Sales tax exemption certificates operate only from issuance, while valid cancellation controls later periods of tax liability.

A sales tax exemption certificate does not protect a dealer for any period before it is actually granted, so liability can still arise for the pre-certificate period. However, once the certificate is issued and remains operative, the dealer is entitled to rely on it until a valid cancellation takes effect. Applying that distinction, the Court treated the period before issuance separately from the period during which the certificate was in force, and held that retrospective cancellation could not negate the exemption for the operative period without lawful effect from the relevant date.

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Issues: Whether the petitioner was liable to pay sales tax for the period during which the exemption certificate was not yet granted and whether the cancellation of the certificate could operate retrospectively to fasten tax liability for the earlier period.

Analysis: The petitioner's unit commenced production on 1 June 1987 and the exemption certificate was issued only on 1 November 1989. The certificate was later cancelled with effect from 1 June 1987. The Court accepted that the petitioner could not rely on the doctrine of legitimate expectation for the entire period from commencement of production, because the exemption was granted only later and the legal position on manufacture of sized timber had already been indicated in earlier decisions. At the same time, once the certificate had been issued and remained in force, the petitioner was entitled to act on it until its cancellation. The Court therefore distinguished the pre-certificate period from the period during which the exemption certificate operated.

Conclusion: The petitioner was held liable to pay sales tax for the period from 1 June 1987 to 31 October 1989, and not liable to pay sales tax for the period from 1 November 1989 to 16 November 1991.

Ratio Decidendi: A sales tax exemption certificate cannot protect a dealer for the period before it is actually granted, but once granted and operative it cannot be ignored for the period it remains in force, absent a valid cancellation taking effect from a lawful date.

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