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TMI Blog1965 (10) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... or commerce after the requisite notification. It is not disputed that in the present case tax under the Central Act is payable by the petitioner. As commission agent, the petitioner supplies wool to purchasers both in and outside the State of Punjab, but in the case in hand, the controversy centres round the supply of wool through the petitioner to parties outside Punjab. Indeed, according to the writ petition, the only party, whose transactions are the subject-matter of the present controversy, is a firm called Krishna Kapoor Co. (hereinafter called Krishna Company) of Jaipur and the assessment in question relates to the year 1963-64 under the Central Act. Krishna Company, it may be pointed out, is also registered under the Central Act. The procedure for the sale of raw wool to Krishna Company is that the said company sends its representatives to Panipat to the petitioner-firm and through the petitioner-firm raw wool is purchased from time to time as required by Krishna Company. After the purchases have been effected, consignments are sent as soon as possible depending on the availability of transport or railway booking, etc. Goods purchased in one transaction may thus be sent b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as Parliament may make during the session in which they are so laid or the session immediately following. (3) The State Government may make rules not inconsistent with the provisions of this Act and the rules made under sub-section (1), to carry out the purposes of this Act. (4) In particular and without prejudice to the powers conferred by sub-section (3), the State Government may make rules for all or any of the following purposes, namely: * * * (e) the authority from whom, the conditions subject to which and the fees subject to payment of which any form of declaration prescribed under sub-section (4) of section 8 may be obtained, the manner in which the form shall be kept in custody and records relating thereto maintained, the manner in which any such form may be used and any such declaration may be furnished; * * * Section 8(4) to which reference has been made in clause (e) may now be adverted to. "8(4). The provisions of sub-section (1) shall not apply to any sales in the course of inter-State trade or commerce unless the dealer selling the goods furnishers to the prescribed authority in the prescribed manner- (a) a declaration duly filled and signed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which, according to the submission, does not include the particulars to be contained in a declaration. The general power conferred on the State Government by section 13(3), in the presence of section 13(1) and (2), should not be construed to cover the subject of the particulars to be contained in a declaration, power regarding which has been delegated to the Central Government in specific terms. Another string in the petitioner's bow of challenge to the impugned rule is that the fixing of rates of tax under the Central Act cannot be, and indeed is not, delegated to the State Government and the State Government, therefore, cannot by an indirect method determine the rate of tax to be imposed on the petitioner. What the State Government cannot do directly, it cannot be held authorised to do indirectly. It has next been contended that in case of ambiguity, the interpretation of the taxing statute in question should be favourable to the assessee and not to the State. Lastly, it has been emphasised that rule 9 of the Central Sales Tax (Punjab) Rules provides a penalty for breach of rules and the second penalty in the form of higher rate of tax under the impugned rule would amount to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned rule made by the Punjab State can operate to its fullest extent and the two provisions can co-exist without coming into conflict with each other. Unless the two provisions are repugnant to or destructive of each other, they should both be given full effect, says the counsel, and for this proposition, he places reliance on The Ambala Ex-Service-men Transport Co-operative Society Ltd., Ambala City, etc. v. The State of PunjabA.I.R. 1959 Punj. 1 (F.B.). , Chautala Workers Co-operative Transport Society Ltd. v. Punjab StateA.I.R. 1962 Punj. 94. , Zeverbhai Amaidas v. State of BombayA.I.R. 1954 S.C. 752., Om Parkash v. State of U.P.A.I.R. 1957 S.C. 458., Nambooripad v. C.D. BoardA.I.R. 1956 T.C. 19 (F.B.)., and In re A.S. Krishna and OthersA.I.R. 1954 Mad. 993. He has also sought assistance from the Patna decision cited on behalf of the petitioner in Mangtulal's caseA.I.R. 1953 Pat. 14. In addition, reference has been made to the Australian decisions reported as Attorney-General for Queensland v. Attorney-General for the Commonwealth20 Com. L.R. 148., and Clyde Engineering Co. Ltd. v. Cowburn 37 Com. L.R. 466. The learned counsel has further stated from the Bar that in almo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er furnishes the requisite declaration to the prescribed authority in the prescribed manner. The declaration has to be duly filled and signed by the purchasing registered dealer and the form is to contain the prescribed particulars. Section 9 deals with levy and collection of tax, etc., by the Government of India. Sub-section (3) of section 9 delegates this power of assessment, collection and enforcing payment to the appropriate State Government on behalf of the Government of India to be exercised in the same manner in which the State exercises similar power in regard to State sales tax laws. Section 13, as already noticed, confers power to make rules. Section 14 declares certain goods to be of special importance, the tax on the sale of which is subject to restrictions and conditions as laid in section 15. The scheme of the Central Act seems to me to disclose that the charging section operates on sales effected by the dealer in the course of inter-State trade and each sale transaction has to be separately considered for determining whether it is subject to tax and if so, at what rate. Exemption and rate of tax payable have to be determined in respect of each transaction of sale. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4) or the Central Turnover Rules, it is not denied that in terms, neither section 8(4) nor the Central Turnover Rules contain any provision which may expressly come into direct conflict with or be repugnant to the impugned rule. If this be the position, then prima facie the impugned rule can scarcely be considered to be inconsistent either with the Central Act or with the rules made by the Central Government thereunder. It has to be borne in mind that the Central Act contains provisions delegating the rule-making power both to the Central Government and to the State Government on certain specified subjects. The subjects on which power is delegated to the Central Government are undoubtedly limited and also more specific, and the power delegated to the State Government is more widely worded and more comprehensive in its nature and scope. The State Government, it may be remembered, can make rules, not inconsistent with the provisions of the Act and the Rules made by the Central Government "to carry out the purposes of this Act". Without prejudice to this general power, certain specific subjects have been mentioned in section 8(4) which include, inter alia, the manner in which declarat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hether consciously and deliberately or as a result of carelessness and improvident act or by an error of judgment. Courts in this task are indeed required in discharging their judicial function, in a way, to overrule the decision of a co-ordinate department entrusted with making laws; naturally, therefore, they enter on this task both with caution and a sense of deep responsibility. I do not intend by any means to lay down that in case of an ultra vires or unconstitutional law, the Courts should feel any hesitation, reluctance or embarrassment in declaring them so. All that I want to say is that the Courts should declare a law ultra vires or unconstitutional only when it is clearly shown to be so and is necessary for adjudicating the controversies before them. The Courts merely discharge their duty and function assigned to them under the fundamental law. In the case in hand, the impugned rule does not encroach on the power relating to the particulars to be contained in Form "C" or in the declaration. The particulars to be contained in the declaration have been determined by the Central Government in prescribing Form "C". The Punjab State has in substance merely provided that no sin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have all along construed section 13(4)(e) of the Central Act to confer this power is not wholly irrelevant. The construction placed on the provisions dealing with the machinery for assessing and realising tax by the administrative departments can legitimately be taken into account to an extent. I may at this stage advert to another aspect. During the course of arguments, we put to the petitioner's learned counsel as to why he should not be directed to seek relief by way of appeal or revision under the statute. At the time of admission, a suggestion was thrown that there was no right of appeal against the impugned order of assessment, but during arguments, it became clear that the impugned order would be open to challenge on appeal, review, revision and reference, etc. The petitioner's learned counsel, however, stated that the period for going up on appeal had by now expired and the relief under the statute may therefore not be efficacious. He also laid stress on the submission that the question raised by him relates to the vires of a statutory rule and, therefore, the proceedings by way of writ are more appropriate than the remedies provided by the statute. I should like at this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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