- (1.) This revision under section 11 of the U.P. Trade Tax Act, 1948 as amended from time to time, (hereinafter referred to as 'the Act') is directed against the order of the U.P. Trade Tax Tribunal, Lucknow, dated 16.3.1998, rejecting the appeal filed by the revisionist. As a result thereof, the decision of the State Level Committee, communicated to the revisionist by the Secretary, U.P. Government (Trade Tax), Anubhag 2, Lucknow vide letter dated 11.4.1996, rejecting its request for substituting its name as "successor manufacturer" in place of Pashupati Bottling Pvt. Ltd. in the eligibility certificate issued under section 4-A, was affirmed.
(2.) The revision was heard on following questions of law :- a) Whether in view of the definition of the word "manufacturer" as given under Section 2(ee) which has to be read under Section A (2-B) of the Act, the Applicant Company has to be treated as manufacturer succeeding Pashupati Bottlers to whom the Eligibility Certificate was granted for the purpose of getting the exemption from payment of sales tax ? b) Whether all the licences and registration which are mandatory for running the industrial unit having been granted only to the Applicant after the unit was taken over by the Applicant in continuation of the earlier licence granted to Pashupathi Bottlers, the Applicant Company as the "successor manufacturer" of the new unit entitled for the benefit of exemption for the remaining period mentioned in the Eligibility Certificate? c) Whether in view of the specific amendment under Section 4-A (2-B) of the Act, even if the Application has succeeded by means of licence or lease and not by way of sale, the Applicant should be treated as "successor manufacturer" for the purpose of Section 4-A(2-B) during the relevant period for which Eligibility Certificate was granted ?
(3.) For appreciating the controversy, relevant provisions of the Act may be noticed. Section 4-A provides for exemption of certain goods from sales tax. It was amended by U.P. Act no. 28 of 1991. The word ''manufacturer' defined under section 2(ee) was also amended. Section 2(ee) and relevant part of section 4-A as were in existence prior to the amendment reads as under :- "Sec. 2(ee) 'Manufacturer' in relation to any goods means the dealer who makes the first sale of such goods in the State after their manufacture." Sec. 4-A. Exemption from sales tax of certain goods for specified period : (1) Notwithstanding anything contained in Section 3 or Section 3-A, 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 industry in the State generally or in any districts or parts of districts in particular, it may on application or otherwise, by notification, declare that the turnover of sales in respect of such goods by the manufacturer thereof shall, during such period not exceeding seven years from the (date of first sale by such manufacturer if such sale takes place within six months from the date of starting production and in any other case from the date following the expiration of six months from the date of starting production), and subject to such conditions as may be specified, be exempt from sales tax or be liable to tax at such reduced rate as it may fix. (2) It shall be lawful for the State Government to specify in the notification under sub-section (1) that the exemption from or reduction in the rate of tax, shall be admissible; (a) generally in respect of all such goods manufactured subsequent to the date of such notification, or (b) in respect of such of those goods only as are manufactured in a new unit, the date of starting production whereof falls on or after the first day of October 1982, or (c) only if the manufacturer had not discontinued production of such goods for a period exceeding six months at a stretch, (d) only if the manufacturer furnishes to the assessing authority an Eligibility Certificate granted by such Officer, in accordance with such procedure, as may be specified. (3) Where the Commissioner of Sales Tax is of the opinion that facility of exemption from, or reduction in the rate of tax obtained on the basis of an Eligibility Certificate referred to in clause (d) of sub-section (2) has been misused in any manner whatsoever, he may, by order in writing, cancel the Eligibility Certificate from such date, whether before or after the date of such order, as may be specified therein : Provided that no order under this sub-section shall be passed without giving the dealer concerned a reasonable opportunity of being heard. Explanation : (i) 'new unit' means a factory or workshop whether set up by a dealer already having an industrial unit manufacturing the same goods at any other place in the State or an industrial unit manufacturing any other goods on, or adjacent to the site of an existing factory or workshop; but does not include ; (a) any factory or workshop using machinery, accessories or components already used or acquired for use in any other factory or workshop in India ; (b) any factory or workshop established on, or adjacent to the site of an existing factory or workshop manufacturing the same goods ; or (c) any addition to or extension of an existing factory or workshop; and (ii) date of starting production' means the date on which any raw material required for use in the manufacture or packing of the specified goods is purchased for the first time or the date of installation of power connection, where needed, whichever is later";