Prospective operation of taxing amendments bars retrospective use of section 5(3)(ii) for earlier assessment years.

A substantive taxing amendment inserted from 1 April 1993 could not be applied to assessment years 1989-90, 1990-91 and 1991-92, because it operated only prospectively. The Tribunal's view treating section 5(3)(ii) as applicable to those earlier assessments was therefore vacated, and the assessee succeeded to that extent. Any alleged misuse of the form 18 declaration had to be dealt with in separate proceedings under the Act. The question whether the assessee was otherwise entitled to the concessional rate under section 5(3) was left open, and the works contract issue was not decided.

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Issues: Whether the Tribunal was justified in applying section 5(3)(ii) to the assessment years 1989-90, 1990-91 and 1991-92 and in treating the original proposal to levy differential tax as valid.

Analysis: Section 5(3)(ii) was inserted only with effect from 1 April 1993. The assessment years in question were earlier years, so the provision could not govern those assessments. As the amendment was substantive, it could operate only prospectively. Any misuse of form 18 declaration, if at all, would have to be dealt with in separate proceedings under the Act. The question whether the assessee was entitled to the concessional rate under section 5(3) was left open because it was not necessary for the assessment controversy under consideration.

Conclusion: The Tribunal's finding upholding the applicability of section 5(3)(ii) was vacated. The assessee succeeded to that extent.

Final Conclusion: The revisions were allowed in part by setting aside the Tribunal's view on the differential tax proposal under section 5(3)(ii), while the remaining question concerning works contract was not decided.

Ratio Decidendi: A substantive taxing amendment cannot be applied retrospectively to assessment years preceding its commencement, and any separate consequence for misuse of a declaration must be pursued under the procedure specifically provided by the statute.

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