TMI Blog1998 (3) TMI 634X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of Indian Express (P) Ltd. v. State of Tamil Nadu [1987] 67 STC 474 to the effect that old newspapers cannot be treated as newspapers to enjoy the immunity from tax, we have the later decision of the Supreme Court in Sait Rikhaji Furtarnal v. State of Andhra Pradesh [1992] 85 STC 1, which merely followed the purported reasoning adopted in All India Reporter Karamchari Sangh v. All India Reporter Limited [1988] 70 STC 349 (SC) though it determined an altogether different point concerning a labour welfare legislation. Faced with these divergent decisions, the Division Bench consisting of M.N. Rao, J., (as he then was) and Rangarajan, J. felt that it is a fit case to be decided by a larger Bench. That is how this appeal is before us. 2.. Before we take up the point for consideration, we would like to state a few relevant facts. This appeal under section 23 of the A.P.G.S.T. Act arises out of the order of the Commissioner of Commercial Taxes passed in exercise of his revisional power under section 20(1) of the Act. For the assessment year 1989-90, the petitioner which is a newspaper publisher and a registered dealer under the Act was subjected to tax on a turnover of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eir sale cannot be regarded as the sale of newspapers. They are not sold for the purpose of reading the news printed in them. It will be noted that the surplus copies are sold by weight and not per copy. What is exempt from sales tax is the turnover of newspapers and not the turnover of old newspapers or waste paper. 5.. If the above decision of the Supreme Court stood alone, there would have been no case for the appellant to claim tax immunity. But, a few years later, another two-Judge Bench of the Supreme Court [Sait Rikhaji Furtarnal v. State of Andhra Pradesh [1992] 85 STC 1 (SC)], without noticing the Indian Express case [1987] 67 STC 474, drew the conclusion that old newspapers are also newspapers and are therefore exempt from tax. This conclusion was solely based on the principle said to have been laid down in AIR Ltd. case [1988] 70 STC 349 (SC). At this stage, it may be noted that there was no express reference to the said decision. But, as the editor of STC has rightly mentioned in the footnote (at page 3 of Volume 85 STC), the obvious reference made by their Lordships was to the case of AIR Ltd. [1988] 70 STC 349 (SC). This is what Ranganath Misra, J. (as he then wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the employees of the newspaper establishments and hence even if it is possible to have two opinions on the construction of the provisions of the Act the one which advances the object of the Act and is in favour of the employees for whose benefit the Act is passed has to be accepted. 8.. It may be seen that the ratio of the above decision is that the Law Reports in so far as they disseminate information regarding recent cases decided by the Supreme Court and the High Courts and other information concerning legislation, latest book reviews, excerpts, speeches made at seminars, etc., legitimately fit into the description of newspapers as they contain news in which the public are interested. At the same time, the following significant observations were made by their Lordships [All India Reporter Karamchari Sangh v. All India Reporter Limited [1988] 70 STC 349 (SC)]: We find it also difficult to agree with the submission made on behalf of the 1st respondent that since the law reports are going to be preserved by the lawyers as reference books after getting them rebound subsequently they should be treated as books. It may be that the decisions contained in these law reports m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o regard the printing and publishing establishment as newspaper establishment for the purposes of the said Act. It is immaterial that in due course of time, the journals lose their characteristics as newspapers. The actual point that arose for consideration and the ratio decidendi is thus vastly different. As far as sales tax is concerned, the taxable event is sale. It is on that date, we have to see whether the old paper still retains the character of newspaper. The answer can only be in negative as per the law enunciated by the Supreme Court in Indian Express case [1987] 67 STC 474, arising under Tamil Nadu General Sales Tax Act. The ruling in AIR case [1988] 70 STC 349 (SC) does not go counter to this view; on the other hand, it reinforces the view-point that the law journals as they become old, cease to be newspapers. Here italicised. 10.. In this state of things, should we follow the decision in Sait Rikhaji case [1992] 85 STC 1 (SC) merely because it is a later decision? The learned counsel for the appellant Mr. Sarveswara Rao, cited the Full Bench decisions reported in AIR 1980 Kar 92 (FB) (Govindanaik G. Kalaghatigi v. West Patent Press Co. Ltd.), AIR 1980 Bom 341 (Va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ......The question is which of these two decisions I should follow, and it seems to me that I ought to follow that of the Master of the Rolls as being the better in point of law . Jessel M.R. in a like circumstance said in Baker v. White (1877) 5 Ch D 183 at page 190, that he was left with liberty to say which was not sound law. It seems to us, therefore, the High Court would be well advised to consider which of two conflicting decisions it will follow in the interest of the administration of justice and it ought to follow that which is better in point of law than in point of time. 12.. We may also notice a Full Bench decision of the Punjab and Haryana High Court in Indo Swiss Time Limited v. Umrao AIR 1981 P H 213, in which the majority Judges took the view similar to the one expressed by Jagannatha Shetty, J. It was observed: When judgments of the Superior Court are of co-equal Benches and therefore of matching authority, then their weight inevitably must be considered by the rationale and the logic thereof and not by the mere fortuitous circumstances of the time and date on which they were rendered........ On principle it appears to me that the High Court must follow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ignoratium. English Courts have developed this principle in relaxation of the rule of stare decisis. The quotable in law is avoided and ignored if it is rendered, in ignoratium of a statute or other binding authority . (Young v. Bristol Aeroplane Co. Ltd. [1944] 1 KB 718). Same has been accepted, approved and adopted by this Court while interpreting article 141 of the Constitution which embodies the doctrine of precedents as a matter of law. In Jaisri Sahu v. Rajdewan Dubey [1962] 2 SCR 558; AIR 1962 SC 83 this Court, while pointing out the procedure to be followed when conflicting decisions are placed before a Bench, extracted a passage from Halsbury s Laws of England incorporating one of the exceptions when the decision of an appellate court is not binding. 16.. In Punjab Land Development and Reclamation Corporation Ltd. v. Presiding Officer, Labour Court, Chandigarh (1990) 3 SCC 682 Saikia, J., speaking for the Constitution Bench explained the principle on similar lines as Halsbury stated. The learned Judge observed: In England a decision is said to be given per incuriam when the court has acted in ignorance of a previous decision of its own or of a court of co-ordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the High Court to disregard a decision of the Court of Appeal. Before quoting this passage, Chinnappa Reddy, J., remarked: The better wisdom of the Court below must yield to the higher wisdom of the court above. That is the strength of the hierarchical judicial system. Relying on these observations, the learned counsel for the appellant virtually tells us that the High Court should unreservedly accept the conclusion reached in Sait Rikhaji case [1992] 85 STC 1 (SC) without questioning the soundness of the reasoning or conclusion, irrespective of the fact whether it is a decision rendered per incuriam or not. 19.. We have given our anxious consideration to this part of the submission made by the learned counsel. While we have no second thoughts on the principle that the High Court should abide by the decision of the apex Court in a spirit of loyalty, we are unable to follow Sait Rikhaji case [1992] 85 STC 1 (SC) (though a later decision it is), which did not notice the decision of a co-ordinate Bench of the Supreme Court in Indian Express case [1987] 67 STC 474. For the time being, we shall leave apart from consideration the question whether later decision is boun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le that in a case of conflict arising from the decisions of co-equal Benches of the Supreme Court, the High Court is free to disregard the decision which is based on an obvious mistake of fact or the one which purports to follow the ratio of an earlier decision though such ratio is found to be non-existent. The High Court can legitimately decline to follow such decision and follow the earlier decision which is backed by reasoning-whether it is acceptable to the High Court or not, and which is free from any such apparent flaw. We are unable to persuade ourselves to subscribe to the view that the later decision should be automatically followed despite the fact that it rests on a conclusion based on an erroneous impression that an earlier decision took a particular view which in fact it has not taken. By doing so, we are neither questioning the hierarchical superiority of the Supreme Court nor the higher wisdom of the honourable Judges of the Supreme Court. We are preferring one decision to the other-both rendered by Division Benches, for obvious reasons so as to avoid an incongruity leading to travesty of justice. 22.. In this context, we would like to derive support from the dicta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 92] 85 STC 1 (SC) was founded on a mistaken impression that in AIR Ltd. case [1988] 70 STC 349, the Supreme Court took the view that law reports are newspapers though they do not report contemporary news. 29.. Applying, therefore, the decision in Indian Express case [1987] 67 STC 474 (SC), the first point urged by the appellant cannot be upheld. Though we do not accept the reasoning given by the Commissioner in distinguishing Sait Rikhaji case [1992] 85 STC 1 (SC), nevertheless, we hold that the Commissioner is justified in subjecting the turnover representing sales of old newspapers to tax by revising the appellate order in this regard. 30.. Viewed from a broader constitutional perspective too, it is difficult to reach the conclusion that the Constitution intended to extend the immunity from State taxation to old and obsolete newspapers which are not meant for reading or of no value to the readers. The idea behind excluding the State s power to levy sales tax on newspapers while reserving the exclusive power to the Parliament in that behalf is to spare the most effective and cheapest media of communication from undue tax burden and to preserve the freedom of press. We do not t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oper explanation, it would have been a different matter. But, in the absence of any explanation whatsoever, we must presume that the order was not made on the date it purports to have been made. It could have been made after the expiry of the prescribed four years period. The civil appeal is accordingly dismissed. Applying the principle laid down in the above case, we must hold that the revision was done beyond the period of limitation prescribed by section 20(1) of the Act. The Division Bench decision in Oriental Enterprises v. Commissioner of Commercial Taxes [1997] 25 APSTJ 109 (AP) cited by the learned Government Pleader does not come to his aid for the reason that the learned Judges accepted the explanation for the delay in service, as given in the counter-affidavit. 32.. Before we close the case, there is one more point which we have to touch, though in view of our finding on the second point, it is strictly unnecessary to deal with it. It is seen from the Commissioner s order that he cancelled the relief granted by the appellate authority, even with regard to the turnover of waste paper and materials which may or may not be newspaper waste. The Commissioner observed th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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