1m/s. Karnataka Water Pumps Limited, Bangalore vs State of Karnataka and Others

The question raised in this writ petition is for sales tax exemption of the petitioner-industry under the Act. A similar question had been considered by this Court in Writ Petition No. 7112 of 1998 and this Court has stated as hereunder:

"2. With regard to the applicability of the notification dated 11-10-1995, issued under Section 8-A of the Karnataka Salex Tax Act. By this notification the tax eligible for exemption is restricted to the average total tax liability of three years immediately preceding the year in which investment/exemption is made. The notification dated 28-8-1993 has contemplated the benefit of exemption of 80% of the amount invested in fixed assets for expansion/diversification/modernisation. The case of the petitioner is of modernisation. It is stated that at the time when the investment was made there was no such restriction and the notification dated 11-10-1995 would only be prospective and will not affect the persons like the petitioner to whom sales tax exemption has been granted in terms of notification dated 28-8-1993 and the certificates of the department of industries and commerce have been issued on 9-7-1996 in this regard. It remains a question of fact as when the investment has been made. If the investment has been made after coming into force of the notification dated 11-10-1995 then the relief could be restricted according to the notification. But if the investment has already been made, prior to coming into force of this notification dated 11-10-1995, in terms of notification dated 28-8-1993, the benefit of exemption cannot be denied giving effect retrospectively. The Assessing Authority therefore may consider this aspect as to when the actual investment has been made by the petitioner. It has been held in Motilal Padampat Sugar Mills Company Limited v State of Uttar Pradesh and Others, 3 SCST 3166 and Pournami Oil Mills v State of Kerala and Another, 3 SCST 3219, that the doctrine of promissory estoppel is applicable to the new unit, in view of the promise given by the State.

Writ petition stands disposed of with the above observation.

Learned Counsel for the petitioner seeks four weeks time to file reply to the show-cause notice. Petitioner may file his objections which the Assessing Authority shall take into consideration before passing the order".

I have heard Mr. S.V. Subramanyam, learned Counsel for the petitioner as also Mrs. Sujatha, learned HCGP for respondents. It is agreed that this writ petition can also be disposed of in similar manner. The claim of exemption will be considered by the Assessing Officer in terms of the notification dated 28-8-1993. The petitioner may produce all the documents that he intends to rely on before the Assessing Authority who shall examine the same and decide as to whether the petitioner can be exempted. The finding in this behalf may be entered by the Assessing Authority on the basis of materials on record and the documents that the petitioner may produce. Writ petition is disposed of in the above terms.