Exemption under section 4-A must be tested on recorded reasons, with fresh reconsideration required for the exemption claim.

Exemption under section 4-A of the U.P. Sales Tax Act, 1948 was examined in light of Explanation 2(6), with the focus on whether a unit registered for the relevant raw material could be denied relief because of the reasons recorded in the rejection order. The Court confined its review to the grounds stated in the impugned order and did not treat additional reasons in the counter-affidavit as a substitute for those original reasons. It also noted that the application had not been assessed in the correct statutory perspective, particularly regarding the later permission to use tin-sheets partly as raw material. The rejection of the exemption claim was held unsustainable and the matter was directed for fresh reconsideration by the Committee.

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Issues: Whether the petitioner was entitled to exemption under section 4-A of the U.P. Sales Tax Act, 1948 in light of Explanation 2(6), and whether the Divisional Level Committee's rejection of the exemption application was legally sustainable.

Analysis: The dispute turned on whether the unit, as registered and later permitted to use tin-sheets partly as raw material, could be denied exemption merely on the basis of the grounds recorded in the impugned order and the manner in which the application was assessed. The order was examined only on the reasons stated in it, and subsequent additional grounds in the counter-affidavit were not treated as a substitute for the reasons originally recorded. On the material before the Court, the petitioner's case was not considered in the correct statutory perspective under section 4-A and its Explanation 2(6), particularly in relation to the registered raw material and the permission later granted for use of tin-sheets.

Conclusion: The rejection of the exemption claim could not be sustained as passed and the matter required reconsideration by the Divisional Level Committee afresh.

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