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| Take up Bhushan Steel row with A'bad HC again: SC asks UP |
| Press Trust of India / New Delhi Sep 07, 2010, 21:46 IST |
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The Supreme Court has asked the UP government to take up its tax exemption dispute with Bhushan Steel and Strips in the Allahabad High Court again through a review petition, after an earlier ruling went in favour of the secondary steel producer.
Hearing an appeal filed by the Uttar Pradesh government against the Allahabad High Court's order allowing the firm to include Rs 5.8 crore paid by it to the state government as excise duty on machinery as 'fixed capital investment', a Supreme Court bench headed by Justice D K Jain directed the state government to file a review petition in the High Court.
The firm had bought machinery worth of Rs 528 crore under the 'fixed capital investment' scheme, based on which it had sought tax exemption on the Rs 5.8 crore it paid to the state government as excise duty, since the value of fixed capital investment is exempt from trade tax under the UP Trade Tax Act, 1948.
Later, Bhushan Steel and Strips had also separately claimed Modvat on the same amount and this was objected by the state revenue officials.
The state government had submitted that the grant of Modvat would not change or reduce the price paid for goods purchased, such as plant and machinery.
The UP government said that the excise duty had already been compensated to the company on the finished goods manufactured by it, so the company could not claim another exemption on the same amount.
However, this interpretation was rejected by the High Court, following which the UP government approached the Supreme Court.
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