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TMI Blog1977 (8) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... n such business; (ii) an incorporated society (including a co-operative society), club or association which sells or supplies goods, whether or not in the course of business, to its members for cash or for deferred payment or for commission, remuneration or other valuable consideration; (iii) a manager, factor, broker, commission agent, del credere agent, or any mercantile agent, by whatever name called, and whether of the same description as hereinbefore mentioned or not, who sells goods belonging to any principal whether disclosed or not; and (iv) an auctioneer who sells or auctions goods belonging to any principal, whether disclosed or not and whether the offer of the intending purchaser is accepted by him or by the principal or a nominee of the principal;...... (g) 'goods' includes all materials, articles, commodities and all other kinds of movable property, but does not include newspapers, actionable claims, stocks, shares, securities or money;........" Under article 285 of the Constitution, the property of the Union shall, save in so far as Parliament may by law otherwise provide, by exempt from all taxes imposed by a State or by any authority within a State, unless i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mployees in certain cases. Section 9 provides that the Central Government shall form a Government company in accordance with the provisions of the Companies Act, to be known as the General Insurance Corporation of India, for the purpose of superintending, controlling and carrying on the business of general insurance. Section 10 provides that all the shares in the capital of every Indian insurance company which stand transferred to and vested in the Central Government by virtue of section 4 [with the exception of the shares transferred to any person under sub-section (2) of that section] shall immediately after such vesting, stand transferred to and vested in the corporation and every Indian insurance company shall forthwith give effect to such transfer of shares and rectify its register of members by including therein the corporation as the holder of such shares. It is the petitioner's case that after the commencement of the Nationalisation Act, the Central Government issued notifications under the Act, by virtue of which the business of certain insurance companies was merged in the petitioner-company, which is incorporated under the Companies Act. The shares have been transferred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has often emphasised that the investigations of validity of a given statute or any part thereof shall be limited to the extent absolutely necessary for the disposal of the issue before the court. Again, a court will not decide the constitutional validity of any law at the instance of a party whose material interests are not prejudicially affected by the enforcement of the law. As a general rule, the courts do not pronounce upon the constitutionality of laws except at the instance of a petitioner whose material interests have been or will be adversely affected by the enforcement of laws. Sitting singly, I may not be having competence to pronounce upon the constitutional validity of any State law, but I have jurisdiction to determine my powers. Any court of law has inherent jurisdiction to determine whether it has jurisdiction to decide a particular case. The mere fact that the petitioner has raised the question relating to the constitutional validity of a State law will not oust the jurisdiction of this court to consider whether such a question in fact arises on the admitted facts before the court. It could not be the intention of the legislature that in all cases in which a questio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s entire share capital is contributed by the Central Government and all its shares have been registered in the name of the President of India and certain officers of the Central Government. It is, therefore, a Government company within the meaning of section 617 of the Companies Act. It was held that the undertaking is not one carried on directly by the Central Government or by any one of its departments as in the case of Post and Telegraphs or the Railways. It was held: "An incorporated company, as is well-known, has a separate existence and the law recognises it as a juristic person separate and distinct from its members. This new personality emerges from the moment of its incorporation and from that date the persons subscribing to its memorandum of association and others joining it as members are regarded as a body incorporate or a corporation aggregate and the new person begins to function as an entity. Its rights and obligations are different from those of its shareholders. Action taken against it does not directly affect its shareholders..." In Andhra Pradesh State Road Transport Corporation v. Income-tax Officer, B-1 Ward, Hyderabad[1964] 52 I.T.R. 524 (S.C.). , the Supr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . He also contends that the case before the Supreme Court was on a reference under article 143 of the Constitution and that the majority opinion in the case has not dealt with the scope and effect of article 245 of the Constitution of India and, therefore, the majority opinion is not law within the meaning of article 141 of the Constitution. Another argument raised by Mr. Chawla is that the impugned legislation was enacted by the Parliament under article 246(4) of the Constitution of India. The impugned legislation was not made in exercise of the power under entry 54 in the State List of the Seventh Schedule of the Constitution. Reliance is placed on Mithan Lal v. State of Delhi[1958] 9 S.T.C. 417 (S.C.). Mr. Chawla also contends that the words "save in so far as Parliament may by law otherwise provide" show that the bar to the taxation is not absolute one. The preamble of the Act shows that it was enacted by the Parliment. On the other hand, the contention of Mr. Sangal is that the definition of State law contained in article 366(26-A)(a), (d) and (g) would include the impugned legislation as the State law. I am not expressing any opinion on these submissions in view of my finding ..... X X X X Extracts X X X X X X X X Extracts X X X X
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