KANTHI ENTERPRISES & ORS. vs STATE OF KARNATAKA & ORS.

The appellants challenged the validity of a retrospective amendment to the Karnataka Sales Tax Act, 1957, specifically the Explanation to the first proviso to sub-section (1-4) of Section 5. They contended that the retrospectivity caused significant economic loss and was arbitrary as they could not pass the tax burden to consumers. The Supreme Court examined whether the retrospective operation of the tax provision was unreasonable or arbitrary.