Declaratory tax ruling governs earlier assessments, allowing rectification and full input tax rebate under the VAT statute.

A declaratory ruling on the correct interpretation of the Karnataka Value Added Tax Act applied to earlier reassessment orders as well as pending matters, so rectification was maintainable under section 69(1). The later Division Bench ruling held that where an assessee manufactures only taxable oil and exempt by-products arise incidentally, section 17 cannot be used to deny full input tax rebate. Because the reassessment orders had allowed only partial rebate on a view inconsistent with the later declared law, the petitioner was entitled to rectification and to full input tax rebate.

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Issues: Whether the petitioner was entitled to rectification of the reassessment orders and grant of full input tax rebate in the light of the subsequent declaratory ruling on eligibility to partial rebate under the Karnataka Value Added Tax Act, 2003.

Analysis: The returns had been accepted and reassessment orders had already allowed only partial input rebate under section 17 of the Karnataka Value Added Tax Act, 2003. A later Division Bench ruling declared that where the assessee manufactures only taxable oil and the exempt by-products arise incidentally, section 17 has no application to deny full rebate. Since the later decision stated the correct legal position, it governed assessments made earlier as well. The rectification application under section 69(1) was therefore maintainable, and the contention that the claim should have been made originally was rejected.

Conclusion: The petitioner was entitled to have the reassessment orders rectified and to receive full input tax rebate.

Ratio Decidendi: A declaratory judicial ruling on the correct interpretation of the tax statute applies to pending and earlier assessments, and rectification can be used to extend the benefit of that ruling where the original assessment was contrary to the law as later declared.

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