Serial numbering requirement for exemption memos must run through the accounting year; monthly resets do not satisfy compliance.

Serially numbered cash or credit memos required for exemption under Bengal Sales Tax Rules, 1941 had to be read in the context of the full exemption scheme, meaning continuity was required for the accounting year. Repeated monthly resetting of serial numbers was not treated as compliance, because the memo condition was intended to verify that the sales related to goods manufactured by the unit. The argument of substantial compliance was rejected, as the defect was not a minor irregularity in an otherwise continuous annual sequence. The eligibility certificate was therefore not granted and the exemption claim failed.

---

---

Issues: Whether a small-scale industrial unit seeking exemption under rule 3(66a) of the Bengal Sales Tax Rules, 1941 was entitled to eligibility certificate when it issued serially numbered cash or credit memos with fresh monthly serial numbers instead of a continuous running serial for the relevant accounting year.

Analysis: The exemption condition in the proviso to rule 3(66a) had to be read in the context of the entire exemption scheme under the 1941 Act and Rules. The requirement of serially numbered cash or credit memos was meant to operate with reference to the accounting year, because the statutory scheme treats the year as the relevant unit of time. The contention that the rule did not expressly mention yearly continuity was rejected, since the provision could not be read in isolation. The plea of substantial compliance also failed, because the defect was not a minor deviation during an otherwise continuous annual sequence, but a repeated monthly reset of serial numbers for the short claim period itself. Liberal construction was likewise held inapplicable where the object of the memo requirement was to prove that the sales were of goods manufactured by the unit.

Conclusion: The applicant was not entitled to the exemption claim, and the rejection of the eligibility certificate was upheld.

Ratio Decidendi: A condition requiring serially numbered cash or credit memos under an exemption rule must be construed in light of the statutory scheme as requiring continuity for the accounting year, and repeated monthly resetting of serial numbers does not amount to compliance.

---