Suhas Chandra Sen, J. - (1.) The petitioner No. 1, Dwarkesh Engineering Works, is a partnership firm and its business is manufacture and sale of steel castings. The petitioner No. 2 is one of its partners. The workshop of the petitioner is situated at Madhyamgram, 24-Parganas, West Bengal.
(2.) The petitioner No. 1 is a registered dealer under the Bengal Finance (Sales Tax) Act, 1941, as well as the Central Sales Tax Act, 1986. The petitioner claims that its manufacturing unit is "a newly set up small-scale industry" and as such, the sale of goods produced by this unit is entitled to be deducted from its gross turnover by virtue of Rule 3(66a) of the Bengal Sales Tax Rules, 1941. Rule 3(66a) provides :
(3.) In calculating his taxable turnover a dealer liable to pay tax under Section 4 or 8(3) of the Act may deduct from his gross turnover, his turnover on the following, namely :-... (66a) (i) Sales by a newly set up small-scale industry of goods or class of goods, other than those included in Schedule X appended to this clause, manufactured by it during the period of three years, if the said industry is situated within the area of the Calcutta Metropolitan District as described in the Schedule to the Calcutta Metropolitan Planning Area (Use and Development of Land) Control Act, 1965, or five years, if it is situated elsewhere in West Bengal, since the date of its first sale of such manufactured goods : Provided that the dealer claiming the benefit of this clause will be so eligible only if he keeps separate accounts in respect of such newly set up small-scale industry, issues serially numbered cash/credit memos for sales of goods manufactured in such industry, keeps vouchers and other documents for purchases of plant and machinery for establishment of such industry and maintains other records to prove that sales claimed exempt under this clause were of goods manufactured in such industry set up by him and that no amount by way of tax under the Act has been realised by him in respect of such sales : Provided further that the dealer claiming the benefit of this clause will be so eligible, if he possesses a valid certificate of eligibility in form No. XXXVIA granted by the appropriate Assistant Commissioner in this behalf, for such period as mentioned in the said certificate... (ii) The certificate of eligibility referred to in the second proviso to Sub-clause (i) shall be granted on application and shall be valid for a period not exceeding twelve months from such date as may be specified in the certificate, but may, at the discretion of the authority granting the certificate, be renewed from time to time for a period not exceeding twelve months at a time. The petitioner claims that it has complied with all the requirements of Rule 3(66a). It keeps separate accounts of the newly set up small-scale industrial unit, issues serially numbered cash/credit memos for sale of goods manufactured in this unit, keeps vouchers and other documents for purchase of plant and machinery for establishment of such industry and also maintains other records to prove that sales claimed exempt under Rule 3(66a)(i) are all goods manufactured in such industry set up by the petitioner.;