HT Bureau
GUWAHATI, Jan 13: In a landmark decision, Justice Soumitra Saikia of Gauhati High Court has ruled against the exclusion of certain industrial units, eligible for benefits under the North East Industrial and Investment Promotion Policy (NEIIPP), from the Budgetary Support Scheme. The court found the denial, based on the non-payment of Central Excise Duty due to turnover thresholds or the production of exempted goods, to be illegal and in violation of Article 14 of the Constitution of India.
Several writ petitions challenging the Ministry of Commerce & Industries’ notification dated October 5, 2017, and related circulars, were filed before the Gauhati High Court. The petitions contested the denial of Budgetary Support benefits to industrial units under the Goods and Services Tax (GST) regime if they were previously exempt from Central Excise Duty.
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Dr Ashok Saraf, senior advocate representing the industrial units, argued that the denial of Budgetary Support benefits to units with turnover below 1.5 crores or manufacturing exempted goods was arbitrary and against the provisions of GST law. He emphasised that such units were eligible for various benefits, and the denial was unjustified based on turnover thresholds or exempted goods production.
The court, accepting the arguments put forth by Dr Saraf, held that the denial of Budgetary Support benefits to these industrial units was based on an unreasonable classification. The court highlighted that units benefiting from the Budgetary Support Scheme and those denied the benefits due to non-payment of Central Excise Duty stand on similar footing under GST. The classification made by the authorities was deemed arbitrary and contrary to the GST law.
The court directed the authorities to examine individual claims of petitioners’ industries. If found to satisfy the criteria and eligibility outlined in the NEIIPP, the Budgetary Support Scheme benefits extended to similarly situated units should also be granted to these industrial units. Dr Ashokk Saraf, senior advocate, and Pritam Baruah, advocate, appeared for the petitioners, while SC Keyal, standing counsel, GST, represented the respondents.
