Expansion of an industrial unit can include new machinery at the same site, limiting sales tax incentive relief.

Rule 149(4) permits amendment of an eligibility certificate for a change in the gross value of fixed capital assets, but only consistently with section 43A of the West Bengal Sales Tax Act, 1994. Additional investment used to increase productive capacity, supported by industrial registration and financing records describing the project as an expansion, was treated as expansion of an existing unit rather than a new eligible investment. Expansion is not limited to physical enlargement of the factory or relocation; it may include new machinery installed at the existing site. On that basis, the claimed enhancement and remission benefit were not available.

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Issues: Whether the petitioner was entitled to enhancement of the gross value of fixed capital assets under rule 149(4) of the West Bengal Sales Tax Rules, 1995 for additional investment made in the unit, or whether the investment was for expansion of the industrial unit so as to attract the restriction under section 43A of the West Bengal Sales Tax Act, 1994.

Analysis: Rule 149(4) permits amendment of an eligibility certificate where there is a change in the gross value of fixed capital assets, but it must operate consistently with section 43A of the West Bengal Sales Tax Act, 1994, which curtails the incentive under section 41 in respect of newly set up units and expanded portions of existing units coming within the post-1 January 2000 regime. The materials showed that the additional investment was made to increase productive capacity, that the unit had obtained industrial registration as an expansion project, and that the proposal to the financial corporation also described the project as expansion. The Court held that expansion is not confined to physical enlargement of the factory shed or a shift to another location and may include installation of new machinery at the existing site that increases capacity.

Conclusion: The petitioner was not entitled to enhancement of the gross value of fixed capital assets under rule 149(4), and the refusal to grant the claimed remission benefit was justified.

Final Conclusion: The application failed on merits because the additional investment was treated as expansion of the unit, bringing the claim outside the protected incentive regime.

Ratio Decidendi: Where a post-1 January 2000 investment in an existing industrial unit is made for expansion and increased productive capacity, the incentive under section 41 cannot be extended through rule 149(4) in view of section 43A.

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