Retrospective tax amendments cannot defeat a concluded refund entitlement where the dealer did not collect tax and the levy was quashed.

Retrospective tax amendments cannot be applied to deny a refund where a concluded appellate decision has already quashed the levy and the dealer did not collect the tax. The article explains that although the Haryana General Sales Tax (Second Amendment) Act, 1988 inserted an explanation retrospectively excluding rice bran from fodder, such retrospective operation was treated as impermissible when it imposed an unreasonable, unforeseen, or confiscatory burden. On the stated facts, rice bran used for oil extraction remained outside purchase tax, and the assessee's refund entitlement could not be defeated by the later amendment. The refusal to refund was set aside, and refund with interest under section 43 was recognised.

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Issues: Whether the retrospective operation of the Haryana General Sales Tax (Second Amendment) Act, 1988 could be applied to deny refund of tax already paid, after the assessee's appeal had been accepted and the levy of purchase tax on rice bran had been quashed.

Analysis: The levy had initially been sustained in reassessment proceedings, but the Tribunal held that rice bran used for extraction of oil fell within the relevant exempt entry and was not liable to purchase tax. The department did not seek a reference. The amendment later inserted an explanation excluding rice bran from fodder and was given retrospective effect. The governing principle applied was that while the Legislature may enact retrospectively, such operation will not be upheld where it creates an unreasonable, unforeseen, or confiscatory burden on the assessee. Where a dealer has not collected the tax and a concluded appellate decision has already conferred entitlement to refund, retrospectively fastening liability would amount to imposing an undue burden rather than removing an unintended benefit.

Conclusion: The retrospective operation of the amending Act was inapplicable against the assessee, and the refusal to refund the tax was set aside. The assessee was held entitled to refund with interest under section 43 of the Haryana General Sales Tax Act, 1973.

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