- (1.) HEARD Sri C.S. Lodha, learned Senior Advocate, assisted by Sri Nandit Srivastava, learned counsel for the petitioner and Sri H.P. Srivastava, learned Additional Chief Standing Counsel for the respondents. The question, cropped up, in this case is as to whether in the event of a situation where an industry has been granted exemption under Section 4-A of the Trade Tax Act (in short Act), notice can be issued under Section 15-A(1)(qq) of the Act for imposition of the penalty relying upon-the provisions contained in Section 8-A (2) of the Act and in case it is permissible, then under what circumstances. The Lipton India Limited, which is a public limited company has got branches at Kolkata (West Bengal), Ambattur, Madras (Tamil Nadu), Dharwad in Karnataka, and Etah (U.P.). During the pendency of the writ petition, the nomenclature has been changed and now it is termed as "Hindustan Unilever Limited", situate at Mumbai.
(2.) THE State Government in pursuance to the power conferred by Section 4-A of the Act is empowered to issue notification for grant of exemption from payment of trade tax to the industrialist for installation of their units in the backward areas of the State of U.P. as an incentive measure. In pursuance to power conferred by Section 4-A of the Act, a notification was issued on 29.1.1985 followed by the amended notification dated 26.4.1995. According to the amended notification, the Government has got power to grant exemption from payment of trade tax for the period of six years from the date of the start of the production. By an order dated 16.9.1991, exemption was granted to the petitioner with regard to payment of trade tax from 8.3.1990 for a period of six years. The certificate dated 16.9.1991 has been filed as Annexure 1 to the writ petition, which has been given effect from 8.3.1990. The Sales Tax Officer of Special Investigation Branch Agra on 22.10.1992 seized a consignment of Tea which was being carried from Mainpuri to Chehisar, manufactured at the industry situated at Etah. It was found by the Sales Tax Officer that the truck was containing the stock of tea bags having invoices of Tea manufactured outside the State by the petitioner and its ancillary units. It was noticed by the Sales Tax Officer that though the rate of tea manufactured was shown as non-taxable under the Act but on the product of tea manufactured outside the State of U.P. and brought to the depot it was found that the trade tax or sales tax is chargeable on such products. Keeping in view the fact that the Etah Branch of the petitioner industry was charging on non-taxable items produced by it, same price of the tea, which was being charged from other units of the petitioner industry, it was presumed that the petitioner is indirectly charging the trade tax on the products produced from Etah industry. Accordingly, the truck was seized and later on released subject to payment of security to the tune of Rs. 46,845/-. The Assistant Commissioner passed an order dated 27.2.1993 with regard to release of tea bags subject to payment of security with the observation that since the sales tax has been charged for items produced outside the State of U.P. and not for other, there will be a presumption that the petitioner has been charging the trade tax indirectly.
(3.) FEELING aggrieved with the order passed by the Assistant Commissioner (Sales Tax), the petitioner preferred an appeal before the Tribunal under Section 10 of the Act. The Tribunal, by order dated 17.4.1993, a copy of which has been filed as Annexure 2 to the writ petition, set aside the order passed by the Assistant Commissioner, Sales Tax and held that the department has illegally issued penalty notice under Section 15-A(1)(qq) of the Act. The judgment of the Tribunal has been filed as Annexure 3 to the writ petition.;