Sales tax collections after a specified cutoff date could not be added to taxable turnover under the re-enacted law.

A validating enactment that expressly confined inclusion of tax collections to sales made before 1 April 1954, and withheld authority to include collections made after that date, controlled assessment under the re-enacted sales tax law. The earlier interpretation of the 1939 Act excluding tax collections from turnover was not displaced by the 1959 re-enactment, because the legislative history preserved the same limitation. Accordingly, amounts collected by a dealer as sales tax after 1 April 1954 could not be brought into taxable turnover, and assessments made on that basis were impermissible.

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Issues: Whether the amounts collected by a dealer by way of sales tax after 1 April 1954 could be included in the dealer's taxable turnover under the Madras General Sales Tax Act, 1959, having regard to the prior judicial interpretation of the 1939 Act and the validating provisions of Madras Act XVII of 1954.

Analysis: The earlier judicial view under the 1939 Act treated tax collections as outside turnover, and Madras Act XVII of 1954 validated inclusion only for sales made before 1 April 1954 while expressly withholding authority to include amounts collected after that date. The re-enacted 1959 Act retained the material provisions without altering the legislative position reflected in the validating Act. The court held that the legislative history had moved beyond a mere presumption of continued interpretation and that Act XVII of 1954, read with the re-enacted statute, prevented the assessing authorities from including post-1 April 1954 tax collections in turnover.

Conclusion: The inclusion of sales tax collections made after 1 April 1954 in the assessable turnover was impermissible, and the proposed assessments were illegal.

Final Conclusion: The writ petitions succeeded and the assessing authorities were restrained from proceeding on the impugned basis.

Ratio Decidendi: Where a validating enactment expressly limits inclusion of tax collections to transactions before a specified date and withholds authority for later collections, that legislative limitation governs the assessment of turnover under the re-enacted law.

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