The Gauhati High Court directed the GST Commissioner to decide the application seeking for fixation of a special rate to the value addition to manufactured goods.
The petitioner M/s Jyothy Labs Ltd (MAXO Unit) is a public limited company registered with the Central Excise Department and is engaged in the manufacture of certain excisable products namely mosquito coils falling under HSN 38 08 9191 of the First Schedule to the Central Excise Tariff Act, 1985. The petitioner with the intention to have the benefits under the Northeastern Industrial Policy of 24.12.1997 had established a manufacturing unit within the Northeastern Region. As per the Northeastern Industrial Policy, the petitioner was earlier entitled to an exemption to excise duty to a certain extent.
The petitioner had submitted an application on 18.05.2020 before the Commissioner of Central Excise and GST, Guwahati making a request for fixation of a special rate for the value addition on the manufactured goods for the financial year 2011-2012 in terms of notifications No.32-99-CE dated 18.07.1999, as amended and No. 31/2008-CE dated 10.06.2008. Similar applications were also filed for fixation of a special rate in respect of other financial years. As the applications of the petitioner were not entertained and the department invoked the attachment of some properties of the petitioner, the petitioner approached this Court by way of writ petitions, which was given final consideration by the order dated 24.03.2021.
As per the order of the Principal Commissioner, GST, Gauhati the authorities had arrived at a conclusion that a stay of the judgment of the Division Bench would not mean that the notifications impugned therein became operational and that the petitioner assessee could have availed the exemption during the intervening period when the appeals were pending before the Supreme Court. The Principal Commissioner was also of the view that the orders of the Supreme Court and the High Court have not provided for any express or implied intention to stay the operation of the amended notification No.32/99-CE dated 19.07.1999.
The single Judge Bench of Justice Achintya Malla Burjor Barua deemed it appropriate that the Principal Commissioner of GST, Guwahati decides the application of the petitioner dated 18.05.2020 on its own merit as regards the claim for fixation of a special rate to the value added to the manufactured goods of the given financial year.
The court also noted that in the earlier order it was an agreed stand of the respondent GST Department that the application of the petitioner requesting for fixation of a special rate on the value added to the manufactured goods would be considered and the possibility that the application would be rejected on the ground of it having not been submitted prior to 30th September of that given financial year was not raised when the said order was passed by the Court.
“We direct the Principal Commissioner, GST, Guwahati to consider the application of the petitioner dated 18.05.2020 seeking for fixation of a special rate to the value added to the manufactured goods of the given financial year and decide the same as per law,” the court said.
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