CST assessment limitation: State procedural rules applied where the central regime was silent, keeping notices within time.

CST assessment notices were treated as timely because section 9(2) of the Central Sales Tax Act allows State sales tax law and its procedural incidents to operate where the CST regime is silent. The Court held that Rule 6(5) of the Kerala CST Rules did not itself prescribe a completion period, and the reassessment timelines in Rules 6(7) and 6(8) could not be read into it. In the absence of an express central limitation, the authorities could rely on the corresponding State limitation provisions, including the extended time under the Kerala General Sales Tax Act and the relevant finance enactment. The period covered by the Court's interim stay also could not be used against the revenue.

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Issues: Whether the CST assessment and the impugned pre-assessment notices were barred by limitation, and whether the authorities could rely on the time-extension mechanism available under the State sales tax enactments and rules for completing assessment under the CST regime.

Analysis: Section 9(2) of the Central Sales Tax Act operates subject to the other provisions of that Act and the rules made thereunder, and authorises the State assessing machinery to act on behalf of the Union by applying the State sales tax law, including its procedural incidents, where the CST enactment is silent. Rule 6(5) of the Central Sales Tax (Kerala) Rules did not prescribe a specific period for completing the assessment, and the Court held that the period prescribed for reassessment under Rules 6(7) and 6(8) could not be read into Rule 6(5). In the absence of an express central limitation, the authorities were entitled to resort to the corresponding State provisions, including the extended time made available under Section 17 of the Kerala General Sales Tax Act and the relevant finance enactment. The interim stay granted by the Court also prevented completion of the proceedings, and that period could not prejudice the revenue in view of the doctrine that an act of the Court should harm no one.

Conclusion: The assessment proceedings were not barred by limitation and the impugned notices were held to be within time.

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