Industrial incentive exemptions cannot be retrospectively curtailed by reclassifying a valid certificate as a factual error.

An industrial incentive eligibility certificate, once validly issued and acted upon, could not be substantively rewritten by introducing a new limitation confining sales tax exemption to additional production capacity. The authorities' power to correct factual error did not extend to fresh adjudication or withdrawal of accrued benefits unless a genuine mistake was shown. As no factual error was established on the record, and the investment had been made before the later notification, retrospective curtailment of the exemption was impermissible. The amended certificate and consequential demand were therefore unsustainable, and the original certificate continued to govern the petitioner's entitlement.

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Issues: Whether the amended eligibility certificate limiting sales tax exemption to additional production capacity created by the investment could be sustained, and whether the authorities were justified in treating the earlier certificate as liable to modification on the ground of factual error.

Analysis: The eligibility certificate had been issued under the industrial incentive scheme and had governed the petitioner's entitlement. The later amendment introduced a new limitation by confining exemption to additional capacity and altered the basis of the original certificate. The reasoning adopted by the authorities rested substantially on the earlier single-judge view, but that view had already been set aside in appeal. The only liberty preserved by the appellate court was to correct any factual error, and such power could not be used to effect a fresh adjudication or withdraw benefits by recharacterising the scheme. The record did not disclose any factual mistake warranting amendment. The court also noted that the investment had been made before the later notification and that retrospective restriction of the benefit was impermissible in the circumstances.

Conclusion: The amended certificate and consequential demand were unsustainable and were set aside. The petitioner was held entitled to the benefit under the original certificate.

Final Conclusion: The decision affirms that an industrial incentive certificate, once validly issued and acted upon, cannot be substantially rewritten under the guise of correcting a factual error, and the exemption already granted could not be retrospectively curtailed on the facts of the case.

Ratio Decidendi: A certificate issued under an industrial incentive scheme may be corrected for factual error, but it cannot be substantively altered to impose a new limitation or withdraw accrued benefits unless a genuine factual mistake is shown.

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