I had a quick and dirty look through some of my old Matchless spare parts lists and found the M40 headlamp was standard equipment on the 1931 models D and DS. The D series Matchless of those days were the bottom of the range bread and butter end of the Matchless line up. The fancy Silver Hawk, Silver Arrow, the vee twin etc, etc used the Lucas H52 but the cheap end used the M40.
I think your seller's right in thinking it is from around the late 20's, early 30's period.
Also according to my Matchless spares list Lucas did the self contained version as shown plus one where the relevant switches etc, were fitted to a tank panel so you got a plain headlamp minus all the gadgets.
It would appear then that the M40 is the Lucas economy model headlight of the day.
Hope this is of some assistance, looking further will take time and if you want to bid on it time is in short supply.
Cheers,