1994 (7) TMI 298

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..... nd Metals Trading Corporation of India Limited v. State of Orissa [1987] 65 STC 129 (Orissa)., filed before the Orissa High Court challenging the validity of the amended section 5(2)(A)(a)(ii) of the Orissa Sales Tax Act, 1947 (the "OST Act") as substituted by the Orissa Sales Tax (Amendment) Act, 1978, with retrospective effect. The High Court upheld the validity of the OST Act. The High Court classified the batch of petitions into the following three categories: 1.. Assessments in which unamended declarations in form No. XXXIV under rule 27(2) of the Orissa Sales Tax Rules, 1947, were given and purchases were made without payment of tax. 2.. Assessment and imposition of tax on sale or purchase of declared goods in violation of section .....

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..... t of their contentions. The High Court rejected the contentions of the appellants and upheld, the validity of the amended section 5(2)(A)(a)(ii) of the OST Act on the following reasoning: "Under the scheme of the Act, the taxable event is postponed until, the registered dealer sells the goods to an unregistered dealer or a consumer, or in breach of the undertaking given. Law is well-settled that the competent Legislature can enact law after removing the infirmities or deficiencies as pointed out by the court. All that is to be seen in such cases is that the amended law is within the competence of the Legislature. Powers of the State Legislature under entry 54 of List II of the Seventh Schedule to the Constitution are plenary. The impugned .....

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..... O.S.T. Rules. From section 15 of the C.S.T. Act, it is abundantly clear that it places restrictions and conditions upon the local law. Its intention is that declared goods should suffer tax at only one point and at a prescribed rate. Section 15 does not bar levy of sales tax by a State on declared goods, but it provides for refund of such tax to the person making such sale in the course of inter-State trade or commerce. Therefore, section 15 clearly shows that there is no bar for levy of charge on declared goods, but that is to be refunded. In section 15, no provision has been made for refund of tax on goods other than declared goods. From this, it can be gathered that the State has also the power to impose tax on the declared goods. But by .....

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