Validating tax statute cannot sustain criminal prosecution where proviso preserves immunity for prior non-punishable conduct.

A validating Act confirmed earlier assessments and collections made on the basis that sales tax formed part of turnover, but its proviso preserved immunity from criminal liability for acts or omissions that would not have been punishable if the Act had not been enacted. The Madras HC held that, although the authorities could pursue recovery by lawful means, the proviso barred prosecution where the tax demand depended on that retrospective treatment and the assessee had not previously been liable on that footing. The prosecution was therefore not maintainable, and the acquittal was upheld.

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Issues: Whether, after the validating Act had confirmed earlier assessments and collections made on the footing that sales tax formed part of turnover, the authorities could still prosecute the assessee for non-payment of the further tax demanded on that basis.

Analysis: The Act validated assessments and collections made before its commencement, but its proviso expressly protected a person from criminal liability for acts or omissions which would not have been punishable if the Act had not been passed. The Court noted that while the authorities might be entitled to recover the amount by means other than prosecution, the proviso prevented criminal prosecution where the demand rested on inclusion of sales tax in turnover and the assessee had not been previously made liable in that manner.

Conclusion: The prosecution was not maintainable, and the acquittal was upheld.

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