1975 (4) TMI 123 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Validity of the notice dated 25th November 1966.
2. Limitation period for issuing the notice.
3. Retrospective application of the amendment to Section 11(2a) of the Bengal Finance (Sales Tax) Act, 1941.
4. Refund of the amount deposited as sales tax.

Issue-wise Detailed Analysis:

1. Validity of the Notice Dated 25th November 1966:
The petitioner, a building contractor registered under the Bengal Finance (Sales Tax) Act, 1941, challenged the notice dated 25th November 1966 issued by the Sales Tax Officer for producing relevant documents for a fresh assessment. The petitioner argued that the notice was issued beyond the permissible period and relied on the judgment of S.K. Kapur, J., which quashed the original assessment and did not provide any positive direction for a de novo assessment. The Court considered the observations made in the earlier judgment which allowed the respondents to make a fresh assessment "in accordance with law."

2. Limitation Period for Issuing the Notice:
The Court examined Section 11(2a) of the Act, which stipulates that no assessment shall be made after the expiry of four years from the end of the assessment year. The amendment to this section, effective from 1st October 1959, introduced a proviso that extended the limitation period when the assessment was made in consequence of an appellate or revisional order. The Sales Tax Officer contended that the notice was within limitation as it was issued within four years of the judgment dated 29th April 1966. However, the Court found that the amendment did not have retrospective effect to cover the period before its enactment.

3. Retrospective Application of the Amendment to Section 11(2a):
The Court referred to various precedents, including the Supreme Court's decisions in Jaipuria Brothers Limited v. State of U.P. and Sales Tax Officer, Circle I, Jabalpur v. Hanuman Prasad, which discussed the retrospective application of amendments to limitation periods. The Court concluded that the amendment to Section 11(2a) did not apply retrospectively to cover the period before its enactment on 1st October 1959. Therefore, the notice issued on 25th November 1966 was beyond the permissible period as the limitation had already expired on 31st March 1959.

4. Refund of the Amount Deposited as Sales Tax:
The petitioner sought a refund of Rs. 3,170.25 deposited as sales tax for the year in question. However, the petitioner's counsel did not press this relief during the hearing. Therefore, the Court did not address this issue in detail and did not grant any relief regarding the refund.

Conclusion:
The Court quashed the impugned notice dated 25th November 1966 as it was issued beyond the permissible limitation period. The amendment to Section 11(2a) of the Act did not have retrospective effect to cover the period before its enactment. The petition was allowed, and the notice was quashed without any order as to costs. The request for a refund of the deposited amount was not pressed by the petitioner and was not decided by the Court.