Prospective cancellation of entitlement certificate under sales tax law operates only from the cancellation order, with no reference question arising.

Section 41C of the Bombay Sales Tax Act, 1959 is construed so that a certificate of entitlement may be cancelled where its grant is inconsistent with the Act, rules, notifications, or incentive scheme, and the unit ceases to be eligible for exemption only "on and from the date of such cancellation". On that reading, cancellation operates prospectively from the cancellation order and does not relate back to the original grant. The Tribunal's construction was accordingly upheld, and no substantial question of law was found to justify a reference under section 61.

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Issues: Whether cancellation of a certificate of entitlement under section 41C of the Bombay Sales Tax Act, 1959 operated prospectively from the date of the cancellation order and whether any question of law arose warranting a reference under section 61 of the Act.

Analysis: Clause (b) of section 41C(1) permits cancellation of a certificate of entitlement where its grant is inconsistent with the Act, rules, notifications, or relevant incentive scheme. Section 41C(2) provides that the unit ceases to be eligible to claim exemption "on and from the date of such cancellation". On that statutory scheme, the cancellation does not relate back to the date of grant but takes effect from the date of the cancellation order. Since the Tribunal had applied that construction and no substantial question of law arose, a reference under section 61 was not required.

Conclusion: The cancellation was rightly held to operate prospectively from the date of the cancellation order, and the application for reference was rightly dismissed.

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