Strict compliance with sales tax exemption conditions defeats renewal claims where separate accounts and exclusive bills are not maintained.

Delay in disposal of a renewal application for an eligibility certificate did not by itself invalidate the rejection, because the circular only contemplated expeditious disposal and imposed no rigid limitation period. The sales tax exemption scheme also required strict compliance with its conditions, including separate accounts for the eligible industrial unit and exclusive use of serially numbered bills for that unit's sales. Use of the same bills for other trading transactions showed non-compliance, and substantial compliance was not accepted on the facts. The refusal of renewal was therefore sustained, though fresh consideration for subsequent periods was left open on a lawful basis.

---

---

Issues: (i) Whether delay in disposal of the application for renewal of the eligibility certificate vitiated the order or entitled the petitioner to relief. (ii) Whether the petitioner satisfied the statutory conditions for renewal of the eligibility certificate under the sales tax exemption scheme.

Issue (i): Whether delay in disposal of the application for renewal of the eligibility certificate vitiated the order or entitled the petitioner to relief.

Analysis: The departmental circular required expeditious disposal of applications, preferably within two months, but did not prescribe a rigid time-limit or period of limitation. In the absence of a statutory limitation period, mere delay in passing the order could not by itself invalidate the rejection or confer relief, particularly where the application itself had been made at a belated stage.

Conclusion: The delay did not vitiate the impugned order and no relief could be granted on that ground.

Issue (ii): Whether the petitioner satisfied the statutory conditions for renewal of the eligibility certificate under the sales tax exemption scheme.

Analysis: The exemption scheme required strict compliance with its conditions, including maintenance of separate accounts for the new industrial unit and issue of serially numbered cash/credit memos or bills exclusively for sales of goods manufactured in that unit. Where serially numbered bills were also used for other trading transactions, the statutory requirement of separate accounts was not fulfilled. The court did not accept the plea of substantial compliance on the facts found, and held that the burden lay on the dealer to establish full compliance with the conditions for exemption.

Conclusion: The petitioner failed to establish compliance with the conditions for renewal and the refusal of the eligibility certificate was upheld.

Final Conclusion: The writ petition was not maintainable on the merits and the rejection of renewal of the eligibility certificate was sustained, while liberty was left to seek consideration for subsequent periods on a fresh and lawful basis.

Ratio Decidendi: A dealer claiming tax exemption or renewal of an eligibility certificate must strictly satisfy the statutory conditions, including maintenance of separate accounts and exclusive use of serially numbered bills for the eligible unit; non-compliance defeats the claim even if the breach is said to be minor.

---