Additional sales tax liability computed on full-year taxable turnover despite mid-year amendment, Madras HC confirms.

Additional sales tax for assessment year 1999-2000 was required to be computed on the dealer's annual taxable turnover for the full year, not only from the date the amending enactment took effect. The Madras HC applied earlier Division Bench authority and held that the statutory scheme did not justify splitting liability into separate periods within the same assessment year. The later amendment governed the applicable rate, but the basis of computation remained the entire year's taxable turnover. The challenge to the levy therefore failed, and the matter was remitted only for fresh computation in line with that legal position.

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Issues: Whether additional sales tax liability for the assessment year 1999-2000 was to be determined on the dealer's total taxable turnover for the entire year or only from the date of the amending enactment.

Analysis: The turnover chargeable to additional sales tax had to be assessed with reference to the annual taxable turnover for the whole assessment year. The Court followed earlier Division Bench decisions holding that the liability could not be split into separate periods merely because the amendment took effect during the year. The clear statutory scheme did not permit reading words into the provision to confine liability only to the post-amendment period. The later amendment was treated as the governing law for the relevant rate, but the taxable turnover for the full year remained the basis for computation.

Conclusion: The challenge to the levy failed. The question was answered against the assessee, and the matter was remitted only for fresh computation in accordance with the governing legal position.

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