Diversification under an incentive scheme cannot be denied by borrowing expansion ; later sick-unit relief bars only concurrent benefit.

A unit eligible under a sales tax incentive scheme's diversification category could not be denied relief by importing the separate conditions attached to expansion, because the scheme treated the two as distinct routes with different requirements. On the facts, the unit had a fresh industrial licence, a new product line and the requisite fixed capital investment, so diversification eligibility was made out even without proof of sale of the diversified product. A later sanction under a sick-unit scheme did not extinguish the earlier entitlement, because the prohibition on dual benefits prevented only concurrent enjoyment, not accrued eligibility under the earlier scheme.

---

---

Issues: Whether the petitioner's unit was entitled to sales tax incentive benefits under the 1987 scheme on the basis of diversification; and whether the later sanction of benefits under the 1989 scheme as a sick unit barred grant of benefits under the 1987 scheme.

Analysis: The Scheme treated expansion and diversification as distinct categories, each with separate qualifying conditions. On the facts, the unit had a new product line under a fresh industrial licence and the additional fixed capital investment met the prescribed threshold. The Court held that eligibility for diversification did not depend on satisfying the requirements of expansion, and the sale of the diversified product was not a necessary condition where the scheme itself did not so provide. The subsequent attempt to reconsider the earlier sanction was held impermissible because review and reconsideration were introduced only later and, in any event, were time-barred by the scheme's appeal period. The bar against availing both schemes simultaneously was construed as preventing concurrent enjoyment, not as extinguishing the earlier entitlement from the date of application; the benefits under the two schemes could operate consecutively.

Conclusion: The petitioner was entitled to benefit under the 1987 scheme on the basis of diversification, and the rejection of that claim on the ground of expansion ineligibility and simultaneous-benefit prohibition was unsustainable.

Final Conclusion: The application succeeded, and the petitioner's entitlement under the old incentive scheme was upheld, subject to the temporal and monetary limits of that scheme and without permitting overlapping enjoyment with the later sick-unit benefit.

Ratio Decidendi: Where a scheme grants separate benefits for diversification and expansion, an applicant eligible under diversification cannot be denied relief by importing the conditions of expansion, and a later bar on simultaneous enjoyment of two schemes prevents only concurrent benefit, not prior accrued eligibility.

---