In the context of the recent rape cases, retrospectivity of criminal law has assumed more importance. The law regarding retrospective effect for criminal jurisprudence is not quite the same as for civil jurisprudence. With regard to levy of taxes, which comes under civil jurisprudence, the law allows retrospectivity, but in tax law, if there is a penal provision, retrospectivity is not permitted.
It is well-established that in tax laws the Parliament can make laws retrospectively to collect taxes. There are so many judgements on this issue from which we find that the courts have successfully upheld the levy of taxes retrospectively both for validation as well as for explanation and clarification. Clarificatory amendment has been held retrospective. There is still a doubt whether retrospective effect can tantamount to a fresh levy. High Court judgements are not unanimous. However the judgement of the Supreme Court in Empire Industries case (1985) clearly gives the conclusion that retrospective legislation has to be a case of small repair and not a fresh imposition of tax.
The law is not the same in respect of criminal cases. Retrospective effect is not allowed in criminal law. Article 20 of the Constitution specifically bars it. Article 20(1) reads thus:
"Protection in respect of conviction for offences - (1) No person shall be convicted of any offence except for violation of a law in force at the time of the commission of the act charged as an offence, nor be subject to a penalty greater than that which might have been inflicted under the law in force at the time of the commission of the offence".This protection given in the Constitution has been the main source of all other judgements with respect of penal provisions in tax cases. The judgements have made it well settled that there cannot be any retrospectivity in respect of penalty and confiscation. This has been upheld in many judgements and the most famous judgement is in the case of JK Spinning & Wvg. Mills Ltd. Vs. UOI - 1987(32) ELT234(SC).
The court held in this case that tax could be retrospectively charged due to retrospective amendment of Central Excise Rules 9 and 49, but there could not be any retrospective imposition of penalty or confiscation of goods.
The exact words of the judgment were thus: "It will be against all principles of jurisprudence to impose penalty on a person or to confiscate his goods for an act or omission which was lawful at a time when such an act was performed or omission made but subsequently made unlawful by virtue of a provision of law."
There are several judgments to the same effect following this leading judgment. Also, in the case of CCE, Ahmedabad vs. Orient Fabrics Pvt. Ltd. - 2003 (158)ELT 545(SC), the Supreme Court held that amendment of Additional Duties of Excise Act providing penal provision cannot be given retrospective effect.
In another important case, CCE, Mumbai vs. Lal Mining Engg. Works - 2007(215) ELT167(SC), the issue was whether the provision of Section 11 AC of the Central Excise Act, which was amended with effect from September 28, 1996 providing for a mandatory penalty could be retrospectively applied.
The Supreme Court held that Section 11AC being a penal provision providing for a mandatory penalty, it cannot be invoked in a case of this nature as the same would amount to giving retrospective operation thereto, which is impermissible in law.
However, retrospectivity was allowed by the Supreme Court in the case of an amendment in 2001 in the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS). This was in view of the fact that it was clear from the objectives and reasons while making the amendment that the intention was to make the law beneficial to the accused in petty cases. So it amounted to mollifications of the rigour of punishment retrospectively for pending cases.
In this case it is proved that if the intention of retrospectivity is clear in the law, even in criminal law, there can be retrospectivity.
Conclusion: So the clear position is that while retrospective effect is allowed, with limitations, in taxation law in general, no retrospective effect can be given in penal provisions even in tax law. However, if the retrospective intention is clear from the law, it can be retrospective even in criminal jurisprudence.
