Representative assessee liability cannot be retrospectively extended to advance tax absent clear statutory authority.

A person appointed as a representative assessee after the close of the relevant financial year cannot be retrospectively burdened with advance-tax liability for that earlier year unless the statute clearly and expressly provides for such operation. The reasoning is that the Act requires the proposed agent to be heard before being treated as representative assessee, and retrospective liability would make that statutory safeguard ineffective. A fiscal provision creating liability is not to be given retrospective effect by implication, and a person cannot practically comply with the advance-tax machinery for a period before valid appointment.

---

---

Issues: Whether a person appointed as a representative assessee after the close of the relevant financial year can be retrospectively saddled with liability to pay advance tax for that past year.

Analysis: The relevant provisions treated an agent or representative assessee as liable in relation to the income of the non-resident, but the scheme of the Act required that the person intended to be treated as agent must first be given an opportunity of being heard. If the liability to pay advance tax were carried back to a period before such appointment, the statutory opportunity would become illusory. The provisions were not clear enough to justify retrospective imposition of a fiscal liability, and a financial statute creating such liability was not to be given retrospective effect unless expressly so provided. The Court also noted that before a person is treated as representative assessee, he cannot in practice comply with the advance-tax machinery for an earlier financial year.

Conclusion: The representative assessee could not be retrospectively made liable to pay advance tax for the financial years in question, and the answer to the reference was against the Revenue and in favour of the assessee.

Ratio Decidendi: A representative assessee cannot be retrospectively subjected to advance-tax liability for a period prior to the date on which he is validly treated as such unless the statute clearly and expressly authorises retrospective operation.

---