TMI Blog1991 (12) TMI 258X X X X Extracts X X X X X X X X Extracts X X X X ..... N-66 of 1991 are registered dealers under the Act of 1941. The applicants in Case No. RN-22 of 1991 are registered dealers under the Act of 1954. 3.. The applicants have paid various amounts of purchase tax under section 4(6)(ii) of the Act of 1941 and/or section 4(2)(i) of the Act of 1954 since the enactment of these provisions by the West Bengal Act 23 of 1977 with effect from October 10, 1977. These provisions in these two Acts were subsequently amended by the West Bengal Taxation Laws (Amendment) Act, 1990 and validation was made of all taxes on purchases levied or collected or purported to have been levied or collected under section 4(6)(ii) of the Act of 1941 and section 4(2)(i) of the Act of 1954. The validation was made by inserting sub-sections (2A) and (2B) in section 26A of the Act of 1941 and enacting section 28 in the Act of 1954. These validating provisions came into effect from February 26, 1990. By the West Bengal Taxation Laws (Amendment) Act, 1990 (West Bengal Act 6 of 1990), clause (iiia) was inserted in sub-section (7) of section 5 of the Act of 1941 and clause (iia) was inserted in section 4(4) of the Act of 1954, which were to operate retrospectively from Oc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ground that the State Legislature had no competence to enact the same. These provisions were struck down by this Tribunal in the case of Rasoi Ltd. [1991] 80 STC 356. The relevant rules were also quashed as ultra vires. The decision of this Tribunal in that case was that the right to get the refund would accrue on and from the date of that judgment of this Tribunal on September 11, 1990. By that judgment the respondents were directed to refund to the applicants in the case of Rasoi Ltd. [1991] 80 STC 356 the amounts of impugned tax and interest thereon, if any, levied and collected from those applicants under the old as well as the new sections 4(6)(ii) of the Act of 1941 and 4(2)(i) of the Act of 1954. The respondents in those cases were directed to make such refunds within six months from September 11, 1990, after verifying the correctness of the particulars of refundable amounts. 5.. On the basis of this judgment in the case of Rasoi Ltd. [1991] 80 STC 356 the present eleven cases have been filed under section 8 of the West Bengal Taxation Tribunal Act, 1987. The applicants in these eleven cases have referred to the judgment of the Supreme Court in the case of Goodyear In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... granted by the Honourable Supreme Court on February 11, 1991 and that stay order has been granted by the Supreme Court only on undertaking by the Government of West Bengal to pay interest at the rate of 18 per cent, if the Government failed at the time of disposal of the appeals. It is alleged that the stay order has been passed by the Honourable Supreme Court so that the Government could levy purchase tax till the disposal of the special leave petitions fixed tentatively for hearing in the month of July, 1991. It is alleged that the applicants in these three cases have come to learn that in some cases such as Messrs. Dey's Medical Stores and others, the Government of West Bengal has not furnished an undertaking to pay interest at the rate of 18 per cent and the Honourable Supreme Court has not allowed stay petitions in those cases and has only admitted the special leave petitions. The applicants in these three cases (RN-4 of 1991, RN-5 of 1991 and RN-31 of 1991) contend that the stay order has been granted only in the matter of Rasoi Ltd. on furnishing an undertaking to pay interest at the rate of 18 per cent and is limited only to Rasoi Ltd. and not to the other applicants who ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oi Limited [1991] 80 STC 356. The respondents have referred to the decisions of the Supreme Court in the cases of A.V. Fernandez v. State of Kerala [1957] 8 STC 561, Devi Dass Gopal Krishnan v. State of Punjab [1967] 20 STC 430; AIR 1967 SC 1895 and Sri Venkateswara Rice, Ginning and Groundnut Oil Mill Contractors Co. v. State of Andhra Pradesh [1971] 28 STC 599, for contending that incurring of charge is different from enforceability and computation. According to the respondents, this distinction between chargeability and quantification of tax was lost sight of by this Tribunal by holding that the pith and substance rule would be meaningless, if the charging provision was construed in isolation from the provision for exemption. The case of the respondents is that by promulgating the West Bengal Taxation Laws (Amendment) Act, 1977, the State of West Bengal amended the Act of 1941 and the Act of 1954 with effect from October 10, 1977, incorporating therein, amongst others, the provisions for levy of tax on purchase of goods by registered dealer for use in the manufacture of goods in West Bengal, when such purchases were made from a registered dealer at concessional rate against decl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stand competition in the markets outside West Bengal, the restrictions and conditions for purchase of raw materials and packing materials referred to in subclauses (i) and (ii) in section 5(1)(bb) of the Act of 1941 and section 23A of the Act of 1954 were relaxed and it was made permissible by sub-section (4) of section 5A of the Act of 1941, inserted by the West Bengal Taxation Laws (Third Amendment) Act, 1977, for the registered dealers to make purchases of raw materials and packing materials on the strength of declaration forms with effect from October 10, 1977, even though the manufactured goods were not sold by them in West Bengal against payment of tax on such purchases at the rate of 4 per cent (up to March 31, 1978), 2 per cent (up to March 31, 1983) and 3 per cent thereafter under section 4(6)(ii) of the Act of 1941 or section 4(2)(i) of the Act of 1954, in lieu of heavy amount of penalty in terms of section 5A of the Act of 1941 or section 4AAAA of the Act of 1954. Before coming into force of this permissive legislation in section 5A(4) of the Act of 1941 and section 4AAAA(4) of the Act of 1954, the registered dealers seldom made purchases of raw materials and packing mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntained in section 13AA of the Bombay Sales Tax Act, 1959 (hereinafter called "the Bombay Act" for the sake of brevity), pertaining to the levy of purchase tax therein, which have been declared ultra vires the Constitution of India and invalid by the honourable Supreme Court in the case of Goodyear India Ltd. [1990] 76 STC 71, are basically different from the point of view of the taxable event under section 4(6)(ii) of the Act of 1941 and section 4(2)(i) of the Act of 1954. Affidavit-in-reply has been filed for the applicants in each of these cases. 9.. The affidavit-in-opposition filed for the respondents is in the nature of an application for reconsideration of the judgment of this Tribunal in the case of Rasoi Limited [1991] 80 STC 356. Two of my learned brothers are parties to the judgment delivered in these cases. Though it is not proper to have a judgment of this Tribunal reconsidered by this Tribunal, particularly when special leave petitions against the judgment have been admitted and are pending in the Supreme Court, I am to discuss the matters mentioned in the affidavit-in-opposition, particularly when applications for transfer of some of these cases to the honourable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r in the packing in West Bengal of goods so manufactured for sale in West Bengal: Provided that where specified purchase price of goods, other than that in respect of purchases referred to in clause (ii) or clause (v), cannot be fully identified by a dealer, the specified purchase price in respect of purchases referred to in this clause shall be determined in such manner as may be prescribed;" 12.. Some consequential amendments for determination of specified purchase prices under the proviso to clause (iiia) of sub-section (7) of section 5 of the Act of 1941 were made by the West Bengal Act 6 of 1990 by omitting with effect from October 10, 1977, sub-section (8) and subsection (9) of section 5 of the Act of 1941 and clause (ddd) to section 26(2) and inserting with effect from October 10, 1977, clause (d-1) to sub-section (2) to section 26 of the Act of 1941. Validating provisions were made by the West Bengal Act 6 of 1990 by inserting sub-sections (2A) and (2B) after subsection (2) to section 26A of the Act of 1941 and inserting clauses (c) and (d) to sub-section (3) of section 26A of that Act so that taxes levied or collected or purported to have been levied or collected under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... where the specified purchase price of goods, other than that in respect of purchases referred to in clause (ii) or clause (iii), cannot be fully identified by a dealer, the specified purchase price in respect of purchases referred to in this clause, shall be determined in such manner as may be prescribed;" 15.. Consequential to those amendments, some more amendments were effected for determination of taxable specified purchase price by omitting with effect from October 10, 1977, sub-sections (6) and (7) of section 4 of the Act of 1954, substituting a new clause (f) to section 21(2) and inserting clause (g) to section 21(2) of the Act of 1954 with effect from October 10, 1977. Some validating provisions were made by inserting section 28 in the Act of 1954 so that all taxes or purchases levied or collected or purported to have been levied or collected and recoveries made thereof or assessment or reassessment made in respect thereof could not be challenged. As a corollary to these amendments, sub-rule (1) to rule 20A of the West Bengal Sales Tax Rules, 1954, was substituted in place of old rule 20A(1) with effect from October 10, 1977 for determination of specified purchase price. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1973, as amended by the Haryana General Sales Tax (Amendment and Validation) Act, 1983, as well as section 13AA of the Bombay Sales Tax Act, 1959, which were considered by the Supreme Court in the case of Goodyear India Ltd. [1990] 76 STC 71 and which formed the basis of the judgment of this Tribunal in the case of Rasoi Limited [1991] 80 STC 356. The contention is that as the provisions in the Haryana and Bombay Acts are different, there was legislative competence of the State of West Bengal to levy purchase tax under entry 54 in List II of the Seventh Schedule to the Constitution. It was held by this Tribunal in the case of Rasoi Limited [1991] 80 STC 356 that the impugned provisions as they stood before 1990 were not different from the new provisions brought in by the Amending Act in 1990 or from the provisions of the Haryana and Maharashtra Acts which were considered by the Supreme Court in the case of Goodyear India Ltd. [1990] 76 STC 71. I am bound by this judgment in the case of Rasoi Limited [1991] 80 STC 356 which is the subject-matter of several special leave petitions in the Supreme Court. It can only be stated that there can be no difference between the Haryana an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in section 5(7)(iiia) and section 4(4)(iia) should not be considered along with the amended section 4(6)(ii) of the Act of 1941 and section 4(2)(i) of the Act of 1954. His contention is that when there is a clear distinction between chargeability and quantification of tax, the provisions for exemption or deduction should not be considered along with the charging provisions so as to come to the conclusion that the purchase tax is really a tax on despatches or consignments of finished products, falling within entry 92B of List I in the Seventh Schedule to the Constitution. Mr. D. Majumdar has drawn our attention to the observations of Hegde, J., referred to in the judgment of this Tribunal in the case of Rasoi Limited [1991] 80 STC 356 and has contended that these observations in the case of J.K. Steel Limited v. Union of India AIR 1970 SC 1173 were not from the majority judgment delivered in that case of J.K. Steel Limited AIR 1970 SC 1173. The observations in the case of J.K. Steel Limited AIR 1970 SC 1173, were that in the case of fiscal statutes, it might not be inappropriate to take into consideration the exemptions granted in interpreting the nature and the scope of the impost. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thorities contended that the appellant was not entitled to take into computation at all his sales of oil outside the State and was not entitled to deduct from his gross turnover the purchase price of copra allocated to the oil sold to the persons outside the State. This contention of the sales tax authorities was upheld by the Supreme Court in view of the non-obstante provision in section 26 of the Travancore-Cochin General Sales Tax Act, 1952, to the effect, "notwithstanding anything contained in this Act, a tax on the sale or purchase of goods shall not be imposed under this Act where such sale or purchase takes place in the course of inter-State trade or commerce." It is against this background that the Supreme Court laid down the difference between exemption of tax and non-liability to tax. 20.. In the case of Devi Dass Gopal Krishnan v. State of Punjab [1967] 20 STC 430 (SC); AIR 1967 SC 1895, one of the controversies was whether the non-quantification of liability would destroy the liability under the charging section. The charging section was section 4 of the Punjab General Sales Tax Act, 1948. Section 5 of that Act, as it originally stood, conferred an uncontrolled power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... become liable to pay tax under sub-section (1) or sub-section (2) or subsection (4) of this section or sub-section (3) of section 8". Section 4(2) of the Act of 1954 opens with the expression "A dealer liable to pay tax under subsection (1)". The liability to pay purchase tax has thus been fastened on every dealer, who has become liable to pay tax and not who has paid tax or has not paid tax. A dealer cannot deposit such purchase tax, unless it is calculated on the transfer of goods outside West Bengal in relation to total sales and total purchase on issue of declaration forms. The provisions for exemptions and deductions are to be looked into for making the calculation regarding the transfer of goods to places outside West Bengal in relation to total sales and total purchase on issue of declaration forms. The provisions for exemption/deduction are thus to be considered along with the charging sections for finding out the pith and substance behind the chargeability of the so-called purchase tax. In other words, when the legislative competence of a State to impose a tax under any of the entries in List II of the Seventh Schedule to the Constitution is to be determined, the exemption ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at case was legislative competence of the State to make the levy in respect of tea estates in this manner. The Supreme Court disposed of this question by making the following observation in paragraph 14 of the judgment delivered in that case: "If the impugned legislation were to be regarded as a levy in respect of tea estates, it would be referable to entry 49 in List II of the Seventh Schedule to the Constitution which speaks of 'taxes on lands and buildings'. But if the legislation is in substance legislation in respect of despatches of tea, legislative authority must be found for it with reference to some other entry. We have not been shown any entry in List II or in List III of the Seventh Schedule which would be pertinent. It may be noted that the Parliament had made a declaration in section 2 of the Tea Act, 1953, that it was expedient in the public interest that the Union should take under its control the tea industry. Under the Tea Act, Parliament has assumed control of the tea industry including the tea trade and control of tea prices. Under section 25 of the Act, a cess on tea produced in India has also been imposed. It appears to us that the impugned legislation is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imed that he was not liable to pay the purchase tax on the raw materials imposed under section 9(1) of the Haryana Act. This claim had been rejected by the taxing authorities and the High Court. Thereafter, the Supreme Court was moved. The decision of the Supreme Court in the case of Goodyear India Ltd. [1990] 76 STC 71 was that the tax imposed under section 9(1)(b) of that Haryana Act, as amended by the Haryana General Sales Tax (Amendment and Validation) Act, 1983, was a tax on despatch outside the State and outside the legislative competence of the State in view of entry 92B in List I of the Seventh Schedule to the Constitution. This decision of the Supreme Court in the case of Goodyear India Ltd. [1990] 76 STC 71 was distinguished in the case of Murli Manohar Co. [1991] 80 STC 79 (SC) on the ground that what was declared unconstitutional in the Goodyear case [1990] 76 STC 71 (SC) was only the levy of a tax where raw materials were purchased and used inside the State for the manufacture of finished goods which were simply, and without any sale, despatched or rather consigned outside the State. Distinguishing the Goodyear case [1990] 76 STC 71 (SC) in this manner it was held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions relating to purchase tax in West Bengal cannot be held to be valid. There is no provision in section 4(6)(ii) read with section 5(7)(iiia) of the Act of 1941 or section 4(2)(i) read with section 4(4)(iia) of the Act of 1954 that there could be a tax on purchase of raw materials if the goods manufactured therefrom are disposed of in the State of West Bengal itself otherwise than by way of sale. It is to be stated in this connection that after this decision in the case of Murli Manohar Co. [1991] 80 STC 79 (SC), on October 25, 1990, there is another decision of the Supreme Court in the case of Mukerian Papers Limited v. State of Punjab [1991] 81 STC 152 (SC) on February 13, 1991, similar to the earlier decision of the Supreme Court in the Goodyear case [1990] 76 STC 71. The case of Mukerian Papers Limited [1991] 81 STC 152 (SC) related to imposition of purchase tax on raw materials when goods manufactured therefrom were sent outside the State of Punjab otherwise than by way of sale in the course of inter-State trade or export outside India. On a consideration of the provisions in section 4B(ii), section 10(6) and section 11(D) of the Punjab General Sales Tax Act, 1948, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ative, is that section 4(6)(ii) of the Act of 1941 and section 4(2)(i) of the Act of 1954, as amended by the West Bengal Act 6 of 1990, are to be held valid, when disposal of the purchased goods, whether by way of inter-State sales or sales in the course of export out of the territory of India, is no longer in these charging sections, as amended in 1990. It is contended that these sections, as amended in 1990, make a dealer purchasing goods against declarations under section 5(1)(bb) of the Act of 1941 or the proviso to section 23A of the Act of 1954, liable to pay purchase tax, even when the goods purchased by them against such declarations are stored for subsequent use or destroyed by fire or natural calamity. As for this contention, it is to be stated that if the unamended section 4(6)(ii) of the Act of 1941 and section 4(2)(i) of the Act of 1954 are scrutinised, it can be seen that there are two conditions which must be fulfilled before the event of sale inside the State of West Bengal or despatch outside the State takes place. These conditions are (a) purchase of goods in the State of West Bengal and (b) user of these purchased goods for the manufacture of any other goods in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 20A(1) in the Rules of 1941 and Rules of 1954, respectively, were amended retrospectively from October 10, 1977 by introducing a new P x S formula -----, where "P" denoted purchase through declaration forms, "S" M denoted sale effected in West Bengal and "M" denoted total manufacture of goods by the dealer. The value of the manufactured goods was to be taken as the saleable value under this newly introduced formula. The contention of Mr. S. Sen, the learned advocate for the applicants, is that the applicants have deposited purchase tax under the relevant sections and rules existing previously for imposition of purchase tax which do not now exist and that new set of rules and sections have been introduced in place of the old ones with retrospective effect, with separate formula for determination of purchase tax and that, on the basis of this separate formula, having retrospective effect from October 10, 1977, the amount of purchase tax has to be assessed anew by the assessing authority separately by reopening the assessment cases as the old laws do not exist retrospectively from October 10, 1977 on the basis of the amendment in 1990. It is contended that if fresh assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n manufactures against declaration, reaping the benefit of concessional rate of tax in fear of liability of payment of heavy amount of penalty if they intended to transfer the finished goods outside West Bengal otherwise than by way of inter-State sale or export sale. The contention is that when after coming into force of this permissive legislation in section 5A(4) of the Act of 1941 and section 4AAAA(4) of the Act of 1954 on October 10, 1977, the benefit of concessional rate of sales tax referred to in section 5(1)(bb) of the Act of 1941 or section 23A of the Act of 1954 had been extended to the registered dealers, the purchase taxes paid by such registered dealers for these long 13 years from 1977, without any protest whatsoever before the decision of the Supreme Court in the Goodyear case [1990] 76 STC 71 should not be refunded to them. 30.. To dispose of these rival contentions, it is necessary to discuss the law relating to refund, as evolved by the Supreme Court in several decisions. The provisions for refund are on the basis of section 72 of the Indian Contract Act, 1872, under which a person to whom money has been paid, or anything delivered, by mistake or under coercion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Contract Act, it was also stated in that case that the special remedy provided in article 226 of the Constitution was not intended to supersede completely the modes of obtaining relief by an action in civil court or to deny defences legitimately open in such actions. It was decided in that case on November 20, 1964, that where a person came to court for relief under article 226 of the Constitution on the allegation that he had been assessed to tax under a void legislation and the court found that the assessment was void, the court was not still bound to exercise its discretion, directing repayment. It was decided in that case that the discretion directing the payment would have to be exercised on considering the facts and circumstances in each case. It was further held in that case that if unreasonable delay or triable issue as regards availability of such relief on merits on ground like limitation was there, the court should ordinarily refuse to issue the writ of mandamus for such payment. This decision of the Supreme Court in the case of State of Madhya Pradesh v. Bhailal Bhai [1964] 15 STC 450; AIR 1964 SC 1006 as well as the previous decision in the case of Sales Tax Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection. The appellant in that case questioned the levy of cess under section 115 of the Madras Act on royalty. The question involved in that case was whether levy or impost of cess on royalty under section 115 of the Madras Act could be justified or sustained under entry 49, 50 or 45 of List II of the Seventh Schedule to the Constitution and was within the legislative competence of the State Legislature. It was held in that case by majority that royalty was a tax and, as such, a cess on royalty, being a tax on royalty, was beyond the competence of the State Legislature, as section 9 of the Mines and Minerals (Regulation and Development) Act, 1957, covered the field and the State Legislature was denuded of its competence under entry 23 of List II of the Seventh Schedule to the Constitution. The decision in the case of H.R.S. Murthy AIR 1965 SC 177, was overruled. The question of refund of the cess already collected on the basis of the Madras Act was thereafter considered by the Supreme Court and the Supreme Court then evolved the doctrine of prospective overruling of statute so that there would not be any refund of cess already paid and collected. This doctrine of prospective overru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctively only. Mr. S. Sen, the learned advocate for the applicants, has contended that in the India Cement case AIR 1990 SC 85; [1990] 1 SCC 12, cess had been realised for the organisation of village and town panchayats and comprehensive programme of measures had been framed under the National Extension Service Scheme. The contention is that the directive principles of State policy embodied in the Constitution enjoined that the State should undertake steps to organise village panchayats and endow them with the power and authority as might be necessary to enable them to function as units of self-Government and as the amounts had been realised on that basis, the Supreme Court declared the cess on royalty in the case of India Cement Limited AIR 1990 SC 85; [1990] 1 SCC 12 to be ultra vires prospectively. Mr. S. Sen, the learned advocate for the applicants, contends that in these cases relating to purchase tax, there is no previous decision of the Supreme Court holding that the levy and collection of purchase tax are within the legislative competence of the State. There is no question of violation of any directive principles of State policy if the purchase tax levied and collected by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction of such goods resulting in heavy loss to the Government. As such, there can be no question of inclusion of purchase tax in the cost of production and collection of purchase tax from the customers in the case of such Government-owned public companies. It is contended by Mr. Sen that if direction for refund is granted from the date of payment of purchase taxes levied and collected on and from October 10, 1977, there will be no unjust enrichment of the assessee/dealers. This contention cannot be accepted. As already stated, the passing on of the purchase tax to the consumers according to usual trade practice, as alleged in the affidavit-in-opposition, has not been challenged by the applicants in their affidavits-in-reply. It has been decided by the Supreme Court in the case of State of Uttar Pradesh v. Synthetics and Chemicals Limited [1991] 3 JT 268 (SC) that taxes on sale or purchase are not governed by the Price Control Orders issued by the Central Government under section 18G of the Industries (Development and Regulation) Act, 1951. In the case of Synthetics Chemicals Limited [1991] 3 JT 268 (SC) the provision in the Uttar Pradesh Sales of Motor Spirit, Diesel Oil and Alco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... axes without any protest till the decision of this Tribunal on September 11, 1990, in the case of Rasoi Limited [1991] 80 STC 356 and when there would be unjust enrichment of the assessee-dealers, passing on the purchase taxes to the consumers. There should, therefore, be no order for refund of purchase taxes paid or payable for the period from October 10, 1977 to September 10, 1990, namely, the date preceding the date of judgment in Rasoi Limited [1990] 80 STC 356. I am, accordingly, of the opinion that the purchase taxes, if paid, for the period from the date of declaration of invalidity of the provisions of section 4(6)(ii) of the Act of 1941 and section 4(2)(i) of the Act of 1954 by this Tribunal in the case of Rasoi Limited [1991] 80 STC 356, namely, on and from September 11, 1990 should be refunded, because the State and the assessee-applicants became fully aware with effect from September 11, 1990 that the enactments imposing the tax were invalid and unconstitutional. So, the doctrine of unjust enrichment should not shield the State from refunding the unauthorised tax with effect from September 11, 1990. Mr. D. Majumdar, the learned State Representative, referred to the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x months from the date of the order of this Tribunal. I am, accordingly, of the opinion that there will be a direction for refund of purchase taxes levied, collected or paid for the period from September 11, 1990, within six months from the date of this judgment. 36.. The applications in all these eleven cases are, accordingly, allowed in part. It is declared that purchase tax is not payable by the applicants in these eleven cases under section 4(6)(ii) of the Bengal Finance (Sales Tax) Act, 1941 or section 4(2)(i) of the West Bengal Sales Tax Act, 1954. The respondents are directed to refund to the applicants in these eleven cases the purchase taxes collected, paid or payable for the period from September 11, 1990, along with interest, if any, realised for nonpayment of purchase taxes payable for the period from September 11, 1990, within six months from this date, after verifying the correctness of the particulars of the refundable amounts. Respondents are directed not to collect or realise purchase tax from the applicants any more. The issuance of declaration forms to the applicants in case Nos. RN-4 of 1991 (Gramophone Company of India Ltd.), RN-5 of 1991 (Jay Engineering W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of federal character, having defined territories for each Legislature, there is a tendency to out-reach the boundaries and occupy the forbidden area. This is not always done directly; sometimes this is achieved by enacting various provisions scattered over various parts of a legislation. The real meaning and the true effect and intent have to be necessarily gathered from a composite consideration of all the relevant parts of the statute by removing the apparent veil of innocence. In the instant case, unless the exemption provisions enacted by the 1990 amendment are taken into consideration, the real impact and the true effect of the impugned legislation for imposition of the "purchase tax" cannot be realised. The decision in Buxa Dooar's case [1989] 74 STC 447 (SC); AIR 1989 SC 2015, is an authority as well as an illustration on this point. The decisions in [1957] 8 STC 561 (SC) (A.V. Fernandez v. State of Kerala), [1967] 20 STC 430 (SC); AIR 1967 SC 1895 (Devi Dass Gopal Krishnan v. State of Punjab) and [1971] 28 STC 599 (SC) (Sri Venkateswara Rice, Ginning and Groundnut Oil Mill Contractors Co. v. State of Andhra Pradesh) had not been relied on by respondents at the time of h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t these two aspects of section 9(1)(b) survive even after the judgment of the Supreme Court in Goodyear's case [1990] 76 STC 71 (SC). As far as the judgment of this Tribunal in Rasoi Limited [1991] 80 STC 356 is concerned, the provisions of the impugned West Bengal Acts, as amended in 1990, were scanned and analysed by taking into account the exemptions provided for. It was ascertained thereafter that the true effect was that the "purchase tax" could be imposed only when the goods manufactured in West Bengal were despatched or consigned outside the State otherwise than by way of sale in West Bengal (the word "sale" connoting all kinds of sales occurring within West Bengal). That being the position, the provisions relating to the "purchase tax" and exemptions therefrom in the 1941 and 1954 Acts of West Bengal, as amended in 1990, had to be struck down. 42.. The decision in Goodyear's case [1990] 76 STC 71 (SC) has also been followed in the case of Mukerian Papers Ltd. v. State of Punjab [1991] 81 STC 152 (SC). A similar provision for "purchase tax" in section 3-AAAA of the U.P. Sales Tax Act, 1948, as amended in 1979, was also declared invalid by a Division Bench of Allahabad High ..... X X X X Extracts X X X X X X X X Extracts X X X X
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