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TMI Blog2011 (3) TMI 1521X X X X Extracts X X X X X X X X Extracts X X X X ..... e cannot exercise retrospective power in certain situations, obviously it cannot authorise delegated authority to do. Contention of the petitioner has, thus, to be upheld. - CWP No. 5957 of 2010 - - - Dated:- 22-3-2011 - ADARSH KUMAR GOEL AND AJAY KUMAR MITTAL, JJ. For the Appellant : Sandeep Goyal For the Respondents : Gagandeep Singh Wasu, Additional Advocate General, Haryana, The judgment of the court was delivered by ADARSH KUMAR GOEL J.- This petition seeks quashing of notification dated May 13, 2008, making retrospective amendment from January 1, 2006 to the Schedule to the Haryana Value Added Tax Act, 2003 (the Haryana VAT Act) thereby making the goods in question taxable. The case set out in the petition is that the petitioner is a dealer registered under the provisions of the Act. It purchased animal feed in the shape of damaged wheat from Government agencies during the year 2005-06. Animal feed which by interpretation included damaged wheat being covered by entry 4 of Schedule B, was tax-free. The petitioner having paid the tax under mistake sought refund relying upon the judgment of this court in Garg Cattle Feed Industries v. Food Corporatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , that is to say aquatic feed, poultry feed and cattle feed including supplements, concentrates and additives to these foods, husk of pulses and de-oiled cakes (including, de-oiled rice bran). Animal feed, that is to say, aquatic feed, poultry feed and cattle feed (but not including damaged wheat including supplements, concentrates and additives to these feeds, husk of pulses and de-oiled cake (including de-oiled rice bran). Thus, the question is whether the amendment is merely clarificatory or it creates taxability of goods for the first time from a retrospective date. It is well-settled that a Legislature has power not only to legislate prospectively but also retrospectively. However, there are certain inherent limitations in making retrospective legislation. The limitations have been judicially recognized to give effect to fundamental right under article 14. Retrospectivity is not permissible if it is unreasonable and arbitrary. It has been held that a Legislature cannot legislate today with reference to a situation which obtained 20 years ago ignoring the march of events and constitutional rights accruing in the meanwhile. Whether or not retro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... infraction of the rights to property is to be tested not by the flexible rule of due process but on the more precise criteria set out in article 19(5). Mere retrospectivity in the imposition of the tax cannot per se render the law unconstitutional on the ground of its infringing the right to hold property under article 19(1)(f) or depriving the person of property under article 31(1). If, on the one hand, the tax enactment in question were beyond the legislative competence of the Union or a State necessarily different considerations arise. Such unauthorised imposition would undoubtedly not be a reasonable restriction on the right to hold property besides being an unreasonable restraint on the carrying on of business, if the tax in question is one which is laid on a person in respect of his business activity.' 33. The court was more emphatic in Rai Ramkrishna v. State of Bihar [1963] 50 ITR 170 (SC); [1964] 1 SCR 897 about the power of the Legislature in India to enact retrospective taxation laws. It held that if in its essential features a taxing statute is within the competence of the Legislature, it would not cease to be so if retrospective effect is given to it. A power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... validity of the retrospective operation of the Act. It is conceivable that cases may arise in which the retrospective operation of a taxing or other statute may introduce such an element of unreasonableness that the restrictions imposed by it may be open to serious challenge as unconstitutional; but the test of the length of time covered by the retrospective operation cannot, by itself, necessarily be a decisive test. We may have a statute whose retrospective operation covers a comparatively short period and yet it is possible that the nature of the restriction imposed by it may be of such a character as to introduce a serious infirmity in the retrospective operation. On the other hand, we may get cases where the period covered by the retrospective operation of the statute, though long, will not introduce any such infirmity. Take the case of a validating Act. If a statute passed by the Legislature is challenged in proceedings before a court and the challenge is ultimately sustained and the statute is struck down, it is not unlikely that the judicial proceedings may occupy a fairly long period and the Legislature may well decide to await the final decision in the said proceedings be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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