Prospective operation of tax amendments bars retrospective set-off under substituted Section 21(1), with refund left open if excess payment exists.

Substitution of Section 21(1) of the Odisha Value Added Tax Act was construed as prospective only, because in tax law an amended provision will not apply retrospectively unless the legislature expressly provides or clearly implies that result. The Court applied the law as it stood on the date of the taxing event and rejected reliance on authorities dealing with declaratory or curative statutes in other contexts. On that construction, the petitioner could not claim retrospective set-off under the substituted text, and the challenge to the rejection of the set-off claim failed, subject to liberty to seek refund before the Assessing Officer if excess payment had in fact been made.

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Issues: Whether the substitution of Section 21(1) of the Odisha Value Added Tax Act operated retrospectively so as to extend the benefit of set-off or refund to the petitioner for the relevant period.

Analysis: The dispute turned on the effect of the amended provision in a taxing statute. The Court held that, in the tax field, an amendment by substitution must be construed strictly in accordance with legislative intent and will not be given retrospective effect unless such intention is expressly stated or clearly implied. It distinguished authorities dealing with declaratory or curative statutes in other contexts and emphasised that, for tax liability and set-off, the law must be applied as it stood on the date of the taxing event. On that construction, the substituted text of Section 21(1) could not be used to claim retrospective benefit for the period in question.

Conclusion: The amended provision was held to operate prospectively only, and the petitioner was not entitled to claim the benefit of retrospective set-off under Section 21(1).

Final Conclusion: The challenge to the rejection of the set-off claim failed, though liberty was left open to the petitioner to seek refund before the Assessing Officer if any excess payment had in fact been made.

Ratio Decidendi: A substitution in a taxing statute is prospective unless the legislature expressly provides, or clearly indicates, retrospective operation; tax provisions must be construed strictly on the law applicable at the time of the taxing event.

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