JUDGMENT Rajes Kumar, J.
1. Present revision Section 11 of U.P. Trade Tax Act (hereinafter referred to as "Act")is directed against the order of Tribunal date 04.08.1994, by which the order of the Commissioner of Trade Tax under Section 4-A (3) of the Act canceling the eligibility certificate, issued under Section 4-A of the act has been confirmed.
2. Brief facts of the case are that the applicant established a new unit for the manufacture of Enameled wire and was issued eligibility certificate under Section 4-A of the Act on 26.03.1990 by the Joint director of Industries, Varanasi granting exemption from the payment of tax on the goods manufactured by it for the period of five years w.e.f. 01.11.1986. Production was started on 30.10.1986. Land was taken on lease. Initially the lease deed was executed w.e.f. 01.08.1985 for the period of five years on 27.07.1985. This was unregistered lease deed Subsequently, another lease deed was executed for the period of 10 years w.e.f. 01.08.1985 for the period of five years on 27.07.1985. The was unregistered lease deed. Subsequently, another lease deed was executed for the period of 10 years w.e.f.01.08.1985 and the same was got registered on 13.04.1988. During the processing of the exemption application both lease deed have been taken into account and therefter, eligibility certificate was issued on 26.03.1990. Subsequently at the instance of the Deputy Commissioner (Executive), Trade Tax, Commissioner of Trade Tax issued a notice under Section 4-A(3) of the Act for cancellation of the eligibility certificate on the ground that on the date of Production, there was no registered lease deed. Applicant filed their reply but the same was not accepted and vide order dated 15.10.1991 eligibility certificate was cancelled under Section 4-A(3) of the Act. Applicant filed appeal before the Tribunal. which was dismissed.
3. Heard Sri P.K. Mishra, learned counsel for the applicant and learned Standing Counsel.
4. Learned counsel for the applicant submitted that before issuing the eligibility certificate on 26.03.1990 State Level Committee had examined the provision of Section 4-A of the Act and had considered lease deed, dated 27.07.1985, which was unregistered land the registered lease deed, dated 13.04.198, which was for the period of ten years effective from 01.08.1985 and, thereafter, eligibility certificate was issued and therefore, such eligibility certificate should not be cancelled in exercise of power under Section 4-A(3) of the Act, in as much there was no mis-representation or concealment of fact on the part of the applicant and there was no case of mis-use of the eligibility certificate. He further submitted that the subsequent registered lease deed, which was registered on 13.04.1988 was w.e.f. 01.08.1985 and, therefore, the requirement of Section 4-A of the Act was fully complied. In support of his contention, he relied upon the Division Bench decision of this Court in the case of Sri Laxmi Tel Udyog and Anr. v. State of U.P. and Ors., reported in 2003 UPTC, 500. Learned Standing counsel supported the order of the Tribunal.
5. I have perused the order of the Tribunal and the authorities below.
Explanation of Section 4-A, which defines new unit, reads as follows:
"Explanation-For the purpose of this Section-
(1) "New Unit" during the period ending with 31st March, 1990, means an industrial undertaking set-up by a dealer on or after October 1, 1982 but not later than March 31, 1990--
(a)...
(b)...
(i)...
(ii)...
(iii)...
(c) on land or building or both owned or taken on lease for period of not less than seven years by such dealer on allotted to such dealer by any Government company or any corporation owned or controlled by the central or the State Government;
(d)...
(e) fulfilling all the conditions specified in this Act or rules or notifications made thereunder in regard to grant of facility under this section on the date from which such facility may be granted to him;
and includes on industrial undertaking fulfilling the conditions laid down in Clauses (a) to (e) set up by a dealer.
(i)...
(ii)...
But does not include-----
(i)...
(ii)...
Provided that ---
(i)...
(ii)...
(iii) in relation to a new unit whose date of starting production falls before March 6, 1986, the condition regarding lease for a period of not less than seven years shall not apply;
(iv)...
6. Section 4-A(3) reads as follows:
"where the Commissioner is of the opinion that the 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 (1) or on the basis of any eligibility certificate issued under any executive orders of the Government issued any manner whatsoever or that the new unit has committed breach of any of the conditions, subject to which the facility of exemption from, or reduction in the rate of tax was granted or that the new unit to which the eligibility certificate has been granted in accordance with the provisions of this Act is not entitled to facility under this section or is entitled to such facility for a lesser period or from a different date he may, by order in writing passed before or after the expiration of the period of exemption or reduction, cancel or amend the eligibility from a date specified in the order and such date may be prior to the date of the however, that in cases of misuse or breach, the cancellation of eligibility certificate shall have effect not before the date of such misuse or breach:
Provided that no order under this sub-section shall be passed without giving the dealer a reasonable opportunity of being heard."
7. Facts of the present case is not in dispute namely that the production was started on 30.10.1986. Land was taken on lease for which first lease deed was executed on 27.07.1985 for the period of five years w.e.f. 01.08.1985. Thereafter, another lease deed was executed on 13.04.1988 for the period of ten years, w.e.f. 01.08.1985, which was registered on 13.04.1988. Therefore, it is not in dispute that the lease deed, which was registered was for the period w.e.f. 01.08.1985.
8. In the case of Sri Laxmi Tel Udyog and Anr. v. state of U.P. and Ors. (supra) unit was involved in the manufacturing of mustard oil and oil cake. Unit was established on the premises, taken on lease. Lease deed was executed on 06.09.1985 for the period of twenty years. Subsequently, a registered lease deed was executed on 14.03.1988 for the period of twenty years with retrospective effect 01.08.1985. Production was commenced from 28.10.1986 and the first sale was on 01.11.1986. Exemption was refused on the ground that on the date of production there was no registered lease deed. Division Bench of this Court held as follows:
"A perusal of the impugned order dated 27th January, 1992 Annexure-11 shows that the only reason to reject the petitioner application under Section 4-A was that the registered lease deed of the land on which the petitioner unit the period cannot be deemed to be a new unit. In our opinion the view taken in the impugned order is not correct. It has been held by several division Bench decision of this Court e.g. Bhola Ice Factory and Cold Storage, Agra v. state of U.P. and Ors., 1996 U.P.T.C. 1989; Laxmi Narain v. State of U.P., 1993 U.P.T.C.1174 and P.P.S. Electronic Industries, Kanpur v. State of U.P. and Ors., 1993 U.P.T.C., 853 that if after execution of an unregistered lease deed, there is a subsequent registered lease deed with retrospective effect, the conditions of Section 4-A will stand satisfied"
9. Similar view has also been taken in the case of Ram Prakash Vijai Kumar Pvt. Ltd., Saharanpur v. Deputy Commissioner (Executive), Sales Tax, Saharanpur, reported in 1996 UPTC, 989 P.P.S Electronics Industries, Kanpur and Anr. v. State of U.P. and Ors., reported in 1993 UPTC, 853 and in the case of Laxmi Narain Flour Mills, Hathras, Aligarh and Anr. v. State of U.P. and Ors., reported in 1993 UPTC, 1174.
10. In my opinion, the issue involved is squarely covered by the aforesaid Division Bench decision of this Court. In the present ease, no case of mis-representation, suppression of fact or mis-used of eligibility certificate has been made out and therefore, exercise of power under Section 4-A (3) of the Act canceling the eligibility certificate is also not justified. Reliance is placed on the decision, of this Court in the case of Jai Durga Detergent And Chemicals Pvt. Ltd., Kanpur v. CST, reported in 1995 UPTC, 89 and Mansarovar Bottling Co. Ltd. v. CTT, reported in 1999 UPTC, 864.
11. For the reasons stated above order of the tribunal is liable to be set aside.
12. In the result, revision is allowed, impugned order of the Tribunal dated 04.08.1994 and the order of Commissioner of Trade Tax dated 15.10.1991 under Section 4-A (3) of the Act are set aside.