Prospective fiscal amendment: pre-amendment turnover threshold governed additional sales tax liability, so the levy remained valid.

The amended turnover threshold under the Tamil Nadu Additional Sales Tax Act, 1970 operated only prospectively from 01.08.1996, so liability for the pre-amendment period had to be tested under the unamended provision. Because the assessee's turnover for 01.04.1996 to 31.07.1996 remained above the earlier threshold of Rs. 10 lakhs, the additional sales tax levy for that period was valid. The fact that the annual turnover for the full year was below Rs. 100 crores did not exempt the assessee from liability during the earlier period. The challenge to the assessment therefore failed.

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Issues: Whether the additional sales tax levy for the period 01.04.1996 to 31.07.1996 was sustainable when the amendment enhancing the turnover threshold under the Tamil Nadu Additional Sales Tax Act, 1970 took effect only from 01.08.1996.

Analysis: The threshold for levy of additional sales tax under Section 2(1)(a) of the Tamil Nadu Additional Sales Tax Act, 1970 stood enhanced from Rs. 10 lakhs to Rs. 100 crores only with effect from 01.08.1996. The turnover for the relevant pre-amendment period remained far above the earlier threshold, and the taxing provision had to be applied strictly from the date on which it came into force. The fact that the annual turnover for the full year was below Rs. 100 crores did not alter the liability for the period governed by the unamended provision.

Conclusion: The levy of additional sales tax for the period 01.04.1996 to 31.07.1996 was valid and the challenge to the assessment failed.

Final Conclusion: The writ petition was rejected on the basis that the amended turnover threshold operated prospectively and did not exempt the assessee from liability for the pre-amendment period.

Ratio Decidendi: An amended fiscal threshold applies only prospectively from its effective date, and liability for a prior period must be determined under the provision as it stood during that period.

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