Exemption-linked set-off cannot be denied for non-payment of tax when binding precedent has already settled the issue.

Where an exemption notification governs the set-off rate, the higher set-off cannot be denied merely because the underlying tax was not actually paid. The High Court noted that the point had already been settled by earlier Division Bench authority, so the benefit of the notification could not be made ineffective by a contrary view. On that settled basis, the Court held that no live question of law arose for interference under the reference provision and declined further adjudication.

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Issues: Whether, on the facts and in the light of the exemption notification, the dealer was entitled to set off at 2.5% instead of 2%, and whether any question of law arose for interference in the reference under section 44 of the MP General Sales Tax Act, 1958.

Analysis: The Reference arose from the Board of Revenue's determination that the dealer could not be denied the higher set-off merely because tax had not actually been paid, where the applicable notification granted the exemption benefit. The Court noted that the question raised had already been considered in an earlier Division Bench decision on the same principle, and that the benefit of the notification could not be rendered nugatory by taking a contrary view. In view of that settled position, the Court found no live question of law warranting interference.

Conclusion: The issue was answered against the assessee and in favour of the Revenue.

Final Conclusion: The reference was declined because the settled legal position on the exemption-linked set-off left no question requiring further adjudication.

Ratio Decidendi: Where a statutory exemption notification governs the applicable rate for set-off, the benefit cannot be denied merely because the underlying tax was not actually paid, and no referable question of law arises when the issue is already settled by binding precedent.

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