Retrospective sales tax exemption applies where genuineness is certified for the relevant period despite later exemption certificate

A statutory sales tax exemption subject to later procurement of an exemption certificate may operate retrospectively when the assessee's genuineness has already been certified for the relevant period. The administrative requirement to obtain the exemption certificate does not defeat the substantive exemption where the certificate of genuineness necessarily covers the assessment year in question. On that basis, the exemption was treated as effective from the date of the genuineness certificate, and the assessee was not liable to sales tax or the related penalty.

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Issues: Whether an exemption certificate issued under section 13 of the Haryana General Sales Tax Act, 1973 operates retrospectively from the date of the certificate of genuineness issued by the Haryana Khadi and Village Industries Board, so as to exempt the assessee from sales tax and penalty under section 29 for the relevant assessment period.

Analysis: The notification issued under section 13 granted exemption to co-operative societies and persons holding certificates of genuineness, subject to obtaining an exemption certificate from the Assessing Authority. The assessee could not apply for exemption before obtaining the certificate of genuineness, and the exemption certificate was issued for a period covering the assessment year in question. The condition in the notification was administrative in nature and related to proof of entitlement; it did not defeat the substantive exemption once genuineness had been certified for the relevant period. The Board's certificate necessarily had to relate back to the period during which the assessee was shown to be a genuine co-operative industrial society.

Conclusion: The exemption certificate took effect retrospectively from the date of the certificate of genuineness, and the assessee was not liable to sales tax or the penalty imposed under section 29.

Ratio Decidendi: Where a statutory exemption is made subject to later procurement of an exemption certificate, the exemption may operate retrospectively to the period covered by the certificate of genuineness if the entitlement itself is certified for that period.

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