Retrospective tax exemption certificate changes barred after expiry when the incentive has already been fully acted upon.

A sales tax exemption certificate issued under an incentive scheme cannot be retrospectively modified to the detriment of an assessee after the exemption period has expired and the benefit has been fully acted upon. Incentive provisions in taxing statutes must be construed liberally, and a completed exemption that has been relied on during the eligible period cannot be withdrawn or altered later; only timely correction of factual errors within the currency of the benefit may be permissible. The retrospective amendment was therefore impermissible and the issue was decided in favour of the assessee.

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Issues: Whether a certificate of exemption granted to an industrial unit for sales tax exemption could be modified retrospectively after the expiry of the exemption period.

Analysis: The exemption was granted under the incentive scheme and acted upon by the assessee for the full period of eligibility. The assessee did not collect sales tax during that period on the strength of the certificate. The governing principle is that incentive provisions in taxing statutes must be liberally construed, but a completed and availed exemption cannot be withdrawn or altered retrospectively after the benefit has run its course. A later correction may be permissible only where factual errors are timely rectified within the currency of the benefit, not after expiry of the exemption period.

Conclusion: The retrospective modification of the exemption certificate was impermissible. The issue is answered in favour of the assessee.

Ratio Decidendi: An exemption certificate under a tax incentive scheme cannot be amended retrospectively to the detriment of an assessee after the exemption period has expired and the benefit has been acted upon.

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