Retrospective eligibility certificate entitled the taxpayer to reopening of assessment and refund of tax deposited.

An assessment for the four quarters ending 31 March 1999 was held liable to reopening because an eligibility certificate for tax remission, though issued later, was given retrospective effect from 30 April 1998 and covered the relevant period. The application for the certificate had been filed in time, and the delay in issuance did not defeat the petitioner's entitlement. On that basis, the tax assessed for the period could not be retained, and the amount already deposited was treated as refundable. The assessment under section 46A was therefore required to be reopened and reconsidered in light of the eligibility certificate.

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Issues: Whether the assessment for the four quarters ending March 31, 1999 was liable to be reopened and the tax deposited refunded on the basis of an eligibility certificate for remission of tax granted later but given effect from an earlier date.

Analysis: The application for the eligibility certificate had been made within time, but the authorities took more than three years to issue it. The certificate was ultimately granted with effect from April 30, 1998, covering the relevant assessment period, though issued later on June 3, 2003. In these circumstances, the petitioner was not liable to pay tax for the relevant period, and the amount already deposited could not be retained. The assessment made under section 46A for the relevant quarters was therefore required to be reopened and reconsidered in the light of the eligibility certificate.

Conclusion: The assessment was directed to be reopened and heard afresh taking into account the eligibility certificate, and the tax deposited for the relevant period was treated as refundable.

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