sales of goods weighing 23,22,945 metric tonnes. The assessing authority however, granted exemption to the extent of turnover from the sale of 13,21,756 metric tonnes of goods. The claim of the revisionist was rejected on the ground that the base production was obtained till 4th January, 1993 and, therefore, the exemption from payment of tax can be granted only after base production is achieved. The admitted tax liability in U. P. was enhanced to Rs. 14,48,125 and in Central sales tax the admitted tax liability of Rs. 4,10,357 was enhanced to Rs. 55,50,712. The revisionist filed two appeals before the Deputy Commissioner (Appeals) which were allowed by the first appellate authority by order dated February 4, 1997 and declared tax liability was accepted. The department felt aggrieved and filed two appeals being Appeal No. 70 of 1997 for U. P. and Central, which were allowed by the Trade Tax Tribunal, Ghaziabad, by judgment and order dated September 24, 1997. By setting aside the orders passed by the first appellate authority the assessment orders were restored by the Tribunal. The dealer feeling aggrieved by the orders of the Tribunal has filed these two revisions. The dealer-opposite party in T. T. R. Nos. 682 of 1999, 702 of 1999, 703 of 1999 and 704 of 1999 carried on business of manufacture and sale of bulbs, etc. In view of the provisions contained in Notification No. 1093 of July 27, 1991 issued by the State of Uttar Pradesh under section 4-A of the U. P. Trade Tax Act, the dealer was granted eligibility certificate on the ground that the unit had undertaken expansion after April 1, 1990. In assessment year 1994-95 the assessee admitted U. P. tax liability of Rs. 41,88,937 and Central tax liability of Rs. 27,51,217 which was enhanced by the assessing authority to Rs. 85,15,050 and Rs. 39,96,534 respectively. In assessment year 1995-96 the dealer admitted tax liability of Rs. 44,21,789 in U. P. and Rs. 12,69,798 in Central which was enhanced to Rs. 1,15,81,829 in U. P. and Rs. 42,31,076 in Central. The dealer filed First Appeal Nos. 60 of 1998 and 61 of 1998 for assessment year 1994-95 (U. P.) and Central and First Appeal Nos. 518 of 1998 and 519 of 1998 for U. P. and Central respectively. The Deputy Commissioner of Appeals, Haldwani dismissed both the appeals for the assessment year 1994-95 and U. P. appeal for assessment year 1995-96. He allowed appeal Central No. 519 of 1998 and remanded the matter to the assessing authority for reassessment according to the directions given in its order. The dealer felt aggrieved and filed Second Appeal Nos. 187 of 1998 and 189 of 1998 for assessment years 1994-95 and 1995-96 U. P. and Second Appeal Nos. 188 of 1998 and 190 of 1998 for assessment years 1994-95 and 1995-96 (Central ). The Tribunal allowed all the appeals and directed the assessing authority to reassess the revisionist in the light of the observations made in the body of the judgment. The dispute before the Tribunal in four-second appeals was as to from which date the dealer was entitled to exemption. The dealer had expanded his unit from the middle of the assessment year 1994-95. The Tribunal took the view that dealer will be entitled to exemption considering the total turnover of the assessment year. The Tribunal further took the view that if closing stock of a particular assessment year has already been added in the first year and has been assessed to tax then the said closing balance cannot be carried forward. In this regard the Tribunal relied upon circular letter of Commissioner of Trade Tax dated February 27, 1993. Tribunal also took the view that for the purposes of arriving at the quantum of benefit, date of production in excess of base production shall not be relevant, the calculations for purposes of granting benefit shall be made on turnover of entire year including the production in excess of base production. In Central appeals the dispute related to the sales made against the form C. The assessing authority as well as the Deputy Commissioner of Appeals did not grant benefit. The Tribunal, however, in view of the correction made by the State Government by notification dated July 18, 1998 took the view that the correction in the notification dated July 27, 1991 by the said notification dated July 18, 1998 shall be deemed to be from the date of earlier notification dated July 27, 1991 and the dealer shall be entitled to benefit of sales against form C. Aggrieved by the orders of the Tribunal in the second appeals the department has filed the aforesaid revisions. In Trade Tax Revision Nos. 1071 of 1997 and 1072 of 1997 Sri Bharat ji Agrawal, learned Senior Counsel assisted by Sri Piyush Agrawal, has been heard for the revisionist and Sri R. D. Gupta, learned Standing Counsel appearing for the Revenue has been heard. In T. T. R. Nos. 082 of 1999, 702 of 1999, 703 of 1999 and 704 of 1999 Sri B. K. Pandey, learned Standing Counsel appearing for the department and Sri Bharat Ji Agrawal, learned Senior Counsel appearing for the dealer assisted by Sri Piyush Agrawal have been heard at length. The submission of Sri Agrawal in all revisions is that the purpose of granting of exemption by issuing notification dated July 27, 1991 was to promote the development of certain industries in the State and by the said notification exemption from payment of tax or reduction in rate of tax was granted to new units as also to the units which had undertaken expansion, diversification or modernisation. The units of the dealers in all the revisions are units, which had undertaken expansion/modernisation. It is submitted that the units of the dealers are covered by clause (1-B) (a) of the notification; exemption granted is on the turnover of the sales of quantity of goods manufactured in excess of base production; that under clause 6 (a) of the said notification turnover of sale of goods in any assessment year to the extent of the quantity covered by base production of that year and balance stock of base production of previous years shall be deemed to be turnover of the base production. Under clause 6 (b) of the notification the facility of exemption can be availed only on the turnover of goods in any assessment year in excess of the quantity referred to in sub-clause (a) of clause 6. Submission of Sri Agrawal is that the exemption is granted on consideration of the turnover of the whole of the assessment year. Therefore, the limit of exemption can be arrived at only at the end of the assessment year and the view taken by the assessing authority in all the cases that the exemption under the said notification shall be granted only from the date, the production in excess of base production is achieved, is not correct. His submission is that the base production has to be seen at the end of the assessment and the extent of actual exemption will depend on the results of the whole year and the dealer can reasonably estimate that his turnover would exceed the base production and make a rational estimate and claim exemption on a month to month estimated basis. The claim of the department on the other hand is that the question of claiming exemption would arise only when the base production is achieved. The department's contention is that it is only after reaching the base production that the dealer is entitled to claim exemption in respect of turnover in excess of the base production. The assessing authority has, therefore, taken a right view that till the base production is not achieved the dealer is not entitled to any exemption. Sri Pandey has vehemently argued that combined reading of clause (1-B) and clause (2) (ii) of the notification dated July 27, 1991 would show that the base production has to be achieved first, and it is only thereafter that the question of exemption on the turnover of production in excess of base production can be considered. To supplement his argument Sri Pandey, has referred to the provisions of section 7 (1) read with rule 41 (1) and has submitted that the dealer is required to file monthly returns on the basis of actual turnover and not on hypothetical basis. He is also required to deposit the admitted tax at the time of filing of monthly return. He also submits that in case the contention of the assessee is accepted then the provisions of section 7 (1) read with rule 41 (1) and the notification under consideration cannot be interpreted harmoniously. In T. T. R. Nos. 1071 and 1072 of 1997 following questions of law are framed : (i) Whether the turnover in excess of base production and in excess of quantity referred to in clause 6 (a) of the notification dated July 27, 1991 has to be seen at the end of year and if in any assessment year turnover of goods after March 31, is found to be in excess of base production then the manufacturer is entitled for exemption ? Whether the Tribunal was not justified in restricting the exemption on the turnover from January 4, 1993 to March 31, 1993 ? (ii) Whether Tribunal was not justified in upholding the levy of interest under section of the U. P. Trade Tax Act in respect of the decision of a division Bench of this Court in the case of Annapurna Biscuit Factory v. State of U. P. [1982] 50 STC 56; 1980 UPTC 1320 ? In Trade Tax Revision Nos. 682 of 1999, 702 of 1999, 703 of 1999 and 704 of 1999 the questions of law which arise for determination are : (i) Whether, in the facts and circumstances of the case, the Trade Tax Tribunal was justified : (a) to accept the tax liability of the admitted tax in respect of the goods under expansion Scheme as disclosed by the dealer which was calculated by him in contravention of the provisions of Notification No. 1093 of July 27, 1991, clause 6 (b) as well as the principles laid down by the Tribunal in its judgment ? (b) to grant exemption on turnover of certain goods in the absence of the mandatory declaration forms even without its mention in its judgment ? To appreciate the arguments advanced by the learned counsel for the parties it would be proper to reproduce the relevant provisions of the notification dated July 27, 1991 and some of the circulars relied upon by the parties. Relevant provisions of notification dated July 27, 1991 being Notification No. ST-2-1094/xi-7 (42)/86-Act, 74/56 - Order-91 are reproduced as below : Whereas the State Government is of the opinion that for promoting the development of the certain industries in the State, it is necessary to grant exemption from or reduction in rate of tax to new units and also to units which have undertaken expansion, diversification or modernisation; Now, therefore, in exercise of the powers under sub-section (5) of section 8 of the Central Sales Tax Act, 1956 (Act No. 74 of 1956) (hereinafter referred to as "the Act") the Governor is pleased to declare that - (1-A ). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1-B) in respect of any goods manufactured in a unit other than the units of the type mentioned in annexure II, which 'has undertaken expansion, diversification or modernisation' on or after April 1, 1990 but not later than March 31, 1995, in the areas mentioned in column 2 of annexure I, no tax shall be payable or, as the case may be, the tax shall be payable at the reduced rates specified in column 4 of annexure I, by the manufacturer thereof for the period specified in column 3 of the said annexure I, or till the maximum amount of tax relief by such exemption from or reduction in rate of tax as specified in column 5 of annexure I, is achieved, whichever is earlier, on the turnover of sales - (a) of the quantity of goods manufactured in excess of the base production in the case of units undertaking expansion or modernisation; and (b) of goods manufactured by the unit which are of a nature different from those manufactured earlier by such unit in the case of units undertaking diversification. (2) The period of such facility shall be reckoned from the first date of production - (i) of goods of a nature different from those manufactured earlier by such unit in case of diversification; and (ii) of the goods manufactured in excess of the base production in the case of units undertaking expansion or modernisation.
(2.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (i) to (iii ). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (a) to (c ). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3.) BASE production of a unit undertaking expansion or modernisation shall be deemed to be - (a) maximum production achieved during any one of the preceding five consecutive assessment years, or (b) 80 per cent, of the installed annual production capacity; whichever is higher. (a) Turnover of sale of goods in any assessment year to the extent of the quantity covered by base production of that year and the stock of base production of previous years shall be deemed to be the turnover of base production. (b) Only the turnover of goods in any assessment year in excess of the quantity referred to in clause (a) shall be entitled to the facility of exemption from or reduction in the rate of tax. It will also be relevant to reproduce the provisions of section 7 (1) and (1-A) of the Act and rule 41 (1) of the U. P. Trade Tax Rules, 1948 (hereinafter called as "the Rules") : " Section 7 (1 ).- 'every dealer who is liable to pay tax under this Act shall submit such return or returns of his turnover at such intervals, within such period, in such form and verified in such manner, as may be prescribed; but assessing authority may in its discretion, for reasons to be recorded, extend the date for the submission of the return by any person or class of persons. Section 7 (1-A ).- Before submitting the return under sub-section (1) or along with such return the dealer shall deposit in such manner as may be prescribed the amount of tax due on the turnover shown in such return. " Rule 41 (1 ).- Every dealer liable to tax, the aggregate of whose net turnover of purchases and sales in any assessment year exceeds rupees five lakhs, shall, deposit the total tax due on his turnover of sales or purchases or both before or up to fifteenth day and submit before or up to twentieth day of the next succeeding month to the Trade Tax Officer, monthly return of his turnover in form IV, giving annexures I and II thereof, detailed information, according to code numbers notified by the State Government from time to time, in respect of each category of goods in which he carries on business : Provided that the dealer may instead of submitting a return as aforesaid, estimate his turnover for the year on the basis of the turnover admitted by him in his return, or disclosed in his account books, whichever is greater, for the immediately preceding year, calculate the amount of tax payable thereon and deposit a sum equal to one twelfth thereof during each of the first two months of every quarter, and deposit the balance of tax due on the turnover admitted by him in his return for the relevant quarter, which shall be prepared and submitted in the manner laid down in this rule. At the outset it may be pointed out that though several questions of law are framed in the memo of revision but the arguments have been advanced only in respect of the question whether the facility of exemption under clause 6 (b) of the notification dated July 27, 1991 could be arrived at only at the end of the assessment year as submitted by Sri Bharat Ji Agrawal or from the date in any assessment year the base production is achieved. Perusal of clause 6 (b) as reproduced above would show that benefit of exemption to a unit is to be granted on turnover of goods in any assessment year in excess of the turnover of the quantity under sub-clause (a) of clause 6. Sub-clause (a) of clause 6 of the notification provides that for the purposes of grant of facility under the notification, the turnover of base production in any assessment year shall be the base production of that year as also the balance stock of base production of the previous year. For example sake as in the case of revisionist, M/s. Modipon Limited, the base production according to the eligibility certificate was 9,460 M. T. If this base production is achieved in any assessment year but the entire production is not sold then for the purposes of next year the turnover base production shall be balance of base production of previous year and the base production to the extent of 9,460 M. T. of the assessment year for which assessment is being made. For example sake if in the assessment year 1993-94 the unit achieved base production of 9,460 M. T. but it could sell only 9,000 M. T. and 460 M. T. is closing balance of the assessment year 1994-95 then this closing balance of 460 M. T. shall be added to the base production of assessment year 1994-95 and turnover in respect of base production for the assessment year 1994-95 - 9,460 M. T. plus balance of unsold base production of previous assessment year, viz. , 460 M. T. i. e. , total turnover sale of 9,920 M. T. in the assessment year 1995-96 shall be the turnover of base production. The facility of exemption from payment of tax shall be available at the end of the assessment year 1994-95 in respect of turnover in excess of the turnover of 9,920 M. T. There is no dispute with regard to this proposition as emerges out from reading of clause 6. The only dispute is whether the facility of exemption can be availed after base production in the assessment year under consideration is achieved or the extent of exemption be worked out only at the end of the assessment year. It is noteworthy that in both sub-clauses (a) and (b) of clause 6 of the notification the words used are "turnover of sale of goods in any assessment year". The expression "assessment year" is defined under section 2 (j) (i) of the Act which provides that "assessment year" means the twelve months ending on March 31. From a bare reading of clause 6 of the notification it is amply clear that the benefit of exemption is in respect of turnover of sale of goods in any assessment year in excess of the quantity as provided under sub-clause (a) of clause 6. When assessment year means the period of twelve months, the extent of facility in any assessment year cannot be worked out unless the assessment year is completed. Therefore, it has to be held that the extent of facility of exemption which can be availed by a unit under the notification can be worked out only at the end of the year. The question is whether a dealer is entitled to estimate his turnover for the whole year at the beginning of the year and can make rational estimate of the turnover in excess of the base production from month to month and file return accordingly. The submission of Shri B. K. Pandey is that section 7 (1) and (1-A) read with rule 41 (1) as reproduced above prohibit such an exercise being made by the unit. His submission is that the facility of exemption is available only when base production in a particular assessment year is achieved. He submits that it is only after the base production in any assessment year is achieved that the unit is entitled to claim exemption in respect of turnover in excess of the turnover of base production. He has strenuously argued that if this interpretation is not accepted then there will be violation of the provisions contained in section 7 (1) and (1-A) read with rule 41 (1 ). He also points out those clauses (1-B) and (2) (ii) of the notification provide that the facility shall be reckoned from the date of production of goods manufactured in excess of the base production in the case of the units undertaking expansion or modernisation. In reply the submission of Sri Bharat Ji Agrawal is that the said provision of clause (1-B) does not relate to reckoning of the facility of exemption in any assessment year. He submits that clause (1-B) of the notification read with annexure I of the said notification provide maximum amount of relief as well as the maximum period in respect of which and during which the facility of exemption under section 4-A read with notification can be availed. It is for this purpose that in clause (1-B) of sub-clause (2) (ii) it is provided as to how the period of the facility shall be reckoned. It is also submitted by Sri Agrawal that the purpose of issuing the notification is to promote the development of certain industries in the State. The purpose can be achieved only by harmonious construction of the provisions of the notification issued under section 4-A of the Act and the provisions of section 7 (1), (1-A) read with rule 41 (1 ). It may be seen that at the end of the notification there is table contained in annexure I which categories different units in accordance with their locations in the districts in Uttar Pradesh. Column 3 provides the maximum period for which the facility of exemption can be granted in accordance with the provisions of section 4-A of the Act and the notification issued thereunder. Column 5 provides with regard to the maximum exemption in terms of the fixed capital investment of the unit. For example sake units falling under category 2 (i) in annexure I to the notification the maximum period for which benefit of exemption can be granted under the notification is nine years and the monetary limit of exemption in payment of tax is 150 per cent of the fixed capital investment in the case of small-scale units and 125 per cent of the fixed capital investment in the case of other units. Clause (1-B), sub-clause (2) starts with the words "the period of such facility" which clearly indicates that sub-clause (2) as referred to by Sri Pandey provides only as to how the period of facility to be availed by a unit shall be reckoned. If the exemption is granted for nine years according to this sub-clause (2) of clause (1-B) the period of nine years shall be reckoned from the date of first production of goods manufactured in excess of the base production in case of units undertaking expansion or modernisation. The entire sub-clause (2) has to be read together. Sub-clause (2) (ii) cannot be read by segregating from the remaining part of sub-clause (2 ). Therefore, the submission of Sri Pandey that sub-clause (2) of clause (1-B) of the notification fortified the interpretation made by him is not correct. There cannot doubt that in view of the provisions contained in section 7 (1) and (1-B) read with rule 41 (1) a dealer whose turnover is more than Rs. 10 lakhs in an assessment year is required to file monthly returns which according to rule 41 (1) shall be filed before the expiry of next succeeding month. Under sub-section (1) of section 7, the dealer is required to submit such return or returns of his turnover at such intervals in such form and verified in such manner as may be prescribed. Along with the return he is required to deposit the amount of tax due on the turnover shown in the return. According to section 2 (i) "turnover" means the aggregate amount for which goods are supplied or distributed by way of sale or are sold by a dealer, either directly or through another, on his account or on account of others, whether for cash or deferred payment or other valuable consideration. The above definition of the "turnover" apparently means the aggregate amount for which the goods are actually supplied, distributed by way of sale or are sold. It does not provide for estimated aggregate of the amount for which the goods are supplied or are sold. This appears to be clear from the explanation to section 8 (1) of the Act, which defines tax admittedly payable. It provides that "the tax admittedly payable means the tax which is payable under this Act on the turnover of sales or as the case may be, the turnover of purchases, or of both, as disclosed in the accounts maintained by the dealer, or admitted by him in any return or proceeding under this Act, whichever is greater. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . " Thus, it is turnover of actual sales or purchases as the case may be as disclosed in the accounts maintained by the dealer which dealer is required to disclose as turnover in his return and on such return he is required to deposit the amount of tax due. However, as pointed out above the notification under section 4-A is issued in the larger interest of the State for promoting the development of certain industries in the State. It may also be observed here that opening words of section 4-A (1) of the Act are that "notwithstanding anything contained in this Act" where the State Government is of the opinion that it is necessary so to do for increasing the production of any goods or for promoting the development of any industry in the State generally or in any districts or parts of districts in particular, it may on application or otherwise, in any particular case or generally, by notification, declare that the turnover of sales in respect of such goods. . . . . . . . be exempt from trade tax on sale of goods whether wholly or partly or be liable to tax at such reduced rate as it may fix. It is clear from the above that the notification under section 4-A (1) is issued by the State Government notwithstanding anything contained in the Act and with a view to increase the production of any goods or promoting the development of any industry in the State. As has been seen above the notification dated July 27, 1991 was also issued for the purpose of achieving the objective of promoting the development of certain industries in the State of U. P. This notification has been issued notwithstanding anything contained in the Act and in accordance with the provisions of section 4-A of the Act. Therefore, whenever there is conflict between the provisions of the notification issued under section 4-A of the Act and the provisions of the Act except the provisions of section 4-A, the provision contained in the notification shall prevail provided it is in conformity with the provisions contained in section 4-A. As has been seen above the notification provides that the extent of availability of benefit of exemption in view of the eligibility certificate granted to a dealer can be worked out only at the end of the assessment year. The provisions contained in the notification shall have to be given effect to notwithstanding anything contained in the Act except the provisions contained in section 4-A of the Act under which notification has been issued. There is another aspect of the matter. The well-settled rule of construction is that if there is conflict between the two provisions under any law then two provisions should be interpreted harmoniously so as to achieve the purpose for which the provisions are made in the Act and in the notification. This Court in T. T. R. No. 700 of 1997, Kajaria Ceramics Limited v. Trade Tax Tribunal, U. P. , Lucknow, decided on January 13, 2000 [2000] 120 STC 117, relying upon the decision of the honorable Supreme Court in Commissioner of Income-tax, Amritsar v. Strawboard Manufacturing Co. Ltd. [1989] 177 ITr 431; 1989 Supp 2 SCC 523; 1989 UPTC 1300 (SC) has held that : " Shri Bharat Ji Agrawal, learned counsel for the revisionist, has rightly pointed out that the provisions for exemption are meant for the purposes of increasing the production of the goods and promoting the development of the industries in the State. Such provisions though to be construed strictly but should be construed in reasonable and purposive manner so as to advance the objective of the provision. The honorable Supreme Court in the case of Commissioner of Sales Tax v. Industrial Coal Enterprises [1999] 114 STC 365; 1999 UPTC 250 made the following observations in paras 6, 11 and 12 of the judgment : '6. Admittedly the provisions for exemption from sales tax have been introduced in the Act for the purpose of increasing the production of goods and for promoting the development of industries in the State. In fact, when the scheme called "grant of Sales Tax Exemption Scheme, 1982 to industrial units under section 4-A of the Sales Tax Act" was originally framed, it was expressly stated that the Government granted the facility of exemption in order to encourage the capital investment and establishment of industrial units in the State. The scheme contained various rules for grant of such exemption. The section itself has referred to the purpose for which the Government could grant such exemption. . . . . . . . . . . . 11. In Commissioner of Income-tax, Amritsar v. Strawboard Manufacturing Co. Ltd. [1989] 177 ITR 431; 1989 Supp 2 SCC 523; 1989 UPTC 1300 (SC) this Court held that in taxing statutes, provision for concessional rate of tax should be liberally construed. So also in Bajaj Tempo Ltd. , Bombay v. Commissioner of Income-tax, Bombay City-III, Bombay [1992] 196 ITR 188 (SC); (1992) 3 SCC 78; 1992 UPTC 857 (SC), it was held that provision granting incentive for promoting economic growth and development in taxing statutes should be liberally construed and restriction placed on it by way of exception should be construed in a reasonable and purposive manner so as to advance the objective of the provision. 12. We find that the object of granting exemption from payment of sales tax has always been for encouraging capital investment and establishment of industrial units for the purpose of increasing production of goods and promoting the development of industry in the State. If the test laid down in Bajaj Tempo Ltd. case [1992] 196 ITR 188 (SC); (1992) 3 SCC 78; 1992 UPTC 857, is applied, there is no doubt whatever that the exemption granted to the respondent from August 9, 1985 when it fulfilled all the prescribed conditions will not cease to operate just because the capital investment exceeded the limit of Rs. 3 lakhs on account of the respondent becoming the owner of land and building to which the unit was shifted. If the construction sought to be placed by the appellant is accepted, the very purpose and object of the grant of exemption will be defeated. ' Therefore, the provisions of the Act as well as the notification issued under section 4-A of the Act have to be construed though strictly but also in a reasonable and purposive manner so as to advance the objective of the provisions. I agree with the learned standing counsel that various provisions of the Act. . . . . . . " Therefore, in the opinion of this Court though normally the monthly return in terms of the provisions of section 7 (1), (1-A) read with rule 41 (1) has to be filed in accordance with the turnover disclosed from the accounts books but in exceptional circumstances where such departure is permissible under the Act and the notification issued under the Act, the provisions contained in section 7 (1), (1-A) read with rule 41 (1) can be reasonably departed from. Once it is found that exemption of actual benefit available to the dealer in any assessment year in view of the eligibility certificate granted under section 4-A of the Act can be worked out only at the end of the assessment year then this is permissible to the dealer to estimate his total turnover at the beginning of the assessment year and work out the taxable turnover from month to month and file monthly return accordingly. In case he does so, he will run the risk of liability to payment of interest as provided in section 8 of the Act. In case it is found that for any particular month the tax deposited was less than the amount of tax admittedly payable by him and in some of such cases he may also run the risk of penalty under section 15-A of the Act in case it is found that there was violation of any provisions of law on account of which he was liable for penalty. However, he is not prohibited from estimation of his total production in a year and making of rational estimate of turnover in excess of the turnover of base production and thereafter allocate turnover in excess of the turnover of base production from month to month. Estimation of the turnover is permissible in view of the proviso to rule 41 (1) which provides that the dealer may instead of submitting a return as aforesaid, estimate his turnover for the year on the basis of the turnover admitted by him in his return, or disclosed in his account books, whichever is greater for the immediately preceding year, calculate the amount of tax payable thereon and deposit a sum equal to one-twelfth thereof during each of the first two months of every quarter. It will not be out of place to mention here that against revisionist, M/s. Modipon Limited in T. T. R. Nos. 1071 and 1072 of 1997, the Commissioner of Trade Tax, U. P. , had filed S. T. R. Nos. 433 to 445 of 1994 in which the department's contention was that in spite of the eligibility certificate the dealer was not entitled to any exemption for the months from May, 1992 to November, 1992 on the ground that the base production was not achieved till December, 1992. The dealer, however, estimated his total production for the assessment year and claimed exemption from the commencement of the year on part of the turnover. The authorities below had not accepted the claim of the dealer and had imposed penalty under section 15-A (1) of the Act. It appears that second appeal filed by the dealer was allowed against levy of penalty for the months from May, 1992 to November, 1992. This Court while dismissing the revisions filed by the department which arose from penalty proceedings has held that "actual exemption and the extent thereof will depend on the results of the whole year and a dealer can reasonably estimate that his turnover would exceed the base production and can make a rational estimate and claim exemption on a month to month estimated basis. There is nothing in the penalty orders to show that in making the exercises by which the dealer treated a part of the turnover to be in excess of the estimated base production, the dealer's action lacked bona fides and was without a reasonable cause". Aggrieved by the judgment dated August 17, 1999 passed by this Court in S. T. R. Nos. 433 to 445 of 1994, the department had filed S. L. P. No. 17773 of 1999 which was dismissed by the honorable Supreme Court vide order dated December 10, 1999. Therefore, the contention raised on behalf of the department cannot be allowed to be canvassed in these revisions. For reasons stated above, T. T. R. Nos. 1071 and 1072 of 1997 for the assessment years 1992-93 U. P. and 1992-93 Central deserve to be partly allowed and T. T. R. Nos. 682 of 1999 and 702 of 1999 for the assessment year 1995-96 U. P. and Central respectively and T. T. R. Nos. 703 and 704 of 1999 for assessment year 1994-95 Central and U. P. respectively deserve to be dismissed. Consequently, T. T. R. Nos. 1071 and 1072 of 1997 are partly allowed and the orders of the Tribunal so far as it relates to grant of benefit of exemption from January 4, 1993 to March 31, 1993 is set aside and that of the Deputy Commissioner (Appeals) in this respect is restored. T. T. R. Nos. 682, 702, 703 and 704 of 1999 are hereby dismissed. No order as to costs. T. T. R. Nos. 1071 and 1072 of 1997 partly allowed. T. T. R. Nos. 682, 702, 703 and 704 of 1999 dismissed. .;