Retrospective sales tax enhancement upheld where ordinances were duly published and no unconstitutional exercise of power was found.

Retrospective enhancement of sales tax on paper was upheld as valid because the ordinances and amendment Act were duly promulgated and published in the Official Gazette, giving public notice and legal force. The Court held that non-placement of an ordinance before the Legislature may be excused where a good reason exists, and found no colourable exercise of power or misuse of the ordinance-making power. It also rejected challenges under Articles 14 and 19(1)(g), holding that the retrospective continuation of the enhanced rate was not arbitrary and that dealer ignorance, hardship, or non-collection of tax could not invalidate a valid taxing statute.

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Issues: Whether the retrospective enhancement of sales tax on paper under section 3(c) of the Kerala General Sales Tax (Amendment) Act, 2002, and the connected ordinances, was unconstitutional on the grounds of want of proper promulgation, non-placement before the Legislature, and violation of articles 14 and 19(1)(g) of the Constitution of India.

Analysis: The governing principle is that an ordinance has the force of law when duly promulgated and published in the Official Gazette, and publication constitutes public notice. The Court found that the ordinances and the Act were in fact published in the Gazette and therefore were duly promulgated. It further held that failure to place an ordinance before the Legislature can be excused where a good reason exists, and that the facts did not disclose any colourable exercise of power or deliberate misuse of the ordinance-making power. The retrospective effect merely continued the enhanced rate already introduced by the ordinance and did not amount to an arbitrary or unconstitutional levy. The Court also rejected the contention that absence of actual knowledge by dealers or non-collection of tax could invalidate the demand, holding that hardship or individual ignorance could not defeat a valid taxing statute.

Conclusion: The retrospective enhancement of tax and the consequential demands were upheld as constitutionally valid.

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