Eligibility certificate cancellation under tax exemption order invalid where authority acted only on a later change of opinion.

An eligibility certificate issued under the Assam Industries (Tax Exemption for Pipeline Units) Order, 2005 could be cancelled only on the specific grounds set out in Clause 12, namely breach of condition, false information, fraud, misrepresentation, suppression of facts, or non-compliance with certificate terms. The cancellation was based only on a later change of opinion that the unit's activity was not manufacturing, with no allegation of any Clause 12 ground. The Gauhati HC held that such a cancellation exceeded the limited power under Clause 12 and could not be sustained.

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Issues: Whether an eligibility certificate granted under the Assam Industries (Tax Exemption for Pipeline Units) Order, 2005 could be cancelled merely on a subsequent change of opinion as to the unit's eligibility.

Analysis: Clause 12 of the Assam Industries (Tax Exemption for Pipeline Units) Order, 2005 permits termination of the eligibility certificate and certificate of entitlement only upon violation of a condition, false information, fraud, misrepresentation, suppression of facts, or non-compliance with the certificate conditions. The impugned cancellation was not founded on any allegation of fraud, misrepresentation, suppression, or breach of condition. It rested only on a later view that the activity did not amount to manufacturing. Such a cancellation exceeded the limited power conferred by Clause 12, and the matter did not require a ruling on whether the activity constituted manufacturing.

Conclusion: The cancellation on the ground of change of opinion was invalid and the impugned orders could not be sustained.

Ratio Decidendi: An eligibility certificate under Clause 12 of the Assam Industries (Tax Exemption for Pipeline Units) Order, 2005 can be terminated only on the grounds expressly specified therein and not merely because the authority later changes its view on eligibility.

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