Retrospective VAT demand waived under government notification, making the notice unsustainable and liable to be quashed.

A demand notice based solely on the retrospective operation of the Tamil Nadu Value Added Tax (5th Amendment) Act, 2013 was held unsustainable because the Government notification dated 21.04.2015 had waived retrospective demands. The Court noted that the issue had already been considered by a Division Bench and applied that position to the impugned demand. As the demand arose entirely from the retrospective amendment and the waiver notification removed its basis, the notice could not stand and was quashed.

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Issues: Whether the demand notice could be sustained when it arose from the retrospective operation of the Tamil Nadu Value Added Tax (5th Amendment) Act, 2013 in the light of the Government notification dated 21.04.2015.

Analysis: The demand was founded on the retrospective operation of the statutory amendment. The Court noted that a similar issue had already been considered by a Division Bench and that, in view of the Government notification dated 21.04.2015, the retrospective demands stood waived. On that basis, the impugned demand was found to be unsustainable.

Conclusion: The demand notice was quashed and the writ petition was allowed in favour of the petitioner.

Ratio Decidendi: A demand arising solely from the retrospective operation of an amendment cannot survive where the competent Government notification has waived the retrospective demands.

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