RSA No.2552 of 2011 (O&M) 1 In the High Court of Punjab and Haryana at Chandigarh RSA No. 2552 of 2011 (O&M) Date of decision: June 03,2011 M/s SRM (India) Limited .....Appellant Versus State of Haryana and others .......Respondents CORAM: HON'BLE MRS. JUSTICE SABINA Present: Mr.Alok Jain, Advocate for the appellant. **** SABINA, J. Plaintiff had filed a suit for permanent injunction. The case of the plaintiff, in brief, was that the defendants be restrained from withdrawing the eligibility certificate issued to the plaintiff-company. Defendants No.1 to 3, in their written statement, averred that the plaintiff was an exempted Unit under Rule 28-A of the Haryana General Sales Tax Rules, 1975 (hereinafter referred to as `the Rules'). Plaintiff-company, while availing the benefit of exemption certificate, had not followed and complied with certain conditions, on the basis of which the exemption certificate was granted to it. As per sub-rule 11A(i) of Rule 28-A of the Rules, the RSA No.2552 of 2011 (O&M) 2 plaintiff was required to continue its production at least for next five years. The plaintiff Unit availed its complete amount of exemption of assessment year 1998-99. The production of the plaintiff decreased continuously. A show cause notice dated 27.5.2003 was issued to the plaintiff under Rule 28-AII(b) of the Rules. Plaintiff was asked to explain his position qua decrease in production. Plaintiff submitted an undertaking that the firm will improve its production but had failed to do so and the firm was closed down. Thus, the plaintiff had violated the conditions of rule 28-A of the Rules. Defendant No. 4 in its separate written statement took up the similar plea as was taken by defendants No. 1 to 3 in their written statement. On the pleadings of the parties, following issues were framed by the trial Court:- “1.Whether the plaintiff is entitled to the relief of permanent injunction restraining the defendants to withdraw the Eligibility Certificate on the grounds as alleged in the plaint?OPP 2.Whether the suit is not maintainable in the present form?OPD 3.Whether the plaintiff has no cause of action to file the present suit?OPD 4.Relief.” The trial Court vide judgment and decree dated 22.12.2009 decreed the suit of the plaintiff to the effect that the defendants were restrained from withdrawing the eligibility certificate dated 6.4.1995 RSA No.2552 of 2011 (O&M) 3 issued by defendant No.4. However, defendant No.3 was left at liberty to issue show cause notice to the plaintiff to explain the decrease in production or the alleged closure of the Unit and then take appropriate permission under the law. Aggrieved by the same, plaintiff preferred an appeal and the same was dismissed by the Additional District Judge, vide judgment and decree dated 17.9.2010. Hence, the present appeal by the plaintiff. After hearing the learned counsel for the appellant, I am of the opinion that the instant appeal deserves dismissal. Clause 9 of Rule 29-A reads as under:- “The exemption/entitlement certificate granted to an eligible industrial unit shall be liable to be cancelled by the Deputy Excise and Taxation Commissioner concerned in the following circumstances, after affording an opportunity of being heard to the unit:- (i)discontinuance of its business by the unit at any time for a period exceeding six months or closing down of its business during the period of exemption/deferment. (ii)disposal by the unit of any of its fixed assets mortgaged with the Government in the Excise and Taxation Department. (iii)failure to furnish adequate security by the unit as required under the rules (iv)failure of the unit to make payment of the deferred amount on the ate of payment. RSA No.2552 of 2011 (O&M) 4 (v)contravention of any of the provisions of the Act and/ or the rules or conditions of the eligibility certificate or the exemption/entitlement certificate by the unit. (vi)When the appropriate committee, which sanctions the eligibility certificate recommends that the exemption/entitlement certificate of the unit be cancelled for reasons to be recorded in writing.” Admittedly, in the present case, the appellant had been issued the eligibility certificate. The Courts below have set aside the show cause notice issued to plaintiff whereby the Eligibility certificate was sought to be withdrawn. The plaintiff is aggrieved by the decision of the Courts below whereby defendant No.3 has been given liberty to issue show cause notice to the plaintiff to explain decrease in production or closure of the Unit. As per Rule 28-A of the Rules, the exemption/entitlement certificate granted to an eligible industrial Unit is liable to be cancelled by the Deputy Excise and Taxation Commissioner concerned after affording an opportunity of being heard to the Unit. One of the conditions under which the notice can be issued is where there is discontinuance of business by the Unit at any time for a period exceeding six months or closing down of its business during the period of exemption/deferment. In these circumstances, the Courts below rightly held that in case of any violation, the Deputy Excise and Taxation Commissioner could certainly take action against the Unit after affording an opportunity of hearing to the RSA No.2552 of 2011 (O&M) 5 concerned Unit. The plaintiff in case is issued any such notice by the Deputy Excise and Taxation commissioner can put up its case as to whether the exemption/entitlement certificate granted to it was liable to be cancelled or not. Hence, no interference by this Court is called for. No substantial question of law arises in this appeal. Dismissed. ( Sabina ) Judge June 03, 2011 arya