Case ID: 1106

Judgment:
Appeal No. 443 of 1957. Appeal by special leave from the judgment and order dated April 25	 1955	 of the Allahabad High Court in Civil Misc. Case No. 26/1951. C. B. Aggarwala	 C. P. Lal for G. Ar. Dikshit	 for the appellant. section K. Kapur and Mohan Behari Lal	 for the respondent. October 31. The Judgment of Hidayatullah	 Das Gupta and Shah	 JJ.	 was delivered by Shah	 J.	 and the judgment of Das and Ayyangar	 JJ.	 was delivered by Ayyangar	 J. SHAH J. Judge (Revisions) exercising authority under section 11 of the United Provinces Sales Tax Act XV of 1948 drew up a statement of case and referred to 191 the High Court of Judicature at Allahabad the follow question : " Whether the assessee	 who is a manufacturer and a dealer of non edible oils and who elected the previous year as the basis of his assessment in the assessment year 1948 49	 is liable to be assessed at the flat rate of 3 pies per rupee on the whole of the turnover of the previous year	 or whether he is liable to be assessed at the rates of 3 pies per rupee and 6 pies per rupee on the turnover of the previous year in proportion to the two periods from 1st April to 8th June	 1948	 and from 9th June	 1948 to the 31st March	 1949 ?" The High Court answered the question as follows: " The applicant company is liable to pay tax for the assessment year 1948 49 on the turnover of the previous year in respect of sales of non edible oils at the flat rate of 3 pies per rupee. " Against the order of the High Court recording its answer	 this appeal with special leave is preferred. The facts which give rise to the appeal are briefly these : The Modi Food Products Co.	 Ltd. hereinafter referred to as " the assessee "	 manufactures oils edible and non edible in its factory at Modinagar	 District Meerut	 State of Uttar Pradesh. The assessee is registered as a "dealer" under the United Provinces Sales Tax Act XV of 1948. The assessee 's year of account commences on June 1	 and ends on May 31	 next year. For the year of account 1946 47	 the assessee 's sales of edible and non edible oils amounted to Rs. 63	02	849 7 7. The U. P. Legislature enacted with effect from April 1	 1948	 the United Provinces Sales Tax Act XV of 1948 providing for the levy of a tax on sales of certain commodities. This act was amended by Act XXV of 1948 with retrospective operation from April 1	 1948. By the Act	 " assessment year " was defined as meaning the twelve months ending on March 31 and " previous year " was defined as meaning the twelve months ending on the 31st March next preceding the assessment year	 or	 if the accounts of the dealer had been 192 made up to a date within the said twelve months in respect of a year ending on any date other than the said 31st March then	 at the option of the dealer	 the year ending on the day to which his accounts had so been made up. 	Turnover " was defined as meaning the aggregate of the proceeds of sale by a dealer. By section 3	 a tax at the rate of 3 pies per rupee of turnover was	 subject to certain exceptions	 made payable by every dealer in each assessment year whose turn. over in the previous year exceeded Rs. 12	000 or such larger amount as may be prescribed; the Provincial Government was however authorised to reduce the rate of tax on any dealer or class of dealers on the turnover in respect of any goods or class of goods. By section 3 A	 the Government of U. P. was authorised to introduce instead of the multiple point scheme of taxation provided by section 3 a single point system of taxation and by notification to declare that the proceeds of sale of any goods or class of goods shall not be included in the turnover of any dealer except to such single point in the series of sales by successive dealers as may be prescribed; and if the Government made such a declaration	 the turnover of the dealer in whose turnover the sale of such goods was included was in respect of such sale to be taxed at such rate as may be specified not exceeding one anna per rupee. By section 7	 every dealer whose turnover in the previous year was Rs. 12	000 or more was directed to submit such return or returns of his turnover of the previous year within sixty days of the commencement of the assessment year in such form and verified in such manner as may be prescribed. By the proviso	 the Government was authorised to prescribe that any dealer or class of dealers may submit in lieu of the return or returns specified in that section	 a return or returns of his turnover of the assessment year at such intervals as may be prescribed. Provision was made by the Act for appeals against the order of assessment and revision against the order of the appellate authority. By section 11	 the High Court of Judicature at Allahabad was authorised to decide questions of law raised in any case in the course of assessment and 193 referred to it on a statement of the case drawn up by the Revising Authority. By section 24. the Provincial	 Government was invested with power to make rules to carry out the purposes of the Act and in particular in respect of certain specified matters. In exercise of the powers conferred by section 24 of the Act	 the Government of U. P. framed rules. Rule 39 of the U. P. Sales Tax Rules gave to every dealer an option to submit his return of the turnover of the assessment year in lieu of the return of the turnover of the previous year. A dealer who did not carry on business during the whole of the previous year had no option	 but was bound to submit his return of the turnover of the assessment year. By r. 40	 it was provided that every dealer who elected to submit a return of the turnover of his previous year shall within sixty days of the commencement of the assessment year	 submit to the Sales Tax Officer a return showing his turnover of the previous year. By r. 41	 it was provided that every dealer whose estimated turnover during the assessment year was not less than Rs. 15	000 and who elected to submit his return of such year shall before the last day of July	 October	 January and April submit to the Sales Tax Officer	 a return of his gross turnover for the quarters ending June 30	 September 30	 December 31 and March 31. In exercise of the authority conferred by section 3 A which was incorporated in the Act by Act XXV of 1948	 the Government of U. P. issed the following notification : " In exercise of the powers conferred by section 3 A of the United Provinces Sales Tax Act	 1941	 as amended by the United Provinces Sales Tax (Amendment) Act	 1948	 the Governor is hereby pleased to declare that with effect from June 9	 1948	 the proceeds of sale of goods entered in column 2 of the schedule hereto shall not be included in the turnover of any dealer except at the point in the series of sales by successive dealers mentioned in column 4 thereof under the circumstances shown in column 3 thereof. (2) The Governor is further pleased to order that 25 194 as from June 9	 1948	 the rate of tax in respect of the column 5 of the schedule hereto. (3) Every dealer by or on whose behalf goods mentioned in the schedule aforesaid are held at the close of the 8th day of June	 1948	 shall submit a statement showing the quantity and price of such stock and of the stock of such goods held on the 24th day of May	 1948	 to the appropriate assessing authority by the 30th day of June	 1948. " To this notification was appended a schedule which set out the descriptions of diverse commodities	 the "circumstances under Which the turnover was to be calculated " the point of tax and the rate of tax. Item 14 of the schedule was " oils of all kinds excluding edible oils but including Vanaspati " and sales thereof by manufacturers in the U. P. were liable to tax at the rate of 6 pies per rupee. By virtue of this notification	 non edible oils became liable to a single point tax as from June 9	 1948	 at the time of sale by an importer or manufacturer in the United Provinces. The assessee submitted its return for the assessment year 1948 49 on its taxable turnover of the previous year ending on May 31	 1947	 to the Sales Tax Officer	 Meerut Range. On the assessee 's return	 the Sales Tax Officer assessed the tax at Rs. 1	16	238 12 0	 holding that sales of non edible oils for the first 69 days out of the year of the turnover were to be taxed at the rate of 3 pies	 and sales for the remaining 296 days were to be taxed at the rate of 6 pies per rupee. Against the order passed by the Sales Tax Officer	 Meerut Range	 an appeal was preferred to the Judge (Appeals)	 Sales Tax	 under section 9 of the Act. The appellate authority modified the order and directed the assessee to pay tax on non edible oils on the turnover of the previous year at the flat rate of 3 pies per rupee and reduced the tax liability to Rs. 1	08	477 0 3. This order of the Judge (Appeals) was set aside by the revising authority and the order of the Sales Tax Officer was restored. On	 a direction made by the High Court	 the revising authority drew up a statement of the case and submitted for opinion a question 195 which in his opinion arose out of the assessment. The High Court re framed the question as set out hereinbefore	 and answered it in favour of the assessee. By section 3 and section 3 A	 which are the charging sections	 the liability to pay sales tax in each assessment year is charged on the total turnover of a dealer. By section 7	 read with r. 39	 the assessee has the option to adopt the turnover of the previous year as the taxable turnover for the year of assessment: and if he does so	 he has to submit within sixty days of the commencement of the assessment year returns showing his turnover for that previous year. If	 however	 the assessee adopts the turnover in the year of assessment as his taxable turnover	 he has to submit returns before the last day of July	 October	 January and April his gross turnover for each of the four quarters ending 30th June	 30th September	 31st December and 31st March. The tax is evidently levied in respect of the year of assessment : it is not levied in respect of the business carried on in the previous year. Again	 the rate applicable in assessing the tax is the rate in force in the year of assessment. That is clear from the terms of sections 3 and 3 A. But the taxable turnover for the year of assessment may	 except in certain cases not material for the purpose of this appeal	 at the option of the tax payer be either the turnover of the previous year or of the year of assessment. If the assessee adopts the turnover of the previous year	 by the provisions contained in section 3 and section 7 and rr. 39 and 40	 the liability to pay tax arises on the 1st of April and the rate applicable is the rate in force on that date. The liability of the assessee adopting the turnover of the year of assessment arises by virtue of sections 3 and 7 and r. 41 at the end of each quarter. When the taxable turnover is based on the turnover of the previous year	 the tax is assessed on an artificial turnover not related to the actual sales of the year of assessment: whereas the levy of tax on a return made on the turnover of the year of assessment is made on actual sales of that year. The tax paid on the turnover of the previous year is not related to the actual sales 196 provision for making adjustments in the liability to tax on ascertainment of the actual turnover at the end of the year of assessment. The Government of the United Provinces had by notification dated June 8	1948	 altered the rate of tax in the matter of various commodities including nonedible oils with effect from June 9	 1948. The Sales Tax Officer was right in his view that the levy of tax at the altered rate was not to operate on sales effected before June 9	 1948. Initially	 when the liability of the assessee to pay tax on edible oils for the assessment year arose	 the rate was undoubtedly 3 pies per rupee on the turnover	 and the question which falls to be determined is whether by reason of the alteration of the rate and its incidence in the course of the year	 the assessee became liable to pay tax at the higher rate on a part of the turnover of the previous year and if so	 on what basis. A tax payer who adopted the previous year 's turnover bad under section 7 and r. 40 to submit his return within sixty days of the commencement of the assessment year	 and no provision for submission of any supplementary returns in the case of alteration of rates in the course of the year was made in the Act or the Rules: nor was any method provided for retrospective modification of an assessment once made. There were under the Act and the Rules two distinct and clear cut schemes to assess sales tax	 (1) where the tax payer elected to submit his return based on the turnover of the previous year and (2) where he elected to or was bound by law to submit his return on the turnover of the year of assessment. Under these two schemes the points of time at which liability arose and the turnover on which liability was to be assessed were in their nature not identical. The tax payers paying tax under the first scheme paid it on the turnover of the previous year and at the rate in force after the end of the period and applicable to it. The tax payer paying tax under the second scheme paid tax in quarterly installments based on the previous quarter 's actual turnover and at the rate or rates prevalent in the quarter or applicable to it. Was it intended	 when alteration was made in the rate of tax 197 or its incidence during the course of the year	 to assimilate these two schemes of taxation so as to	 permit of a departure from the one to the other ? There is no express provision in the Act or in the Rules in that behalf. Nor does the notification suggest that it was so intended. In the case of a dealer who adopts the turnover of the year of assessment for purposes of taxation	 the application of the notification altering the rate of tax and the incidence of tax does not present any difficulty. The notification enjoins levy of the tax at the altered rate only in respect of sales taking place after the fixed date	 and all sales which preceded that date are to be taxed at the original rate. In the face of the language employed sales anterior to the date specified could not be affected. The question next arises: Is any machinery provided in the Act or the Rules for projecting this division of the year of assessment	 into the previous year	 and for apportioning the turnover of that year ? Express provision in that behalf there is none : and it is difficult to imply such a provision in the Act. The dates of commencement and closure of the previous year of a tax payer may vary according to the system of accounting adopted by the assessee. The year may commence from any day of any recognised calendar year	 and the year may not consist of 365 days. The method of antedating by one year the date on which the alteration is made in the rate or incidence will be manifestly inappropriate. The method of division of the turnover proportionate to the period of the assessment year before the alteration of the rate and after such alteration though prospective	 must be deemed to have been made retrospectively in the previous year	 and on a day which is removed from the commencement of the year of account by the number of days by which the date of alteration of rate is removed from the commencement of the year of assessment. But the adoption of the turnover of the previous year as the taxable turnover for the year of assessment is itself based on a fiction and	 in the absence of any express provision either in the Act or the Rules or even in the notification setting out machinery for such 198 a division of the year	 we are unable to hold that this scheme of a fictional division may be projected into the previous year to make an artificial division of the turnover for imprinting thereon the altered rate of assessment as from the date of the division. Counsel for the State of Uttar Pradesh submitted several hypothetical cases suggesting that by refusing to adopt this method of division of the previous year of assessment for the application of the altered rate	 several anomalies may arise in working out the liability to tax. He submitted that a person who was not a manufacturer or an importer of goods included in the schedule to the notification under section 3 A may	 if he has adopted the turnover of the previous year as his taxable turnover be liable even though it was the intention of the Government to absolve him from liability to pay tax. But a tax payer adopting the turnover of the previous year for payment of tax makes his choice 'voluntarily and subject to the advantages and disadvantages which that step involves. The fact that he may have to pay tax from which persons choosing the alternative method of submitting of return may partially be exempted	 because of an exemption granted in the course of the year	 may not	 in our judgment	 be a ground for not giving full effect to the provisions of the Act as they stand. In interpreting a taxing statute	 equitable considerations are entirely out of place. Nor can taxing statutes be interpreted on any presumptions or assumptions '. The court must look squarely at the words of the statute and interpret them. It must interpret a taxing statute in the light of what is clearly expressed it Cannot imply anything which is not expressed it cannot import provisions in the statutes so as to supply any assumed deficiency. Section 18 el. (c) of the Act which provides for proportionate reduction of tax when in the case of a change or discontinuance taking place in the course of the assessment year of a firm which has been assessed for such year on the turnover of the previous year does not support the contention that an artificial divisions of the turnover of the previous year is intended 199 in cases of alteration of circumstances during the course of the assessment year. It may be noticed that	 the provision is limited to changes in or discontinuance of the business of a firm	 in terms it does not apply to individuals. It is not for us to consider why the Legislature has not chosen to make a similar provision in respect of individuals. But the fact that the Legislature has made an express provision dealing with changes or discontinuance of business of firms in the course of the assessment year enabling a reduction proportionately to the tax already paid would be a ground indicating that in cases not governed by that provision	 no alteration in the liability was permissible when the taxable turnover was based on the previous year 's turnover. It is not provided that in giving effect to the alteration of the rate during the course of the year of assessment an artificial division of the turnover of the previous year should	 in applying the altered rate be made. The Legislature having failed to provide machinery for working out the liability	 the attempted projection becomes unworkable. A legal fiction must be limited to the purposes for which it has been created and cannot be extended beyond its legitimate field. The turnover of the previous year is fictionally made the turnover of the year of assessment: it is not the actual or the real turnover of the year of assessment. By the imposition of a different tariff in the course of the year	 the incidence of tax liability may competently be altered by the Legislature	 but for effectuating that alteration	 the Legislature must devise machinery for enforcing it against the tax payer and if the Legislature has failed to do so	 the court cannot resort to a fiction which is not prescribed by the Legislature and seek to effectuate that alteration by devising machinery not found in the statute. We are therefore of the view that the conclusion of the High Court is correct. The appeal therefore fails and is dismissed with costs. AYYANGAR J. We regret we are unable to agree with the judgment just now pronounced. The facts giving rise to this appeal are briefly 200 these:A company called The Modi Food Products Ltd. ' (amalgamated with the respondent) which will be referred to hereinafter as the assessee	 was during the years 1946 & 1947 a manufacturer of and dealer in vegetable oils both edible and non edible. During that year there was no legislation imposing any tax on sales. The U. P. legislature enacted the U. P. Sales Tax Act in 1948 and the statute received the assent of the Governor and was published in the official Gazette on June 5	 1948. Section 1 (2) of the Act enacted that it shall be deemed to have come into force on April 1	 1948. The appeal is concerned with the liability to sales tax under the Act of the assessee company in respect of the sale of oil effected by the assessee during the period June 1	 1946 to May 31	 1947	 which was the account year of the assessee previous to the first assessment year under the Act1948 49. Section 3 of the Act	 to quote only the relevant words	 as it stood at the material time	 enacted : " Section 3. Liability to tax under the Act. Subject to the provisions of this Act	 every dealer shall pay on turnover in each assessment year a tax at the rate of 3 pies a rupee Provided that (i) the Provincial Government may	 by notification in the official Gazette	 reduce the rate of tax on the turnover of any dealer or class of dealers or on the turnover in respect of any goods or class of goods; (ii) a dealer whose turnover in the previous year is less than Rs. 12	000 or such larger amount as may be prescribed shall not be liable to pay the tax under this Act for the assessment year. " By the U. P. Sales Tax Amendment Act	 1948 (Act XXV of 1948) this proviso was slightly modified and section 3(A) was inserted in the Act reading as follows: " Section 3 A. Single point taxation. (1) Notwithstanding anything contained in Section 3	 the Provincial Government may	 by notification in the official Gazette	 declare that the proceeds of sale of any goods or class of goods shall not be included in the turnover of any dealer except at such single point 201 in the series of sales by successive dealers as may be prescribed. (2)If the Provincial Government makes a declaration under sub section (1) of this Section	 it may further declare that the turnover of the dealer	 in whose turnover the sale of such goods is included	 shall	 in respect of such sale	 be taxed at such rate as ' may be specified not exceeding one anna per rupee if the sale relates to goods specified below. (A list of goods was then set out) and nine pies per rupee if it relates to any other goods. " Non edible oil which is the commodity with the sale of which the assessment in the present appeal is concerned is not in the list of goods set out in section 3(A) and would therefore be covered by the residuary clause of the section. The U. P. Government issued the following notification dated June 8	 1948	 under section 3(A) of the Act: " In exercise of the powers conferred by Section 3 A of the United Provinces Sales Tax Act	 1948	 as amended by the United Provinces Sales Tax (Amendment) Act	 1948	 the Governor is hereby pleased to declare that with effect from June 9	 1948	 the proceeds of sale of goods entered in column 2 of the Schedule hereto shall not be included in the turnover of any dealer except at the point in the series of sales by successive dealers mentioned in column 4 thereof under the circumstances shown in column 3 thereof. 2. The Governor is further pleased to order that as from June 9	 1948	 the rate of tax in respect of the turnover of the aforesaid goods shall be as entered in column 3 of the Schedule hereto. Every dealer	 by or on whose behalf goods mentioned in the schedule aforesaid are held at the close of the 8th day of June	 1948	 shall submit a statement showing the quantity and price of such stock and of the stock of such goods held on the 24th day of May	 1948	 to the appropriate assessing authority by the 30th day of June	 1948 ". In the Schedule annexed to this notification	 nonedible oil of the type dealt with by the assessee was 202 subject to a tax @ 6 pies per rupee if the same was manufactured in U. P. Section 7 of the Act	 as it stood at the date relevant to this appeal	 enacted : " Section 7. Determination of turnover and assessment of tax. (1) Subject to the provisions of Section 18	 every dealer whose turnover in the previous year is Rs. 12	000 or more in a year shall submit such return or returns of his turnover of the previous year within sixty days of the commencement of the assessment year in such form and verified in such manner as may be prescribed: Provided that the Provincial Government may prescribe that any dealer or class of dealers may submit	 in lieu of the return or returns specified in this section	 a return or returns of his turnover of the assessment year at such intervals	 in such form and verified in such manner as may be prescribed	 and thereupon all the provisions of this Act shall apply as if such return or returns had been duly submitted under this section. Provided further that the assessing authority may in his discretion extend the date for the submission of the return by any person or class of persons ". Rules were framed by Government inter alia under the power conferred by the 1st proviso just now set out and by rule 39 of the said rules an option was given to dealers to submit returns of their turnover of the assessment year in lieu of the turnover of the previous year. The assessee exercised the option of being assessed on the basis of the turnover of the previous year under section 7(1) of the Act and in respect of first assessment year after the Act came to force assessment year 1948 49	 it filed a return in respect of the turnover of its previous year June 1	 1946 to May 31	 1947. The total turnover of the assessee during this period was Rs. 63	02	849 7 7. The Sales Tax Officer by his order dated March 12	 1949	 assessed the turnover in respect of edible oil at 3 pies per rupee. As regards the sale of non edible oil	 the sales tax officer hold that since the notification set out above under 203 section 3(A) had come into force as and from June 9 of the assessment year	 the assessee was liable to be assessed @ 3 pies per rupee on the turnover during the first 69 days of the year and @ 6 pies per rupee in respect of the remaining days of the year and he computed the ' tax accordingly. The assessee preferred an appeal to the Judge (Appeals)	 Meerut Range	 Meerut	 against the order of the Sales Tax Officer. This officer allowed the appeal of the assessee and held that the entire turnover was liable to be taxed only at a flat rate of 3 pies per rupee under section 3(1) of the Act on all oil sold by the assessee edible or non edible. The reason assigned for the order was that on the terms of the notification the new rate of tax could not be applied to sales effected in the previous year which had been opted for the purposes of assessment by the assessee and that so to apply it would be tantamount to giving retrospective effect to the notification which was contraindicated by the terms of the notification itself. The department thereupon moved the Judge (Revision) who accepted its contention and restored the order of the Sales tax Officer applying the provisions of the notification to the turnover of the assessee. There. after the assessee made an application to the Judge (Revision) to state a case for the opinion of the High Court under section 11 of the Act as to whether the rate of tax fixed by the notification could be applied to the sales of the commodity which factually took place on or before June 8	 1948. This petition having been dismissed	 an application was filed before the High Court for directing the reference and on this being ordered the following question (as reframed by the High Court) was referred to it for determination : " Whether the assessee who is a manufacturer and a dealer of non edible oils and who elected the previous year as the basis of his assessment in the assessment year 1948 49 is liable to be assessed at the flat rate of 3 pies per rupee on the whole of the turnover of the previous year or whether he is liable to be assessed at the rates of 3 pies per rupee and 6 pies per rupee on the turnover of the previous year in proportion to the two periods from April 1 to June 8	 1948 and from to March 31 1949. " 204 The learned Judges answered the question in favour of the assessee and held that the notification under section 3(A) could not apply to determine the rate of tax payable by the assessee on his turnover of the previous year. The present appeal is against this answer by the High Court. As the arguments before us proceeded on practically the same lines as before the High Court	 it will be convenient if we set out the reasoning by which the learned Judges upheld the asssessee 's contention that the notification under section 3(A) was inapplicable to determine the rate of tax payable by it. The grounds were mainly five: (1) The assessee could not be charged at the rates prescribed by the notification unless the new rates operated retrospectively; (2) that section 3(A) which was introduced into the parent Act (Act XV of 1948) by the Amending Act XXV of 1948 was not enacted with retrospective effect. Though the charge imposed by section 3(1) of the Act read with section 7(1) imposed tax retrospectively as and from April 1	 1948	 section 3(A) did not on its terms so operate as and from that date. Hence the liability of the assessee which had become fixed under Act XV of 1948	 as it originally stood	 could not be and 'Was not varied by section 3(A) and would not therefore be affected by any notification issued under the last mentioned provision ; (3) that a notification under section 3(A) could not have retrospective effect since section 3(A) itself did not operate of its own force and merely empowered the Government	 'by a notification	 to effect changes in the law and hence such changes when notified could not operate as from any date prior to the date of the notification ; (4) Section 3(A) which used the words " in respect of such sales " contemplated particular sales taking place after the notification issued under it and hence the notification issued under that section could not alter the rate of levy in respect of sales anterior to the date of the notification ; (5) that the terms of the notification carried out the general scheme of the Act and negatived retrospective operation and that as on its langu age it applied only to sales which took place on or 205 admittedly effected long prior thereto in the previous year the same could not be affected by the enhanced rate of duty. Before proceeding further it must be pointed out that the learned Judges of the High Court were not right in thinking that section 3(A) was not enacted to operate retrospectively from the commencement of the ' parent Act. Section 1(2) of the Sales tax Amending Act XXV of 1948 which introduced section 3(A) enacted: " It (this Act) shall be deemed to have come into force on the 1st April	 1948." and as section 3(A) was one of the sections of this enactment	 it would have effect from the earlier date. This inadvertent error	 however	 would not affect the central point of the reasoning of the learned Judges. Besides elaborating the other points in the judgment of the High Court	 learned Counsel for the respondent further pressed upon us that there was no specific provision in the Act for refund or reassessment which would have been present if the levy of a rate with retrospective effect were contemplated by the Act as applicable to the assessees who bad opted for the " previous year turnover " basis of assessment. He pointed out that in the case of those assessees who opted for their being assessed in respect of their turn. over during the assessment year	 quarterly returns were submitted along with the payment provisionally of the tax due on the basis of that return	 the final assessment being completed only after the close of the year when the amount due for the year was ascertained and a demand made for the balance due after adjustment of the amounts already paid during the course of the year (Rule 41). Obviously in their case no difficulty could arise by reason of any change in the law either in the rate or basis of taxation effected during the year	 as these would automatically be given effect to in the final assessment. If	 however	 changes made in the rate of tax payable during the year were held applicable to those assessees who had opted for the previous year turnover basis	 necessary adjustments could not be made in their assessment for lack of specific machinery to achieve the same. From this 206 he argued that the scheme of the Act was that in the case of the previous year turnover assessees	 to use a convenient phrase	 the tax liability had to be determined on the state of the law as it prevailed on the 1st day of the assessment year and that it got fixed and crystallised on that date and remained unaffected by any changes in the law effected during the course of the assessment year. In view of these additional submissions	 we consider that it would be convenient to examine the entire argument of learned Counsel for the respondent under three heads into which they naturally fall: (1) Does the Act	 read in conjunction with the Rules framed to give effect to its provisions	 contemplate any difference being drawn between the basis of the tax liability (as distinct from the quantum of the turnover) of those assessees who have opted for the previous year turnover and " the assessment year turnover " assessees. (2) Is there any sound basis for the contention that the tax liability of the "previous year turnover" assessees gets crystallised on the 1st of April of the assessment year	 with the result that such assessees are unaffected by any changes of the law which operate from beyond that date. (3) If the above two questions are answered in the affirmative the construction of the notification dated June 8	 1948	 would not fall for consideration	 for even if on its language it can apply to the turnover of a period anterior to its issue	 the notification cannot be given such effect since the same would be against the basic scheme of the Act. If	 however	 the answer to the above two questions were in the negative	 a further point would arise as to whether on the terms of the notification now under consideration the same could on its language apply so as to affect the tax liability of the " previous year turnover assessees. We shall now proceed to examine these submissions. On the scheme of U. P. Sales tax Act	 as of every other sales tax legislation in the other Indian States	 the total tax liability of an assessee is the resultant 207 product of two factors: (1) the total of the proceeds of sales effected during a given period	 universally a year	 from which are deducted the turnover of the sales of commodities which are exempt from tax; for instance under section 4 of the Act whose provisions will be referred to later; (2) multiplied by the rate of tax applicable either to the entire turnover or where ' different rates are prescribed on sales of different articles	 such rates in respect of such turnover. The best way to appreciate the scheme underlying the Act would be to ascertain the position at the time the Act was enacted. It received the assent of the Governor and was published in the Gazette on June 5	 1948. Section 1(2) of the Act further enacted that " It shall be deemed to have come into force on April 1	 1948 ". Except to that limited extent	 the Act is prospective. The tax is on the " turnover "	 i.e.	 on the total of the sales proceeds of taxable sales and therefore unless there were a taxable sale	 its proceeds would not enter the pool which goes by the name of " turnover ". As the Act is not retrospective	 the taxable turnover would normally be the total of the sales effected after the enactment became operative	 i. e.	 from and after April 1	 1948	 but for the sake of convenience of assessment	 it enacts by section 7(1)	 we have extracted earlier	 a provision providing an option to dealers who have been in business in the year previous to the taxing enactment	 to be assessed either on the turnover of the previous year	 when owing to the absence of the Act their sales were not subject to tax or on the turnover of the current year. But whichever be the turnover adopted	 the rate of tax or the determination of the particular sale proceeds whose total constitutes the taxable turnover	 i.e.	 after the exclusion of the sale proceeds of the commodities listed in section 4	 does not vary. In other words	 though the figure of turnover might vary between those who have opted for the one or the other mode of assessment due to the volume of the sales	 no difference is maintained in the Act as regards the incidence of the tax	 i.e.	 either in the principle underlying the computation of the total turnover or in 208 the rate or rates applicable to the sales of particular goods or on the total turnover. This can only be on the premise or implicit assumption that the sales of the previous year are treated by the Act for the purpose of computing tax liability as the sales of the current year a projection forward in point of time. In other words	 the entire basis underlying the charging provision section 3(1) read with the option provided by section 7(1) is that the sales of the previous year are fictionally treated as the sales of the current year for the purpose of the computation of the tax liability. It has to be remembered that in cases like the present	 during the time when the sales were effected	 the Act was not in operation and hence the sales were not taxable. But for the purpose of the imposition of the tax liability	 it is assumed that the sales are taxable and the goods whose sales become taxable are determined on the basis of the provisions of the Act. Thus	 if in the current year commodities A	 B and C are exempt from tax	 they are not to be included in the turnover of the dealer in respect of the previous year in the case of those who have opted for the " previous year turnover " under section 7(1)	 and the turnover thus computed is charged at the same rate of tax applicable to transactions of the current year. So far	 therefore	 as the express provisions of the Act go	 no difference is made between the basis of the tax liability of the " previous year turnover " and the " assessment year turnover " assessees; and though by reason of the terms of section 7(1) the quantum of the turnover varies no other variation in the law applicable to the two types of assessees is contemplated. We must therefore start from the premise that the Act does not contemplate any difference in the incidence of the tax and the quantum of tax liability flowing from the choice of either the " previous year " or the " assessment year " as the basis of the determination of the turnover. We should add that learned Counsel for the respondent has not been able to point out any provision in the Act or in the Rules pointing to any such differentiation. It was	 however	 submitted that though the statute 209 might not say so in express terms	 still by reason of the provisions of the Act and the Rules under	 which the " previous year turnover " assessee had to ' or could submit his return within sixty days from the commencement of the assessment year and have his assessment completed immediately thereafter as compared to the " assessment year assessee " whose assessment was completed after the end of the year	 coupled with the absence of any machinery for re assessment or refunds in the event of any change in the law effected after the commencement of the financial year	 it had necessarily to be held that the liability of the " previous year turnover " assessee got crystallised as on the 1st of April of the assessment year and that the Act did not contemplate this being disturbed by any subsequent changes in the substantive law relating to assessment during the assessment year. It was said that the tax liability of the dealer who had opted for the " previous year " basis had to be determined on foot of two factors and only two: (1) the turnover of the sales of the previous year which is a definite and known figure by the 31st of March of the previous year and (2) the rate of tax on the turnover as it prevailed on the 1st of April of the assessment year when it was said that there was a "crystallisation" of the liability to tax. It was pointed out that it was possible for an assessee to submit his return on the basis of the " previous year turnover " even on the 1st of April of the assessment year and there being no legal impediment in the way of the figures returned by the dealer being accepted the assessment might conceivably be completed and the tax due demanded and even paid on the 1st of April	 it sell If this were done	 it was urged	 there being no machinery for reassessment or refunds such completed assessment would become final for the year and could not be disturbed thereafter. If this were possible or were actually done in the case of one dealer who had so opted	 it was urged that it would obviously be anomalous if another dealer who happened to submit his return later and whose assessment was in 27 210 consequence delayed	 should be subjected to a different law or a different rate of levy. In our opinion	 this argument breaks on critical examination. Learned Counsel for the respondent	 to start with	 asserted that the crystallisation of the tax liability as on the 1st of April of the assessment year was with reference to the law as it factually was on that date and that changes made subsequently even if with retrospective effect to date from the commencement of the year	 would not affect that liability. This was obviously an untenable contention because if the later enactment or rule was retrospective it must be deemed in the eye of the law to have been in existence and in operation on the earlier date. Though learned Counsel withdrew this extreme argument	 still the concession that changes effected with retrospective effect to date from the commencement of the assessment year would apply to determine the tax liability even of the " previous year turnover " assessee serves to emphasize that little importance could be attached to the two bases on which " the crystallisation " argument was rested	 viz. : (1) the obligation or freedom of the previous year turnover assessee to submit his return and have his assessment completed within sixty days of the commencement of the assessment year and (2) the absence of a specific provision for reassessment and refund. Under the proviso (1) to section 3 which reads: " the Provincial Government may	 by notification in the official Gazette	 reduce the rate of tax on the turnover of any dealer or class of dealers or on the turnover in respect of any goods or class of goods." the State Government could reduce the rate of tax on the turnover of dealers from the standard rate of 3 pies in the rupee under the main part of section 3. It is also not denied that there is nothing in the terms of the proviso to confine the power to effect reductions only prospectively as distinguished from reductions having retrospective effect. If a reduction were effected say in January or February of the year	 having effect as and from the 1st April preceding	 on the very argument advanced	 Counsel for the respondent would 211 have to concede	 that the reduced rate would govern the liability of even those dealers who were assessed on the basis of their turnover of the previous year. Let us first take a case where such a reduction in the rate is notified to be effective before an assessee submits his return. In such a case	 the benefit in the reduction of the rate could not be withheld from the previous year turnover dealers even on the theory of " crystallisation " just now referred to. Let us next take the case of a dealer who has submitted his return of the turnover of the previous year on a date anterior to the notification regarding the alteration of the rate. It might be mentioned that in the return submitted by dealers which has to be in Form IV of Appendix F to the rules	 only the total of the sale proceeds of the sales of the classified items of goods have to beset out	 but the return does not concern itself with the rate of the tax levied. This latter is a matter with which the assessing authority is concerned when determining the amount of tax payable. If the rates are altered subsequent to the submission of the return but before the assessment is completed	 on the terms of the charging section which draws no distinction in the incidence of the tax as between the " previous year turnover " group and the " assessment year turnover " dealers	 the Sales Tax Officer would have to afford every assessee	 whatever be the basis of this turnover the benefit of the tax reduction. The position reached therefore is that if the change in the rate (we have assumed it to be by way of reduction	 but the argument would equally apply to variation in any kind)	 were effected before the actual assessment	 it should be given effect to in the case of every assessee for not merely is there no procedural complication in the shape of a need for refund but it would be in accordance with the	 law and in fact one might go further and say that any other mode of proceeding would not be countenanced by the Act	 because the statute homologises the basis of the tax whether the turnover is computed on the previous year 's or the current year 's sales. Next in regard to cases where the change in the law 212 is effected after the completion of the assessment we consider that the submission regarding the absence of machinery for reassessment and refund is not well founded. It is true that there are no provisions specially so designated to meet this contingency here referred to	 but that is not the same thing as saying that there is a complete absence of machinery. In the first place	 section 22 of the Act empowers authorities including the assessing officer to rectify any mistake apparent on the face of the record and by such rectification even to enhance the tax liability. If on the premises assumed	 the variation in the rate of tax would on a proper construction of the Act be applicable to the turnover of the dealer who has opted for the " previous year rule " but the assessment order does not give effect to it	 it would certainly be a case of an error apparent on the face of the record	 which would bring the case within the power of rectification. On the analogy of the cases under section 35 of the Income Tax Act	 1922	 the assessment officer could order rectification in such cases. Even apart from this	 under a. 10(2) of the Act the dealer or the department as the case may be may apply to the Revising authority for revision of the assessment on the ground that the same is not legal	 proper or regular. This section enacts: " The Revising Authority may in its discretion at any time suo motu or on being moved by the Commissioner of Sales Tax or on the application of any person aggrieved	 call for and examine the record of any order or proceedings recorded by any appellate or assessing authority under this Act for the purpose of satisfying itself as to the legality or propriety	 of such order or as to the regularity of such proceedings and may pass such order as he thinks fit." The orders which the Revising Authority could pass might either be by way of enhancement or reduction	 and the subsequent sub sections provide: . "10 (4). The Revising Authority shall not pass any order under sub section (3) adversely affecting any person unless an opportunity has been given to such person to be heard. 213 (5) If the amount of assessment is reduced by the Revising Authority under sub section (3) it shall order the excess amount of tax if already realised to be refunded. " It is	 therefore	 not correct to say that there is no machinery for rectifying errors and for making consequential orders for payment of further tax	 or for directing refunds	 and this argument cannot therefore justify the construction contended for by the respondent. In the entire discussion up to now we have proceeded on the assumption that the turnover of " the previous year " of the dealer was a fixed quantity which was finally determined once and for ever on the 31st March of that year and that the problem was merely to find the rate of tax to be applied to this predetermined factor. It will be seen from an examination of the Act that even the factor of the turnover is subject to variation. For instance	 the first part of section 4 enacts: " The provisions of section 3 of this Act shall not apply to (1) the sale of water	 salt	 foodgrains	 milk	 gur	 electrical energy for industrial purposes	 books	 magazines	 newspapers and motor spirit as defined in the United Provinces Sales of Motor Spirit Act	 1939	 and any other goods which the Provincial Government may	 by a notification in the official Gazette exempt from time to time. " Under this power besides the specified goods	 the State Government might from time to time exempt other goods from among those whose sale proceeds have to be included in the turnover. If an exemption of that type were granted say in 1948 49	 it cannot be contended that the turnover of the dealer who had opted for the " previous year " has to include these sales in the return which he submits in Form IV	 If by the date of the submission of the return	 the exemption has been notified	 and has effect for the entire year of course he need not include these sale proceeds in his return. The computation	 therefore	 of the quantum of turnover of the previous year on which tax has to be levied is one which is subject to the law 214 in relation to it in the assessment year	 and any change in that law presents the same problems	 as the variation in the rate of tax. Up to now the discussion has proceeded on the basis that a change in the law made in the assessment year whether as regards the computation of the turnover or as to the rate of levy	 is effective throughout that year	 i.e.	 from the 1st April to the 31st March	 and it is found that the fact that the returns of the previous year turnover dealers are required to or are submitted within the early part of the year	 or the contention based on the absence of specific machinery for reassessment or refund are an insufficient basis for holding that a change in the law affecting the basis of tax liability would not affect the previous year turnover assessees and that the machinery provided by sections 10 and 22 are adequate to meet the contingencies arising out of the changes being retrospectively effected after the assessments were completed. We shall next proceed to consider whether the change in the law either as regards the computation of the taxable turnover or as regards the rate of tax becoming operative sometime after the year has commenced makes any difference. In the case of the "assessment year turnover " dealers	 there is no problem because the sales effected during the course of the year would be governed by the law applicable from time to time. The entire basis or theory of the tax being levied on foot of the previous year 's turnover is that notwithstanding that factually the sales took place in the previous year they are to be deemed by fiction to have taken place in the year of assessment. If that theory be discarded there could be no legal foundation for the tax being levied by the Act even as originally enacted on a sale which factually took place before it was operative. The only question therefore is the precise scope of that fiction and its logical implication. If the sale in the previous year is treated by the Act as a sale in the present year	 then no principle is contravened	 if it were held that sales during a portion of the previous year are held to be sales during a corresponding portion of the current 215 year. If we reject the argument that it is only the law as prevailed on the 1st April of a year that forms		 the basis for the computation of the turnover and for the ascertainment of the tax liability as not flowing from the provisions of the Act	 and indeed as contrary to the very scheme underlying the enactment	 the changes in the law effected during the course of the assessment year must operate even in respect of the turnover of the previous year	 which are deemed to be the turnover of the assessment year. It now remains to deal with the question as to whether the language employed in the notification by which only sales effected after a date specified in the assessment year are to be governed by the new levy	 precludes the application of the notified change to those dealers whose sales were actually effected in the previous year	 but who had opted for the " previous year turnover " basis of assessment. The argument of learned Counsel	 which found favour with the learned Judges of the High Court was briefly this. The notification expressly states that only sales effected from and after June 9	 1948	 were to be charged with the new rates. In terms therefore	 the change in the law is wholly prospective. If so	 one cannot by any line of reasoning reach the conclusion that the new rates of levy applied to sales	 as by the present respondent	 more than a year earlier. So stated the reasoning appears impressive and it is true that a taxing enactment cannot be construed as levying a charge unless the words clearly do so. But the words have always to be understood and more than that applied with reference to the underlying basis of the scheme of taxation. So applied	 it does not appear to us to support the contention of the respondent. The change in the rate of tax	 was no doubt prospective. The phraseology employed merely means that in the case of the " assessment year turnover " dealers only the sale proceeds of sales effected after the specified date would be governed by the new rates. In the case of the " previous year turnover " dealers	 the change operates to determine the amount of tax during their assessment year just in the same manner as 216 the original charge under the Act	 of a flat rate of three pies determined the tax payable notwithstanding that none of the sales whose proceeds were included in their turnover were effected during the assessment year. We have already pointed out that the basic idea underlying the provision contained in section 7(1) of the Act 'is that it projects the turnover of the previous year into the assessment year. Admittedly the Act itself is not retrospective	 or designed to levy the charge under section 3(1)	 on sales effected before April 1	 1948. If sales of the previous year are brought within the taxing provision	 it is not because the sales when they took place were subject to tax	 but because either (a) the previous year 's sales are deemed in law when the assessee so opts as the sales of the current year or (b) the previous year 's turnover being opted	 the provisions of the charging sections operate on that turnover. Whichever of these be the more accurate method of expressing the result	 the fact is that there is no element of retrospectivity at all involved in the application of the tax law which prevails in the year of assessment to the turnover of the previous year when due to the choice of the assessee of being assessed under section 7(1)	 the previous years ' turnover basis is rendered applicable. Possibly the matter may be tested in this manner. Section 3(1) of the Act the charging section imposes in effect a tax of three pies per rupee on all sales effected after the commencement of the Act	 i.e.	 after April 1	 1948. pose that section itself	 had by a proviso imposed a tax @ six pies per rupee on all sales of edible oil effected on and after June 9	 1948. Could it then be open to argument	 that in respect of the previous year 's sales	 only a three pies tax was payable and that the result of the charging provision could be ignored. If	 therefore	 we are right so far	 the respondent derives no advantage from the notification specifying the dates of sales effected from and after which they would be subject to the varied rate. The notification had necessarily to be worded as it was	 in order to fulfil its primary purpose of effecting a change in the rate during the assessment year. The date 217 mentioned in the notification as the date from and after which sales would be charged at the new rates would therefore not militate against the new rates being applied to the turnover of the previous year	 since the turnover of the previous year has to be assessed on the rates prevailing in the assessment year. The next question is how on the terms of the notification which came into operation after the commencement of the assessment year and during the course of it	 the proportion of the turnover on the basis of which the tax liability of a previous year 's turnover dealer could be computed. Learned Counsel for the respondent urged that no intelligible basis could be suggested for distinguishing the two periods in the previous year when the original rates and the altered notified rates would operate. Learned Counsel urged that it would be impossible to distinguish these two periods either on any theory of retrospectivity of the notification or on any theory regarding the sales of the previous year being attributed to the corresponding dates of the current year. There is no doubt that this mode of computing the proportion	 viz.	 to treat the sales which were effected on various dates of the previous year	 as if they were sales on the corresponding dates of the current year and thus to compute the two totals of turnover which would be subject to different rates of duty would not be proper. The impropriety would arise from the fact that the fiction enacted by section 7(1) is not that each day 's sale in the previous year is deemed to be a sale on the corresponding date in the current year	 but only that the total taxable turnover of the previous year is deemed to be that of the current year. The method to which objection is taken is however not the manner in which the Sales tax Officer computed the proportion which was affirmed by the Judge (Revision). If the total of the sale proceeds of the previous year is deemed to be the total of the current year	 there is no illogicality or impropriety in dividing that total in accordance with the number of days in the year in which the different rates prevailed and that is precisely what the Sales tax Officer did. 28 218 If as we hold both the computation of the turnover of the previous year	 as well as the incidence of the tax leviable on it	 are to be determined not merely by the law as it stood on the first day of the assessment year	 but by the law applicable to assessments during the entire assessment year	 the method by which the tax liability of the respondent was computed by the Sales tax Officer is not open to any objection. In connection with the interpretation of the notification a minor point was suggested to which brief reference might be made. It was submitted that as the notification in effect levied a tax	 if it was ambiguous	 it should be resolved in favour of the subject the tax payer. We see no ambiguity in the notification to justify an appeal to this rule. Besides the notification in effect frees dealers other than importers and manufacturers of all tax liability in respect of the sale turnover of oil	 though in the case of two specified classes of dealers. a single point tax at an enhanced rate is levied. In such a situation	 the rule of construction invoked could hardly be applied	 even if the condition as to ambiguity were present. We	 therefore	 hold that the assessment to sales tax of the respondent company by applying to its turnover of the year 1947 48	 the rate of tax specified in the notification of June 8	 1948	 as determined by the Sales tax Officer was in accordance with the law. We would accordingly allow the appeal	 set aside the decree of the High Court and restore the assessment order of the Sales tax Officer with costs here and in the High Court. BY COURT. In accordance with the opinion of the majority	 the appeal is dismissed with costs.

Summary:
The respondent company was a manufacturer of edible and non edible oils and was registered as a " dealer " under the United Provinces Sales Tax Act	 1948. Its year of account commenced on June 1	 and ended on May 31 of the next year. Under section 7(1) of the Act read. with rule 39 of the rules framed thereunder the respondent exercised the option of being assessed on the turnover of the previous year and submitted its return for the assessment year 1948 49 on its taxable turnover of the previous year ending May 31	 1947. The Sales Tax Officer assessed the turnover in respect of edible oil at 3 pies per rupee under section 3	 but in respect of non edible oil he held that since a notification dated June 8	 1948	 issued under section 3(A) had come into force from June 9	 of the assessment year providing for the levy of tax at 6 pies per rupee	 the assessee was liable to be assessed at 3 pies per rupee on the turnover during the first 69 days of the year and at 6 pies per rupee for the remaining days of the year. On appeal by the assessee the appellate authority modified the order and directed that the tax be levied at a flat rate of 3 Pies on both edible and non edible oils. This order was set aside by the revising authority and the order of the Sales Tax Officer was restored. On a direction made by the High Court the revising authority submitted a question for opinion. The High Court held that the assessee was liable to pay the tax at a flat rate of 3 pies per rupee. On appeal by the Commissioner of Sales Tax by special leave	 Held (per Hidayatullah	 Das Gupta and Sliah	 jj.)	 affirming the view of the High Court	 that the assessee who elected to submit his return on the turnover of the previous year	 is liable to be assessed to sales tax at the rate in force on the first day of the year of assessment because the liability arises on that date	 and any subsequent enhancement of the rate by virtue of a notification under section 3(A) does not alter that liability. A taxing statute must be interpreted in the light of what 190 is clearly expressed therein and nothing can be implied nor can provisions be imported into them so as to supply an assumed deficiency. Per section K. Das and Ayyangar	 JJ. The rate of tax as applied by the sales tax officer was in accordance with law. Having regard to the scheme underlying the option to elect for a previous year turnover conferred by section 7(1) of the Act the change in the law and in the rate of tax effected during the assessment year must apply to the turnover of the previous year which is deemed to be the turnover of the assessment year and sales effected during that period have to be assessed at the rate prevailing in that year. Although the notification was prospective and was made with the object of changing the rate of taxation during the assessment year	 the date mentioned therein did not prevent the application of the assessment year rate to the opted previous year turnover. It is not correct to say that there is absence of machinery for reassessment and refund of tax to justify the conclusion that the basis of the tax liablity for an assessment year is that which prevailed on the first day of that year since there are provisions in the Act such as for instance sections 10 and 22 which provide for reductions	 refunds and rectification of errors regarding taxation and even for enhancement of the tax already levied. There was no ambiguity in the notification and the principle of resolving ambiguities in favour of the assessee could not be applied in this case.