DIVISIONAL LEVEL COMMITTEE AND ANR. versus HARSWARUP DRUM UDYOG

Citation: [1999] 1 S.C.R. 336 · Decided: 02-02-1999 · Supreme Court of India · Bench: M. SRINIVASAN, U.C. BANERJEE · Disposal: Dismissed

Judgment (excerpt)

A 
DIVISIONAL LEVEL COMMITTEE AND ANR. 
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I 
v. 
. 
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HARSWARUP DRUM UDYOG 
FEBRUARY 2, 1999 
[ 
B 
[M. SRINIVASAN AND U.C. BANERJEE, JJ.] 
U.P. Sales Tax Act, 1948: Section 4A. 
,. 
• 
Sales T~xemption from-Respondent's application dated 
c 28.1.1992 for exemption of sales t~ejection--Ground that the registration 
of the lease deed was made on 27.3.1990 after the date of the first sale, 
namely, 19.5.1989 and, therefore, the lease deed having been registered after 
the date of the availability of the facility of exemption, the respondent was not 
entitled to claim the benefit of section 4-A-High Court held that the lease 
D deed having been registered on 27.3.1990, the respondent was entitled to get 
the exemption with effect from the date-However, it did not made clear 
whether the respondent would get exemption for a period off our years from 
27.3.1990-Appeal before Supreme Court-Held, Sub-section (1) of Section 
-,.. 
4-A itself contemplates the grant of exemption whether 'wholly or 
E partly'-Theref ore, an asses see can get exemption for a part of the period 
subject to fulfilment of all the conditions--!n the present case, the relevant 
condition is found in sub-cluase (c) of Clause 1 of Explanation to Section 
4(1) A-:ln the present case though the lease was taken by respondent much 
earlier but the registration was made only on 27.3.1990-The lease being one 
F 
for a period of seven years, required registration and will satisfy the require-
ment of the Section from the date of registration-Hence the High Court was 
right i~ holding that all the conditions are fulfilled on 27.3.199()-[n the 
present case, sub-section 5 of section 4A governs the situation-The respon-
dent no doubt applied for exemption for the entire period but the conditions 
G 
were fulfilled only on 27.3.1990 and the exemption can be granted only for 
the remaining period after that date-:ln other words, the respondent will be 
entitled to exemption for a period of 3 years 1 month and 4 days from 
27.3.1990. 
• 
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CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3543 of 
H 1996. 
336 
. .( 
DIVISIONAL LEVEL COMMITTEE v. HARSW ARUP DRUM UDYOG 
337 
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From the Judgment and Order dated 5.12.94 of the Allahabad High A 
Court in C.M.W.P. No. 485 of 1992. 
Avadh Behari Rohtagi, R.B. Misra, (Sunil Kumar) (NP). Jitendra 
Mohan Sharma, Dr. Meera Aggarwal and Ramesh Chandra Mishra for the 
appearing parties. 
B 
", 
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The following Order of the Court was delivered : 
... 
The Divisional Level Committee constituted under Section 4-A of 
the U.P. Sales Tax Act, 1948 (for short "the Act"), and the State of U.P. 
are aggrieved by the order of the High Court passed in Civil Misc. Writ c 
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Petition No. 485 of 1992 quashing the order of the Committee rejecting an 
application filed by the respondent for exemption from payment of sales 
tax under Section 4-A of the Act. 
2. The order of the Joint Director of Industries rejecting the applica-
tion of the respondent dated 28.1.1992 shows that the rejection was on the D 
ground that the registration of the lease deed was made on 27.3.1990 aft:::r 
the date of the first sale, namely, 19.5.1989 and, therefore, the lease deed 
having been registered after the date of the availability of the facility of 
exemption, the respondent was not entitled to claim the benefit of Section 
4-A. The High Court has held that the lease deed having been registered E 
on 27.3.1990, the respondent was entitled to get the exemption with effect 
from that date. The High Court has not, however, made it clear whether 
the respondnet would get exemption for a period of four years from 
27.3.1990. 
3. Learned counsel for the appellants contends that the respondent 
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not having fulfilled all the conditions prescribed in Section 4-A of the Act 
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for getting the exemption on the date on which the first sale was effected, 
is not entitled at all to get the exemption for any period whatsoever. 
According to him, the relevant date for grant of exemption is the that date 
of first sale as contemplated by sub-section (1) of Section 4-A of the Act. G 
According to him, if on that date, all the conditions are not fulfilled and 
they are fulfilled at a later date, the assessee will not be entitled to get the 
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exemption. 
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4. We are unable to agree with this contention. Sub-section (1) of 
Section 4-A itself contemplates the grant of exemption whether 'wholly or H 
338 
SUPREMECOURTREPORTS. 
[1999] 1 S.C.R. 
A partly

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