Commercial production date under exemption notification governed by trial-run finding; later date could not extend the tax exemption period.

A sales tax exemption notification defined commercial production for a small-scale industrial unit by reference to the expiry of the trial run or thirty days from commencement of the trial run, whichever was earlier. On the facts found, trial production had begun on 1 September 1992, and an inspection letter relating to another unit did not displace that finding. The authorities were therefore justified in treating 1 September 1992 as the date of commercial production, and the exemption period had to run from that date rather than from 1 August 1993.

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Issues: Whether the petitioner was entitled to have the date of commercial production treated as 1 August 1993 instead of 1 September 1992 for the purpose of sales tax exemption under the applicable notification.

Analysis: The applicable notification issued under Section 12 of the M.P. General Sales Tax Act, 1958 granted exemption for seven years from the date of commercial production and defined commercial production in relation to a small-scale industrial unit by reference to the expiry of the trial run or thirty days from commencement of the trial run, whichever was earlier. On the facts recorded in the impugned orders, the trial production had commenced from 1 September 1992. The earlier inspection letter relied on by the petitioner related to a different unit and did not displace the finding that the unit had entered the trial production stage. In view of the notification, commercial production was to be deemed to commence on the earlier of the two stipulated dates, and the authorities were justified in treating the relevant date as 1 September 1992.

Conclusion: The determination of commercial production from 1 September 1992 was in law and the petitioner was not entitled to have the exemption period reckoned from 1 August 1993.

Final Conclusion: The challenge to the date fixed for commercial production failed, and the exemption period was held to run from the date determined by the authorities under the notification.

Ratio Decidendi: Where an exemption notification defines commercial production by a deemed date linked to the trial run, the authority must apply that definition on the factual finding as to commencement of trial production, and a contrary later registration date does not govern the exemption period.

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