Court Upholds Retrospective Sales Tax Amendment; Petitioner's Challenge Dismissed

The Court upheld the retrospectivity of item No. 34 in Schedule B of the Haryana General Sales Tax Act, 1973, despite the petitioner's challenge on grounds of fresh levy of tax on previously non-taxable goods and extended period of retrospectivity. The Court found the challenges to be without merit, citing precedents supporting similar retrospective amendments to sales tax provisions. The petitioner was directed to pursue statutory remedies against the notice demanding the refunded amount. The writ petition was dismissed, with each party bearing their own costs, and Justice Mital concurred with the decision.

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Issues:
Retrospectivity of item No. 34 in Schedule B of the Haryana General Sales Tax Act, 1973 challenged in writ petition.

Detailed Analysis:

The primary issue in this case pertains to the retrospectivity granted to item No. 34 in Schedule B of the Haryana General Sales Tax Act, 1973, effective from 20th May, 1955. The petitioner-firm, engaged in commission agency and sale of foodgrains, specifically chhilka of foodgrains, was assessed for sales tax. Subsequently, a Division Bench judgment led to a refund for the petitioner. However, with the retrospective amendment to the Act, the Assessing Authority demanded the refunded amount back, leading to the petitioner challenging the notice and the retrospective provisions. The challenge was based on the grounds of fresh levy of tax on previously non-taxable goods and the extended period of retrospectivity, deemed violative of fundamental rights under article 19(1)(f) and (g).

The legislative history surrounding item No. 34 is complex, involving changes from the Punjab General Sales Tax Act to the Haryana General Sales Tax Act, with amendments excluding and later including chhilka of foodgrains in taxable items. The petitioner contended that the retrospective effect of the provision was unreasonable and infringed upon their constitutional rights. However, the Court relied on precedents, including a Supreme Court judgment and a Division Bench decision, which upheld similar retrospective amendments to sales tax provisions. The Court found the challenges raised by the petitioner to be without merit and upheld the retrospectivity of item No. 34.

The judgment emphasized that the petitioner could pursue statutory remedies available to them, as per the Constitution, against the notice demanding the refunded amount. Ultimately, the writ petition was dismissed, with each party bearing their own costs. Justice Mital concurred with the decision to dismiss the petition, thereby concluding the case.

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