1951 (3) TMI 18 - HC - VAT and Sales Tax

Summary

Issues:
1. Validity of the order of the Chief Commissioner to levy sales tax.
2. Legality of changes introduced in Schedule II of exemptions.

Analysis:

Validity of Chief Commissioner's Order:
The judgment addresses the legality of the Chief Commissioner's order to levy sales tax in Vindhya Pradesh. The applicants argued that the law under which the Chief Commissioner acted was not in operation on January 1, 1950. However, the court found that the Vindhya Pradesh Ordinance No. II, in force since January 10, 1949, continued to be law even after the state became a Part C State. The Ordinance required an administrative order for its operation, which the Chief Commissioner was authorized to issue. The judgment emphasized that the law coming into force does not necessarily mean it is operational, and the Chief Commissioner had the constitutional competence to enforce the Sales Tax Ordinance.

Legality of Changes in Schedule II:
The judgment also delves into the amendments made by the Sales Tax Commissioner to Schedule II of exemptions without following the prescribed procedure. The State Government, under Section 6(2), was required to notify proposed amendments in the Gazette and allow for public scrutiny before making changes. The court found that the amendments were made without proper notice and reconsideration, rendering them invalid under Section 6(2). Consequently, the court directed the opposite party to adhere to the original Schedule II and disregard the unauthorized amendments.

Conclusion:
In conclusion, the court upheld the enforcement of the sales tax but issued a mandamus to the opposite party to revert to the original Schedule II. The applicants' claims were largely dismissed, and they were ordered to pay costs to the opposite party. Application No.55 was summarily dismissed as per the judgment.