JUDGMENT I.M. Quddusi, J.
1. This revision has been filed by M/s. Dhampur Sugar Mills Ltd., Under Section 11 of the U.P. Trade Tax Act, 1948 (hereinafter referred to as "the Act") against the order dated October 23, 1999 passed by the Trade Tax Tribunal, Moradabad, by which its earlier order dated July 2, 1999 passed in Appeal Nos. 258 to 263 of 1998 and Appeal Nos. 50 to 53 of 1999 (for the year 1998-99) Filed against the provisional assessment orders for the months of May, 1998 to September, 1998, was revised Under Section 22 of the Act.
2. The facts of the case, in brief, are that the revisionist was granted licence by the Ministry of Industries, Government of India, under the Industries (Development and Regulation) Act, 1951 for the manufacture of chemicals in their factory at Dhampur. The revisionist, M/s. Dhampur Sugar Mills Ltd., which had fixed investment of Rs. 52 crores on March 31, 1991, had invested Rs. 15.12 crores in establishing chemical plant at their factory at Dhampur up to August 31, 1991. The revisionist applied for availing the facility of exemption of Uttar Pradesh Trade Tax Act, 1948 and Central Sales Tax Act, 1956 as per industrial policy of State Government, Under Section 4-A of the Act in the prescribed form on August 31, 1991 for chemicals, derivatives of chemicals, by-products and waste products. Thereupon the Divisional Level Committee, which is the statutory body constituted for the purposes of granting the above facility Under Section 4-A of the Act, by its decision dated February 1, 1994 granted the facility of exemption of total tax to the extent of Rs. 7,61,69,544.80 or for the period of eight years, i.e., from March 30, 1991 to March 29, 1999 whichever is earlier. This facility was granted on chemicals manufactured under notification dated July 27, 1991.
3. The revisionist had submitted the monthly returns in forms I and IV claiming the exemption of tax exemption for manufactured chemicals and its derivatives for the months of May, 1998 to September, 1998. The assessing officer had assessed the tax provisionally Under Section 7 of the Act read with Rule 41(6) of the Rules for the said period on the derivatives of chemicals manufactured and also held that the facility was not granted from payment of total tax but on reduced rate of tax. These orders were challenged by the revisionist before the Deputy Commissioner (Appeals), Trade Tax, Under Section 9 of the Act and being unsuccessful second appeals Under Section 10 were filed before the Trade Tax Tribunal, Bench-II, Moradabad.
4. The aforesaid division Bench of the Tribunal by its order dated July 2, 1999 had set aside all the provisional assessment orders and remanded the case to the assessing authority with following directions:
(1) The authorities below had not ascertained whether the facility of Rs. 7,61,69,545 passed by the statutory body had been utilised by the appellant towards the tax facility or not before the provisional assessment for May, 1998 to September, 1998 were passed.
(2) The derivatives, waste products and by-products are the result of manufacture of main products, so these are also covered under notification dated July 27, 1991 and are eligible for the facility of Section 4-A of the Act.
5. Thereafter the Trade Tax Tribunal, suo motu, had reviewed its order dated July 2, 1999 of allowing the appeal by way of remand Under Section 22 of the Act and passed a common order dated October 23, 1999 by disturbing its judgment dated July 2, 1999 and dismissed the appeals of the revisionist, hence the present revision.
6. I have heard the learned Senior Advocate Sri Umesh Chandra along with Sri Aseem Chandra and Sri Vikash Singh for the revisionist, and Sarvasri Rakesh Bajpai and Rajeev Sharma learned Standing Counsel for the State.
7. The learned Senior Advocate Sri Umesh Chandra for the revisionist submitted that the statutory authority, Divisional Level Committee, Moradabad, on February 1, 1994 had allowed maximum trade tax and Central sales tax facility to the revisionist to the extent of Rs. 7,61,69,545 or for a period of eight years from March 30, 1991 to March 29, 1999 whichever is earlier and a certificate to this effect was issued on February 9, 1994.
8. The learned Counsel for the revisionist had further submitted that the revisionist had also filed an application in June, 1994 for modifying the order dated February 1, 1994, upon which the Divisional Level Committee, vide its order dated March 30, 2000 accepted the contention of the revisionist and observed that the facility of exemption from payment of tax was also applicable to derivatives which were also eligible for total exemption from payment of tax.
9. The learned Counsel had further submitted that the division Bench of the Trade Tax Tribunal, Moradabad had earlier on May 19, 1994 in Second Appeals Nos. 71 to 78 of 1994 after considering the aforesaid eligibility certificate dated February 9, 1994 had held that total exemption from payment of tax was allowed on chemicals and the demand raised in respect of chemicals through provisional assessment orders was set aside. This order dated May 19, 1994 of the Tribunal was also confirmed by this Court in Trade Tax Revision No, 833 of 2000 (Dhampur Sugar Mills Ltd. v. Commissioner of Trade Tax, U.P. reported in [2003] 134 STC 322 : 2001 UPTC 95).
10. The learned Senior Advocate has also submitted that the division Bench of the Trade Tax Tribunal, Moradabad, on 17th/26th December, 2000 while deciding the Appeal Nos. 612 to 615 of 2000 against the provisional assessment orders for the subsequent months of October, 1998 and November, 1998 has also considered the report mentioned in the order of Divisional Level Committee dated March 30, 2000 and observed that the derivatives were also eligible for full exemption from payment of trade tax and Central sales tax.
11. The learned Counsel Sri Umesh Chandra has further submitted that since the order dated October 23, 1999 is not providing the facility granted by the statutory authority under notification dated July 27, 1991, as such, there was no mistake apparent on the face of record of law or fact and the order dated October 23, 1999 passed Under Section 22 of the Act is not sustainable.
12. Another submission of the learned Counsel was that the interest at the rate of 15 per cent may also be allowed on the 50 per cent of the amount deposited pursuant to stay order passed by this Court on November 5, 1999 from the date of deposit as was allowed by the division Bench of this Court in the matter of Anuj Bricks v. State of Uttar Pradesh 2000 UPTC 999, in paragraphs 4 and 5 of which it has been held as under:
4. The grievance of the petitioner is that interest on principal amount must also be paid by the department. We agree with this submission as interest is the normal accretion on capital. Similar view has been taken by this Court in Babu Ram Daya Nand Prakash v. State of Uttar Pradesh [2003] 133 STC 139 : 1997 UPTC 1264 paras 8 and 9.
5. Following the said decision the petition is allowed. The department is directed to pay 15 per cent interest per annum from the date of deposit till the date of refund of the principal amount and this interest will be paid within three months of production of certified copy of the order before the authority concerned.
13. The learned Standing Counsel Sri Rakesh Bajpai submitted that the certificate granted on February 9, 1994 under notification dated July 27, 1991 was for Rs. 7,61,69,545 for the chemicals manufactured by the time certificate was granted Under Section 4-A. The assessing officer had rightly imposed the tax in accordance with certificate granted Under Section 4-A. The Tribunal was not correct in allowing the appeal on July 2, 1999. This mistake was corrected by Tribunal on October 23, 1999 by exercising its suo motu power Under Section 22 of the Act. It was further submitted by him that the order dated October 23, 1999 under appeal is a correct and legal order passed Under Section 22 of the Act and the revision is liable to be dismissed with costs.
14. I have perused the records placed before me which reveals that Divisional Level Committee is a statutory authority constituted Under Section 4-A of the Act for granting the benefit of exemption of trade tax or Central sales tax. The Divisional Level Committee in its decision on February 1, 1994 and March 30, 2000 had granted total maximum facility of sales tax to the extent of Rs. 7,61,69,545 or for the period of eight years whichever is earlier, on chemicals and derivatives manufactured, and its decision cannot be brushed aside by the assessing officer.
15. This Court is, therefore, of the opinion that the impugned order dated October 21, 1999 passed Under Section 22 of the Act is unsustainable and the same is liable to be quashed.
16. In view of the above, the revision is allowed and the order dated October 23, 1999 passed by the Trade Tax Tribunal, Moradabad, is hereby quashed. It is further directed that in view of the decision of the division Bench of this Court in the case of Anuj Bricks 2000 UPTC 999, interest at the rate of 15 per cent shall be paid by the respondents to the revisionist from the date of deposit of amount with them by the revisionist, within two weeks from the date of production of a certified copy of this order.
17. No order as to costs.