TMI Blog1967 (2) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Authority on 30th of September, 1964, which is sought to be impugned in the first petition, a levy of purchase tax on ground-nuts at the rate of 2 per cent. was imposed to the tune of Rs. 34,950.77 P., while a sum of Rs. 934.27 P. was assessed as sales tax on edible oils. The first imposition is challenged on the ground that the levy of the tax is void and ultra vires. The petitioner is a partnership firm doing the business of crushing oil-seeds at Khanna. During the course of its business, it makes purchases of oil-seeds also. It is not disputed that ground-nuts had been purchased by the petitioner and if these are regarded as oil-seeds the levy would be justifiable. It is contended by Mr. Bhagirath Dass, the learned counsel for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by item No. 3 of Part II of Schedule I of the C.P. and Berar Sales Tax Act, 1947. The test is not whether oil can be extracted from a fruit or seed, but it is whether in common parlance the article is known as 'oil-seed' used principally for the extraction of oil. Judged by this test, it cannot be said that coconuts, ground-nuts and jira fall within the meaning of the term 'oil-seeds'.................." If it is found that ground-nuts are not oil-seeds, the foundation for the assessment no longer exists and the levy must be declared to be without warrant. Mr. Prem Chand Jain, the learned counsel for the State, contends, however, that though the ruling of the Madhya Pradesh High Court appears to be decisive on the point, the matter is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esident's assent had been obtained as required by Article 286(3) of the Constitution. The impugned notification, by which the dealers in edible oils were made liable to pay sales tax, was a law made by the State Legislature after the enactment of Act 52 of 1952 which laid down the inhibition and as the notification did not receive the assent of the President as required by Article 286(3) it was ultra vires and invalid. After the decision in Ganga Ram's case[1963] 14 S.T.C. 476., the Punjab Government rectified the defect by another notification of 8th March, 1965, that tax on edible oils could be imposed. This time the President's assent has been obtained. Admittedly, the present levy was made in pursuance of the notification of 1954 which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can be made under the Sales Tax Act and further, if the notification of 1954 is bad, as has been held by a Division Bench of this Court, there can be no levy of sales tax on edible oil. Plainly, the matter with respect to these liabilities concerns the Jurisdiction of the sales tax authority and the petition under Article 226 is entertainable by this Court. Holding, as I do, that the impositions of the purchase tax on ground-nuts and the sales tax on edible oils are unlawful, the question of penalty does not arise and the impugned order, which has been challenged in Civil Writ No. 2562 of 1964 imposing a penalty of Rs. 15,000 under section 10(6) of the Act is clearly unsustainable. In the result, both the petitions would be allowed and the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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