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TMI Blog1977 (3) TMI 132X X X X Extracts X X X X X X X X Extracts X X X X ..... lying them. Shri Sibal urged that there was a legislative injunction, in section 6, that "no tax shall be payable on the sale of goods specified in the first column of Schedule B" and, since country liquor fell within entry 37 of Schedule B, the notifications imposing tax, on the sale of country liquor were in clear violation of the legislative mandate. Entry 37 was "All goods, except foreign liquor as defined in sub-paragraph (2) of paragraph 2 of the Punjab Excise Liquor Definitions, 1954, on which duty is or may be levied under the Punjab Excise Act, 1914, or the Opium Act, 1878". Shri Sibal submitted that the general legislative policy discernible from entry 37 was that goods on which excise duty was leviable was not to be subject to sales tax. The notifications imposing tax on the sale of country liquor was contrary to this legislative policy. Shri Sibal argued that it was not for a delegate like the Government or for a sub-delegate like a Panchayat Samiti to contravene a legislative direction or known legislative policy. It was argued by Shri Sibal that there was an impermissible delegation by a delegate. According to him, the Government was the delegate and the Panchayat Sam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivots of local self-government. Chapter V deals with finance and taxation. We are primarily concerned with sections 65, 66 and 67, which are as follows: "65. Power of taxation.-Subject to the general direction and control of the Government, a Panchayat Samiti may with the previous permission of the Deputy Commissioner concerned, Impose any tax which the Legislature of the State has power to impose under the Constitution of India. 66.. Power to impose tax without sanction of Government.-Notwithstanding anything contained in section 65, the Government may empower any Panchayat Samiti to impose without such permission any tax referred to in that section subject to such limitations as it may direct. 67.. Procedure in imposing taxes.-(1) A Panchayat Samiti may at a special meeting pass a resolution to propose the imposition of any tax under section 65. (2) When a resolution referred in sub-section (1) has been passed, the Panchayat Samiti shall publish a notice defining the class of persons or description of property proposed to be taxed, the amount or rate of the tax to be imposed and the manner of assessment to be adopted. (3) Any person likely to be affected by the proposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be conclusive evidence that the tax has been imposed in accordance with law." Section 70 and section 115(1) and (4) are also relevant. They are as follows: "70. Taxes how to be assessed and collected.-The Government may, by notification, determine the person by whom the cess or any tax imposed under this Act shall be assessed and collected and make rules for the assessment and collection of the cess or tax and direct in what manner persons employed In the assessment or collection thereof shall be remunerated." "115. Power of Government to make rules.-(1) The Government may in the official Gazette make rules for carrying out the provisions of this Act .......... (4) Every rule made under this section shall be laid as soon as may be after it is made before each House of the State Legislature while it is in session for a total period of ten days which may be comprised in one session or in two successive sessions and if before the expiry of the session in which it is so laid or the session immediately following, both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such mod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to further levy "any other tax to the nature and object of which the approval of the Governor in Council shall have been obtained It was not argued before us that section 65 of the Punjab Panchayat Samitis and Zila Parishads Act which provides for the imposition by a Panchayat Samiti of "any tax which the legislature of the State has power to impose" was beyond the competence of the State Legislature or that it suffered from the vice of excessive delegation. It was also not disputed before us that the legislature was competent to levy simultaneously two taxes of the same kind for different purposes. In Mathra Parshad v. State of Punjab[1962] 13 S.T.C. 180 (S.C.); A.I.R. 1962 S.C. 745, the Supreme Court held that there was no illegality in the East Punjab General Sales Tax Act and the Punjab Tobacco Vend Fees Act, both of which provide for the levy of tax on the sale of manufactured tobacco, being simultaneously in force or in the simultaneous levy of both the taxes. They observed: "..........There can be two taxes on the same commodity or goods without the one law repealing the other. No repeal can be implied, unless there is an express repeal of the earlier Act by the later A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e enactment, the delegate makes an item taxable and if in respect of that item the other enactment says "it shall not be taxable", in our view, there is no repugnancy since the declaration regarding non-taxability in the second Act is for the purposes of that Act only and not for the purposes of the other Act. The delegate is left free to operate under the other Act within the limits of his delegation. We, therefore, reject the submission of Shri Sibal that because it is declared by section 6 read with entry 37 of Schedule B of the Punjab General Sales Tax Act that sale of country liquor shall not be taxed, the sale of country liquor cannot be notified as taxable under the Punjab Panchayat Samitis and Zila Parishads Act also. We are not also impressed with the submission that the legislature laid down any definite legislative policy when it originally included all goods on which duty may be levied under the Punjab Excise Act in entry 37 of Schedule B of the Punjab General Sales Tax Act. The very power given to the Government under section 6(2) of the Punjab General Sales Tax Act to add to or delete from Schedule B clearly indicates that it is not permissible to glean any such leg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ify the person who is liable to pay the tax. But the notification has to be read along with the resolution of the Panchayat Samiti proposing to impose the tax. Section 67(5) is intend. ed only to notify the imposition of the tax in accordance with the proposal and to specify the date on which the tax shall come into force. A perusal of the provisions of section 67 shows that the Government is not empowered to notify a proposal as modified by the Government. If the Government wishes a proposal to be modified it can only return it to the Panchayat Samiti for further consideration. The Panchayat Samiti may thereafter submit a fresh proposal to the Government. Thus, the imposition of the tax has always to be in accordance with the proposal of the Panchayat Samiti. In every one of the proposals with which we are concerned, the Panchayat Samiti has clearly specified the "country liquor vendors" as the persons responsible for the payment of the tax. The very circumstance that the tax is on sale of country liquor necessarily indicates that the persons who may lawfully sell country liquor, that is, those holding the requisite licences under the Liquor Rules are the persons responsible for p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ases, demand slips had been issued without assessments being made. If it is so, the person on whom the demand is made may file an appeal to the appellate authority under section 73 of the Act, which provides for an appeal against any order of any person authorised to make assessment or collection of tax. Another important question which was raised by Shri H. L. Sibal and Shri Munjral was that the Rules made on 1st December, 1976, were not laid before the legislature as prescribed by section 115(4) and, therefore, were not effective. The failure of the executive to lay the Rules before the legislature is indeed a very serious matter. One of us had occasion to express his individual views in an article written in 1970 for the Andhra Pradesh Law Journal. Another of us (Harbans Lal, J.) whom we are very fortunate to have with us on this Bench, was a Speaker of the Punjab Legislative Assembly and is keenly alive to the importance of the question. In England, the matter is considered so serious that when it was discovered that certain regulations were not laid before the Parliament as required by the Fire Services (Emergency Provisions) Act, 1941, the Secretary of State threw himse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... subordinate legislation has grown in geometrical progression to legislation as such. With the growth of subordinate legislation, has grown the possibility of abuse in the making of such subordinate legislation, not because of any evil design on the part of the executive but because of the well-known tendency on the part of the executive to get on with the job without any possible interference. In fact, a well-intentioned executive armed with power may turn out to be the most arbitrary of men. There is thus a danger of the expert executives becoming masters of the people they are employed to serve. There is an even greater danger of indifferently made delegated legislation wrecking parent legislation as effectively as by design. We are quite familiar with such delegated legislation. So it is necessary for the legislature to control the executive and "laying before the legislature" is one of the devices by which such control is exercised. But then is it for the courts to declare delegated legislation as invalid on the ground of "non-laying" when the legislature itself attached or prescribed no consequence to the "non-laying"? Apparently not, and so it has been held by the Andhra Pra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, ineffective. If they were not effective, clause 4 also was not effective. They said: "All that is necessary to make clause 4 effective is that some principles should be specified, and these notified in the Gazette, and laid before the Houses of Parliament. It may be necessary from time to time to specify new principles in view of the changed circumstances; these have again to be notified in the Gazette and laid before the Houses of Parliament in order to be effective." The Supreme Court was dealing with a case where the parliamentary legislation stipulated that the subordinate legislation made by the subordinate legislating authority should be published in the official Gazette. It is one of the well-known principles of subordinate legislation that in order to be effective the subordinate legislation must be published in the prescribed manner. That apparently was the basis of the decision of the Supreme Court. True, the Supreme Court said that the principles should be published as well as laid before Parliament in order to be effective. We do not think that the Supreme Court was deciding that if there had been publication but no laying before Parliament, the "principles" ..... X X X X Extracts X X X X X X X X Extracts X X X X
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