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2022 (8) TMI 1246 - HC - VAT and Sales TaxConstitutional validity of retrospective amendment to VAT act after amendment to Constitution to introduce GST laws - Validity of assessment notices - notices are without jurisdiction and competence of the Assessing Officers or not - competence of the Assessing Officer under amended Section 25(1) of the KVAT Act through Kerala State Finance Act Nos.11/2017 and 5/2018 - time limitation - HELD THAT:- The liability to pay tax is incurred with the taxable event as per the charging section. The liability arising from the taxable event is independent of any consideration of time or period of limitation. The time limit for reassessment is for the convenience of the dealers. Therefore, the amendment to Section 25(1) made with effect from 01.04.2017 shall be read as enabling the officers to initiate proceedings within six years with the end of the Assessment Year. Hence, the time limit and the year and date on which the notice is issued, are relevant. What is the plain expression either for the commencement of the Act or for the operation of the Finance Act 11 of 2017? - HELD THAT:- The long and short of the conclusion is the substituted words ‘six years’, being operational in the Statute Book with effect from 01.04.2017, the Assessment Year 2010-11 is excluded from the reassessment enquiry by 31.03.2017. The fundamental rule in any interpretation is that if the legislative expression is unambiguous; the Courts employ the golden rule of interpretation and give the meaning applicable to the words employed by the State Legislature. It is clear to one's mind and interpretation that the amendment to Section 25(1) of KVAT Act substituting the words ‘five years’ to ‘six years’ is prospective. Competence of the State Legislature to amend the Kerala Value Added Tax Act through Finance Act 5/2018 - HELD THAT:- Since the legislative competence is traceable to Article 246A, which speaks about goods – supply of goods or services, the argument canvassed is that under Article 246A, the State Legislature has broader power than what it had before 16.09.2016. The repeal of the KVAT Act shall not be understood as taking away the original power of the State Legislature to make amendments to the repealed Act. The amendments are not simultaneously operating along with Kerala Goods and Services Tax Act. Still, the amendments provide for the extension of the period of limitation for assessment attracting Section 25(1) of the KVAT Act, and the same is legal and constitutionally valid. The legislative competence to amend KVAT Act through Finance Act 5/2018 is not established. It is found from the scope and scheme of powers enjoyed by the Centre and the State as regards the supply of goods and services, power to amend the KVAT Act is unavailable - The amendment to KVAT Act by Finance Act 5/2018 is without competence. Appeal dismissed.
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