Sales tax notification effective date controls deduction loss; excise duty deduction stopped from 1 January 1966.

Omission of rule 9(i) of the Kerala General Sales Tax Rules, 1963 took effect from the date fixed in the amending notification, 1 January 1966, and not only from the start of the financial year. In sales tax matters, a valid notification may operate within an assessment year where the statute permits such effect. As the deduction for excise duty had been deleted from that date, excise duty paid after 1 January 1966 could not be deducted in computing turnover for assessment year 1965-66, and the claim failed.

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Issues: Whether the omission of rule 9(i) of the Kerala General Sales Tax Rules, 1963, with effect from 1 January 1966 entitled the assessee to deduct excise duty paid after that date while determining turnover for the assessment year 1965-66.

Analysis: Rule 9(i) of the Kerala General Sales Tax Rules, 1963 originally allowed deduction of excise duty paid to the Central Government, and later to the Government of Kerala or the Central Government, in computing taxable turnover. By the amending notification issued under section 57(2)(b) of the Kerala General Sales Tax Act, 1963, clause (i) was omitted and the notification expressly stated that it would come into force on and from 1 January 1966. The Court held that, unlike the income-tax cases relied on, sales tax liability under the Kerala General Sales Tax Act, 1963 did not require the rule to operate only from the beginning of the financial year. Since the notification validly fixed an effective date within the assessment year, the omission took effect from that date and the deduction was not available for excise duty paid thereafter.

Conclusion: The assessee was not entitled to deduction of excise duty paid from 1 January 1966 to 31 March 1966 under rule 9(i); the omission operated from 1 January 1966 and the claim failed.

Final Conclusion: The revision petition was rejected, and the turnover had to be computed without allowing the excise duty deduction for the period after 1 January 1966.

Ratio Decidendi: Where a valid sales tax notification expressly specifies an effective date within an assessment year, the amendment or deletion of the deduction provision operates from that date and not from the beginning of the financial year.

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