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TMI Blog1957 (2) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... tiles Limited, a public limited company, having its registered office in Kanpur, the 2nd petitioner being the company itself, whose business is the manufacture of cotton cloth and yarn intended for sale in India, as also for export abroad. In the course of that business, the 2nd petitioner sells quantities of cloth to persons styled as indentors who after dyeing and hand-printing them, export them overseas. The 2nd petitioner is a dealer as defined in section 2(c) of the Uttar Pradesh Sales Tax Act, which by section 3 lays down that every dealer shall, subject to the provisions of the Act, in every assessment year, pay a tax on his turn- over of each year which shall be determined in such manner as may be prescribed. Under section 4 of that Act, the State Government has been empowered either to exempt certain kinds of transactions from the payment of sales tax completely, or to allow a rebate of a portion of the tax payable. In pursuance to that, the Uttar Pradesh Government on 3rd December, 1949, issued a Notification No. ST-6499-X-902(20) 48, that with effect from 1st December, 1949, the provisions of section 3 of the Act (relating to the levy of sales tax) shall not apply to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they had been assessed to sums of money on this account which they should not have been because of the exemption. Samples of export licence as well as the intimation to the manufacturers were placed before the Court and no objection was taken by the counsel appearing on behalf of the State Government to their correctness. The conditions on which the licence has been granted are that the licence is valid only for export by the named consignor to the particular ultimate consignee named therein, and if the original transaction licensed breaks down or if any change of consignee is initiated by the exporter or any middleman without proper authority, the goods consigned are liable to be detained en route. When the Sales Tax Officer attempted to assess the petitioners for the three years referred to above, along with other items on the quantity of cloth sold by them to the indentors for the purpose of hand- printing and export overseas, he did not accept the objections raised on the footing of the exemption and passed the final assessment order in each case. With regard to the years 1952-53 and 1954-55, the Sales Tax Officer did not find that as a matter of fact the quanti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authority on any trade or business, then it is open to the citizen aggrieved to approach this Court for a writ under Article 32, since his right to carry on a trade is violated, or infringed by the imposition and such being the case, Article 19(1)(g) comes into play. An objection has been taken on behalf of the State Government that the imposition of an illegal tax will not entitle the citizen to invoke Article 32; but he must resort to remedies available under the ordi- nary law or proceed under Article 226 of the Constitution, in view of the fact that the right to be exempted from the payment of tax cannot be said to be a fundamental right which comes within the purview of Article 32. This argument has no force in view of the decision of this Court in Bengal Immunity Company Limited v. The State of Bihar & Others, [1955] 2 S.C.R. 603, 618; 6 S.T.C. 446. where a Full Bench dealing with the Bihar Sales Tax Act, 1947, observed as follows:- "We are unable to agree with the above conclusion. In reaching that conclusion the High Court appears to have overlooked the fact that the main contention of the appellant company, as set forth in its petition, is that the Act, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessary for the application of the exemption clause that there should be an initial manufacture with a view to make a sale for export but that the exemption will be satisfied even if already existing manufactured cloth is sold with a view to ex- port. All that is essential is the sale of cotton cloth or yarn made on or after 1st December, 1949, with a view to export. The exemption will be attracted if the sale is made on or after the particular date for the specific purpose. The essential pre-requisite is that the sale must be made with a view to export as the emphasis is on the word "sale" and its time and purpose and not the manufacture of the cloth at a particular time for a particular purpose. Three conditions are necessary to be fulfilled in order to attract the exemption under the notification. They are- (1) the cloth must be manufactured in U.P.; (2) the sale should be on or after 1st December, 1949, with a view to export, and (3) there should be actual export of such cloth. On the facts admitted or found there has been a sale and also that export has taken place of such cloth but what is urged is that the thing exported is not the same, and reliance is placed upon the w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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