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TMI Blog2022 (4) TMI 1204X X X X Extracts X X X X X X X X Extracts X X X X ..... ted. The High Courts and the Supreme Court created under the Constitution serve as Constitutional bodies to uphold the rule of law. Any law much less the fiscal law is tested on its constitutionality. The question as to whether a law violates any fundamental or constitutional right guaranteed by the Constitution is to be reviewed only by this pillar of democracy. Whenever the executive and the legislature encroach upon the rights guaranteed, judicial review cannot be curtailed. The power of a High Court under Article 226, as agreed and settled by the Apex Court is in fact much wider even than the powers of the Apex Court in its Writ Jurisdiction as the High court is not only entitled to interfere qua infringement of fundamental rights, but also Constitutional rights. In COMMISSIONER OF CUSTOMS (IMPORT) , MUMBAI VERSUS M/S. DILIP KUMAR AND COMPANY ORS. [ 2018 (7) TMI 1826 - SUPREME COURT ], the Constitutional Bench, while dealing with a reference regarding the interpretation of an exemption notification, differentiating it with the interpretation of the provisions contained in the statute, after analysing various judgments on the issue, held that a taxing statute must be l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the subsequent event of the manufactured goods being sold by way of inter-state/ intra-state sale would have no bearing nor does it result in imposing any limitation/restriction or whittle down the right to ITC earned in terms of Section 19(2)(ii) or 19(2)(v) of the TNVAT Act in the interregnum period. Consequential refund and applicability of doctrine of unjust enrichment - taxes paid on raw material and captively consumed in the manufacture of finished goods within the State - HELD THAT:- the doctrine of unjust enrichment would apply to duty paid on raw materials and captively consumed, it was held that passing of incidence of duty to any other person may be direct such as when the goods imported are themselves sold and the burden of tax thereon is passed on to the buyer or it may be indirect when the goods imported are captively consumed by importer himself and the duty paid thereon is added to the price of the finished goods which are sold to others Period of limitation - HELD THAT:- The Apex Court has held that Article 62 of the Limitation Act, 1908 would appear implying that the period of limitation would be three years from the date of receipt of tax that has b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in WP.No.6004 of 2019 For the Respondent : Mr. Adithya Reddy in WA.Nos.1626, 1633, 1677, 1678, 1625, 1632, 1701 of 2017, 216 of 2018 and 2902 of 2019, Mr.Ramani, Senior Counsel for Mr.B.Raveendran in WA.Nos.1551, 1554, 1565, 1566, 1567, 1629, 1646, 1658, 1680, 1724 of 2017, Mr.B.Raveendran in WA.2963 of 2021, Mr. Joseph Prabakar in WA.Nos.446 and 459 of 2019, Mr. K.Jayachandran in WA.Nos.2807 and 2809 of 2019, Mr.N.Murali for R.Raghavan in WA.Nos.1643 1652 of 2017 and 6 1399 of 2018 and 100, 1862 1864 of 2019, Mr.Prasad for N.Inbarajan in WA.Nos.1682, 1686 and 1260 of 2017, 1518, 1543 and 1639 of 2019, Mr. Sri Prakash for N.Inbarajan in WA.Nos.1689 1725 of 2017, Mr.N.Inbarajan in WA.No.422 of 2018, Mr.D.Vijayakumar in WA.No.1588 of 2017, Mr.P.Rajkumar in WA.No.1770 of 2017, Mr.R.Kumar in WA.No.2067 of 2019, Mr.R.Saravanakumar in WA.No.1732 of 2017, Mr. Ragavan Ramabadran for M/s.Lakshmi Kumaran Sridharan in WA.No.1650 of 2017, Mr.S.Ramanathan in WA.Nos.1508, 1527, 1528 and 1692 of 2017 and 54 of 2020, Mr.V.Sundareswaran in WA.Nos. 1651 and 1709 of 2017, 18 of 2018, Mr.V.Sundaeswaran for Mr.V.V.Ramesh in WA.No.205 of 2018, Mr.T.Pramodkumar Chopda in WA.No.1771 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate to reversal of Input Tax Credit (ITC) under the proviso to Section 19 (2) (v) of the TNVAT Act and further direct the respondents therein not to apply Section 2(1) of the Amendment Act, 2013 inasmuch as they are the manufacturers of goods in the State of Tamil Nadu consequent to the omission of proviso to Section 19 (2) (v) of the Tamil Nadu Value Added Tax (Fifth Amendment) Act, 2015 read with substitution of clause (v) to section 19 (2) of the TNVAT Act. 3. In view of commonality of the issue involved, the instant writ appeals and writ petitions were heard together and are decided by this common judgment. Background of the Litigation. 4. The introduction of the proviso to Section 19 (2) (v) of then TNVAT Act, 2006 by Act 28 of 2013 with effect from 11.11.2013 has triggered the department to initiate the proceedings for reversal of ITC on interstate sale of goods covered under Section 8(1) of the CST Act, which has resulted in mushrooming of cases before this Court. 5. The subject proviso reads as under: Provided that input tax credit shall be allowed in excess of three percent tax for the purpose specified in clause (v). 6. Before proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brought into Section 19 (2) (v) of the TNVAT Act. 8. The writ petitions were opposed by the Revenue by filing a detailed counter affidavit stating that as per the newly amended proviso, the assessment proceedings were initiated and it was found that the dealers have effected inter-state sales to the registered dealers against C forms and sales to the unregistered dealers and adjusted the Input Tax Credit for the tax dues payable. However, they have not filed C forms for the turnover nor have reversed the input tax credit as per the amended Section 19 (2) (v) and Section 19 (5) (c). As per the newly amended Section 19 (2) (v) of the Act with effect from 11.11.2013, ITC shall be allowed in excess of 3% of tax for the sale in the course of inter-state falling under sub-section (1) of Section 8 of the Central Sales Tax and therefore, it was proposed to reverse the ITC under the proviso to section 19 (2) (v). Before finalising the assessment proceedings, a notice inviting objection on the proposal was issued to the dealers. In response, it was stated that the reversal of ITC is not applicable to them as they are manufacturers and their purchases are mostly inter-state. It was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of Inter-State trade or commerce falling under sub-section (1) of Section 8 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956). (vi) agency transactions by the principal within the State in the manner as may be prescribed. [Provided that input tax credit shall be allowed in excess of three percent tax for the purpose specified in clause (v);] 20. A careful reading of Section 19 would show that a dealer is entitled to claim ITC in respect of tax suffered inputs, which are specified in the First Schedule, and are purchased within the State from a registered dealer, and thereafter, are used for the purpose set out in clauses (i) to (vi), as delineated in sub-section (2) of Section 19 of the 2006 Act. 20.1 The proviso to sub-section (2) of Section 19 limits the availment of ITC by providing that ITC shall be allowed in excess of 3% of the tax for the purposes specified in clause (v). Clause (v), if read with sub-section (2) of Section 19 would have me conclude that, if, an assessee were to purchase taxable goods specified in the First Schedule, which were sold in the course of Inter-State Trade or Commerce against declarations made in form ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clusion that the proviso to Section 19(2) would apply only qua that purpose which is engrafted in clause (v) of the very same Section, in my view, the alternate argument advanced on behalf of the petitioners need not detain me. 23. Apart from what is adverted to above, I must also indicate that reliance was placed by Mr.Annamalai on the judgement of the Orissa High Court in the matter of : Bajrang Steel and Alloys Ltd. and others V. State of Orissa and Others, (2011) 43 VST 235 (Ori). To my mind, the said judgement would not further the cause of the respondents for the following brief reasons: 23.1. First, the Orissa High Court in that matter was dealing with a challenge made to Rule 11(3) of the Orissa Value Added Tax Rules, 2005 (in short OVAT Rules), framed under the Orissa Value Added Tax Act, 2004 (in short OVAT Act). 23.2. It was contended in that case that not only Rule 11(3) ultra vires Section 20 of the OVAT Act, but that it conferred unguided and unfettered powers on the State Government. 23.3. It was, this challenge, which, the Orissa High Court repelled. 23.4. In matters placed before me for adjudication, there is no challenge to the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd to the conclusion reached in W.P.No.7969 of 2014, I am inclined to allow the other writ petitions as well. The impugned orders in each of the writ petitions are set aside. Accordingly, the writ petitions Nos. 7969 of 2014, 10585 and 10586 of 2014, 38233 of 2015, 43402 of 2016 and 44188 of 2016, 722 of 2017, 1230, 1268, 1388 and 1880 of 2017 are allowed. Consequently, the connected pending applications are also closed. There shall, however, be no order as to costs. 10. Referring to the aforesaid order, similar orders were passed in the other writ petitions. Therefore, the Revenue is before this court with these batches of writ appeals, except WA.Nos.1446 and 1447 of 2021, which are filed by the assessee against the order of dismissal passed by the learned Judge on the ground of limitation. 11. While so, some of the assessees preferred writ petitions challenging the orders passed by the assessing officers qua reversal of ITC under section 19(2)(v) of the TNVAT Act. Taking note of the commonality of the issue involved, a Co-ordinate Bench of this court, by order dated 20.10.2017, directed the Registry to tag all the writ appeals along with those writ petitions for joi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sale, ITC can be claimed to the extent of excess of three percent. 14. The Learned Additional Advocate General further contented that the value addition refers to any processing and profit in case of manufacturers and profit alone in case of traders. Apart from the local sale transactions governed by VAT, the dealer can effect inter-state transactions governed by Central Sales Tax (CST) Act covering the following categories such as (i) Sale to other state registered dealers against C forms. If the buyer at the other State obtains C forms from the Commercial Tax Department of other State and submits it to the Government of Tamil Nadu, a concessional rate of 2% alone is levied and collected; (ii) Sale to other State registered and unregistered dealers without C forms and in such case, tax is levied at the rate of 5%; (iii) Branch or stock transfer of goods to other state with Form F and this transaction is exempted; and (iv) Branch or stock transfer of goods to other State without form F is levied at the rate of 5%. It is also his contention that the dealer, on local purchase, claims ITC at 5% from the State of Tamil Nadu and pays at concessional rate of 2% thereby 3% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udes. To buttress this submission, the learned Additional Advocate General relied on the decision of the Honourable Supreme Court in CST vs. Suresh Chand Jain reported in 1988 70 STC 45 (SC) and reiterated the said requirement for sale. It is also contended that a taxing statute ought not to be read in isolation, rather it has to be read along with other associated provisions, as well, more particularly when the subject matter with different sections or parts of the same statute is identical. While so, Section 19 (2) has to be read as a whole to give the intending meaning behind the proviso to Section 19 (2) according to which the Legislature intended to restrict the claim of ITC when final product is sold outside the State. In this context, the learned Additional Advocate General placed reliance on the decision of the Honourable Supreme court in the case of Kailash Chandra vs. Mukund Lal reported in 2002 (2) Supreme Court Cases 678 wherein it was held that ITC is a concession and it is open to the legislature to impose restrictions while extending the concession . 15. It is further contended that the intention of the legislature was always to include the manufact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he purchase of local taxable inputs, consumables, packing materials including capital goods for the inter-state sales of manufactured goods against Form C . It is further contended that in inter-state transactions covered under C Forms, concessional tax at 2% is made and the dealer retains the purchase tax as ITC, which necessitated the introduction of the proviso, as there was huge accumulation and undue enrichment of ITC on increasing inter-state sales causing loss to the state exchequer, added further by the reduction of rates under CST Act and the increase in state tax. It is also contended that the withdrawal of the proviso in 2015 to plug the loopholes cannot be given retrospective effect and in any case, the Learned Judge ought not to have given retrospective effect to the order, which has cascaded in huge loss to the state exchequer and that unless it is shown that the refund of tax would reach the ultimate customer, the same cannot be permitted. It is further pointed out that the vires of Section 19 (5) (c), which deals with denial of ITC on inter-state sale of goods falling under Section 8(2) of the CST Act was upheld by this court as affirmed by the Apex Court, supe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ility of the proviso to the manufacturers. Further, under Section 19(2)(ii), the word 'use of manufacturer' has been added and under section 19(2)(v) the expression 'use' has not been employed at all and hence, Section 19(2)(v) cannot be said to be applicable only to the traders. Therefore, the learned Judge, on appreciation of the said factual as well as legal position, has rightly allowed the writ petitions filed by the assesses, which do not call for any interference by this court. 18. Mr.Prasad, learned counsel representing Mr.N.Inbarajan, learned counsel appearing for the respondents in WA.Nos.1260, 1682 and 1686 of 2017 as well as WA.No.422 of 2018 would, at the outset, contend that when the provisions of the taxing statute are clear and unambiguous, recourse to internal or external aids is not necessary, besides it is legally impermissible. Further, endorsing the order passed by the Learned Judge, it is contended that the proviso cannot be applied to the manufacturers as they fall within the ambit of Section 19 (2) (ii) of the Act and once the goods are used for the manufacturing activity, they are entitled to claim ITC. 19. The learned counsel furt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19 (2) (v). Further, as per the definition provided under Section 2 (27) of the Act, the inputs purchased have lost their commercial identity. Thus, a plain reading of Section 19 (2) (v) and the earlier part of Section 19 (2) would show that it would apply where inputs are purchased, which are used for the purpose of sale in the course of inter-state trade or commerce falling under Section 8 (1) of the CST Act. Therefore, Section 19 (2) (v) will apply to a case of trading of inputs, which are purchased inside the State, which are for the purpose of sale in the course of inter-state trade under Section 8 (1) of the CST Act. In the case of the respondent assessee itself, while inputs are purchased inside the state of Tamil Nadu on Payment of TNVAT, the final product is Asbestos sheet and there is a value addition to it. Therefore, the rate of CST at 2% is not on the input sold as such, but on the manufactured commodity. It was further contended that the proviso inserted by Tamil Nadu Act 28 of 2013 effective from 11.11.2013 cannot be applied to the manufacturers as because the restriction of input credit to the manufacturer effecting an inter- state sale from the State of Tamil Nadu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'use in manufacture' is found in sub-clause (ii) of section 19(4) but it is inherently absent in sub-clause (i) of section 19 (4). Therefore, according to the learned counsel, Section 19(2)(v) would not include a case of inputs used in manufacture, as if inputs were intended for sale in the course of inter-state trade or commerce, and it would amount to reading words into the provisions which are non-existent. 23. The learned counsel further contended that under the scheme of the Act, there is a distinction between credit being 'allowed' and the same being 'utilized'. Section 19 (2) contemplates that ITC is being 'allowed', which expression refers to the grant of credit. Once credit is granted or earned by a manufacturer, the use of credit can be made under Rule 5 (3-A) of the Central Sales Tax Act (Tamil Nadu) Rules, 1957 in respect of inter-state sale effected by a manufacturer. Further, under the provisions of CST Act, the State Government has framed Rules in exercise of power under Section 13 (3) of the Central Sales Tax Act where Rule 5 (3-A) permits use of the credit earned under Section 19. Therefore, sub-clause (v) is not necessary to co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earned counsel sought for dismissal of the appeals filed by the state and allowing the writ petitions filed by the assessees. 25. Mr. Joseph Prabhakar, learned counsel appearing for the respondents in W.A. Nos. 446 and 459 of 2019 would contend that the Value Added Tax (VAT) Act, was introduced on 01.01.2007 and the erstwhile Tamil Nadu General Sales Tax Act was in vogue until the year 2006 and it provided for a single point of taxation in the State. Upon introduction of VAT, multiple point of taxation came into force with an intention to levy tax at every stage of sale and ITC was allowed at every stage of purchase. Thus, the grant of ITC on purchase, upon introduction of VAT, is not a benefit, but a necessity for the purpose of sustaining VAT, which is a scheme for multiple point of taxation. Relying upon Section 19 (2), the learned counsel further contended that each of the sub-clauses are independent of each other and lay down different stipulations to claim ITC. The learned counsel emphasized the use of the ; or at the end of each sub-clause to buttress his case that the sub clauses must be read separately. According to the learned counsel, a semi colon is used betwee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by all the States. As per the White Paper, ITC shall be available to all intra-state sales as well as inter-state sales and it was agreed to allow ITC on all sales including the inter-state sales irrespective of whether such sale is made to a registered or unregistered dealers. However, the State of Tamil Nadu restricted the availment of ITC on inter-state sales falling under Section 8 (2) of the Central Sales Tax Act under Section 19 (5) (c) read with Rule 10 (9) (a) of the TNVAT Rules unless form C is filed by the seller. In fact, the Central Government, with a view to facilitate the introduction of Goods and Service Tax Act, wanted to phase out the CST levy so as to remove the cascading effect of tax. Accordingly, vide Taxation Laws (Amendment) Act, 2007, the Central Government reduced the rate of CST in a phased manner viz., reduction of tax from 4% to 3% from 01.04.2007 and subsequently from 3% to 2% from 01.04.2008. However, during the assessment year 2011-2012, the Government of Tamil Nadu had increased the rate of sales tax under the TNVAT Act from 4% to 5% with effect from 12.07.2011 and from 12.5% to 14.5% with effect from 12.07.2011. Section 19(5)(c) denies the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner of Income Tax -I, New Delhi vs. Vatika Township Private Limited reported in 2015 1 Supreme Court Cases 1, SEBI vs. Alliance Finstock Limited reported in (2015) 16 Supreme Court Cases 731, the learned counsel sought for the dismissal of the state appeals and allowing the writ petitions filed by the assessees. 28. Mr. Ramanathan, learned counsel appearing for the respondents in W.A. Nos. 1508, 1527, 1528 and 1692 of 2017 and W.A. No. 54 of 2020 and Mr. Pramodkumar Chopda, learned counsel for the respondent in W.A. No. 1771 of 2017 have adopted the arguments advanced by the other learned counsel appearing for the assessees. 29. Mr. Rajkumar, learned counsel for the respondent in W.A. No. 1770 of 2017 and Mr. K. Jayachandran, learned counsel for the respondents in W.A. Nos.2807 and 2809 of 2019 have adopted the arguments made by Mr.Prasad, learned counsel appearing for the respondent in W.A. No. 1260 of 2017. 30. Mr. N.Murali, learned counsel appearing for the appellants in W.A Nos.1446 and 1447 of 2021 / assessee contended that when the batch of writ petitions was pending and the earlier batch was allowed, it was appropriate for the learned judge to d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeals filed by the Revenue. As per section 23 of the Act, if any identical question of law is pending before this Court or the Supreme Court, the Assessing Officer has to keep all further proceedings in abeyance till such time the issue is settled by the Constitutional Courts once and for all. When this Court is seized of the issue relating to applicability of the amended proviso to Section 19 (2) (v) of the Act, to a manufacturer, the Assessing Officer cannot proceed further until the conclusion of the writ appeals. Thus, we shall first proceed to examine the writ appeals filed by the Revenue. Issues at Large 37. The following questions arise in these writ appeals filed by the Revenue, viz., i. Whether the proviso to Section 19(2) (v) of the TNVAT Act, 2006 inserted by Tamil Nadu Act 28 of 2013 in vogue till 01.04.2015, which provides that input tax credit shall be allowed only in excess of 3%, would apply to the manufacturers also, in respect of inputs used in manufacturing or processing of goods in the State, when such manufactured/processed goods are sold in the course of intra-State trade or commerce under sub-section (1) of Section 8 of the Central Sales Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of legislative judgment appears to be palpably arbitrary. The Court should constantly remind itself of what the Supreme Court of the United States said in Metropolis Theater Company v. City of Chicago [57 L Ed 730 : 228 US 61 (1912)] : The problems of government are practical ones and may justify, if they do not require, rough accommodations, illogical it may be, and unscientific. But even such criticism should not be hastily expressed. What is best is not always discernible, the wisdom of any choice may be disputed or condemned. Mere error of government are not subject to our judicial review. 41. State of Kerala vs. Builders Association of India [(1997) 2 SCC 183]: 9. .....It must also be remembered that in the field of taxation, the legislature must be allowed greater play in the joints , as it is called. Allowance must also be made for trial and error by the legislature..... 42. DDA v.UEE Electrical Engg.(P) Ltd [(2004) 11 SCC 213]: 11. One can conveniently classify under three heads the grounds on which administrative action is subject to control by judicial review. The first ground is illegality the second irrationality , and the thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itution, it does not cease to enjoy the character of State and, therefore, it is subjected to all the obligations that State has under the Constitution. When the State's acts of omission or commission are tainted with extreme arbitrariness and with mala fides, it is certainly subject to interference by the Constitutional Courts (emphasis added) 35. Thus, it is clear from the above that unless it is found that act done by the authority earlier in existence is either contrary to statutory provisions, is unreasonable, or is against public interest, the State should not change its stand merely because the other political party has come into power. Political agenda of an individual or a political party should not be subversive of rule of law. ***** ***** ***** ***** 45. The legislature while delegating such powers has to specify that on certain data or facts being found and ascertained by an executive authority, the operation of the Act can be extended to certain areas or may be brought into force on such determination which is described as conditional legislation. While doing so, the legislature must retain in its own hands the essential legislative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erest. It seems only necessary to recognise certain principles, supposed to have been long and well established, to decide it. 133.That the people have an original right to establish, for their future government, such principles as, in their opinion, shall most conduce to their own happiness, is the basis on which the whole American fabric has been erected. The exercise of this original right is a very great exertion; nor can it nor ought it to be frequently repeated. The principles, therefore, so established are deemed fundamental. And as the authority, from which they proceed, is supreme, and can seldom act, they are designed to be permanent. 134.This original and supreme will organizes the government, and assigns to different departments their respective powers. It may either stop here; or establish certain limits not to be transcended by those departments. 135.The government of the United States is of the latter description. The powers of the legislature are defined and limited; and that those limits may not be mistaken or forgotten, the constitution is written. To what purpose are powers limited, and to what purpose is that limitation committed to writing; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ution: if both the law and the constitution apply to a particular case, so that the court must either decide that case conformably to the law, disregarding the constitution; or conformably to the constitution, disregarding the law: the court must determine which of these conflicting rules governs the case. This is of the very essence of judicial duty. 143.If then the courts are to regard the constitution; and he constitution is superior to any ordinary act of the legislature; the constitution, and not such ordinary act, must govern the case to which they both apply. 144.Those then who controvert the principle that the constitution is to be considered, in court, as a paramount law, are reduced to the necessity of maintaining that courts must close their eyes on the constitution, and see only the law. 145.This doctrine would subvert the very foundation of all written constitutions. It would declare that an act, which, according to the principles and theory of our government, is entirely void, is yet, in practice, completely obligatory. It would declare, that if the legislature shall do what is expressly forbidden, such act, notwithstanding the express prohibition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r his government? if it is closed upon him and cannot be inspected by him. 161.If such be the real state of things, this is worse than solemn mockery. To prescribe, or to take this oath, becomes equally a crime. 162.It is also not entirely unworthy of observation, that in declaring what shall be the supreme law of the land, the constitution itself is first mentioned; and not the laws of the United States generally, but those only which shall be made in pursuance of the constitution, have that rank. 163.Thus, the particular phraseology of the constitution of the United States confirms and strengthens the principle, supposed to be essential to all written constitutions, that a law repugnant to the constitution is void, and that courts, as well as other departments, are bound by that instrument. 164.The rule must be discharged. 46. As a matter of fact, the position in India or throughout the world, is not different. Judiciary as the pillar of democracy is the premise on which the rule of law and democracy rests. The Constitution of the India being law of the land, is the touchstone on which all substantive, procedural or any other law in any form fal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l of WALMI has adopted the Maharashtra Civil Services Rules except the Pension Rules. Therefore, as such a conscious policy decision has been taken not to adopt the Pension Rules applicable to the State Government employees; that the State Government has taken such a policy decision in the year 2005 not to extend the pensionary benefits to the employees of the aided institutes, boards, corporations etc.; and the proposal of the then Director of WALMI to extend the pensionary benefits to the employees of WALMI has been specifically turned down by the State Government. Considering the aforesaid facts and circumstances, the High Court is not justified in directing the State to extend the pensionary benefits to the employees of WALMI, which is an independent autonomous entity. 49. The above said judgment was rendered in the context of extension of benefits to the employees, who were refused to be treated on par with the state government employees, in view of a specific law. It is the prerogative of every State to impose any condition in its policy by granting or restricting benefits to a section of society. The court will be hesitant to interfere with such policy decisions even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enactments is not abridged in totality, in addendum, the decision-making process is also subject to judicial review. The court is to weigh such policy decisions against the guarantees and safeguards under the Constitution of India. In fiscal matters, generally, the courts take a restrained approach in interfering with any policy decision taken to bring about a particular law, where the financial implications in the subject matter are more. The courts cannot direct the state to extend the benefit to another section. Even though taxing statutes can be categorized as a fiscal matter, the general rule cannot be abruptly applied in view of various safeguards and protection under the Constitution in the matters of taxation. 52. The safeguard insofar as taxes are concerned is stronger by virtue of Article 265 of the Constitution of India, which states No tax shall be levied or collected except by authority of law . It is affirmative in the sense that it restricts the authority of the State as the State is to satisfy the test of law before any levy or collection. The word levy is to be tested on the touchstone of the constitutional and charging provision and the word collected is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw in spheres where either the law of the state is found wanting or a new situation not anticipated by the legislature or parliament is exposed. It lingers on either side of the line to be taken as judicial activism or judicial overreach. The question raised here is purely a question of law and requires interpretation of the statute, which squarely falls within the ambit of review and therefore, the power of judicial review is not taken away. Hence, the contention of the state is turned down. 55. Now, coming to the issues at large, it is necessary to narrate the basic and overall scheme of the Act before proceeding and elaborating further and for that purpose, the relevant portion as it was in vogue, is extracted as under: Section 2 of the Act deals with definitions. The relevant definitions applicable to the present case as extracted under: Section 2 (10) business includes -- (i) any trade or commerce or manufacture or any adventure or concern in the nature of trade, commerce or manufacture, whether or not such trade, commerce, manufacture, adventure or concern is carried on with a motive to make gain or profit and whether or not any profit accrue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... remuneration or other valuable consideration, shall be deemed to be a dealer for the purposes of this Act: Explanation II .- The Central Government or any State Government which, whether or not in the course of business, buy, sell, supply or distribute goods, directly or otherwise, for cash, or for deferred payment, or for commission, remuneration or other valuable consideration, shall be deemed to be a dealer for the purposes of this Act; Explanation III. - Each of the following persons or bodies who dispose of any goods including unclaimed or confiscated or unserviceable or scrap surplus, old or obsolete goods or discarded material or waste products whether by auction or otherwise directly or through an agent for cash or for deferred payment or for any other valuable consideration, notwithstanding anything contained in this Act, shall be deemed to be a dealer for the purposes of this Act to the extent of such disposals, namely:- (i) Port Trust; (ii) Municipal Corporations, Municipal Councils and other local authorities constituted under any law for the time being in force; (iii) Railways administration as defined under the Railways Act, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... means tax paid or payable under this Act by any registered dealer in respect of sale of any goods; Section 2(30) registered dealer means a dealer registered under this Act; Section 2(33) sale with all its grammatical variations and cognate expressions means every transfer of the property in goods (other than by way of a mortgage, hypothecation, charge or pledge) by one person to another in the course of business for cash, deferred payment or other valuable consideration and includes ,- (i) a transfer, otherwise than in pursuance of a contract of property in any goods for cash, deferred payment or other valuable consideration; (ii) a transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract; (iii) a delivery of goods on hire-purchase or any system of payment by instalments; (iv) a transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; (v) a supply of goods by any un-incorporated association or body of persons to a member thereof for cash, deferred payment or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or purchase might have been made, if the goods are within the State - (i) in the case of specific or ascertained goods, at the time the contract of sale or purchase is made; and (ii) in the case of unascertained or future goods, at the time of their appropriation to the contract of sale or purchase by the seller or by the purchaser, whether the assent of the other party is prior or subsequent to such appropriation. (b) Where there is a single contract of sale or purchase of goods, situated at more places than one, the provisions of clause (a) shall apply as if there were separate contracts in respect of the goods at each of such places. Explanation VI .- Notwithstanding anything to the contrary contained in this Act, two independent sales or purchases shall, for the purposes of this Act, be deemed to have taken place (a) when the goods are transferred from a principal to his selling agent and from the selling agent to the purchaser, or (b) when the goods are transferred from the seller to a buying agent and from the buying agent to his principal, if the agent is found in either of the cases aforesaid- (i) to have sold the good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6-2007. in respect of such dealer whose total turnover for that year exceeds the total turnover referred to in the said clause (a) or (b) of subsection 1 and if,- (a) such dealer has not collected the tax under this Act, he is liable to pay tax under this Act, (b) such dealer has collected the tax under this Act, he is liable to pay tax under this Act, and other provisions of this Act, shall apply to such dealer. (2) Subject to the provisions of sub-section (1), in the case of goods specified in Part - B or Part - C of the First Schedule, the tax under this Act shall be payable by a dealer on every sale made by him within the State at the rate specified therein. Provided that all spare parts, components and accessories of such goods shall also be taxed at the same rate as that of the goods if such spare parts, components and accessories are not specifically enumerated in the First Schedule and made liable to tax under that Schedule. (3) The tax payable under sub-section (2) by a registered dealer shall be reduced, in the manner prescribed, to the extent of tax paid on his purchase of goods specified in Part - B or Part - C of the First Schedule, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibed,- (i) for transfer to a place outside the State otherwise than by way of sale; or (ii) for use in manufacture of other goods and transfer to a place outside the State, otherwise than by way of sale: Provided that if a dealer has already availed input tax credit there shall be reversal of credit against such transfer. (5) (a) No input tax credit shall be allowed in respect of sale of goods exempted under section 15 (b) No input tax credit shall be allowed on tax paid or payable in other States or Union Territories on goods brought into this State from outside the State. (c) No input tax credit shall be allowed on the purchase of goods sold as such or used in the manufacture of other goods and sold in the course of inter-State trade or commerce falling under sub-section (2) of section 8 of the Central Sales Tax Act, 1956.(Central Act 74 of 1956). (6) No input tax credit shall be allowed on purchase of capital goods, which are used exclusively in the manufacture of goods exempted under section 15. Provided that on the purchase of capital goods which are used in the manufacture of exempted goods and taxable goods, in put tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (12) Where a dealer has availed credit on inputs and when the finished goods become exempt, credit availed on inputs used therein, shall be reversed. . (16) The input tax credit availed by any registered dealer shall be only provisional and the assessing authority is empowered to revoke the same if it appears to the assessing authority to be incorrect, incomplete or otherwise not in order. (17) If the input tax credit determined by the assessing authority for a year exceeds tax liability for that year, the excess may be adjusted against any outstanding tax due from the dealer. (18) The excess input tax credit, if any, after adjustment under sub-section (17), shall be carried forward to the next year or refunded, in the manner, as may be prescribed. 19) Where any registered dealer has availed input tax credit and has goods remaining unsold at the time of stoppage or closure of business, the amount of tax availed shall be reversed on the date of stoppage or closure of such business and recovered. 20) Not withstanding anything contained in this section, where any registered dealer has sold goods at a price lesser than the price of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... different circumstances under which a registered dealer is entitled to Input Tax Credit and from section 19(10) onwards, the provisions deal with the conditions to be satisfied to claim ITC. No Input Tax Credit is available on exempted goods or goods falling under Schedule IV. It could also be discerned that the point of levy of tax is at every point of sale and that a dealer is entitled to adjust his output tax from and out of the credit to which he is entitled as per the provisions and after satisfying the requirements. It is needless to point out that the Output tax would include the value added on the goods purchased or manufactured from and out of the goods purchased within the state. Every dealer has to file its monthly return in Form I and claim ITC. In case, any dealer fails to claim ITC in its monthly returns, he can make a claim within 90 days from purchase or before the end of the financial year, whichever is later. To be specific, if not claimed in monthly returns, by late he can claim ITC for the period up to December of any assessment year within 31st March and for the months of January, February and March of the Assessment year in the months of April, May and June, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or stock transfer/consignment sale of goods out of the state, input tax paid in excess of 4 % will be eligible for tax credit. Carrying Over of Tax Credit 57.3. If the tax credit exceeds the tax payable on sales in a month, the excess credit will be carried over to the end of next financial year. If there is any excess unadjusted input tax credit at the end of second year, then the same will be eligible for refund. Input tax credit on capital goods will also be available for traders and manufacturers. Tax credit on capital goods may be adjusted over a maximum of 36 equal monthly instalments. The States may at their option reduce this number of instalments. There will be a negative list for capital goods (on the basis of principles already decided by the Empowered Committee) not eligible for input tax credit. 58. Of course, when the Act came into force, small changes were made by many States. However, the concept regarding Input Tax Credit as stated above was implemented. There is no one to one corelation in either the goods or the tax, while adjustment or set-off, but the disposal of the goods is an essential condition to adjust ITC. 59. It appears t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the statute. Reference is made to the judgment of this Court in Godrej Boyce Mfg. Co. (P) Ltd. v. CST [Godrej Boyce Mfg. Co. (P) Ltd. v. CST, (1992) 3 SCC 624] . Rules 41 and 42 of the Bombay Sales Tax Rules, 1959 provided for the set-off of the purchase tax. This Court held that the rule-making authority can provide curtailment while extending the concession. In para 9 of the judgment, the following has been laid down: (SCC pp. 631-32) 9. In law (apart from Rules 41 and 41-A) the appellant has no legal right to claim set-off of the purchase tax paid by him on his purchases within the State from out of the sales tax payable by him on the sale of the goods manufactured by him. It is only by virtue of the said Rules-which, as stated above, are conceived mainly in the interest of public-that he is entitled to such set-off. It is really a concession and an indulgence. More particularly, where the manufactured goods are not sold within the State of Maharashtra but are despatched to out-State branches and agents and sold there, no sales tax can be or is levied by the State of Maharashtra. The State of Maharashtra gets nothing in respect of such sales effected outside the St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct of unregistered dealer in other States, the State of Tamil Nadu has no mechanism to prevent evasion of tax and loss of revenue caused by trade with such unregistered dealers in the State of Tamil Nadu. Therefore, the provision was aimed at achieving a specific and justified purpose and could not be treated as discriminatory. 42. It is stated at the cost of repetition that Section 19 of the Tnvat Act deals with ITC. It incorporates provision for grant of ITC under certain circumstances and, at the same time, also lays down the conditions in which such ITC would be admissible. It is in this context sub-section (5) of Section 19 is to be analysed. Sub-section (5) stipulates certain contingencies where such ITC would not be admissible. There is no quarrel about clauses (a) and (b). We are only concerned with clause (c) of this sub-section which provides that ITC would not be allowed on the purchase of goods sold as such or used in the manufacture of other goods and sold in the course of inter-State trade or commerce falling under sub-section (2) of Section 8 of the Central Sales Tax Act. To put it tersely, sale by a dealer who is registered in the State of Tamil Nadu whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plies, it is to be used for the manufacturing process. 68. Section 19 (4) deals with inter-state transactions otherwise than by way of sale. From inception, the legislature thought it wise to bring the manufacturer also within the ambit of the sub-section and to allow ITC only above four percent until it was reduced to three percent which is fortified in sub-clause (ii) by employment of the words for use in manufacture of other goods and transfer to a place outside the state, otherwise than by way of sale; . The transactions covered under Form F of the CST Act fall under Section 19(4). 69. Similarly, the State thought it wise and took a policy decision to disallow ITC on sales of goods as such or use in the manufacture of other goods in the course of inter-state trade or commerce in Section 19 (5) (c) when the sale is effected to an unregistered dealer as because no concession under the Section 8 (2) of the CST Act is available on sales to unregistered dealers and no ITC can be claimed on a transaction with unregistered dealer even within the state. The first limb deals with goods sold as such, implying resale of the goods and the second limb deals with inputs in the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nother contention, noteworthy to be addressed is the reliance upon the provisions of CST Act, to augment that Section 3 of the CST Act is to be taken into account for understanding, what is sale in the course of inter-state trade or commerce. There can be no quarrel about the conditions to be satisfied for a transaction to qualify as an interstate transaction as upheld by the Apex Court in Suresh Chand Case. Section 3 does not point out a difference between an interstate sale falling under Sections 8 (1) and 8(2) of the Act. It is only under Section 8, the levy of concessional tax is prescribed. The object of Section 8(1) is to enable a party to avail concessional rate of tax. There is no compulsion under the statute that every dealer should effect interstate sale only under Section 8(1). If the dealer wants to avail concessional rate, he has to produce the C Form within the stipulated time. If the C Form is not produced, the rate of tax under the local Act has to be paid. It is pertinent to note here that while dealing with ITC, the State had endeavoured to distinguish traders who effect resale and who effect sale after manufacturing the goods in section 19 (5) (c) disclos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able or just result would occur. Even where the meaning of the statute is clear and sensible, either with or without the omitted word, interpolation is improper, since the primary source of the legislative intent is in the language of the statute. Lord Parker applied the rule in R.v. Oakes [(1959) 2 All ER 350] to construe and , as or in Section 7 of the Official Secrets Act, 1920 and stated : It seems to this Court that where the literal reading of a statute, and a penal statute, produces an intelligible result, clearly there is no ground for reading in words or changing words according to what may be the supposed intention of Parliament. But here we venture to think that the result is unintelligible. Lord Reid also with great clarity and precision which always characterise his judgment enunciated the rule as follows in Federal Steam Navigation Co. Ltd. v. Department of Trade and Industry [(1974) 2 All ER 97] : Cases where it has properly been held that a word can be struck out of a deed or statute and another substituted can as far as I am aware be grouped under three heads: where without such substitution the provision is unintelligible or absu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry of Delhi. The Legislature was enacting a piece of legislation intended to levy tax on dealers who are laymen and we have no doubt that if the legislative intent was that re-sale should be within the territory of Delhi and not outside, the Legislature would have said so in plain unambiguous language which no layman could possibly misunderstand. It is a well-settled rule of interpretation that where there are two expressions which might have been used to convey a certain intention, but one of those expressions will convey that intention more clearly than the other, it is proper to conclude that, if the legislature used that one of the two expressions which would convey the intention less clearly, it does not intend to convey that intention at all. We may repeat what Pollack C.B. said in Attorney General v. Sillem [(1864) 2 H C 431, 526] that: If this had been the object of our legislature, it might have been accomplished by the simplest possible piece of legislation; it might have been expressed in language so clear that no human being could entertain a doubt about it. We think that in a taxing statute like the present which is intended to tax the dealings of o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a)(ii) and the resale by the purchasing dealer would also be free from tax by reason of Section 27. But that is not such a consequence as would compel us to read the word resale as limited to resale inside Delhi. The argument of the Revenue was that the Legislature could never have intended that the Union Territory of Delhi should be altogether deprived of tax in cases of this kind. The legislative intent could only be to exempt the sale to the purchasing dealer in those cases where the Union Territory of Delhi would be able to recover tax on resale of the goods by the purchasing dealer. The goods must be taxed at least at one point and it could not have been intended that they should not be taxable at all at any point by the Union Territory of Delhi. The Revenue urged that it was for the purpose of taxing the goods at least at one point that the second proviso was enacted by the Legislature. We do not think this contention based on the presumed intention of the Legislature is- well founded. It is now well-settled that when the court is construing a statutory enactment, the intention of the Legislature should be gathered from the language used by it and it is not permissible to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the purchasing dealer is exempt, the resale by the purchasing dealer should be taxable. We do not find evidence of such legislative intent in any provision of the Act. On the contrary, it is very clear that there are certain categories of resales by the purchasing dealer which are admittedly free from tax. If, for example, the purchasing dealer resells the goods within the territory of Delhi, but such resale is in the course of inter- State trade or commerce, or in the course of export out of the territory of India, it would be exempt from tax and yet, even on the construction suggested on behalf of the Revenue, the sale to the purchasing dealer would not be liable to tax. Both the sale as well as the resale would be free of tax even if the word resale were read as limited to resale inside the territory of Delhi. Then again, take a case where the resale by the purchasing dealer, though inside the territory of Delhi, falls within Section 5(2)(a)(ii). The resale in such a case would be exempt from tax and equally so would be the sale. So also the resale would not be taxable if it falls within Rule 29 and in that case too, the sale as well as the resale would both be exempt from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purchasing dealer. Moreover, it may be noted that if the purchasing dealer resells the goods outside Delhi, then, on the construction contended for on behalf of the Revenue, he would be liable to include the price of the goods paid by him in his return of taxable turnover and pay tax on the basis of such return and if he fails to do so, he would expose himself to penalty, though he has complied literally with the declaration made by him. We find that in fact a penalty of ₹ 2 lakhs has been imposed on the assessees in Civil Appeal No. 1085 of 1977 for not including the price of the goods purchased by them in their return of taxable turnover and paying tax on the basis of such return. It would be flying in the face of well-settled rules of construction of a taxing statute to read the words inside the Union Territory of Delhi in Section 5(2)(a)(ii) and the second proviso, when the plain and undoubted effect of the addition of such words would be to expose a purchasing dealer to penalty. 16. The subsequent history of the Act also supports the construction which we are inclined to place on Section 5(2)(a)(ii) and the second proviso. Section 5(2)(a)(ii) was amende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tory of Delhi, it did not carry out any amendment in the section with a view to limiting resale in the same manner by the addition of some such words as in the Union Territory of Delhi or inside Delhi . This clearly evinces parliamentary intent not to insist upon resale being restricted to the territory of Delhi. It is a circumstance which lends support to the view that resale in Section 5(2)(a)(ii) and the second proviso meant resale outside as well as inside Delhi. 21. She, however, urged that in her submission the second proviso was inconsistent with Section 4 and, therefore, no effect should be given to it. This contention is, in our opinion, wholly unsustainable. We fail to see how the second proviso can be said to be inconsistent with Section 4. It may be pointed out that even if there were some conflict, which we do not think there is, it would have to be reconciled by a harmonious reading of the two sections and it would not be right to adopt a construction which renders one of the two sections meaningless and ineffectual unless the conflict between the two is so utterly irreconcileable that the Court is driven to that conclusion. Here we find that Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rpret literary works and in due course gave way to the literary rule of interpretation. In the literary rule of interpretation, the plain language by taking into consideration the literary and grammatical meaning of the words used in the statute alone is to be considered to derive the object. More often or not, it has been held that taxing statutes are to be interpreted by deploying the literal rule. The interpretation of a taxing statute has always been treated differently in comparison with other laws. It is also settled law that once the language of the provision is clear and unambiguous from a careful reading of the provision, no internal or external aid can be called for. In a taxing statute, the intention of the legislature is to be gauged from the words used and not from what they had in their mind. It is only when the language is unclear and ambiguous and when the literary interpretation would result in absurdity, defeating the very purpose of the enactment, there would be a necessity for interpretation much less to resort to other aids. Even if there is any ambiguity or conflict between two provisions, the first step would be to look into the other provisions of the Act an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd April 30, 1960, and the cotton fabrics were produced on power-looms owned by the cooperative society and there is nothing in the notifications to suggest that the cotton fabrics should be produced by the Cooperative Society for itself and not for a third party before it was entitled to claim exemption from excise duty. It was contended on behalf of the respondent that the object of granting exemption was to encourage the formation of cooperative societies which not only produced cotton fabrics but which also consisted of members, not only owning but having actually operated not more than four power-looms during the three years immediately preceding their having joined the society. The policy was that instead of each such member operating his looms on his own, he should combine with others by forming a society which, through the cooperative effort should produce cloth. The intention was that the goods produced for which exemption could be claimed must be goods produced on its own behalf by the society. We are unable to accept the contention put forward on behalf of the respondents as correct. On a true construction of the language of the notifications, dated July 31, 1959 and A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ple we are of opinion that the case of the appellant is covered by the language of the two notifications dated July 31, 1959 and April 30, 1960 and the appellant is entitled to exemption from excise duty for the cotton fabrics produced for the period between October 1, 1959 to April 30, 1960 and from May 1, 1960 to January 3, 1961. It follows therefore that the appellant is entitled to the grant of a writ in the nature of certiorari to quash the order of the Assistant Collector of Central Excise of Baroda dated November 26, 1962 and the appellate order of the Collector of Central Excise dated November 12, 1963. 80. CIT v. Vadilal Lallubhai, (1973) 3 SCC 17 : 1973 SCC (Tax) 1: 13. It is established on high authorities that the subject is not to be taxed unless the charging provision clearly imposes the obligation - see CIT v. Ajax Products Ltd.[AIR 1965 SC 1358 : (1965) 1 SCR 700 : (1965) 55 ITR 741 (SC) :] As is often said that in interpreting a taxing provision one has merely to look to the words of the provision. The language employed in Section 44-F cannot be said to be plain enough to bring to tax the receipts of the character with which we are concerned i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax, under such conditions that the interest on the securities is the income of this second person. A common form of the process is the sale of securities-cum-interest with a simultaneous contract to purchase them ex-interest. Where foreign securities are concerned this second person may be a foreigner resident abroad entitled to claim exemption from the tax on the interest. More often a financial concern in India is utilised whose computation of profits includes the results of realising securities, so that the concern can profitably offer bond-washing facilities to the owner of securities bearing fixed interest where the owner himself is not liable to taxation on the realisation of the securities. 81. Govind Saran Ganga Saran v. CST, 1985 SCC (Tax) 447: 11. It may be noted that the State Act as applied to the Union Territory of Delhi was amended by Parliament in 1959, and Section 5-A was inserted. Section 5-A provides: Notwithstanding anything to the contrary in this Act, the Chief Commissioner may, by notification in the Official Gazette, specify the point in the series of sales by successive dealers at which any goods or class of goods may be tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ex Court, while interpreting an exemption provision, held as follows: 4. Entitlement of exemption depends on construction of the expression any factory commencing production used in the Table extracted above. Literally exemption is freedom from liability, tax or duty. Fiscally it may assume varying shapes, specially, in a growing economy. For instance tax holiday to new units, concessional rate of tax to goods or persons for limited period or with the specific objective etc. That is why its construction, unlike charging provision, has to be tested on different touchstone. In fact an exemption provision is like an exception and on normal principle of construction or interpretation of statutes it is construed strictly either because of legislative intention or on economic justification of inequitable burden or progressive approach of fiscal provisions intended to augment State revenue. But once exception or exemption becomes applicable no rule or principle requires it to be construed strictly. Truly speaking liberal and strict construction of an exemption provision are to be invoked at different stages of interpreting it. When the question is whether a subject falls in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exceed ₹ 1800, automatically becomes liable for payment of tax and if so what is the rate of tax in such a case. The provision in sub-section (1) of Section 127-A, which is a charging section, makes no provision regarding the rate at which the tax is to be paid in case the building or land in question the annual letting value of which is less than ₹ 1800 is to be taxed. 10. On a fair reading of the proviso to Section 127-A(2)(b) it is clear that in respect of any building or land whose letting value is less than ₹ 1800 which is owned by a person who owns any other building or land in the same municipality, the annual letting value of such building or land shall be deemed to be the aggregate annual letting value of all buildings or lands owned by him in the municipality. The provision also makes it clear that this exception is meant for the purpose of this clause i.e. clause (b) of sub-section (2). It follows, therefore, that the exemption to the levy under sub-section (1) of Section 127-A will not be available in a situation to which the proviso applies. 12. Another question that arises for consideration in this connection is whether sub-sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be. On the other hand, if the Crown seeking to recover the tax cannot bring the subject within the letter of the law, the subject is free, however, apparently within the spirit of the law the case might otherwise appear to be. 14. In the case of Russell (Inspector of Taxes) v. Scott [(1948) 2 All ER 1, 5] Lord Simonds in his opinion at p. 5 observed: My Lords, there is a maxim of income tax law which, though it may sometimes be overstressed, yet ought not to be forgotten. It is that the subject is not to be taxed unless the words of the taxing statute unambiguously impose the tax on him. It is necessary that this maxim should on occasion be reasserted and this is such an occasion. 15. In Administrator, Municipal Corpn. v. Dattatraya Dahankar [(1992) 1 SCC 361] this Court while accepting the position that each building is a unit for the purpose of taxation and that there is no provision for taxation in respect of a building having annual letting value less than ₹ 1800 and that the deeming proviso to clause (b) of sub-section (2) as expressly stated is for the purpose of this clause , held that since the aggregation of annual letting value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the notification which may give it some meaning other than what is clearly and plainly flowing from it. 86. Gurudevdatta VKSSS Maryadit v. State of Maharashtra, (2001) 4 SCC 534 : 2001 SCC OnLine SC 573: 20. The proviso for which the clarificatory Ordinance has been promulgated, it appears that the legislature advisedly used the expression new members . Members have been defined under the State Cooperative Societies Act [Section 2(19) of the Act of 1960] meaning - a person joining in an application for registration of a cooperative society which is subsequently registered or a person duly admitted to membership of his society after registration and includes a nominal associate or sympathizer member. Section 27(3) proviso as noticed above adds an appendage any new before the member society. Whereas Mr Bobde contended that the appendage any new cannot but mean though existing but not voted since Section 27 on which the proviso as noticed above was added by the Maharashtra Cooperative Societies (Second Amendment) Act, 2000 which came into force on and from 23-8-2000 and deals with the parties' voting rights in terms of Section 27 of the Act of 1960, any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Acts Interpretation Act to urge this Court to examine and take into account the extrinsic material. Section 15-AB is entitled Use of extrinsic material in the interpretation of an Act and relevantly provides: (1) Subject to sub-section (3), in the interpretation of a provision of an Act, if any material not forming part of the Act is capable of assisting in the ascertainment of the meaning of the provision, consideration may be given to that material: (a) to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act; or (b) to determine the meaning of the provision when: (i) the provision is ambiguous or obscure; or (ii) the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act leads to a result that is manifestly absurd or is unreasonable. (2) Without limiting the generality of sub-section (1), the material that may be considered in accordance with that sub-section in the interpretation of a provision of an Act incl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to those societies which became member society of the federal society after 23-8- 2000. In this view of the matter, the impugned judgment of the High Court does not suffer from any infirmity. Even if there remained any doubt in the matter of interpreting the proviso, in the Ordinance that has been promulgated on 27-2-2001, called Maharashtra Ordinance 10 of 2001, after the first proviso to sub-section (3), a second proviso had been inserted, which has removed any doubt or controversy inasmuch as it has been indicated therein that the first proviso will not apply to the member society which has invested any part of its fund in the share of the federal society before the commencement of the Maharashtra Cooperative Societies (Amendment) Act, 2000 dated 23-8-2000. The aforesaid Ordinance also has been given a retrospective effect, to be effective from 23-8-2000. The Ordinance having been held to be valid by us as stated above, the so-called prohibition contained in the first proviso to sub-section (3) of Section 27 will not apply to all those societies which have already become members of the federal society prior to 23-8-2000. 87 . In P. Nirathilingam v. Annaya Nadar, (2001 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome inexactitude in the language used. (See Salmon v. Duncombe [(1886) 11 AC 627 : 55 LJPC 69 : 55 LT 446 (PC)] AC at p. 634, Curtis v. Stovin [(1889) 22 QBD 513 : 58 LJQB 174 : 60 LT 772 (CA)] referred to in S. Teja Singh case [AIR 1959 SC 352 : (1959) 35 ITR 408] .) 18. The statute must be read as a whole and one provision of the Act should be construed with reference to other provisions in the same Act so as to make a consistent enactment of the whole statute. 19. The court must ascertain the intention of the legislature by directing its attention not merely to the clauses to be construed but to the entire statute; it must compare the clause with other parts of the law and the setting in which the clause to be interpreted occurs. (See R.S. Raghunath v. State of Karnataka [(1992) 1 SCC 335 : 1992 SCC (L S) 286 : (1992) 19 ATC 507 : AIR 1992 SC 81] .) Such a construction has the merit of avoiding any inconsistency or repugnancy either within a section or between two different sections or provisions of the same statute. It is the duty of the court to avoid a head-on clash between two sections of the same Act. (See Sultana Begum v. Prem Chand Jain [(1997) 1 SCC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordinary meaning unless it leads to an anomalous or absurd situation . 93. In Commr. of Customs v. Dilip Kumar Co. , (2018) 9 SCC 1 : 2018 SCC OnLine SC 747 , the Constitutional Bench, while dealing with a reference regarding the interpretation of an exemption notification, differentiating it with the interpretation of the provisions contained in the statute, after analysing various judgments on the issue, held that a taxing statute must be literally construed in a strict manner and in case of ambiguity in the statute, the view favourable to the assessee must be taken and in case of an exemption or exemption notification, the balance must be tilted in favour of the revenue. In the process, the Apex Court held as under: 16. An Act of Parliament/Legislature cannot foresee all types of situations and all types of consequences. It is for the Court to see whether a particular case falls within the broad principles of law enacted by the legislature. Here, the principles of interpretation of statutes come in handy. In spite of the fact that experts in the field assist in drafting the Acts and Rules, there are many occasions where the language used and the phrases em ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utory provision is open to more than one meaning, the Court has to choose the interpretation which represents the intention of the legislature. In this connection, the following observations made by this Court in District Mining Officer v. Tisco [District Mining Officer v. Tisco, (2001) 7 SCC 358] , may be noticed : (SCC pp. 382-83, para 18) 18. A statute is an edict of the legislature and in construing a statute, it is necessary, to seek the intention of its maker. A statute has to be construed according to the intent of them that make it and the duty of the court is to act upon the true intention of the legislature. If a statutory provision is open to more than one interpretation the court has to choose that interpretation which represents the true intention of the legislature. This task very often raises difficulties because of various reasons, inasmuch as the words used may not be scientific symbols having any precise or definite meaning and the language may be an imperfect medium to convey one's thought or that the assembly of legislatures consisting of persons of various shades of opinion purport to convey a meaning which may be obscure. It is impossible even fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e plain language results in absurdity, the court is entitled to determine the meaning of the word in the context in which it is used keeping in view the legislative purpose. [Commr. v. Mathapathi Basavannewwa, (1995) 6 SCC 355] Not only that, if the plain construction leads to anomaly and absurdity, the court having regard to the hardship and consequences that flow from such a provision can even explain the true intention of the legislation. Having observed general principles applicable to statutory interpretation, it is now time to consider rules of interpretation with respect to taxation. 24. In construing penal statutes and taxation statutes, the Court has to apply strict rule of interpretation. The penal statute which tends to deprive a person of right to life and liberty has to be given strict interpretation or else many innocents might become victims of discretionary decision-making. Insofar as taxation statutes are concerned, Article 265 of the Constitution [ 265. Taxes not to be imposed save by authority of law .-No tax shall be levied or collected except by authority of law. ] prohibits the State from extracting tax from the citizens without authority of law. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2). Strict construction of a statute is that which refuses to expand the law by implications or equitable considerations, but confines its operation to cases which are clearly within the letter of the statute, as well as within its spirit or reason, not so as to defeat the manifest purpose of the legislature, but so as to resolve all reasonable doubts against the applicability of the statute to the particular case. Willam M. Lile et al., Brief Making and the Use of Law Books 343 (Roger W. Cooley Charles Lesly Ames eds., 3d Edn. 1914). Strict interpretation is an equivocal expression, for it means either literal or narrow. When a provision is ambiguous, one of its meaning may be wider than the other, and the strict (i.e. narrow) sense is not necessarily the strict (i.e. literal) sense. John Salmond, Jurisprudence 171 n. (t) [Glanville L. Williams (Ed.), 10th Edn. 1947]. 27. As contended by Ms Pinky Anand, learned Additional Solicitor General, the principle of literal interpretation and the principle of strict interpretation are sometimes used interchangeably. This principle, however, may not be sustainable in all contexts and situations. There is cer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... governed wholly by the language of the notification. Equity has no place in interpretation of a tax statute. Strictly one has to look to the language used; there is no room for searching intendment nor drawing any presumption. Furthermore, nothing has to be read into nor should anything be implied other than essential inferences while considering a taxation statute. . 32. Yet again, it was observed: It may thus be taken as a maxim of tax law, which although not to be overstressed ought not to be forgotten that, the subject is not to be taxed unless the words of the taxing statute unambiguously impose the tax [on] him , (Russell v. Scott [Russell v. Scott, 1948 AC 422 : (1948) 2 All ER 1 (HL)] , AC p. 433). The proper course in construing revenue Acts is to give a fair and reasonable construction to their language without leaning to one side or the other but keeping in mind that no tax can be imposed without words clearly showing an intention to lay the burden and that equitable construction of the words is not permissible [Ormond Investment Co.v. Betts [Ormond Investment Co. v. Betts, 1928 AC 143 (HL)] ]. Considerations of hardship, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pliance with the main requirements. This, however, did not in any manner tinker with the view that an ambiguous exemption clause should be interpreted favouring the Revenue. Here again this Court applied different tests when considering the ambiguity of the exemption notification which requires strict construction and after doing so at the stage of applying the notification, it came to the conclusion that one has to consider liberally. 36. With the above understanding the stage is now set to consider the core issue. In the event of ambiguity in an exemption notification, should the benefit of such ambiguity go to the subject/assessee or should such ambiguity be construed in favour of the Revenue, denying the benefit of exemption to the subject/assessee? There are a catena of case laws in this area of interpretation of an exemption notification, which we need to consider herein. IRC v. James Forrest [IRC v. James Forrest, (1890) LR 15 AC 334 (HL)] is a case which does not discuss the interpretative test to be applied to exemption clauses in a taxation statute-however, it was observed that : (AC p. 338) it would be unreasonable to suppose that an exemption was wide as p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch not only produced cotton fabrics but also consisted of members, not only owning but having actually operated not more than four power looms during the three years immediately preceding their having joined the society. The policy was that instead of each such member operating his looms on his own, he should combine with others by forming a society to produce clothes. It was argued that the goods produced for which exemption could be claimed must be goods produced on his own and on behalf of the society. The Court did not countenance such purposive interpretation. It was held that a taxing legislation should be interpreted wholly by the language of the notification. 45. The relevant observations are : (Hansraj case [Hansraj Gordhandas v. CCE and Customs, AIR 1970 SC 755 : (1969) 2 SCR 253] , AIR p. 759, para 5) 5. It is well established that in a taxing statute there is no room for any intendment but regard must be had to the clear meaning of the words. The entire matter is governed wholly by the language of the notification. If the taxpayer is within the plain terms of the exemption it cannot be denied its benefit by calling in aid any supposed intention of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 56 : 1990 SCC (Tax) 422] , SCC p. 262, para 6) 6. Do not extend or widen the ambit at the stage of applicability. But once that hurdle is crossed, construe it liberally. The reasoning for arriving at such conclusion is found in para 4 of Wood Papers Ltd. case [Union of India v. Wood Papers Ltd., (1990) 4 SCC 256 : 1990 SCC (Tax) 422] , which reads : (SCC p. 260) 4. Literally exemption is freedom from liability, tax or duty. Fiscally, it may assume varying shapes, specially, in a growing economy. For instance tax holiday to new units, concessional rate of tax to goods or persons for limited period or with the specific objective, etc. That is why its construction, unlike charging provision, has to be tested on different touchstone. In fact, an exemption provision is like an exception and on normal principle of construction or interpretation of statutes it is construed strictly either because of legislative intention or on economic justification of inequitable burden or progressive approach of fiscal provisions intended to augment State revenue. But once exception or exemption becomes applicable no rule or principle requires it to be construed strictly. Tru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ligible to get the benefit of exemption of remission of excise duty on specified intermediate goods as per the Central Government Notification dated 11-8-1994, if captively consumed for the manufacture of final product on the ground that the records kept by it at the recipient end would indicate its intended use and substantial compliance with procedure set out in Chapter 10 of the Central Excise Rules, 1994, for consideration? The Constitution Bench answering the said question concluded that a manufacturer qualified to seek exemption was required to comply with the preconditions for claiming exemption and therefore is not exempt or absolved from following the statutory requirements as contained in the Rules. The Constitution Bench then considered and reiterated the settled principles qua the test of construction of exemption clause, the mandatory requirements to be complied with and the distinction between the eligibility criteria with reference to the conditions which need to be strictly complied with and the conditions which need to be substantially complied with. The Constitution Bench followed the ratio in Hansraj Gordhandas case [Hansraj Gordhandas v. CCE and Customs, AIR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s which are essential to achieve the object and purpose of the rule or the regulation. Such a defence cannot be pleaded if a clear statutory prerequisite which effectuates the object and the purpose of the statute has not been met. Certainly, it means that the Court should determine whether the statute has been followed sufficiently so as to carry out the intent for which the statute was enacted and not a mirror image type of strict compliance. Substantial compliance means actual compliance in respect to the substance essential to every reasonable objective of the statute and the Court should determine whether the statute has been followed sufficiently so as to carry out the intent of the statute and accomplish the reasonable objectives for which it was passed. 33. A fiscal statute generally seeks to preserve the need to comply strictly with regulatory requirements that are important, especially when a party seeks the benefits of an exemption clause that are important. Substantial compliance with an enactment is insisted, where mandatory and directory requirements are lumped together, for in such a case, if mandatory requirements are complied with, it will be proper to say ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ably for this reason the Bench which decided Surendra Cotton Oil Mills case [Collector of Customs Central Excise v. Surendra Cotton Oil Mills Fertilizers Co., (2001) 1 SCC 578] observed that there exists unsatisfactory state of law and the Bench which referred the matter initially, seriously doubted the conclusion in Sun Export case[Sun Export Corpn. v. Collector of Customs, (1997) 6 SCC 564] that the ambiguity in an exemption notification should be interpreted in favour of the assessee. 53. After thoroughly examining the various precedents some of which were cited before us and after giving our anxious consideration, we would be more than justified to conclude and also compelled to hold that every taxing statute including, charging, computation and exemption clause (at the threshold stage) should be interpreted strictly. Further, in case of ambiguity in charging provisions, the benefit must necessarily go in favour of subject/assessee, but the same is not true for an exemption notification wherein the benefit of ambiguity must be strictly interpreted in favour of the Revenue/State. 54. In Govind Saran Ganga Saran v. CST [Govind Saran Ganga Saran v. CST198 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... schewing equity in taxation. Thus, we may emphatically reiterate that if in the event of ambiguity in a taxation liability statute, the benefit should go to the subject/assessee. But, in a situation where the tax exemption has to be interpreted, the benefit of doubt should go in favour of the Revenue, the aforesaid conclusions are expounded only as a prelude to better understand jurisprudential basis for our conclusion. We may now consider the decisions which support our view. 56. In Hansraj Gordhandas case [Hansraj Gordhandas v. CCE and Customs, AIR 1970 SC 755 : (1969) 2 SCR 253] , the Constitutional Bench unanimously pointed out that an exemption from taxation is to be allowed based wholly by the language of the notification and exemption cannot be gathered by necessary implication or by construction of words; in other words, one has to look to the language alone and the object and purpose for granting exemption is irrelevant and immaterial. .. 58. In the above passage, no doubt this Court observed that : (Parle Exports case [CCE v. Parle Exports (P) Ltd., (1989) 1 SCC 345 : 1989 SCC (Tax) 84] , SCC p. 357, para 17) 17. when two views of a n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nion of India v. Wood Papers Ltd., (1990) 4 SCC 256 : 1990 SCC (Tax) 422] , SCC p. 262, para 6) 6. Do not extend or widen the ambit at stage of applicability. But once that hurdle is crossed, construe it liberally. 60. We do not find any strong and compelling reasons to differ, taking a contra view, from this. We respectfully record our concurrence to this view which has been subsequently, elaborated by the Constitution Bench in Hari Chand case [CCE v. Hari Chand Shri Gopal, (2011) 1 SCC 236] . 65. As already concluded in paras 53 to 55 and 63, above, we may reiterate that we are only concerned in this case with a situation where there is ambiguity in an exemption notification or exemption clause, in which event the benefit of such ambiguity cannot be extended to the subject/assessee by applying the principle that an obscure and/or ambiguity or doubtful fiscal statute must receive a construction favouring the assessee. Both the situations are different and while considering an exemption notification, the distinction cannot be ignored. 94. State of A.P. v. Linde (India) Ltd., (2020) 16 SCC 335 : 2020 SCC OnLine SC 362: 17. The term m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the context in which the word has been employed. In such cases, the distinction disappears and courts must adopt the meaning which flows as a matter of plain interpretation and the context in which the word appears. 20. In State of H.P. v. Pawan Kumar [State of H.P. v. Pawan Kumar, (2005) 4 SCC 350 : 2005 SCC (Cri) 943] it was contended that the safeguards provided in Section 50 of the Narcotics Drugs and Psychotropic Substances Act, 1985 regarding search of any person would also apply to any bag, briefcase or any such article or container, which is being carried by the person. The word person was not defined in the Act. A three-Judge Bench of this Court, having regard to the scheme of the Act and the context in which the word - person has been used, rejected the contention and held thus : (SCC p. 358, para 8) 8. One of the basic principles of interpretation of statutes is to construe them according to plain, literal and grammatical meaning of the words. If that is contrary to, or inconsistent with, any express intention or declared purpose of the statute, or if it would involve any absurdity, repugnancy or inconsistency, the grammatical sense must then ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : When the language of the statute is clear and unambiguous, internal or external aid cannot be looked into and the court has to go by the plain language to interpret the law and to find out the intention of the legislature, a. In interpreting a taxing provision, one should merely look at the plain, natural meaning of the words in the provision and resort to literal but strict interpretation, b. The intention of the legislature is to be gauged from the plain and unambiguous words used and intentions cannot be derived contrary to the language or the plain words used, c. If the legislature has not used a particular word(s), it means that it never intended to use or mean it, d. No words can be added or read into the statute to supplement the cause or to achieve the just or the desired result, e. There is neither equity nor waiver or acquiescence in tax. If the subject cannot be brought within the four corners of the taxing statute, no tax can be levied or collected necessarily, even by implication, f. Where there are two conflicting provisions, the provisions must be harmoniously interpreted to give effect to both the provisions to annul any absurdit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o, there was no embargo for the dealers to claim full ITC. The sub-clauses are distinct and cannot be read together as pre-conditions as they are intended to apply to different categories of dealers. In fact, a close reading of the sub-clauses would reveal that the ITC on goods purchased within the state is available upon satisfaction of any of the categories as they are distinct and capable of independently conveying the intention of the legislature to allow ITC. Further, the usage of full stop after sub-clause (iv) denotes the intention of the legislature to end the sentence there or in other words, any relationship with the preceding sub-clauses ends there. While interpreting the sub-clauses, the main clause should be the basis upon which the sub-clauses are interpreted. When a provision contains various sub-clauses which are capable of standing alone and meaningful and separated by the use of punctuations and disjunctive like or when exposed to the main clause, they have to be treated as independent clauses and would have no connection. The test would be to read the sub-clauses with the main clause and see whether it conveys the meaning as intended. 98. Let us now cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icularly when used in a series. It is also used in the sentences to denote a relation between two independent sentences. Semi-colon in Webster's New World Dictionary (Third Edition) has been defined to mean, a mark of punctuation indicating a degree of separation greater than that marked by the comma and less than that marked by the period: used chiefly to separate units that contain elements separated by commas, and to separate closely related coordinate clauses. As per the definition, Semi-colon is the punctuation mark (;) used to indicate a major division in a sentence where a more distinct separation is felt between clauses or items on a list than is indicated by a comma, as between the two clauses of a compound sentence . 100. The use of semi-colon in the sub-clauses as referred above clearly indicates that the legislature intended to treat the sub-clauses as distinct and capable of being treated independently. The deliberate omission of the legislature to make way for separate clause for manufacturers who sell their goods to a dealer outside the State postulates the fact that the legislature intended to go-by the simple and plain meaning of the word Sale without a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )(a) and (1)(b), the two subsections lay down alternative conditions. The tenant must be deemed to have purchased the land if he satisfies either of the two conditions. The appellant is not a permanent tenant, and does not satisfy the condition mentioned in sub-section (1)(a). Though not a permanent tenant, he cultivated the lands leased personally, and, therefore, satisfies the first part of the condition specified in sub-section (1)(b). The appellant's contention is that sub-sections (1)(b)(i), (1)(b)(ii) and (1)(b)(iii) lay down alternative conditions, and as he satisfies the condition mentioned in sub-section (1)(b)(iii), he must be deemed to have purchased the land on 1-4- 1957. Colour is lent to this argument by the word or appearing between sub-section (1)(b)(ii) and sub-section (1)(b)(iii). But, we think that the word or between sub-sections (1)(b)(ii) and (1)(b)(iii) in conjunction with the succeeding negatives is equivalent to and should be read as nor . In other words, a tenant (other than a permanent tenant) cultivating the lands personally would become the purchaser of the lands on 1-4-1957, if on that date neither an application under Section 29 read with Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be found in sub-clause (b)(iii) remains unfulfilled, the conditions laid down in the entire clause cannot be said to have been satisfied. The clear import of the opening part of clause (b) with the word and appearing there read with the negative or disqualifying conditions in sub-clause (b)(iii) is that the assessee was bound to satisfy apart from the conditions contained in the other sub-clauses that its affairs were at no time during the previous year controlled by less than six persons and shares carrying more than 50% of the total voting power were during the same period not held by less than six persons. We are unable to find any infirmity in the reasoning or the conclusion of the Tribunal and the High Court so far as Question 1 is concerned. It was observed that if either of the two negative conditions, which are to be found in sub-clause (b)(iii), remains unfulfilled, the conditions laid down in the entire clause cannot be said to have been satisfied. . 102. In Ranchhoddas Atmaram v. Union of India, AIR 1961 SC 935 : (1961) 2 Cri LJ 31] , a Constitution Bench of this Court observed that if there are two negative conditions, the expression ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive effect to the clear intention of the legislature, the word or was read as and . 103. Reference has also been made to Pooran Singh v. State of M.P., (1965) 2 SCR 853 : AIR 1965 SC 1583: (1965) 2 Cri LJ 547] , in which the Court considered the scheme of the Motor Vehicles Act. The Magistrate was bound to issue summons of the nature prescribed by sub-section (1) of Section 130. The Court held that there was nothing in the sub-section which indicated that he must endorse the summons in terms of both clauses (a) and (b), that he is so commanded would be to convert the conjunction or into and . There is nothing in the language of the legislature which justifies such a conversion and there are adequate reasons which make such an interpretation wholly inconsistent with the scheme of the Act. 104. Reliance has been placed on Nasiruddin v. STAT, (1975) 2 SCC 671] . The word or was given grammatical meaning. The order states that the High Court shall sit as the new High Court and the Judges and Division Bench thereof shall sit at Allahabad or at such other places in the United Provinces as the Chief Justice may appoint. It was held that the word or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... covered by or falling squarely within the clauses preceding it. If the phrase is to be read disjunctively the mere proof of the article of food being filthy, putrid, rotten, decomposed or insect-infested would be per se sufficient to bring the case within the purview of the word adulterated as defined in sub-clause (f), and it would not be necessary in such a case to prove further that the article of food was unfit for human consumption. *** 11. In the definition clause, the collection of words filthy, putrid, rotten, decomposed and insect-infested which are adjectives qualifying the term an article of food , show that it is not of the nature, substance, and quality fit for human consumption. It will be noticed that there is a comma after each of the first three words. It should also be noted that these qualifying adjectives cannot be read into the last portion of the definition i.e. the words or is otherwise unfit for human consumption , which is quite separate and distinct from others. The word otherwise signifies unfitness for human consumption due to other causes. If the last portion is meant to mean something different, it becomes difficult to unders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is also pertinent to point out that from a harmonious reading of the provisions, to claim ITC, though one to one correlation is not required, for adjustment, there must be disposal. Entitlement to ITC is different from claim for adjustment or availment. The ITC is to be claimed in the monthly returns and adjusted against the output tax payable. It is not necessary for the dealer to sell the very same goods within the same month to claim ITC in the next month returns as because the dealer is not only entitled to carry forward the ITC even to next year, but also to hold stock of the goods. Therefore, the State has prescribed the different points for entitlement and availing ITC. It is relevant to refer to the definition of output tax , which means tax paid or payable in respect of sale of any goods. The disposal, contemplated necessarily does not mean the very same goods, it also includes manufactured goods. Take for instance, a newly registered dealer purchases goods for ₹ 100/- and pays a tax of ₹ 5/- @ 5% in the first transaction. He sells goods worth ₹ 50/- for ₹ 55/-, the tax on it would be ₹ 2.75/-. Adjusting the credit available with him, he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-clause is distinct and alternate and cannot be read as a pre or post condition of another for the entitlement of ITC and the sale of goods to the registered dealer in other States in the course of trade or commerce falling under Section 8(1) would be covered by section 19 (2) (v) irrespective whether such sale is a resale or of manufactured goods. Therefore, the claim of ITC by the manufacturers will fall under section 19 (2) (ii) only as long as they effect local sales, the moment they sell the goods to a dealer in other State, section 19 (2) (v) or section 19(5) (c) would come into operation. Therefore, the proviso introduced to cover section 19 (2) (v) is applicable to the manufacturers also, at the point of inter-state sale falling under Section 8(1) as the word sale includes sale of goods in the same or different form. In this regard, it is relevant to refer to the following judgments: 110. Kerala State Coop. Marketing Federation Ltd. v. CIT , (1998) 5 SCC 48: 6. The classes of societies covered by Section 80-P of the Act are as follows: (a) engaged in business of banking and providing credit facilities to its members; (b) cottage industr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich are primary societies. If a small agricultural cooperative society does not have any marketing facilities it can certainly become a member of an apex society which may market the produce of its members. It was submitted on behalf of the Department that the member societies themselves do not raise the agricultural produce. The societies only market the produce raised by their members and do not themselves raise agricultural produce. The language adopted in Section 80-P(2)(a)(iii) with which we are concerned will admit the interpretation that the society engaged in marketing of agricultural produce of its members as agricultural produce belonging to its members which is not necessarily raised by such member. Thus, when the provisions of Section 80-P of the Act admit of a wider exemption there is no reason to cut down the scope of the provision as indicated in Assam Coop. Apex Marketing Society case[1994 Supp (2) SCC 96 : (1993) 201 ITR 338] . 111. CIT v. Plantation Corpn. of Kerala Ltd., (2001) 1 SCC 207 : 2000 SCC OnLine SC 1662: 3. Heard the learned Senior Counsel for the appellant State and the learned counsel for the respondent-assessee. Section 5 in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he further fact of retrospective effect having been given to the said explanation with effect from 1-4-1951, to presume that in doing so the legislative intention indicated was to avoid refunds being made on account of the Supreme Court judgment reported in Travancore Rubber Tea Co. Ltd. case[Travancore Rubber Tea Co. Ltd. v. CIT (Ag), (1961) 41 ITR 751 : AIR 1961 SC 604] which, in turn, concerned Section 5(j) of the Act. This in our view is fallacious and cannot be so presumed. The decision of the Supreme Court declaring the position of law on the scope of Section 5(j) might have been the occasion for the legislature to enact Explanation 2, and that too with retrospective effect but the said occasion would have equally enlightened and served as an eyeopener about the need for enacting the explanation in such a manner as to avoid similar claims being projected in respect of expenditure or deductions envisaged in the various other limbs of Section 5 as well, apart from clause (j) alone. This Court has always been reiterating that if the intendment is not in the words used it is nowhere else and so long as there is no ambiguity in the statutory language resort to any interpretati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of the assessee is one which falls squarely under Section 36(1)(vii-a) of the Act. 34. We may also notice that the Explanation to Section 36(1)(vii), introduced by the Finance Act, 2001, has to be examined in conjunction with the principal section. The Explanation specifically excluded any provision for bad and doubtful debts made in the account of the assessee from the ambit and scope of any bad debt, or part thereof, written off as irrecoverable in the accounts of the assessee . Thus, the concept of making a provision for bad and doubtful debts will fall outside the scope of Section 36(1)(vii) simpliciter. The proviso, as already noticed, will have to be read with the provisions of Section 36(1)(vii-a) of the Act. Once the bad debt is actually written off as irrecoverable and the requirements of Section 36(2) satisfied, then, it will not be permissible to deny such deduction on the apprehension of double deduction under the provisions of Section 36(1)(vii-a) and the proviso to Section 36(1)(vii). 113. In Union of India Vs VKC Footsteps India Pvt Ltd, 2021 SCC OnLine SC 706 , the Apex Court, while deciding on the vires of Rule 89 (5) of CGST Rules and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt, is that under the substantive part of Section 54(3), Parliament has contemplated that the claim of refund may extend to any unutilized ITC. ITC means credit of input tax and since input tax is defined with reference to the tax charged on the supply of goods or services or both, a refund may be claimed not only of the tax charged on input goods but also input services as a whole. According to the Revenue, the first proviso to Section 54(3) is a restriction. On the other hand, assessees have urged that the first proviso sets out only a condition or provision for eligibility and once it is fulfilled, the refund is available on the entirety of the unutilized ITC including the credit which is relatable to tax paid on input goods and input services. 65. The crux of the dispute in the present case pertains to how sub-Section (3) to Section 54 and Explanation 1 to sub-Section (1) of Section 54 are to be understood and interpreted. For convenience of analysis, the interpretation of sub-Section (3) of Section 54 can be distributed in its main tier and the three provisos. The main part of sub-Section (3) provides that a registered person may claim refund of any unutilized I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... less than the GST on inputs; (b) stock accumulation; (c) capital goods; and (d) partial reverse mechanism for certain services. There could be other reasons as well, such as excessive discounts or predatory pricing. F.4 Construing the proviso 79. Provisos in a statute have multi-faceted personalities. As interpretational principles governing statutes have evolved, certain basic ideas have been recognized, while heeding to the text and context. Justice GP Singh, in his seminal text, Principles of Statutory Interpretation formulates the governing principles of interpretation which have been adopted by courts while construing a statutory proviso. The first rule of interpretation is that: The normal function of a proviso is to except something out of the enactment or to qualify something enacted therein which but for the proviso would be within the purview of the enactment. As stated by LUSH, J.: When one finds a proviso to a section the natural presumption is that, but for the proviso, the enacting part of the section would have included the subject-matter of the proviso. In the words of LORD MACMILLAN: The proper function of a proviso is to except and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourse a proviso may be used to guide you in the selection of one or other of two possible constructions of the words to be found in the enactment, and show when there is doubt about its scope, when it may reasonably admit of doubt as to having this scope or that, which is the proper view to take of it. (iv) An effort should be made while construing a statute to give meaning both to the main enactment and its proviso bearing in mind that sometimes a proviso is inserted as a matter of abundant caution: The general rule in construing an enactment containing a proviso is to construe them together without making either of them redundant or otiose. Even if the enacting part is clear effort is to be made to give some meaning to the proviso and to justify its necessity. But a clause or a section worded as a proviso, may not be a true proviso and may have been placed by way of abundant caution. (v) While ordinarily, it would be unusual to interpret the proviso as an independent enacting clause, as distinct from its main enactment, this is true only of a real proviso and the draftsperson of the statute may have intended for the proviso to be, in substance, a fresh ena ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co. Ltd., Bombay [AIR 1961 SC 1040 : (1961) 2 SCR 493 : (1961) 41 ITR 290] this Court held that by the fiction in Section 10(2)(vii) second proviso read with Section 2(6-C) of the Indian Income Tax Act, 1922 what is really not income is, for the purpose of computation of assessable income, made taxable income. 83. Besides the decision in CIT v. Bipinchandra Maganlal, the Court in Hiralal Rattanlal(supra) adverted to the earlier decisions in State of Rajasthan v. Leela Jain and Bihar Cooperative Development Cane Marketing Union Ltd. v. Bank of Bihar. 84. In their effort to persuade this Court to accept the submission that the first proviso to Section 54(3) is in the nature of an eligibility condition as distinct from a restriction on the substantive part (contained in the opening words) of the provision, Counsel appearing on behalf of the assessees have sought to buttress their submissions with the following facets: (i) Clause (ii) of the first proviso refers to rate of tax as distinct from the quantum of tax; (ii) The expression in cases other than where adverts to situations or circumstances; (iii) The expression on account of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able under section 54(3) of the CGST Act read with rule 89(5) of the CGST Rules, which prescribes the formula for the maximum refund amount permissible in such situations. iii. Further assume that the claimant supplies the output Y having value of ₹ 3,000/- during the relevant period for which the refund is being claimed. Therefore, the turnover of inverted rated supply of goods and services will be ₹ 3,000/-. Since the claimant has no other outward supplies, his adjusted total turnover will also be ₹ 3,000/-. iv. If we assume that Input A, having value of ₹ 500/- and Input B, having value of ₹ 2,000/-, have been purchased in the relevant period for the manufacture of Y, then Net ITC shall be equal to ₹ 385/- (₹ 25/- and ₹ 360/- on Input A and Input B respectively). v. Therefore, multiplying Net ITC by the ratio of turnover of inverted rated supply of goods and services to the adjusted total turnover will give the figure of ₹ 385/-. vi. From this, if we deduct the tax payable on such inverted rated supply ofgoods or services, which is ₹ 360/-, we get the maximum refund amount, as per rule 89(5) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctment, the clear intent of Parliament was to confine the grant of refund to the two categories spelt out in clauses (i) and (ii) of the first proviso. That clauses (i) and (ii) are the only two situations in which a refund can be granted is evident from the opening words of the first proviso which stipulates that no refund of unutilised input tax credit shall be allowed in cases other than . What follows is clauses (i) and (ii). The intent of Parliament is evident by the use of a double - negative format by employing the expression no refund as well as the expression in cases other than . In other words, a refund is contemplated in the situations provided in clauses (i) and (ii) and no other. To put it differently, the first proviso can be recast, without altering its meaning to read that a refund of unutilised ITC shall be allowed only in the cases governed by clauses (i) and (ii). Clause (i) deals with zero rated supplies without payment of tax. Explanation-1 to Section 54 clarifies that the expression refund includes refund of tax paid on zero rated supplies on goods or services or both, or on inputs or input services used in making such zerorated supplies. On the other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clear that the object of a proviso is to bring in clarity or to impose any restriction or condition to the provision in relation to which it is enacted. In other words, they carve out a portion which is otherwise covered by the previous provision with regard to which proviso is enacted. In the case of Kerala State Cooperative Marketing Federation Limited and others vs. Commissioner of Income Tax reported in (1998) 5 Supreme Court Cases 48 , (cited supra), the appellant was an Apex Society registered under the Kerala Cooperative Societies Act, who purchased cashew from its member societies and earned profits on such purchases. Upon rejection of such profits to be deducted under Section 80-P(2) (a) (iii) of the Income Tax Act, the appellant approached the Apex Court which held that each of the exemption clauses are distinct and would be available if any one of them is satisfied. In VKC Footsteps referred above, after analysing as to how the proviso is to be read, the Apex Court clearly held that when the proviso refers to two clauses or circumstances under which refund of ITC would be allowed, reading it otherwise or extending the meaning of inputs to mean input of goods a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impose restrictions or conditions for availing the ITC. In the present case, prior to the introduction of the proviso, every dealer who effected interstate sale availed ITC under section 19 (2) (v) and the State imposed a restriction on such availment by the proviso, which naturally is binding on the assessees. 115. Now, insofar as the nature, effect and applicability of the amendments brought in by way of Act 05/2015, it is to be noted that as we have already held that Section 19 (2) (v) is applicable to the manufacturers and so, the proviso, we would go into the effect of such amendments whereby section 19(2)(v), the proviso and 19 (5) (c) were omitted and substituted with a new provision. 116. It is necessary to briefly look into the history of the changes from 2013 onwards. Though we need not venture into the statement of objects and reasons as we have already held that there is no ambiguity in the provision, to decide this issue, we advent into the same to remove all doubts as much emphasis has been laid on the same. 117. The State, six years after the Act came into force, felt that the interstate sales was affecting the revenue of the State. According to the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nment. The commodity Iron and Steel, which is declared in section 14 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956) as goods of special importance in inter-State trade or commerce, is also susceptible to evasion of tax leading to loss of revenue. In order to prevent evasion of tax and to protect the revenue, the Government have decided to include vegetable oils including refined vegetable oils and Iron and Steel as specified in clause (iv) of section 14 of the Central Sales Tax Act, 1956 in the Sixth Schedule to the said Tamil Nadu Act 32 of 2006. 4. The Government have, therefore, decided to amend the Tamil Nadu Value Added Tax Act, 2006 (Tamil Nadu Act 32 of 2006) for the aforesaid purposes. 5. The Bill seeks to achieve the above object. Sd/- 119. The said bill was passed and Act 28 of 2013 received the assent of the Governor on 08th November 2013 and the following amendments were made to the Act: 2. In section 19 of the Tamil Nadu Value Added Tax Act, 2006 (hereinafter referred to as the principal Act),- (1) to sub-section (2), the following proviso shall be added, namely:- Provided that input tax credit sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #8377; 5.00 After Adjustment of ITC available ₹ 2.00 Without C forms Total tax payable reversing or without ITC ₹ 7.50 What is evident from the above illustration is that when a dealer effects interstate sale to a registered dealer falling under Section 8(1) of the CST Act, the output tax is less when compared to a local sale. In that sense, the State is losing revenue. When a dealer effects local sale of goods purchased as such or manufactured, he will have to remit tax out of his pocket. On the other hand, when he sells goods to a dealer in other State at concessional rate of tax, he adjusts the entire tax payable on sale from ITC and excess ITC is still available with him, thereby the State tends to lose revenue. It is to curb this loss of revenue, the proviso was introduced. Thereafter, notices were issued to all the dealers including the manufacturers for reversal of ITC of 3%. Few dealers challenged the same before this court. While so, the Government decided to again amend sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed and after notification, the following changes were brought in by Act 05/2015. In section 19 of the Tamil Nadu Value Added Tax Act, 2006 (hereinafter referred to as the principal Act),- (1) in sub-section (2),- (i) for clause (v), the following clause shall be substituted, namely:- (v) sale in the course of Inter-State trade or commerce falling under subsections (1) and (2) of section 8 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956). ; (ii) the proviso shall be omitted. (2) in sub-section (5), clause (c) shall be omitted. 123. It is not in dispute that the budgetary speech is delivered in the vernacular language in the assembly. It is also not in dispute that the budgetary speech is summed up as the object and reason for any enactment, which is also obviously evident from the opening lines of the statement to object and reasons in Legislative Assembly Bill No.2/2015. The actual budgetary speech did not contain the word henceforth translated as inimael which is the tamil synonym for henceforth when 19 (2) (v) was addressed, but it is found only with regard to section 19 (5) (c). The Tamil word vagaiyil would b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fect, unless the retrospectivity is expressly or impliedly contemplated. To decipher whether a law is implied or not, warrants interpretation. Further, it has been held that generally, conferment of a benefit can be with retrospective effect and when a liability is imposed, it is scarcely given retrospective effect. In this connection, it is relevant to refer to the following judgments: 127 . Allied Motors (P) Ltd. v. CIT , (1997) 3 SCC 472: 6. To understand the circumstances in which Section 43-B came to be inserted in the Income Tax Act and the mischief which it sought to prevent, it is necessary to look at the memorandum explaining the provisions in the Finance Bill of 1983 [(1983) 140 ITR (St.) 160]: 59. Under the Income Tax Act, profits and gains of business and profession are computed in accordance with the method of accounting regularly employed by the assessee. Broadly stated, under the mercantile system of accounting, income and outgo are accounted for on the basis of accrual and not on the basis of actual disbursements or receipts. For the purposes of computation of profits and gains of business and profession, the Income Tax Act defines the wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en paid by the assessee within the statutory period prescribed for its payment and prior to the filing of the income tax return, these assessees were unwittingly prevented from claiming a legitimate deduction in respect of the tax paid by them. This was not intended by Section 43-B. Hence the first proviso was inserted in Section 43-B. The amendment which was made by the Finance Act of 1987 in Section 43-B by inserting, inter alia, the first proviso, was remedial in nature, designed to eliminate unintended consequences which may cause undue hardship to the assessee and which made the provision unworkable or unjust in a specific situation. 13. Therefore, in the well-known words of Judge Learned Hand, one cannot make a fortress out of the dictionary; and should remember that statutes have some purpose and object to accomplish whose sympathetic and imaginative discovery is the surest guide to their meaning. In the case of R.B. Jodha Mal Kuthiala v. CIT[(1971) 3 SCC 369 : (1971) 82 ITR 570] , this Court said that one should apply the rule of reasonable interpretation. A proviso which is inserted to remedy unintended consequences and to make the provision workable, a proviso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision to an assessee stands on a footing entirely different from that which may necessitate the passing of a validating Act seeking to validate any statutory provision declared unconstitutional or to make the law clear. While the legislature makes an amendment validating any provision, which might have been found to be defective, the legislature seeks to enforce its intention which was already there by removing the defect or lacuna. However, withdrawal or modification with retrospective effect of the relief properly granted by the statute to an assessee which the assessee has lawfully enjoyed or is entitled to enjoy as his vested statutory right, depriving the assessee of the vested statutory right has the effect of imposing a levy with retrospective effect for the years for which there was no such levy and cannot, unless there be strong and exceptional circumstances justifying such withdrawal or modification cannot be held to be reasonable or rational. 129 . Govt. of India v. Indian Tobacco Assn. , (2005) 7 SCC 396 14. However, the question which arises for consideration in this case is as to what would be the effect of the subsequent notification. 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or substantive. 18. As noted by this Court in CIT v. Podar Cement (P) Ltd. [(1997) 5 SCC 482] the circumstances under which the amendment was brought in existence and the consequences of the amendment will have to be taken care of while deciding the issue as to whether the amendment was clarificatory or substantive in nature and, whether it will have retrospective effect or it was not so. 20. In Zile Singh v. State of Haryana [(2004) 8 SCC 1] it was observed as follows : (SCC pp. 8-9, paras 13-15) 13. It is a cardinal principle of construction that every statute is prima facie prospective unless it is expressly or by necessary implication made to have a retrospective operation. But the rule in general is applicable where the object of the statute is to affect vested rights or to impose new burdens or to impair existing obligations. Unless there are words in the statute sufficient to show the intention of the legislature to affect existing rights, it is deemed to be prospective only- nova constitutio futuris formam imponere debet non praeteritis -a new law ought to regulate what is to follow, not the past. (See Principles of Statutory Interpretation by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Section 271(1)(c) is clarificatory and not substantive. The view expressed to the contrary in Virtual case [(2007) 9 SCC 665] is not correct. 131. CIT v. Alom Extrusions Ltd. , (2010) 1 SCC 489 : 2009 SCC OnLine SC 1842: 14. However, the second proviso once again created further difficulties. In many of the companies, financial year ended on 31st March, which did not coincide with the accounting period of RPFC. For example, in many cases, the time to make contribution to RPFC ended after due date for filing of return. Therefore, the industry once again made representation to the Ministry of Finance and, taking cognizance of this difficulty, Parliament inserted one more amendment vide the Finance Act, 2003, which, as stated above, came into force with effect from 1-4-2004. In other words, after 1-4- 2004, two changes were made, namely, deletion of the second proviso and further amendment in the first proviso, quoted above. 17. We find no merit in these civil appeals filed by the Department for the following reasons: firstly, as stated above, Section 43-B (main section), which stood inserted by the Finance Act, 1983, with effect from 1-4-1984, expre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ] was delivered by a Bench of three learned Judges, which is binding on us. Accordingly, we hold that the Finance Act, 2003 will operate retrospectively with effect from 1-4-1988 (when the first proviso stood inserted). 24. In our view, therefore, the Finance Act, 2003, to the extent indicated above, should be read as retrospective. It would, therefore, operate from 1-4- 1988, when the first proviso was introduced. It is true that Parliament has explicitly stated that the Finance Act, 2003, will operate with effect from 1-4- 2004. However, the matter before us involves the principle of construction to be placed on the provisions of the Finance Act, 2003. 25. Before concluding, we extract hereinbelow the relevant observations of this Court in CIT v. J.H. Gotla [(1985) 4 SCC 343 : (1985) 156 ITR 323] which reads as under: (SCC p. 360, para 47) 47. we should find out the intention from the language used by the legislature and if strict literal construction leads to an absurd result i.e. result not intended to be subserved by the object of the legislation found in the manner indicated before, and if another construction is possible apart from strict lite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Supreme Court [ Ed. : The reference is to Central Bank of India v. Workmen, AIR 1960 SC 12, para 29] : For modern purposes a declaratory Act may be defined as an Act to remove doubts existing as to the common law, or the meaning or effect of any statute. Such Acts are usually held to be retrospective. The usual reason for passing a declaratory Act is to set aside what Parliament deems to have been a judicial error, whether in the statement of the common law or in the interpretation of statutes. Usually, if not invariably, such an Act contains a Preamble, and also the word declared as well as the word enacted . But the use of the words it is declared is not conclusive that the Act is declaratory for these words may, at times, be used to introduced new rules of law and the Act in the latter case will only be amending the law and will not necessarily be retrospective. In determining, therefore, the nature of the Act, regard must be had to the substance rather than to the form. If a new Act is to explain an earlier Act, it would be without object unless construed retrospective. An explanatory Act is generally passed to supply an obvious omission or to clear up doubts as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ed 596 : 232 US 261 at p. 265 : 34 S Ct 421 (1914)] , the Supreme Court clearly acknowledged this basic and long-standing rule of statutory construction: (L Ed p. 598) Tax statutes should be strictly construed; and if any ambiguity be found to exist, it must be resolved in favour of the citizen. Eidman v. Martinez [46 L Ed 697 : 184 US 578 (1902)] , L Ed p. 701 : US p. 583; United States v. Wigglesworth [2 Story 369 (1842)] , Story p. 374 and Mutual Benefit Life Insurance Co. v. Herold [198 Fed 199 (1912)] , Fed p. 201, affirmed in Herold v. Mutual Benefit Life Insurance Co. [201 Fed 918 (CCA 3d 1913)] ; Parkview Building Loan Assn. v. Herold [203 Fed 876 (1913)] , Fed p. 880 and Mutual Trust Co. v. Miller [177 NY 51 : 69 NE 124 (1903)] , NY p. 57. 133. Indian Performing Rights Society Ltd. v. Sanjay Dalia, (2015) 10 SCC 161 : (2016) 1 SCC (Civ) 55 : 2015 SCC OnLine SC 616 . 24. If the interpretation suggested by the appellant is accepted, several mischiefs may result, intention is that the plaintiff should not go to far-flung places than that of residence or where he carries on business or works for gain in order to deprive the defendant a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... common law) four things are to be discerned and considered: 1st : What was the common law before the making of the Act. 2nd : What was the mischief and defect for which the common law did not provide. 3rd : What remedy Parliament hath resolved and appointed to cure the disease of the commonwealth, and 4th : The true reason of the remedy; and then the office of all the Judges is always to make such construction as shall suppress the mischief, and advance the remedy, and to suppress subtle inventions and evasions for continuance of the mischief, and pro private commodo, and to add force and life to the cure and remedy, according to the true intent of the makers of the Act, pro bono publico. (Bengal Immunity Co. Ltd. v. State of Bihar [AIR 1955 SC 661] ). 134. SEBI v. Alliance Finstock Ltd. , (2015) 16 SCC 731 18. On a careful consideration of the rival submissions and keeping in view the relevant case laws relied upon by the parties we have examined analytically and carefully Para 4 as well as the explanations thereto in Schedule III of the Regulations. We find that Para 4 was no doubt inserted through an amendment with effect from 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are not adversely affected by creation of legal liabilities and obligations for a period already bygone. In the present case the provisions do not create any obligation or liability. They only confer benefits by way of fee continuity on account of fees already paid by the earlier entity before its conversion into a new corporate entity. 20. Even if we were to apply the test of fairness, no exception can be taken to extension of the benefit of fee exemption as provided by the relevant provision in the Regulations. Since the policy behind grant of benefits is to encourage corporatisation of individual or partnership members of a stock exchange, the action of extending such benefits without any curb on the basis of date of conversions cannot be held as unfair. 135. SBI v. V. Ramakrishnan, (2018) 17 SCC 394 : (2019) 2 SCC (Civ) 458 : 2018 SCC OnLine SC 963 at page 419: 33. The Report of the said Committee makes it clear that the object of the amendment was to clarify and set at rest what the Committee thought was an overbroad interpretation of Section 14. That such clarificatory amendment is retrospective in nature, would be clear from the following jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which was already implicit. 33.2. CIT v. Vatika Township (P) Ltd. [CIT v. Vatika Township (P) Ltd., (2015) 1 SCC 1] : (SCC p. 23, para 32) 32. Let us sharpen the discussion a little more. We may note that under certain circumstances, a particular amendment can be treated as clarificatory or declaratory in nature. Such statutory provisions are labelled as declaratory statutes . The circumstances under which provisions can be termed as declaratory statutes are explained by Justice G.P. Singh [Principles of Statutory Interpretation, (13th Edn., LexisNexis Butterworths Wadhwa, Nagpur, 2012)] in the following manner: Declaratory statutes The presumption against retrospective operation is not applicable to declaratory statutes. As stated in Craies [W.F. Craies, Craies on Statute Law (7th Edn., Sweet and Maxwell Ltd., 1971)] and approved by the Supreme Court (in Central Bank of India v. Workmen [Central Bank of India v. Workmen, AIR 1960 SC 12, p. 27, para 29] ): For modern purposes a declaratory Act may be defined as an Act to remove doubts existing as to the common law, or the meaning or effect of any statute. Such Acts are usually held to be retros ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officers till they attain the age of 65 years or complete five years' term before attaining the age of 65 years. 16. In the first instance, we have to bear in mind the language/terminology which the legislature used while inserting new Section 6 with effect from 1- 9-2016. This section stands substituted with the old section. The word substituted has its own significance. In Union of India v. Indian Tobacco Assn. [Union of India v. Indian Tobacco Assn., (2005) 7 SCC 396], this Court noted dictionary meaning of the word substitute as can be seen from para 15 of the said judgment : (SCC p. 400) 15. The word substitute ordinarily would mean to put (one) in place of another ; or to replace . In Black's Law Dictionary, 5th Edn., at p. 1281, the word substitute has been defined to mean to put in the place of another person or thing , or to exchange . In Collins English Dictionary, the word substitute has been defined to mean to serve or cause to serve in place of another person or thing ; to replace (an atom or group in a molecule) with (another atom or group) ; or a person or thing that serves in place of another, such as a player in a game ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght out the 2019 Amendment so as to cure the said mischief. We therefore hold that the 2019 Amendment is declaratory and clarificatory in nature and therefore retrospective in operation. 88. This Court while observing, that the amendment was clarificatory in nature, held thus : (Zile Singh case [Zile Singh v. State of Haryana, (2004) 8 SCC 1] , SCC pp. 9-12, paras 14-22) 14. The presumption against retrospective operation is not applicable to declaratory statutes . In determining, therefore, the nature of the Act, regard must be had to the substance rather than to the form. If a new Act is to explain an earlier Act, it would be without object unless construed retrospectively. An explanatory Act is generally passed to supply an obvious omission or to clear up doubts as to the meaning of the previous Act. It is well settled that if a statute is curative or merely declaratory of the previous law retrospective operation is generally intended . An amending Act may be purely declaratory to clear a meaning of a provision of the principal Act which was already implicit. A clarificatory amendment of this nature will have retrospective effect (ibid., pp. 468-69). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed, and they must be taken together as if they were one and the same Act; (Price at p. 392) 17. Maxwell states in his work on Interpretation of Statutes (12th Edn.) that the rule against retrospective operation is a presumption only, and as such it may be overcome, not only by express words in the Act but also by circumstances sufficiently strong to displace it (p. 225). If the dominant intention of the legislature can be clearly and doubtlessly spelt out, the inhibition contained in the rule against perpetuity becomes of doubtful applicability as the inhibition of the rule is a matter of degree which would vary secundum materiam (p. 226). Sometimes, where the sense of the statute demands it or where there has been an obvious mistake in drafting, a court will be prepared to substitute another word or phrase for that which actually appears in the text of the Act (p. 231). 18. In a recent decision of this Court in National Agricultural Coop. Mktg. Federation of India Ltd. v. Union of India [National Agricultural Coop. Mktg. Federation of India Ltd. v. Union of India, (2003) 5 SCC 23] it has been held that there is no fixed formula for the expression of legis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statute firmly established in England as far back as 1584 when Heydon case [Heydon case, (1584) 3 Co Rep 7a : 76 ER 637] was decided that- for the sure and true interpretation of all statutes in general (be they penal or beneficial, restrictive or enlarging of the common law) four things are to be discerned and considered- 1st. What was the common law before the making of the Act. 2nd. What was the mischief and defect for which the common law did not provide. 3rd. What remedy Parliament hath resolved and appointed to cure the disease of the Commonwealth, and 4th. The true reason of the remedy; and then the office of all the Judges is always to make such construction as shall suppress the mischief, and advance the remedy, and to suppress subtle inventions and evasions for continuance of the mischief, and pro privato commodo, and to add force and life to the cure and remedy, according to the true intent of the makers of the Act, pro bono publico. 21. In Allied Motors (P) Ltd. v. CIT [Allied Motors (P) Ltd. v. CIT, (1997) 3 SCC 472] certain unintended consequences flowed from a provision enacted by Parliament. There was an obvious omiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 04) 8 SCC 1] has been subsequently followed in various judgments of this Court, including in CITv. Gold Coin Health Food (P) Ltd. [CIT v. Gold Coin Health Food (P) Ltd., (2008) 9 SCC 622] (three-Judge Bench). 91. This Court recently in SBI v. V. Ramakrishnan [SBI v. V. Ramakrishnan, (2018) 17 SCC 394 : (2019) 2 SCC (Civ) 458] had an occasion to consider the question as to whether the amendment to sub-section (3) of Section 14 of the I B Code by Amendment Act 26 of 2018 was clarificatory in nature or not. By the said amendment, sub-section (3) of Section 14 of the I B Code was substituted to provide that the provisions of sub-section (1) of Section 14 shall not apply to a surety in a contract of guarantee for corporate debtor. Considering the said issue, this Court observed thus : (SCC pp. 417- 19, paras 30-33) 30. We now come to the argument that the amendment of 2018, which makes it clear that Section 14(3), is now substituted to read that the provisions of sub-section (1) of Section 14 shall not apply to a surety in a contract of guarantee for corporate debtor. The amended section reads as follows: 14. Moratorium .-(1)-(2) * * * (3) The provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e being infructuous, and not serving the purpose for which they have been entered into. 5.8. In SBI v. V. Ramakrishnan [SBI v. V. Ramakrishnan, 2018 SCC OnLine NCLAT 384] , Nclat took a broad interpretation of Section 14 and held that it would bar proceedings or actions against sureties. While doing so, it did not refer to any of the above judgments but instead held that proceedings against guarantors would affect the CIRP and may thus be barred by moratorium. The Committee felt that such a broad interpretation of the moratorium may curtail significant rights of the creditor which are intrinsic to a contract of guarantee. 5.9. A contract of guarantee is between the creditor, the principal debtor and the surety, whereunder the creditor has a remedy in relation to his debt against both the principal debtor and the surety (National Project Construction Corpn. Ltd. v. Sadhu and Co. [National Project Construction Corpn. Ltd. v. Sadhu and Co., 1989 SCC OnLine P H 1069 : AIR 1990 P H 300] ). The surety here may be a corporate or a natural person and the liability of such person goes as far as the liability of the principal debtor. As per Section 128 of the Contract Act, 1872 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te the above apprehension of abuse of the moratorium provision. The Committee concluded that Section 14 does not intend to bar actions against assets of guarantors to the debts of the corporate debtor and recommended that an explanation to clarify this may be inserted in Section 14 of the Code. The scope of the moratorium may be restricted to the assets of the corporate debtor only. 33. The Report of the said Committee makes it clear that the object of the amendment was to clarify and set at rest what the Committee thought was an overbroad interpretation of Section 14. That such clarificatory amendment is retrospective in nature, would be clear from the following judgments: (emphasis in original) 92. In B.K. Educational Services (P) Ltd. v. Parag Gupta and Associates [B.K. Educational Services (P) Ltd. v. Parag Gupta Associates, (2019) 11 SCC 633 : (2018) 5 SCC (Civ) 528] this Court considered the question as to whether the 2018 Amendment which inserted Section 238-A to the I B Code was clarificatory in nature or not. After considering various earlier judgments of this Court, this Court observed thus : (SCC p. 654, paras 26-27) 26. In the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent behind this is to freeze all the claims so that the resolution applicant starts on a clean slate and is not flung with any surprise claims. If that is permitted, the very calculations on the basis of which the resolution applicant submits its plans would go haywire and the plan would be unworkable. 138. In a recent judgment in Chandra Sekhar Jha Vs Union of India and others reported in 2022 SCC Online SC 269, the Apex Court held as follows: 4. Section 129E of the Customs Act, 1962, as it stood before substitution by Act 25 of 2014, reads as follows:- 129E. Deposit, pending appeal, of duty and interest, demanded or penalty levied.- Where in any appeal under this Chapter, the decision or order appealed against relates to any duty any interest demanded in respect of goods which are not under the control of the customs authorities or any penalty levied of goods which are not under the control of the customs authorities or any penalty levied under this Act, the person desirous of appealing against such decision or order shall, pending levied under this Act, the person desirous of appealing against such decision or order shall, pending the appeal, deposi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not apply to the stay applications and appeals pending before any appellate authority prior to the commencement of the Finance (No. 2) Act, 2014.] 6. The specific argument of the learned counsel for the appellant is that in the case of the appellant in view of the fact that the act relates to the year 2013 (namely on 28.2.2013), the appellant must be governed by Section 129E prior to the substitution. This is for the reason that the substitution of Section 129A was effected on 06.08.2014 which is after the date of the incident (28.02.2013). On the basis of the same, it is contended that under Section 129E, as it stood, prior to the substitution there was a power available with the Appellate Authority in the matter of demand of pre-deposit. He would point out that the amount for pre-deposit in his case is harsh and onerous. 7. On a conspectus of the provisions of Section 129E before and after the substitution, it becomes clear that the law giver has intended to bring about a sweeping change from the previous regime and usher in a new era, under which the amount to be deposited was scaled down and pegged at a certain percentage of the amount in dispute. In othe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14, Section 129E as substituted would not apply. Substitution of a provision results in repeal of the earlier provision and its replacement by the new provision. 11. As far as the argument of the appellant that for the reason that the incident which triggered the appeal filed by the appellant took place in the year 2013, the appellant must be given the benefit of the power available under the substituted provision, it does not appeal to us. The substitution has effected a repeal and it has re-enacted the provision as it is contained in Section 129E. In fact, the acceptance of the argument would involve a dichotomy in law. On the one hand, what the appellant is called upon to pay is not the full amount as is contemplated in Section 129(E) before the substitution. The order passed by the Commissioner is dated 23.11.2015 which is after the substitution of Section 129E. The appellant filed the appeal in 2017. What the appellant is called upon to pay is the amount in terms of Section 129E after the substitution, namely, the far lesser amount in terms of the fixed percentage as provided in section 129E. The appellant, however, would wish to have the benefit of the proviso whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thus relate back to 11.11.2013, resultantly, the position insofar as the right of the manufacturers to avail ITC is, it becomes an absolute right, once the inputs are used in the manufacture or processing of the goods within the State, the subsequent event of the manufactured goods being sold by way of inter-state/ intra-state sale would have no bearing nor does it result in imposing any limitation/restriction or whittle down the right to ITC earned in terms of Section 19(2)(ii) or 19(2)(v) of the TNVAT Act in the interregnum period. 140. In the light of the view expressed by us on the scope of the curative/ declaratory nature of Amendment to Section 19 (2) vide Act 5 of 2015, there is a possibility that the State may have to deal with the claims of refund on account of excess ITC to the credit of the assessees, consequent to the above view. It is thus, necessary to clarify the impact of the view expressed by us, on the claim of refund. 141. The first question which arises for consideration is as to whether the doctrine of unjust enrichment would apply in the absence of an express provision incorporating the same. Stated simply, unjust enrichment means retention of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicable. A person who unjustly enriches himself cannot be permitted to retain the same for its benefit except enrichment. Where it becomes entitled thereto the doctrine of unjust enrichment can be invoked irrespective of any statutory provisions. 34. In Mafatlal Industries Ltd. [(1997) 5 SCC 536] Section 72 of the Contract Act providing for restitution may be taken recourse to. Doctrine of unjust enrichment was resorted to, observing: (SCC p. 633, para 108) 108. (iii) A claim for refund, whether made under the provisions of the Act as contemplated in Proposition (i) above or in a suit or writ petition in the situations contemplated by Proposition (ii) above, can succeed only if the plaintiff-petitioner alleges and establishes that he has not passed on the burden of duty to another person/other persons. His refund claim shall be allowed/decreed only when he establishes that he has not passed on the burden of the duty or to the extent he has not so passed on, as the case may be. Whether the claim for restitution is treated as a constitutional imperative or as a statutory requirement, it is neither an absolute right nor an unconditional obligation but is subject to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d are captively consumed by importer himself and the duty paid thereon is added to the price of the finished goods which are sold to others . The following passage of the said judgment would make the said position clear: 20. We are of the opinion that the aforesaid observations would be applicable in the case of captive consumption as well. To claim refund of duty it is immaterial whether the goods imported are used by the importer himself and the duty thereon passed on to the purchaser of the finished product or that the imported goods are sold as such with the incidence of tax being passed on to the buyer. In either case the principle of unjust enrichment will apply and the person responsible for paying the import duty would not be entitled to get the refund because of the plain language of Section 27 of the Act. Having passed on the burden of tax to another person, directly or indirectly, it would clearly be a case of unjust enrichment if the importer/seller is then able to get refund of the duty paid from the Government notwithstanding the incidence of tax having already been passed on to the purchaser. (emphasis supplied) 144. Following the above judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Description of suits period of limitation period begins to run time from which 120. Suit for which no period of limitation is provided elsewhere in this schedule. Six years When the right to sue accrues As Article 120 can apply only if no other specific article were applicable, we have to examine the question whether there is any other specific article applicable and in particular whether the language of the first column of Article 62 covers a suit making a claim of the nature made in the plaints before us. The contention urged on behalf of the appellant in Civil Appeals 306 and 644 of 1962 was that the Article refers to money payable by the defendant to the plaintiff only in those cases where the money was received by the defendant for the plaintiff's use . The latter condition that the money which is sought to be recovered must have been received by the defendant for the plaintiff's use should, it was urged, be literally satisfied before that Article could be applied. In other words, the contention was that that Artic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1984] as a liberal action, founded on large principles of equity, where the defendant cannot conscientiously hold the money . In later decisions it was said to be based not merely on an equitable doctrine but was a Common Law right [ See for instance Royal Bank of Canada v. Reh, 1913 AC 283] . The jural basis on which the action was originally supported, was a promise to pay by the defendant implied or imputed by law. Lord Mansfield explained: If the defendant be under an obligation from the ties of natural justice to refund, the law implies a debt and gives this action, founded on the equity of the plaintiffs case, as it were upon a contract. Moses v. Macferlan [(1760) 2 Burr 1005] itself was an action of assumpsit and the imputed promise was an extension of the principle on which it was in its origin based as stated in Cheshire Fitfoot. In the third Edition of Bullen and Leake published in 1868 they said: [ILR 32 Cal 527] The action for money had and received is the most comprehensive of all the common counts. It is applicable wherever the defendant has received money, which, in justice and equity, belongs to the plaintiff under circumstances which ren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... limitation for the filing of a suit. 60. So far as the present claim for recovery of a tax illegally collected is concerned the authorities are fairly uniform that the period of limitation for a suit making such a claim is governed by Article 62. Rajputana Malwa Railway Cooperative Stores Ltd. v. Ajmere Municipal Board [ILR 32 All 491] arose out of a suit against a Municipal Board for refund of certain octroi duty which they were not legally entitled to levy. The suit for that claim was held to be governed by Article 62, the learned Judges stating: The language of Article 62 is borrowed from the form of count in vogue in England under the Common Law Procedure Act of 1852. Prior to the passing of the Supreme Court of Judicature Acts of 1873 and 1875, there was a number of forms of pleading known as the common indebitatus counts, such as counts for money lent, money paid by the plaintiff for the use of the defendant at his request, money received by the defendant for the use of the plaintiff, co The most comprehensive of the old common law counts was that for money received by the defendant for the use of the plaintiff. This count was applicable where a defenda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fund of the tax collected or retained by the State, steps must have been taken by them within three years from the date of their payments to the department. Thus, any claim for refund may have to be examined keeping in view the doctrine of unjust enrichment as explained by the decisions cited supra and the findings rendered hereinabove and in the preceding paragraph. Conclusion. 147. Therefore, the position as regards section19(2)(ii) and the proviso inserted vide Act 28 of 2013 and its subsequent omission vide Amendment Act 5 of 2015 and the claim of refund, shall be examined in the light of the principles as set out above. To that extent, the appeals filed by the State are partly allowed. 148. Insofar as W.A Nos.1446 and 1447/2021 are concerned, the same have been preferred against the orders of the learned Judge dismissing the writ petitions as barred by limitation, based on the decision of the Apex Court in Glaxo Smith Kline Consumer Health Care Pvt lTd. 149. It is brought to the knowledge of this court, a subsequent judgment of a Co-ordinate Bench of this court in W.A No.493/2021, wherein after considering the observations of the Hon ble Apex Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lying the dictum of a three Judge Bench of this Court in Oil and Natural Gas Corporation Limited (supra). In other words, the fact that the High Court has wide powers, does not mean that it would issue a writ which may be inconsistent with the legislative intent regarding the dispensation explicitly prescribed under Section 31 of the 2005 Act. That would render the legislative scheme and intention behind the stated provision otiose. ...... 19........ Pertinently, no finding has been recorded by the High Court that it was a case of violation of principles of natural justice or non compliance of statutory requirements in any manner. Be that as it may, since the statutory period specified for filing of appeal had expired long back in August, 2017 itself and the appeal came to be filed by the respondent only on 24.9.2018, without substantiating the plea about inability to file appeal within the prescribed time, no indulgence could be shown to the respondent at all. 6. On a reading of the above extracted paragraphs, it is seen that the Hon'ble Supreme Court, after referring to the decision of the Constitution Bench in the case of Thansingh Nathmal, held that althoug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of India has to be exercised to effectuate rule of law and not for abrogating it. 9. In the light of the above, we have no hesitation to hold that the observation of the learned Single Judge to the effect that there is absolute bar for entertaining a writ petition does not reflect the correct legal position. Hence, we are inclined to interfere with the observation made in the impugned order. 150. With utmost respect, the Hon ble Supreme Court has held that such writs should not be entertained as a matter of course, even though, the court has wide powers under Article 226 of the Constitution. The writ court ought to have seen that the High Court under Article 226 of Constitution is rather circumscribed by the theory of laches and not by limitation, because the Constitution is above a statute as held by the Apex Court in the Judgment in the matter of Samjuben Gordhanbhai Koli Vs State of Gujarat, reported in MANU/SC/0826/2010 . The effect of laches depends upon the facts of each case and is left to the discretion of the court to either reject or entertain a writ petition. In taxing matters, whenever a levy or demand is made without authority of law, the court would ..... X X X X Extracts X X X X X X X X Extracts X X X X
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