Tax liability survives repeal where a saving clause applies; failure to file returns permits best judgment assessment.

Tax liability under a fiscal enactment arises from the charging provision and survives repeal where a saving clause or general saving principle preserves accrued obligations. The repeal of the Hyderabad Sales of Motor Spirit Taxation Regulation did not extinguish tax already incurred for the earlier period, so the challenge to liability failed. Where the dealer failed to file the statutory monthly returns, the authority was still entitled to require returns and proceed with assessment by best judgment because the assessee cannot defeat the fiscal scheme by withholding the return on which it depends. The notices were therefore upheld against the petitioner.

---

---

Issues: (i) Whether the repeal of the Hyderabad Sales of Motor Spirit Taxation Regulation by section 13 of the Andhra Pradesh extension Act destroyed the petitioner's liability to pay tax for the earlier period. (ii) Whether the respondents could require returns and proceed to assess the tax by best judgment when no monthly returns had been filed under the Regulation.

Issue (i): Whether the repeal of the Hyderabad Sales of Motor Spirit Taxation Regulation by section 13 of the Andhra Pradesh extension Act destroyed the petitioner's liability to pay tax for the earlier period.

Analysis: Liability under a fiscal enactment arises from the charging provision and not from assessment. Assessment only quantifies the amount payable. The saving provision in section 13(1) preserved liabilities already incurred under the repealed Regulation, and the repeal did not show any intention to destroy such liabilities. The court also relied on the general saving principle that repeal does not affect accrued rights, obligations, or liabilities unless a contrary intention appears. On the facts, the tax liability under section 3 of the Regulation was already incurred and survived the repeal.

Conclusion: The liability to pay tax was saved and the challenge on repeal failed, against the petitioner.

Issue (ii): Whether the respondents could require returns and proceed to assess the tax by best judgment when no monthly returns had been filed under the Regulation.

Analysis: The Regulation itself required the dealer to furnish returns and pay tax. A dealer cannot defeat assessment by withholding the return on which the statutory scheme depends. Where liability exists but is not crystallized because of the assessee's default, the fiscal authority may proceed to assess and recover the tax later. The absence of filed returns therefore did not bar assessment under section 8(1) of the Regulation.

Conclusion: Best judgment assessment and the demand for returns were valid, against the petitioner.

Final Conclusion: The petition challenging the notices failed in substance because the tax liability survived repeal and the authorities were entitled to enforce the statutory return and assessment mechanism.

Ratio Decidendi: In a fiscal statute, liability is created by the charging provision and survives repeal when preserved by a saving clause or general saving principle, and the assessee cannot avoid assessment by failing to furnish the statutory return.

---