1957 (5) TMI 32

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..... of section 5 which reads: "Provided that a tax at double the rate of tax so notified may be levied on the sale of luxury goods as specified in Schedule 'A' appended to this Act from such date as the State Government may be notification direct. The State Government, after giving by notification not less than three months' notice of its intention so to do, may by like notification add to or delete from this Schedule, and thereupon this Schedule shall be deemed to have been amended accordingly." The Government published a notification on the 28th of November, 1956, levying double the rate of tax with effect from the 1st of December, 1956. The validity of this notification is challenged by this petition on the ground that the notification was .....

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..... of the Act as they are liable to pay tax on the ground that their annual turnover is Rs. 50,000 [vide sections 4(1) and 4(5)(d) of the Act]. It is argued that the effect of this piece of legislation is that dealers with large business have to pay a tax which is higher than the rate paid by dealers with small business and that the petitioners have also to keep accounts for that purpose. The contention is that the object of the Act is to levy general tax on the sale of goods in Punjab as given in its preamble and it is not to help smaller businessmen. Their Lordships of the Supreme Court in Bidi Supply Co. v. Union of India and Others[1956] 29 I.T.R. 717; A.I.R. 1956 S.C. 479.ff , have laid down: "It is now well-established that while Article .....

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..... 00 and Rs. 5,000 respectively for general tax and special tax. An argument was raised that this differentiation amounted to discrimination violating Article 14 of the Constitution. Their Lord- ships of the Supreme Court repelled the contention and observed: for it must be conceded that the general effect of fixing these minimum limits must necessarily be to enable traders whose taxable turnover is below those limits to sell their goods at lower prices to their customers than dealers whose turnover exceeded those limits, for the latter have to add the sales tax to the prices of their goods. But no discrimination is involved in this classification which is perfectly reasonable when it is borne in mind that the State may not consider it admin .....

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