Retrospective penalty amendments under sales tax law cannot apply to pre-amendment concealment in reassessment proceedings.

Amendment to section 36(2)(c) of the Bombay Sales Tax Act, 1959, effective from 1 September 1969, was held not to operate retrospectively to support penalty in reassessment for concealment relating to earlier periods. The material date for penalty was the date of concealment, namely when the return was filed or the time to file a revised return expired. Because the amendment affected liability to penalty rather than mere procedure, it could not be applied to concealment, if any, occurring before the effective date. The distinction applicable to procedural amendments governing appeals was held inapposite, and the penalty was not sustained.

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Issues: Whether the amendment to section 36(2)(c) of the Bombay Sales Tax Act, 1959 with effect from 1 September 1969 was retroactive so as to permit levy of penalty in reassessment proceedings for concealment relating to periods prior to that date.

Analysis: The material date for imposition of penalty for concealment is the date on which the concealment occurred, namely when the return was filed or when the time for filing a revised return expired. The amendment enabling penalty in reassessment proceedings did not merely regulate procedure; it affected the assessee's liability to penalty and was therefore substantive in nature. Since the concealment, if any, took place before 1 September 1969, the amended provision could not be applied to the reassessment proceedings initiated thereafter. The distinction drawn from procedural amendments governing appeals was inapplicable.

Conclusion: The amendment was not applicable to the present reassessment proceedings, and the penalty could not be sustained. The answer was in favour of the assessee.

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