PETITIONER : N9 .,C,4JVV / AGRAWAL STRUCTURE MILLS (P) LTD., 0&ice at : Behind Krishna Taikies, Samta Cclony, Raipur (CG), ‘ Through Director — SHRI ANIL AGRAWAL, A Company Registered under the Indian Companies Act, 1956 Factory At Urla Industrial Area, Birgaon, Raipur (CG) S/oV ShriMVL. Agrawal, . R/o. : Samta Colony, Raipur (CG) f ‘ V, i RESPONDENTS z /(1) STATE OF CHHATTISGARH Versus Represented by the Special Secretary, Ministry of Commerce & Industries, State of Chhat’nsgarh, Mantralaya, Raipur (Chhattisgarh) / (2) ADDITIONAL DIRECTOR - INDUSTRIES, Directorate of Industries, Raipur (Chhattisgarh) ‘\ PETITION UNDER ARTICLE 226 / 227 OF T L HE CONSTITUTION OF INDLA. N W mé p HIGH COURT OF QUDICATUkE . gT BILAsPUR, CHHATT156ARH ‘ PETITIO .1249 OF 2005 Agrnwal Sfructure Mills (P) L+d Versus Sfute of Chhmisgarh and arm-her- POST FOR ORDER O 9 ‘ AUEUST 2 H sw- / [ A ' - L.C.Bhadoo ‘ ‘ Judge 7fcp8-2605 / mi; a @ HIGH COUkT OF JUDICATURE AT BILASPUR (CHHATTISGARI-D Writ Pc‘tmon No.1249 of 2005 Agrawal STr-ucfure Mills (P) Ltd. - Versus - 5+n1'e of Chha‘H‘isga'h and ana‘rher. Present: - 5hri saryawan Agar-wal wifh Shri R.M. Solapurkar, Advoca-res: Shri N.K. Agrawal, Deputy Advocate General with 5hri R. R. Sinhn, Panel Lawyer: For the Shh/respondents. For fhe pc'H'l-ioner. O R D E R (Passed on 21"“ August, 2005) L.c. aHAboo‘ J. 1. By this writ petitian under- Articie 226/227 of the Constitution of India the petitioner has questioned the legality, propriety and correctness of the communications dated 7*“ August 2004 and 23" November 2W whereby the Additionui Director, Industries has refused to extend the concession and ben‘efit under the Industrial Policy 2001-2006 mined {mder the notification dated sm-o-zooa entitling a new industry for concession of 8% electricity duty for a period of 10 years as well as interest subsidy to the extent of Rs.5 lakhs per year for a period of 5 years. i 2. The petitioner‘s case, as set out in the petition, is that the petitioner has established a new industrial unit as per the Industrial Policy 2001- 2006 and thereby he is eligible for exemption from electricity duty on consumption of the electricity for a period of 1O years stw-ting from 3— 1-2003 and also entitled for interest subsidy to the extent of Rs.5 lakhs per year for a period of 5 years, as the case of the petitioner is covered under the Industrial Policy notified under the notification l i \, t . t es-wwo v ,o WN 166 2 dared 3—6-2003 for fhe periodjOOl—ZOOé. The pefifioner's exisfing indusfr-y Le. Rolling Mill srarl'ed production on 3-8-98 which is located in Urln Indusrr-inl Area, Raipur- on lease hold plo‘r No.162 granted by the District Industries Centre and also on the adjoining free hold land of the petitioner. The existing rolling mill was located in on area of 14386 sq. ft. The petitioner company in order to take advantage of new Industrial Policy established a new industrial unit for production of MS. Ingot, Runner Riser, by constructing an independent and separate shed and building on free hold land belonging to the petitioner and located in the premises of the existing rolling mill and has installed new machines valuing more than R550 lakhs. The new industrial unit is entirely independent and separate from the building and shed of the existing unit and for that purpose the existing electrical load/power supply has also been enhanced. The electricity supply for the rolling mill from the erstwhile M.P.E.B. was of 1200 KVA and for establishment and working of the new industrial unit the load of electricity has been enhanced to 5700 KVA. A separate book of accounts is being maintained for this new industrial unit. . The factory licence, licence for State Commercial Tax/Central Sales Tax, Central Excise licence have been obtained for establishment of new industrial unit. The copies of old and amended factory licence, Commercial Tax & Central Sales Tax Registration Certificates mid Central Excise Licence have been enclosed as Annexures-P/3 to P/6 respectively. Therefore, the petitioner company is entitled for concession of 87; amount of electricity duty andxalso interest to the ’ tune of Rs.5 lakhs per year for a period of 5 years. . Return has been filed on behalf of respondents in which it has been mentioned that the unit for which the petitioner is claiming concessions is not a new unitas per the Industrial Policy, rather this was an expansion of the existing rolling mill and the petitioner company was ~ 10‘; no? able i0 fulfill fhe requirement for the aforesaid exemptions under The new Industrial Policy. . I have heard 5hri Satyawan Agrawal with Shri R. M. Solapurkar, learned counsel for the pefi‘rioner and Shri N. K. Agrnwol, learned Deputy Advocafe General wi'lh Shri R. R. 5inha, Panel Lawyer for The Shh/respondents. . Shri Satyawan Agrawal, learned counsel for the petitioner while inviting fhe «Hemion of fhe Court fowards clause-4 of The notification do‘ted 3/Th-6-2003 regarding new Industrial Policy, argued that it is evident from Permanent Registration Certificate (Annexure-P/l), licence to work a factory (Annemre-P/3), registration certificate under the Sales Tax (Annexure-P/4), registration certificate under the Central Sales Tax Rules 1957 (Annexure-P/5), proforma of registration certificate (Annexure-P/é), the site map of location where the new industry has been set up and the order dated 20-4-2002 issued by the Department of Commerce and Industry, Government of Chhattisgarh, Annexures-P/IO & P/11, that the case of the petitioner company is covered under the new policy as the petitioner's existing unit was rolling mill, whereas a totally separate new unit in the same premises was set up by the petitioner company of a different product i.e. M.$. Ingot by incurring an expenditure to the‘tune of Rs.68,58,997/-. Therefore, action of respondents was not in consonance with the new Industrial Policy and the petitioner is entitled for concession of 8% electricity duty and interest of Rs.5 lakhs per year for a period of 5 years. . On the other hand, Shri NK. Agrawal, learned Deputy Advocate General argued that from perusal of factory licence as well as other registration certificates, it is evident that these licences and registration certificates were issued in the year 1996-98 for the rolling mill and only the addition regarding MS. Ingot ha been incorporated in these old licences which shows that the independent x l l i l 108 uni'r as per clause-4 of The Industrial Policy was no? set up by fhe pe‘l’ifioner. Hence, The petitioner company has righ‘rly been refused 1'he concession and benefi'i' available under- ‘l'he said new Industrial Policy 2001-2006. . In order +0 appreciate fhe‘argumenfs advanced by respective counsel if will be useful to r-e-produce clause—4 of the Industrial Policy. ‘Clause-4: New Industrial unit means (1) which has stwted commercial production on or after 1-11-2001’and there should be permanent registration certificate and production certificate issued by the competent officer indicating the same intention. (2) The industrial unit which has been set up in the premises of the existing industriai unit shall also be considered as new unit on satisfying the following conditions: (a) There should be a separate factory licence/central excise tax licence whichever is necessary and sales tax Act, commercial tax under central sales tax, there should be a separate registration certificate and should be of independent existence. (b) There should be a new building and shed constructed with new plant and machinery of the unit on a separate land for the industrial unit. 'There should be a separate electric connection provided by the Chhattisgarh Electricity Board or the additional electric load has been sanctioned. (c) The unit must be producing separate products other than the existing products. (d) The new industrial unit must maintain its separate account books. (e) Also fulfill the conditions of point No.1: [a . As per annexures-P/IO and P/11 the Commercial and Industrial Department of Public Undertaking Ministry, Raipur issued an order on 20*“ April 2002 and noiificciion dmd 13-2—2003 whereby apart from other industry in the thrust sector list, as per clause No.2 an industry based on steel and iron of the value of R55 lakhs has been included. Therefore. in order to have benefit of new Industrial Policy as per the 0 .-. 10E notificufion dared 3/7m-6-2003 'l'he said new uni? must safisfy +he above requirements. { 10. In the light of the above, if we look into the documents submitted by The pafifioner wifh The pefi'rion, Annexur-e-P/l is fhe per-mananf’ registrafioh cartificafe issued by 'l'he Direcfor of Industries, Raiupr. This was issued 1’0 fhe existing unit i.e. Agrnwai Sirucfure Mills (P) L1d., on 3-8-98 and the industry was for re-roiiing products up 1o 13,000 MT. Perusul of fhe same shows +haf addifional capacify was extended on 28-2-2002 to the extent of 18,000 MT and the reverse ' side of this certificate shows that additional product was inserted on 20*” March 2003 i.e. M.S. Ingot. Similarly, licence to work a factory Annexure-P/3 was also originally issued regarding re-rolling of steel issued under the licence No.2?9/14378/RPR/2MC5 which was renewed up to 30*“ December 2001. Second part of Annexure-P/3 at page 19 shows that in the year 2003 renewal licence to work a factory was up to 31" December 2003, apart from steel rolling, M.5. Ingots were also inserted and the some was issued on 9-7-2003. The letter dated 28-1- 2005 sent by Deputy Director, Industrial Health and Security, Raipur to Mr. Anil Agrawal of the petitioner company with reference to the letter dated 27-12-2004 and it was informed that new factory licence is issued only when factory is totally new, but from your letter, it appears that Agrawal Structure Mills (P) Ltd., Urla has been expanded and some furnace has been established. Therefore, for the expansion only amendment is to be incorporated in the licence. Annexure-Pi4 is the permanent registration certificate issued under the Madhya Pradesh Commercial Taxation Act, 1994. Perusal of the some also shows that initially it was for manufacturing of re-rolling products, with effect from 7-10-2002 M.S. Ingot product was inserted and amended. Even certificate issued by the Commercial Taxation Officer at page 22 also shows that initially the commercial registration certificate was issued to M/s Agrawal Structure Mills (P) Ltd., on 2—9-98 and thereafter on 2-12—2002 M.5. Ingot was also inserted in the said / «.11‘ .n. 11E certificate. Annexure-P/5 is fhe registration certified-e issued under Rule 5(1) of 'i'he Cen‘l'r-al Commercial Tax Rules, 1957. The said certificafe was inifinlly issued on 11-7-96 for M/s Agrnwal S‘rrucrure Mills (P) Lid” and 1hereafl’er regarding MS. Ingo'rs inseri'ion was made on 2-12-2002. Similar is fhe position under 1'l1e Cen'l'ral Sales Tax Act Similar is the posi'iion of proforma of registration certificate issued on 30*” August 1996 by the Central Excise Department. Perusal of the above documents shows that only insertions were made regarding new product M.5. Ingot in the original certificates of the petitioner company which was issued in the year 1996-98. whereas, requirement of clause-4 of the Industrial Policy is that there should be a separate factory licence, Central Sales Tax licence, Central Excise Tax licence and there must be a separate Sales Tax Registration Certificate under the State and Central Act. As far as maintenance of the separate account books is concerned, it has been mentioned in the petition, but nothing has been placed on record which indicates that separate account books are being maintained for MS. Ingot unit and also that separate assessments are being made under the Central Excise and Sales Tax Act and the State Sales Tax Act. All these documents shows that no separate registration certificates and licences were issued in favour of the petitioner indicating establishment of a new unit. In other words, above documents on which petitioner has placed reliance do not satisfy the requirements of clause-4 of the Industrial Policy to be known as new unit. Therefore, I am of the consider-ed opinion that in view of the above facts, the petitioner has not been able to make out a case for benefit and concession available under the new Industrial Policy, Annemre-P/2, issued by the State of Chhattisgarh with effect from 2001. In this connection, the Hon'ble Apex Court in the matter of GRASIM INDUsTRIES LTD AND ANOTHER Versus STATE OF MADHVA PRADESH AND ANOTI-ER reported in (1999) 8 SUPREME COURT CASES 547, after relying on its earlier decision in the matter of . UNION OF INDIA V. WOOD PAPER5 LTD reporfad in (1990) 4 SCC 256, in para-5, held that “I? is serrled posirion of [aw Mar- exempfian nafificafian parficu/arb/ in fiscal mah‘ers has f0 be sfricfbt cansrmea‘ and fhe person claiming ifs benefif is obliged fa saris& file caurr Mar his claim was covered by rite exemption nafificarian. The nafificafian has fa be read in ifs enrirefy and naf in parrs." The above observetian was made by fhe Hon'ble Apex Cour“? while interpreting 'Hwe ofificafion ted 13-3-1981 issued under Section 3-8 cf the Madhyn Pradesh Electrici Duty ct, 1949 for exempting all the producers who run industries from payment of duty during the period specified with effect from 10-12-1980. In the above ase also, the appellants had set up their own generating units or the supply of electricalenergy and claimed the benefit of above notification. 12. Therefore, the titioner has not been able to establish before this Court that the petitioner company had set up a new Industrial Unit as envisaged under clse-4 of the Industrial Policy issued under the notificatio on 3/7’h-6-2003 because before granting exemption of the electrity dut and th interest the intention of the Government was to encoura establishing and setting up of a new Industrial Unit, to give a boost to the industrial development in the $tate and also for generating employment fo the public whereas, from the documents produced b the petitioner, it shows only that this was the expansion of the existing unit and it was not entirely a new independent unit set up in terms of clause-4 of the Industrial licy. 13. In the result, the petitioner's petition tails and the same is dismissed e/ bu without any order as to costs. l . 5d]. L.C.Bhadoo Judge l ii W i igvan ‘8‘2ms n da ty A c f pe au n ci y e ge r y Po t