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TMI Blog1998 (9) TMI 608X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1956 and is engaged in the business of manufacturing electrical goods. It is a registered dealer under the provisions of the Karnataka Tax on Entry of Goods Act, 1979 (hereinafter referred to as the Act ). In the course of manufacturing activities petitioner caused entry of several goods enumerated in the Schedule to the Act in the local area of Bangalore and Hubli. The subject-matter of these revision petitions, inter alia, relates to grant of exemption for component parts or goods made out of iron and steel under Notification No. FD 83 CET 84 dated 27th November, 1984. 4.. Entry tax is levied under the Entry Tax Act on the goods enumerated in the Schedule contained in the Act. With effect from May 1, 1992, the Schedule has been thoroughly revised. For the relevant period which is the subject-matter of these petitions, the entry in question was all raw materials, component parts and inputs which are used for the manufacture of intermediate or finished products. The said entry was followed by two explanations. Explanation II provided that certain goods are excluded from the meaning of expression raw materials, components and inputs . In addition to the specifically exclud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... XIII of 1948), but excludes (i) handicrafts manufacturing units (ii) handloom weaving units and (iii) any other group or class of industries which may with reference to their nature, competitiveness, employment potential or such other factors, be notified by the State Government. Explanation II.-The words raw materials, component parts and inputs do not include agricultural produce, horticultural produce, timber or wood of any species, silk cocoons, raw thrown or twisted silk, tobacco (whether raw or cured), cement, paper, electrical goods or such other inputs as may be notified by the State Government for purposes of exemption from tax under item 16-B from time to time, but include aluminium ingots and ores of all kinds. 6.. By virtue of explanation II, agricultural produce, horticultural produce, timber or wood of any species, silk cocoons, raw thrown or twisted silk, tobacco, cement, paper, electrical goods are not considered as inputs or raw materials and therefore not liable to tax under Sl. No. 16-B of the Schedule. The said explanation also empowers the Government to notify such other inputs for the purpose of exemption from tax under entry 16-B of the Schedule from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll the 16 items of iron and steel illustrated in the notification dated November 27, 1984 were bodily incorporated into the main Act under explanation II. The amendment was given retrospective effect with effect from November 27, 1984. The words and component parts or inputs manufactured out of the above of the notification were not incorporated in the Act. According to the Government Pleader Legislature deliberately omitted to include component parts and inputs manufactured out of the 16 items into the Schedule under explanation II and therefore exemption from entry tax on the component parts or goods made of iron and steel are not available. Per contra, counsel for the respondent argued that notification dated November 27, 1984 not having been withdrawn by any order or any statutory measure, has to be given effect to and there can be no implied repeal of the notification. Imposition of tax has to be by clear words and intendment of the Legislature by mere omission to include component parts made out of iron and steel in explanation II to entry 16-B by the amending Act 18 of 1989 could not be inferred. 8.. It was conceded before us that raw material, component parts and inpu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the statute stands impliedly repealed or rendered ineffective whenever the Legislature intervenes and amends the Act relating to the same subject by making an amendment in the main Act. This point was examined by a Full Bench of this Court in Shaw Wallace Co. Ltd. v. State of Karnataka [1993] 91 STC 37. The following question of law was referred to the Full Bench: Whether a notification issued by the State Government in exercise of the power conferred by section 8-A of the Karnataka Sales Tax Act, 1957, is impliedly repealed or rendered ineffective when the Legislature amends the Act and introduces an entry in the Schedule to the Act, which relates to the class of goods to which exemption is given by the notification? While answering the question referred in the affirmative it was held that the notification issued under section 8-A of the Act impliedly repealed or rendered ineffective when the Legislature amends the Act and introduces an entry in the Schedule to the Act which relates to the class of goods to which exemption is given by the notification. In coming to this conclusion the Full Bench observed and adopted the following reasons: In this connection, the dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sible to infer an implied intention on the part of the Legislature to treat the goods in any other manner, contrary to the express intention in the amending Act; necessarily, the earlier notification would cease to be effective, automatically. If the Legislature enacts on a particular date that specified goods shall be taxed in a particular manner, it is clear that at least on the said date, the Legislature had a clear intention to levy the tax on the goods in question at that particular rate. The Legislature is presumed to be aware of the prevailing circumstances relevant to the subject-matter in question as it existed when the law was enacted. Therefore, when entry 48-A was amended retrospectively with the insertion of sub-entry (ii), it is clear that the Legislature intended that the tax under section 5 will have to be levied in terms of said entry 48-A, with retrospective effect from 1st July, 1974. While inserting sub-entry (ii) by Act No. 23 of 1983 the Legislature has not found it necessary to save the operation of the notification issued by the State Government. If actually the intention of the Legislature was to keep alive the tax structure envisaged by the exemption n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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