Allowed

Apt Packaging Ltd. Thr G.M. v. the State of Mah and Ors.

Bombay HC17 Nov 2014WP/524/2013

Case brief

AI extract

What is this about?

This judgment allowed a writ petition where the High Court set aside an order denying sales tax incentive deferral. Relying on SICA and the Raheja judgment, the Court held that BIFR directives override state tax demands unless set aside by an appellate forum.

What did the court decide?

The impugned order dated 18-9-2012 was set aside and the Writ Petition was allowed and disposed of with liberty to the respondents to proceed further.

Apt Packaging Ltd. Thr G.M. Vs the State of… — Pension and Retirement Benefits | Bombay HC (2014)

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(1) W.P. No. 524 of 2013

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY, AURANGABAD BENCH, AT AURANGABAD.

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Writ Petition No. 524 of 2013

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Apt Packaging Ltd. (Formerly known as Anil Chamicals Ltd.), A company registered under the Indian Companies Act, 1956, having its registered office at J-18, MIDC, Chikalthana, Aurangabad, through its General Manager (Finance & Accounts), Deepak s/o. Satya Naraian Khandelwal, Age : 49 years, Occupation : Service as General Manager, Apt packaging Ltd., R/o. J-18, MIDC Chikalthana, District : Aurangabad.

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.. Petitioner.

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versus

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The State of Maharashtra, Through its Chief Secretary, Industries Department, Mantralaya, Mumbai.

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Joint Director of Industries, Aurangabad Region, Aurangabad.

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District Collector, Aurangabad, District : Aurangabad.

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Development Commissioner (Industries), Department of Industries, Govt. of Maharashtra, New Administrative Building, Opp. Mantralaya, Madam Cama Road, Mumbai.

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(2) W.P. No. 524 of 2013

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Joint Commissioner of Sales Tax (I&E), Maharashtra State, R No.916, 9th Floor, Old Building, Vikrikar Bhawan, Majgaon, Mumbai - 400 010.

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Dy. Commissioner of Sales Tax, Vikrikar Bhawan, Railway Station Road, Aurangabad. .. Respondents.

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Mr. A.P. Bhandari, Advocate, for the petitioner.

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Mrs. M.A. Deshpande, Assistant Government Pleader, for respondent nos.1 to 6.

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CORAM : B.P. DHARMADHIKARI &

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A.M. BADAR, JJ.

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DATE : 17TH NOVEMBER 2014

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ORAL JUDGMENT (Per B.P. Dharmadhikari, J.) :

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Heard Adv. Mr. A.P. Bhandari for the petitioner, and learned AGP Mrs. M.A. Deshpande for the respondents.

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Earlier Writ Petition filed by the petitioner, vide Writ Petition No. 3820 of 2011 was disposed of, by this Court on 4th July 2012.

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In order to avoid prolixity, we find it proper to reproduce order dated 20th June 2012, passed in that Writ Petition, and the later

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(3) W.P. No. 524 of 2013

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dated 4th July 2012, passed therein below.

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Order dated 20th June 2012

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“ The matter was heard on earlier occasion and for some time today. The question is, whether after removal of the seek unit from the scheme, liabilities waived in scheme revive. The other question is, if respondent no.2 has decided to file an appeal against the scheme itself, whether notice for recovery of amount waived under the scheme could have been issued ?

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Learned AGP is seeking time of two weeks for assistance in this respect.

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Accordingly, we adjourn the matter for two weeks.”

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Order dated 4th July 2012

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“1. Heard.

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Learned Addl. Govt. Pleader seeks further time, stating that though some instructions are received, the same are not sufficient to meet the order of this court dated 20-6-2012.

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Senior Counsel Mr. Shah insists that in that event, the court may admit the matter and continue the interim order as has been done in other matters.

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Looking to the nature of controversy, we do not want to keep the matter pending at this stage. On earlier occasion, and even today, our attention has been drawn to similar recovery certificates issued on 31-1-2007 to two units of the petitioner - industry and withdrawal thereof on 23-10-2009 because of the directions of B.I.F.R.

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(4) W.P. No. 524 of 2013

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The controversy arising has been very briefly mentioned by us in our order dated 20-6-2012. In this situation, we find that interest of justice can be met with, by directing Respondent No.2 to look into the grievance as made by the petitioners. The petitioners have, before approaching this court, made representation on 7-2-2011 to the Chief Secretary, Government of Maharashtra.

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We direct Respondent No.2 to look into the said representation of the petitioners in the light of previous history and orders passed by this court and take a suitable decision within a period of eight weeks after the petitioners appear before him.

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We direct the petitioner to appear before Respondent No.2 on 31-7-2012 and to abide by his further instructions in the matter. Till Respondent No.2 takes further appropriate decision on the controversy, coercive action in response to two impugned RRCs shall not be initiated.

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With aforesaid observations and directions, we dispose of the petition. No costs. Pending Civil Applications stand dispose of. ”

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In terms of directions contained in order dated 4th July 2012, the petitioner has appeared for hearing and then the impugned order has been passed by respondent no.2 - Joint Director, on 18th September 2012. The said order with covering letter of even date are at Exhibit “O” with the Writ Petition.

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Only reason given in the impugned order is, the petitioner is not entitled to sales tax incentive as per guidelines dated 11-8-1980.

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Adv. Mr. Bhandari submits, that reliance upon package scheme

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(5) W.P. No. 524 of 2013

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of incentive is erroneous as petitioner was found eligible and entitled in terms of certificate Exhibit "G" for availing of sales tax incentive under Part I of 1993 Package Scheme of Incentive of Government of Maharashtra, by way of deferment of sales tax liability for the period from 1-11-1997 to 3110-2012. He further submits, that these benefits have been extended till financial year 2020 to petitioner under the sanctioned scheme in Case No. 71/2001 by B.I.F.R., within same limits after hearing State Government also. He relies upon Clause 12(I) of the scheme. He also draws support from Section 32 of Sick Industrial Companies (Special Provisions) Act, 1985 [For short, "SICA"] , and judgment of Hon'ble Apex Court, in the case of Raheja Universal Limited Vs. NRC Limited & others , reported in (2012) 4 Supreme Court Cases 148 , particularly, paragraph 85.

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The learned Assistant Government Pleader submits that the sanctioned scheme does not debar Government from considering eligibility and entitlement of the petitioner. The eligibility and entitlement has been accordingly examined and as communicated in the impugned order, petitioner was not found entitled to extension. It is further submitted, that because of these findings, Section 32 of SICA has no application. The learned Assistant Government Pleader also invites attention to the statement contained in paragraph 6 of the affidavit of Assistant Commissioner of Sales Tax, dated 24-10-2013, to point out that the direction of the Board of Industrial and Financial Reconstruction [For short, "B.I.F.R."] and its scheme is being challenged before appropriate appellate forum.

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We find, that the scheme sanctioned by B.I.F.R. has not been so far assailed, in accordance with law, and is in force. Clause 12(H) deals

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(6) W.P. No. 524 of 2013

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with the obligation cast upon MIDC, Aurangabad, to ‘consider’ the waiver of demand of water charges and penalty. As against this, Clause 12(I) does not use said word ‘consider’ and contains a mandate to extend the sales tax deferral scheme & availability of benefits thereof to petitioner Company up to financial year 2020 with overall sanctioned ceiling limit of Rs. 32.10 Crores, as against its termination in 2012. The B.I.F.R., thereafter has also issued necessary directions about no change in repayment of deferred sales tax in view of the shifting of benefit period.

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In the light of judgment of the Hon'ble Apex Court, in the case of Raheja Universal Limited (supra) , particularly paragraph 85 thereof, it is clear that Section 22(1) read with Section 32 of SICA, give an overriding effect and hence, unless and until these directions are set aside, the respondents cannot insist for the payment of sales tax or impose liability therefor, contrary to those directions. Recovery has to be in consonance with Clause 12(I) above.

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In this situation, without observing anything more and as respondents planned to approach appellate authority against the mandate of B.I.F.R., with liberty to the respondents, to proceed further in the matter, in accordance with law, we set aside the impugned order dated 18-9-2012.

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The Writ Petition is, thus, allowed and disposed of. No costs.

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( A.M. BADAR ) ( B.P. DHARMADHIKARI ) JUDGE JUDGE

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bgp/WP524.13

Apt Packaging Ltd. Thr G.M. v. the State of Mah and Ors.

Case brief

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Apt Packaging Ltd. Thr G.M. v. the State of Mah and Ors.

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