Annual tax exemption applies for the full assessment year when no commencement date is fixed in the statute or notification.

Where sales tax is an annual levy and the Act, rules, and exemption notification do not specify the commencement date of an exemption certificate, the exemption operates for the whole assessment year. Rule 12 governed only expiry and renewal of the certificate for subsequent years and did not restrict commencement from the date of application or grant. The date of application, payment of fee, and the assessee's accounting year were immaterial to the scope of exemption. The certificate therefore covered the entire business transacted during the assessment year.

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Issues: Whether an exemption certificate granted under section 4(2) of the Rajasthan Sales Tax Act, 1954, during the relevant year operated for the entire assessment year or only from the date of application or grant.

Analysis: The sales tax under the Act was held to be an annual tax, levied on annual turnover and assessed after the returns for all periods of the year became due. Rule 12 regulated only the expiry of an exemption certificate and required a fresh certificate for each subsequent assessment year, but it was silent as to the commencement of the exemption. The notification granting exemption also did not fix any starting date. In such a statutory setting, and following the principle that where an annual tax is exempted during the year without the Act or notification fixing a commencement date, the exemption operates for the whole year, the date of application or payment of the fee did not limit the period of exemption. The distinction drawn from the conditional nature of the exemption and from the assessee's accounting year was held to be immaterial.

Conclusion: The exemption certificate operated for the entire business transacted in the assessment year, and not merely from the date of the application.

Ratio Decidendi: Where a tax is annual and the governing Act, rules, and exemption notification do not specify the commencement date of an exemption certificate, the exemption applies for the whole assessment year despite being granted mid-year.

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