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Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: Whether reassessment for assessment year 2001-02 could be sustained on the basis of a later notification excluding rice manufactured from paddy from the exemption entry, and whether such later notification operated retrospectively.
Analysis: The exemption granted to units of the Khadi Gram Udyog Board under the earlier government orders covered processing, packaging and marketing of cereals, and rice was held to fall within that expression. The later government order dated 30.09.2004 specifically excluded rice and by-products manufactured from paddy from the exemption entry. An exclusionary amendment was treated as substantive and not merely clarificatory. Since the assessment year in question preceded the exclusion, the later notification could not be applied retrospectively to justify a finding of escaped assessment or to support reassessment under Section 21(2).
Conclusion: Reassessment based on the subsequent exclusionary notification was invalid, and the exemption claimed for assessment year 2001-02 could not be denied on a retrospective basis.
Final Conclusion: The reassessment order was set aside and the writ petition was allowed in favour of the assessee.
Ratio Decidendi: A later notification that expressly excludes goods from an exemption entry operates prospectively unless the statute or notification clearly provides otherwise, and it cannot be used retrospectively to reopen completed assessments.
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