Plain-language interpretation of fiscal exemptions excludes stock transfers, while reassessment cannot rest on a later change of opinion.

A fiscal exemption notification under section 4-A of the Uttar Pradesh Trade Tax Act must be construed by its plain words and the statutory meanings of "turnover" and "sale". On that reading, the phrase "turnover of sales" does not extend to stock transfers or consignment sales, so those transfers are excluded from the base production computation; the clarifying circular was upheld. A completed assessment cannot be reopened merely because the department later changes its view through a revised circular. Reassessment based only on such a change of opinion is without jurisdiction and invalid.

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Issues: (i) Whether the words "turnover of sales" in the exemption notifications issued under section 4-A of the Uttar Pradesh Trade Tax Act, 1948 include stock transfers and consignment sales for the purpose of computing base production. (ii) Whether reassessment proceedings could be initiated on the basis of the revised circular dated 25.1.2003 where the original assessment had been completed on the basis of the earlier binding circular.

Issue (i): Whether the words "turnover of sales" in the exemption notifications issued under section 4-A of the Uttar Pradesh Trade Tax Act, 1948 include stock transfers and consignment sales for the purpose of computing base production.

Analysis: The notifications had to be read in the light of the statutory definitions of "turnover" and "sale" in the Act. The phrase used in the notifications was "turnover of sales" and not "total turnover". On the plain language of the notifications, and applying the strict interpretative rule governing fiscal exemptions, turnover confined to sales did not extend to branch transfers or consignment transfers, which are outside the statutory concept of sale turnover.

Conclusion: The expression "turnover of sales" does not include stock transfers or consignment sales. The circular clarifying that position was held to be valid.

Issue (ii): Whether reassessment proceedings could be initiated on the basis of the revised circular dated 25.1.2003 where the original assessment had been completed on the basis of the earlier binding circular.

Analysis: The earlier departmental circular had governed the completed assessments. A subsequent change in the Commissioner's view could not justify reopening completed assessments. Reassessment on a mere change of opinion is impermissible, and the initiation of proceedings on that basis was without jurisdiction.

Conclusion: Reassessment proceedings based solely on the later circular were invalid and could not be sustained.

Final Conclusion: The notifications were construed according to their plain language, excluding stock transfers and consignment sales from the relevant turnover, but reassessment could not be reopened merely because the department revised its earlier interpretation. Accordingly, the connected petitions succeeded to that extent, while the separate petition challenging the circular failed.

Ratio Decidendi: A fiscal exemption notification must be construed according to its clear language, and completed assessments cannot be reopened merely because the departmental authority later changes its interpretation of the governing circular.

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