TMI Blog1997 (8) TMI 482X X X X Extracts X X X X X X X X Extracts X X X X ..... plywood and allied timber products are also manufactured. 4.. According to the petitioners the sawn timber converted by the petitioners are sold entirely outside the State to buyers either on the basis of prior orders or in the common market. Delhi is the principal market in which the sawn timber of the petitioners are sold. So far as veneer is concerned about 80 per cent of the veneer is transported to Tinsukia for use in the plywood factories of the State of Assam. So far as plywood is concerned about 90 per cent of the plywood manufactured by the petitioners are sold outside the State. The petitioners therefore claimed that the sales transaction of timber products is in the course of interState trade. Prior to the Nagaland Purchase Tax Act, 1993 (hereinafter referred to as the Act ) timber other than firewood was one of the items included in Schedule I to the Nagaland Sales Tax Act, 1967, as amended and the effective rate of tax on timber was fixed as 8 per cent under the said Act. The Nagaland Purchase Tax Act was enacted in the year 1993 to provide for the levy of tax on the purchase of certain commodities in Nagaland to impose tax on purchase point of certain commodities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Sales Tax Act from persons liable to pay such tax. Mr. Gogoi, learned counsel, further submitted that under the provisions of the Sales Tax Act, 1967 timber was taxable till September 30, 1993 at the rate of 8 per cent only which was to be realised by the seller from the purchaser of the goods and deposited in the Government treasury by the seller of the goods in question. Under the provisions the purchase tax has been fixed at 25 per cent which in the facts and circumstances of the case is, confiscatory in nature. Mr. Gogoi, learned counsel, further submitted that the Act in question has been enacted as a device and cloak to confiscate the property of the petitioners and therefore, the same is a fraud on the legislative power conferred by the Constitution on the State Legislature. Mr. Gogoi also submitted that the rate fixed by the legislation in question would necessarily result in a complete stoppage of the occupation, trade and business inasmuch as it would not be possible to the petitioners to sell their goods in a highly competitive market at the enhanced rate therefore, the same is violative of fundamental rights guaranteed to the petitioners under articles 19(1)(g) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax under the Nagaland Sales Tax Act, 1967 to purchase point tax on certain commodities in order to check evasion of tax. The said Act was enacted within the full competence of the State Legislature. The respondents also denied that the Act in question was enacted as a device and cloak to confiscate the property of the petitioner and the same is fraud on the legislative power. 7.. Mr. Misra, learned counsel appearing for the State of Nagaland brought my attention to the provision of the Act and submitted that while considering the validity of a legislation the court is not required to go to the object and statement of the Bills when the legislative enactment is clearly spelt out by the provisions of the Act itself. Mr. Misra, learned counsel further submitted that an Act of the Legislature should normally presumed to be valid and the burden of showing for want of legislative competence or otherwise as arbitrary and unreasonable, rests on the persons who impeached the law. Mr. Misra, the learned counsel submitted that tax is levied in the instant case by the Legislature and it is for the Legislature to consider the motive for imposing tax and the necessity or expediency of a partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te by a dealer: Provided that when the tax has been levied under this Act in respect of the purchase within the State of any declared goods and such goods are sold in the course of inter-State trade or commerce the tax so levied shall be refunded to such person in such manner and subject to such conditions as may be prescribed: Provided further that where any dealer claims that any purchase of taxable goods by him is not the last purchase of goods in the State the burden of proof of the same shall be on the dealer....... 9.. There is always a presumption in favour of the constitutionality of statute and the burden of proof rests on the persons who assailed the constitutionality of the statute. It must be assumed that the Legislature understands and rightly appreciates the ground realities and legislative measures are taken to tackle the situations made manifest by its experience. Whenever the validity of enactment is attacked it becomes the duty of the court to look to the legislation as a whole and to find out the real intention of the Legislature. When the legislative intendment is plain and simple, the question of delving deep to ascertain the will of the Legislature from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The statute places the burden of proof upon the dealer. The object is to tax on the purchase of the taxable goods on the turnover of purchase at the point of last purchase. The Statement of Objects and Reasons assigned in the Nagaland Purchase Tax Act, 1993 cannot defeat the legislative intendment as contained in section 4 of the Act. There cannot be any estoppel against the statute. On a survey of the scheme of the Act and more particularly provisions contained in section 4 of the Act on the subject cannot be said that the tax is levied on stock transfer and consignment sales. The legislative intendment is to be given full effect to, inspite of possible defect of draftsmen. The Legislature, after all represents the will and faith of the people and the legislative will is to be given full effect and the draftman s devil if there be any is not to be allowed to act as an obstruction. The Legislature is free to utilise its taxing power to improve the fiscal position of the State and the economic condition of the State. The following observation of the Supreme Court in Hotel Balaji v. State of Andhra Pradesh reported in [1993] 88 STC 98 (SC); (1993) Suppl 4 SCC 563 is usefully recalled ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
