TMI Blog1982 (2) TMI 276X X X X Extracts X X X X X X X X Extracts X X X X ..... der the Act. The definition of "dealers" includes those who sell taxable goods manufactured, made or processed by them in Assam. In the discussion to follow, we shall also refer to rule 46A as framed in 1969 as old rule 46A, and the impugned provision as new rule 46A 1A. To understand the challenge in the proper perspective, it would be apposite to first note sections 24 and 24A of the Act, which read as below: "24. Refund.-(1) The Commissioner on being satisfied either on an application or on any other manner that the dealer has paid in excess of the sum due from him shall order, as soon as it may be, the refund of the sum so paid in excess: Provided that the Commissioner may set-off such sum against other dues from the same dealer in respect of any other return period. (2) Where a tax has been levied under this Act in respect of any declared goods which are subsequently sold in the course of inter-State trade or commerce the tax as levied shall be refunded to the dealer in the manner as may be prescribed. (3) If for reasons of delay a refund, being other than a refund under section 24A(2), due to a dealer is not made within ninety days of such refund being due, the Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods for sale. (2) In allowing drawback, set-off or refund the provisions of rules 39 and 46 shall apply.' 5.. ........................................" 2. This rule was substituted by new rule 46A by Notification No. FTX. 134/ 71/13 dated 2nd November, 1971, as published in the Extraordinary Assam Gazette of the same day reading: "In exercise of the powers conferred by sub-section (1) of section 39 of the Assam Finance (Sales Tax) Act, 1956 (Assam Act XI of 1956), the Governor of Assam is pleased to make the following rule for the purpose of carrying into effect the said Act as amended, namely: THE ASSAM FINANCE (SALES TAX) (FOURTH AMENDMENT) RULES, 1971 1. Short title and commencement.-(1) These Rules may be called the Assam Finance (Sales Tax) (Fourth Amendment) Rules, 1971. (2) Amendment of rule 46A.-For the existing rule 46A of the Assam Finance (Sales Tax) Rules, 1956, as amended, the following shall be deemed to have been substituted with effect from 1st January, 1968, namely: '46A. (1) Where a dealer sells taxable goods in the manufacture, making, processing or production of which by him on small-scale within the State he has used raw materials in respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enefit available under the old rule 46A by the amendment in 1971. 4.. The challenge to the validity of new rule 46A is on these grounds: (1) The rule is void inasmuch as it was made without "previous publication". (2) This rule is invalid in any case as retrospective operation was given to it from 1st January, 1968. (3) The provision in sub-rule (2) requiring application "within three months from the date of sale of the taxable goods.............." is violative of article 19 being an unreasonable restriction. (4) Sub-rule (3) is ultra vires section 24A(2). 5. Before examining these grounds of challenge, it may be worthwhile to mention the changes brought about by the new rule 46A. The main changes are these: (1) it conferred the benefit of "drawback, set-off or refund" only to small-scale manufacturers; and dealers having fixed investment not exceeding Rs. 5,00,000 (Rupees five lakhs) in their industrial units were to be regarded as small-scale manufacturers; (2) the small-scale unit must be one registered by the Director of Industries, Government of Assam; (3) a certificate in form XV from the Director of Industries, Government of Assam, had to accompany in an appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ospective part of the operation alone would be ineffective. This position has been clearly admitted by Shri Bhattacharjee on behalf of the petitioners. Thus new rule 46A cannot meet its waterloo because it was brought into effect on and from 1st January, 1968. As agreed to by both the sides the position in this regard would be that the new rule must be deemed to have started operating from 2nd November, 1971. 7.. Qua the third ground of attack, the learned Advocate-General, Meghalaya, fairly states that a dealer could not have been asked to do what is impossible. As we have held that the rule started operating from 2nd November, 1971, the same would apply to sales taking place on or after 2nd November, 1971. So interpreted, submits Shri Bhattacharjee, the sub-rule would not violate article 19. We have no difficulty in holding that the period of three months mentioned in sub-rule (2) has to apply to the sales taking place on or after 2nd November, 1971, only. 8.. The last ground of attack is that though by virtue of section 24A(2) of the Act a dealer would have been entitled to drawback, set-off or refund "in respect of any purchase of raw materials", sub-rule (3) has empowered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been exercised only after satisfying the condition of previous publication as clearly mentioned in sub-section (1) of that provision. On the other hand, if the rule could have been framed by virtue of what is provided in section 24A(2), absence of previous publication would not affect the validity. It is also not in dispute that if section 24A(2) can be read to contain the rule-making power, this provision would prevail over the general rule-making power conferred by section 39 inasmuch as in case of conflict between specific provision and general provision, the former prevails as stated, inter alia, in J.K. Cotton Spinning and Weaving Mills v. State of U.P. AIR 1961 SC 1170. 11.. We have, therefore, to find out whether conferment of rule-making power can be read in section 24A(2). At this stage we may note section 39 of the Act also: "39. Power to make rules.-(1) The State Government may, subject to the condition of previous publication, make rules for the carrying out the purposes of this Act. (2) Without prejudice to the generality of the foregoing power, such rules may, in particular, prescribe- (a) all matters required by this Act to be prescribed; (b) the class ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not material, according to the counsel, inasmuch as the instances mentioned under sub-section (2) cannot take away the general power conferred by sub-section (1). It is also contended that clause (f) of subsection (2) authorising making of rules to deal with "the manner in which refunds shall be made" would cover rule like 46A. We are also reminded that in fact new rule 46A had been made by invoking power under section 39(1) of the Act. 14.. To us it appears that the operation of section 39(1) cannot be ruled out on the thin ground that while inserting section 24A in the Act no corresponding provision was made in section 39(2) empowering making of rules relating to remission. We do not think it necessary for the case at hand to decide whether the drawback, set-off, etc., provided for in sub-section (2) of section 24A are really in the nature of "remission" or "refund". We only note that according to the learned Advocate-General, Meghalaya, it is a part of remission as would appear from the heading of the section, while according to Shri Bhattacharjee, subsection (2) itself had used the word "refund" along with "drawback and set-off", and marginal note of the section cannot co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous publication. There can be no denial that a stautute may contain different provisions conferring rule-making powers, see Defence of India Acts, 1962, or 1971, to which our attention was fairly drawn by Shri Bhattacharjee. 17.. Because of all the above, we hold that the proper section to be invoked while making rule 46A was section 24A(2) of the Act. As such new rule 46A cannot be held to be invalid on the ground of lack of previous publication. The first ground of challenge cannot, therefore, be sustained. In view of this it is not necessary for us to examine the submission of the learned Advocate-General, Meghalaya, that even if we were to hold that new rule 46A was invalid on the ground of lack of previous publication, old rule 46A could not also operate, to substantiate which plea, the learned counsel referred to Firm A.T.B. Mehtab v. State of Madras [1963] 14 STC 355 (SC); AIR 1963 SC 928 and Koteswar v. K.R.B. Co. AIR 1969 SC 504, which have pointed out that the process of substitution consists of two steps, first, the old provision is made to cease to exist, and next, a new provision is brought into existence in its. place; and so even if the new provision is invalid, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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