1998 (11) TMI 549 - SC - VAT and Sales Tax

Power to make to include power to add, amend, vary or rescind orders, etc Held that - Appeal allowed. The Legislature, empowered the State Government to amend Schedule I only to this extent that it could widen the scope thereof, either by including therein goods which had not already got its benefit or by relaxing or removing conditions which were a pre-requisite for obtaining the exemption thereunder. No power was conferred by the statute upon the State Government in any way to curtail the scope of Schedule I. Having regard to the express terms of section 10(2), reliance upon section 21 of Madhya Pradesh General Clauses Act was uncalled for. In any event, under section 21 the power to issue a notification, order, rule or bye-law conferred by a Madhya Pradesh Act is to be read as including a power to add to, amend, vary or rescind the notification, order, rule or bye-law so issued. Section 21 has no application to a case such as this where the Schedule (Schedule I) is a part of the statute itself and not the creation of a notification, order, rule or bye-law.

Summary

Issues:
Interpretation of statutory provision granting power to amend Schedule I under Madhya Pradesh General Sales Tax Act.

Analysis:
The case involved a dispute regarding the interpretation of the Madhya Pradesh General Sales Tax Act, specifically focusing on the power granted to the State Government to amend Schedule I under section 10(2) of the Act. The original Schedule I covered various types of cloth, including processed cloth. The State Government, exercising its power under section 10(2), issued a notification to exclude certain cloth from the purview of Schedule I, leading to denial of exemption to the appellants during assessment proceedings.

The High Court, in its judgment, relied on section 21 of the Madhya Pradesh General Clauses Act, stating that the power to include certain entries in Schedule I also encompassed the power to exclude items. The High Court held that the State Government had the authority to amend the Schedule, including the power to exclude items mentioned in it. However, the Supreme Court disagreed with this interpretation.

The Supreme Court clarified that Schedule I was originally created by the Legislature, and the State Government was only empowered to widen its scope by including new goods or relaxing conditions for exemption. The Court emphasized that the statute did not grant the State Government the authority to restrict the scope of Schedule I. Therefore, the reliance on section 21 of the General Clauses Act was deemed unnecessary and inapplicable to the case at hand.

Consequently, the Supreme Court allowed the appeal, setting aside the judgment of the High Court and granting relief to the appellant by reinstating the exemption on the cloth in question. The Court highlighted the limitations of the State Government's power to amend Schedule I under the Madhya Pradesh General Sales Tax Act, emphasizing the need to adhere strictly to the statutory provisions governing such amendments.

In conclusion, the Supreme Court's decision clarified the extent of the State Government's authority to amend Schedule I under the Madhya Pradesh General Sales Tax Act, ensuring that such amendments align with the legislative intent and do not exceed the statutory boundaries set forth in the Act.