Retrospective cancellation of C-Forms cannot prejudice a selling dealer after completed concessional inter-State sales.

C-Forms issued to support concessional inter-State sales under the Central Sales Tax regime cannot be retrospectively cancelled to the prejudice of the selling dealer once the sales have been completed on their basis. The Court treated the issue as covered by prior decisions and held that the revenue's retrospective cancellation was impermissible. The forms were therefore to be treated as valid against the petitioner, while the authorities remained free to proceed against the purchasing dealer for any statutory default in accordance with law.

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Issues: Whether C-Forms issued to the purchasing dealer under the Central Sales Tax (Registration & Turnover) Rules, 1957 could be cancelled retrospectively so as to unsettle the petitioner's completed sales made on the strength of those forms.

Analysis: The challenge arose from the revenue authorities' action in cancelling Form-C declarations after the petitioner had effected inter-State sales on their basis and charged central sales tax at the concessional rate. The issue was treated as settled by prior decisions of the Court, and the respondents also accepted that the matter stood covered. On that basis, retrospective cancellation of the C-Forms could not be sustained, while the authorities remained free to proceed against the purchasing dealer for any statutory infraction in accordance with law.

Conclusion: The retrospective cancellation of the C-Forms was impermissible and the C-Forms were directed to be treated as valid against the petitioner.

Ratio Decidendi: C-Forms validly issued to support concessional inter-State sales cannot be retrospectively cancelled to the prejudice of the selling dealer, though proceedings may continue against the defaulting purchasing dealer in accordance with law.

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