Expansion scheme eligibility turns on statutory conditions, and timing of expansion alone is not conclusive where substantive requirements are met.

Under the U.P. Trade Tax Act, the Tribunal's power to stay an impugned order on appeal extends to cancellation of an eligibility certificate, and eligibility under the expansion scheme turns on the statutory conditions for entitlement. The note distinguishes the field of eligibility under Explanation (5) to Section 4-A from the stage at which exemption becomes available after base production is crossed. It further explains that substantial additional fixed capital investment and increased production capacity may satisfy the scheme's requirements, so timing of expansion alone is not conclusive where the substantive conditions are otherwise met.

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Issues: Whether the Trade Tax Tribunal was justified in rejecting the stay application and whether the petitioner's expansion unit satisfied the eligibility requirements under the expansion scheme.

Analysis: The writ petition arose from an order passed on a stay application in an appeal against cancellation of an eligibility certificate. The statutory appeal under Section 10(2) of the U.P. Trade Tax Act, 1948 was maintainable, and the Tribunal had power under Section 10(6) to stay the operation of the impugned order. On the facts, the petitioner had made additional fixed capital investment exceeding the prescribed percentage and had increased production capacity substantially. The judgment distinguished between the field of eligibility under Explanation (5) to Section 4-A and the stage at which exemption becomes available after crossing base production. The rejection of the stay application merely because expansion was undertaken before completion of one year was held to be unsustainable in the circumstances, especially when the petitioner otherwise satisfied the eligibility conditions.

Conclusion: The rejection of the stay application was set aside, the cancellation order was stayed, and the appeal was permitted to proceed for decision afresh on merits. The petitioner succeeded.

Ratio Decidendi: Eligibility under the expansion scheme must be assessed by reference to the statutory conditions governing entitlement, and the Tribunal may not refuse relief by treating the timing of expansion alone as conclusive where the substantive eligibility requirements are satisfied.

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