Limitation for reassessment notice cannot be revived by later completion-extension amendments or retrospective substitution.

Limitation for initiating reassessment under Section 25(1) of the Kerala Value Added Tax Act governed issuance of notice, so later amendments extending only the time for completion of assessment could not validate notices already issued after the prescribed period. Section 25B, dealing with extension of time for completion, could not be used once the initiation period had expired, and its application required prior notice and opportunity of hearing where it prejudicially affected the assessee. A substitution extending limitation from five years to six years was not retrospective absent express language or necessary implication, and could not revive assessments already time-barred.

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Issues: (i) Whether notices issued under Section 25(1) of the Kerala Value Added Tax Act, 2003 after expiry of the prescribed period could be sustained on the basis of later amendments extending only the time for completion of assessment; (ii) Whether Section 25B of the Kerala Value Added Tax Act, 2003 could validly be invoked to extend the period for completion of assessment after the limitation for initiation had expired, and whether such extension required prior notice and hearing; (iii) Whether the substitution of the period of limitation from five years to six years operated retrospectively so as to revive assessments already time-barred.

Issue (i): Whether notices issued under Section 25(1) of the Kerala Value Added Tax Act, 2003 after expiry of the prescribed period could be sustained on the basis of later amendments extending only the time for completion of assessment.

Analysis: The limitation in Section 25(1) was held to govern the initiation of reassessment proceedings by notice, not the completion of assessment. The later proviso extending time for completion did not enlarge the period for issuance of notice, and could not revive proceedings already barred. The same construction was applied to the notices issued beyond the five-year period.

Conclusion: The time-barred notices under Section 25(1) could not be sustained and the finding was in favour of the assessee.

Issue (ii): Whether Section 25B of the Kerala Value Added Tax Act, 2003 could validly be invoked to extend the period for completion of assessment after the limitation for initiation had expired, and whether such extension required prior notice and hearing.

Analysis: Section 25B was treated as a provision enabling extension of time for completion of assessment, but it could not operate where the period for initiating proceedings had already lapsed. Since the extension prejudicially affected the assessee by exposing it to reassessment and further tax liability, the Court read the requirement of prior notice and opportunity of hearing into the provision on principles of natural justice.

Conclusion: Invocation of Section 25B after expiry of the initiation period was held invalid, and the provision had to be applied consistently with natural justice, in favour of the assessee.

Issue (iii): Whether the substitution of the period of limitation from five years to six years operated retrospectively so as to revive assessments already time-barred.

Analysis: The Court held that substitution does not invariably mean retrospectivity. An amending provision affecting limitation will operate retrospectively only if the language expressly so provides or such intention follows by necessary implication. In the absence of a retrospective or validating clause, the substituted six-year period could not reopen assessments for which the earlier five-year period had already expired.

Conclusion: The substituted six-year limitation was not retrospective and could not revive barred assessments, in favour of the assessee.

Final Conclusion: The State's writ appeals were rejected and the judgments in favour of the assessees were upheld, including the connected rulings applying the same limitation principle.

Ratio Decidendi: A limitation provision governing initiation of reassessment proceedings cannot be enlarged or revived by an amendment that only extends the time for completion of assessment, and an amendment by substitution is not retrospectively operative unless the statute clearly so provides or necessary intendment requires it.

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