Limitation for escaped turnover reassessment prevails where the CST rules impose a four-year bar on notice

A notice proposing reassessment of escaped turnover for assessment year 2003-2004 was issued after the four-year period in Rule 6(7) of the Central Sales Tax (Kerala) Rules, 1957, so it was treated as time-barred. Section 9(2) was read as subject to the Act and the Rules, while Section 6A(3) was confined to reassessment in cases involving a dealer's claim of non-liability and discovery of new facts. It did not displace the limitation for escaped-assessment notices, so the challenged notice remained governed by Rule 6(7) and the challenge failed.

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Issues: Whether a notice proposing reassessment of escaped turnover for the assessment year 2003-2004 was barred by limitation under Rule 6(7) of the Central Sales Tax (Kerala) Rules, 1957, and whether Section 6A(3) of the Central Sales Tax Act, 1956 displaced that limitation.

Analysis: The notice for reassessment was issued beyond four years from the relevant assessment period, whereas Rule 6(7) prescribed a four-year limit for such action. Section 9(2) empowered State authorities to act under the Act only subject to the Act and the Rules. Section 6A concerned proceedings based on a dealer's claim of non-liability, and the insertion of sub-section (3) only preserved reassessment on discovery of new facts in that context; it did not override the limitation governing escaped-assessment notices. The challenged notice related to escaped assessment and therefore remained governed by Rule 6(7).

Conclusion: The reassessment notice was time-barred and the challenge to it failed.

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