1954 (3) TMI 56 - HC - VAT and Sales Tax

Summary

Issues:
1. Jurisdictional challenge to a notice issued for recovery of sales tax.
2. Legislative competence under Entry 43 of the Concurrent List in the Constitution of India.
3. Conflict of judicial opinion on the interpretation of Section 6 of the General Clauses Act.

Analysis:

Issue 1:
The petitioner challenged a notice issued by the Municipal Sales Tax Officer for the recovery of a small balance of sales tax. The petitioner contended that the notice was ultra vires the jurisdiction of the officer as it pertained to tax due to the erstwhile Cochin State. The petitioner raised concerns about the applicability of legislative sanction to his case and the extra-territorial enforcement of laws from the Cochin and Travancore-Cochin States. The matter was referred to a Full Bench due to the significant legal questions raised regarding the enforcement and recovery of demands from the former States post their integration.

Issue 2:
The key questions arising for consideration were whether Parliament's legislative competence under Entry 43 of the Concurrent List extended to claims that arose before the Constitution of India and whether the absence of a provision saving the operation of the prior Act in Central Act XXXIII of 1950 affected the enforcement of claims under the repealed Cochin Revenue Recovery Act. The Court held that Entry 43 allowed for the recovery of all claims, whether pre or post-Constitution, in a State, emphasizing that the existence of the States at the time of recovery was crucial, not the time of claim origination.

Issue 3:
The Court addressed the conflict of judicial opinion on the interpretation of Section 6 of the General Clauses Act. While acknowledging sections in the Act referring to repeal and re-enactment, the Court held that Section 6 was not limited to cases involving a repeal without re-enactment. The Court aligned with the Nagpur High Court's view, disagreeing with the Allahabad High Court's interpretation. Consequently, the Original Petition was dismissed, emphasizing the legislative competence to legislate for the recovery of all claims, regardless of when they accrued, and the applicability of Section 6 of the General Clauses Act in such scenarios.