Retrospective tax enhancement under Rule 39A was invalidated, limiting brick kiln owners' liability to the earlier rate.

Retrospective enhancement of lump sum tax under amended Rule 39A of the Haryana General Sales Tax Rules, 1975, could not validly impose a higher fiscal burden on brick kiln owners for the period before the amendment took effect. The High Court, relying on the earlier Division Bench view in the same controversy, held that the increased liability could not be sustained retrospectively and quashed the notification to that extent only. The assessee's liability at the earlier rate for the relevant period was left intact, but the retrospective operation of the amendment was invalidated.

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Issues: Whether the amendment to Rule 39A of the Haryana General Sales Tax Rules, 1975, by notification dated 31 March 1999, could validly impose a higher lump sum tax liability on brick kiln owners with retrospective effect from 1 October 1998.

Analysis: The challenge was confined to the retrospective operation of the amendment enhancing the lump sum tax rate. The impugned notification was examined only to the extent it fastened the increased liability for the prior period. In light of the earlier Division Bench decision in the same line of controversy, the retrospective enhancement could not be sustained. The Court accordingly restricted relief to the retrospective part of the amendment and left intact the petitioners' liability to pay tax at the old rate for the relevant period.

Conclusion: The retrospective enhancement of lump sum tax under the amended Rule 39A was held invalid and was quashed to that extent, in favour of the assessee.

Ratio Decidendi: A taxing amendment by subordinate legislation cannot be enforced retrospectively to impose an enhanced fiscal burden unless such retrospectivity is validly authorised and sustained in law.

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