Retrospective sales tax enhancement and reassessment can stand where the levy is lawful and reopening power remains available.

Retrospective enhancement of sales tax on water-pumps was held not to become colourable or confiscatory merely because it operated on past periods, and the Legislature was treated as competent to give the amendment retrospective effect. The commentary further states that pending appeals against the original assessment did not bar reopening under section 21 of the U.P. Sales Tax Act, because the appellate authority was confined to the existing record and the reopening power operated independently. On that basis, the reassessment under the amended tax law was upheld.

---

---

Issues: (i) whether the retrospective enhancement of sales tax from 2 per cent to 6 per cent on water-pumps was a colourable exercise of power or confiscatory in nature; (ii) whether the State Legislature lacked power to give retrospective effect to the tax amendment from an earlier date; and (iii) whether, in view of pending appeals against the original assessment, the Sales Tax Officer could reopen the assessment under section 21 of the U.P. Sales Tax Act.

Issue (i): whether the retrospective enhancement of sales tax from 2 per cent to 6 per cent on water-pumps was a colourable exercise of power or confiscatory in nature.

Analysis: The increase in tax rate was accepted to be reasonable when applied prospectively. The mere fact that the same levy was made retrospective did not convert a lawful tax into an extortionate or confiscatory impost. Retrospectivity by itself did not establish colourable exercise of power.

Conclusion: The challenge to the retrospective levy as colourable or confiscatory failed and was rejected against the assessee.

Issue (ii): whether the State Legislature lacked power to give retrospective effect to the tax amendment from an earlier date.

Analysis: The Legislature was competent to enact retrospective fiscal legislation, and no legal limitation was shown preventing it from operating from the date chosen by it. The retrospective operation did not exceed the life of the Legislature or offend any constitutional restriction identified in the judgment.

Conclusion: The Legislature had the power to impose retrospective effect, and this objection failed against the assessee.

Issue (iii): whether, in view of pending appeals against the original assessment, the Sales Tax Officer could reopen the assessment under section 21 of the U.P. Sales Tax Act.

Analysis: The appellate authority under section 9(3) was confined to the material already on record and did not consider new circumstances or new material. Pending appeals against the original assessment did not oust the statutory power to reopen proceedings under section 21 where the amended law applied.

Conclusion: The Sales Tax Officer had jurisdiction to reopen the assessment under section 21, and the objection to jurisdiction failed against the assessee.

Final Conclusion: The petition failed on all substantial grounds, and the reassessment under the amended tax law was upheld.

Ratio Decidendi: A valid retrospective tax enhancement is not unconstitutional merely because it operates on past periods, and the existence of pending appeals does not bar reassessment under a separate statutory reopening power where the appellate forum is confined to the existing record.

---