Exemption under section 4A: multiple industrial units, belated applications, and eligibility must be decided by the competent authority.

For exemption under section 4A and the 21 February 1997 notification, a company's industrial undertaking could comprise multiple units, so a joint application was maintainable and qualifying fixed capital investment was not confined to one physical unit. A belated application did not bar consideration altogether; it only limited the exemption period from the date of application to the end of the notified period. The existence of stay orders could prevent a finding of tax arrears for the covered period, but final entitlement to an eligibility certificate still required factual verification by the competent authority. The High Court's direct directions for issuance and reimbursement were unsustainable, and the matter was remitted for fresh decision.

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Issues: (i) Whether a joint application could be filed for multiple units of the same industrial undertaking and whether the fixed capital investment could be aggregated for claiming exemption under section 4A and the notification dated 21 February 1997; (ii) whether the application was time-barred under section 4A(5); (iii) whether rejection on the ground of arrears of tax was sustainable and whether the High Court could direct issuance of the eligibility certificate and reimbursement of amounts.

Issue (i): Whether a joint application could be filed for multiple units of the same industrial undertaking and whether the fixed capital investment could be aggregated for claiming exemption under section 4A and the notification dated 21 February 1997.

Analysis: Section 4A, read with the notification, treated the company as the dealer and the industrial undertaking as the unit for the purpose of expansion, modernisation, diversification or backward integration. The statutory scheme and the notification did not require the entire qualifying investment to be confined to one physical unit. The reference to unit-wise figures did not negate the wider entitlement of the industrial undertaking, and the benefit could be worked out unit-wise according to the location and the schedule.

Conclusion: A joint application was maintainable, and qualifying investment was not restricted to a single unit only.

Issue (ii): Whether the application was time-barred under section 4A(5).

Analysis: Section 4A(5) expressly provided that a belated application did not destroy entitlement to the exemption altogether. If filed after the prescribed period, the benefit was confined to the period computed from the date of application up to the end of the notified period. The provision therefore operated as a limitation on the extent of benefit, not as a complete bar to consideration.

Conclusion: The application could not be rejected merely as time-barred.

Issue (iii): Whether rejection on the ground of arrears of tax was sustainable and whether the High Court could directly order issuance of the eligibility certificate and reimbursement of amounts.

Analysis: The existence of stay orders meant that the assessee could not be treated as in arrears during the period covered by the stay. However, the factual position for any uncovered period still required examination by the competent authority. The entitlement to an eligibility certificate depended on verification of the actual expansion, modernisation or diversification and on the applicability of the notification conditions, which the High Court could not finally determine on the material before it. The proper course was for the committee to decide the application on merits.

Conclusion: The arrears ground was not on the material before the Court, and the High Court's directions for issuance of the certificate and reimbursement were unsustainable.

Final Conclusion: The matter was remitted to the competent committee for fresh decision on the application, while the view that a single company could not file a joint application for multiple units and that a belated application was wholly barred was rejected.

Ratio Decidendi: For exemption under section 4A and the relevant notification, the industrial undertaking of a company may comprise multiple units, a belated application only limits the period of benefit, and final entitlement must be determined by the statutory authority on the factual conditions prescribed by the notification.

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