Amnesty settlement under sales tax law remains conditional where later assessment reveals higher liability and permits adjustment.

An amnesty settlement under section 23B of the Kerala General Sales Tax Act, 1963 does not prevent the statutory authorities from completing a regular assessment. The scheme operates on the tax and interest disclosed or admitted at the time of settlement, but where the later assessment shows a higher liability, the earlier settlement cannot operate as a final bar. If the amnesty application is made before assessment is completed, the benefit remains conditional and subject to the eventual assessment outcome. Adjustment under section 55C and consequential demand in regular assessment therefore remain permissible.

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Issues: Whether an assessee who opted for settlement under the Amnesty Scheme before completion of assessment could retain the benefit of section 23B of the Kerala General Sales Tax Act, 1963 when the regular assessment resulted in a higher tax liability.

Analysis: Section 23B permits reduction of interest and settlement of arrears, but it does not bar the statutory authorities from completing assessment under the Act. The scheme operates on the basis of the tax and interest due as disclosed or admitted, and if the assessment ultimately discloses a higher liability than what was settled under the scheme, the settlement cannot stand as a final bar against assessment. Where the application for amnesty is made under protest and assessment is still pending, the benefit availed is necessarily conditional and subject to the outcome of assessment. The adjustment made under section 55C and the demand raised in regular assessment therefore remained permissible.

Conclusion: The assessee was not entitled to retain the amnesty benefit after the regular assessment disclosed a higher liability, and the assessment was valid.

Final Conclusion: The revision failed and the assessment sustaining the balance tax and interest demand was upheld.

Ratio Decidendi: A settlement under an amnesty provision for arrears of tax and interest, if obtained before completion of assessment, remains subject to the statutory assessment and ceases to protect the assessee where the assessed liability is higher than the amount settled.

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