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TMI Blog2006 (8) TMI 537X X X X Extracts X X X X X X X X Extracts X X X X ..... ial. Section 5(3) of the KGST Act provides for a reduced rate of tax at three per cent payable by the dealer in respect of sale of raw materials when sold to any industrial unit for use in the production of finished products in the State for sale. According to sub-section (3) of section 5, reduced rate of tax given to the selling dealer is subject to the condition of furnishing a declaration duly filled in and signed by the purchasing dealer in the prescribed form 18 under the KGST Act. In accordance with the said subsection (3) the petitioner furnished form 18 to the selling dealer for the purchase of printing ink used in the production of newspapers and other publications. The petitioner-company purchased printing ink for Rs. 91,64,100 from M/s. Quality Ink Manufacturing Company, Poovanthuruthu, issuing form 18 under section 5(3) of the KGST Act for the year 2000-01. The petitioner-company has also purchased printing ink for Rs. 1,00,03,050 from the very same company by issuing form 18 for the year 2001-02. During the year 2002-03 the petitioner-company purchased printing ink for Rs. 84,69,603 from the same company by issuing form 18. During the year 2003-04 also the petitioner-c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng process is involved in printing of newspaper the petitioner has misused form 18 which is an offence attracting penalty under section 45A of the KGST Act. Learned single judge did not entertain the writ petition and dismissed the same holding that the petitioner has got an effective alternate remedy by way of revision under the KGST Act. The judgment is Malayala Manorama Company Ltd. v. Assistant Commissioner (KGST), Commercial Taxes reported in [2007] 8 VST 587 (Ker); [2006] 2 KLJ 443. Senior Counsel appearing for the appellant Sri Pathrose Matthai submitted that learned single judge has committed an error in dismissing the writ petition on the sole ground that the petitioner has got an alternative remedy by way of revision. Counsel submitted that the first respondent has initiated proceedings based on provisions which are repealed, non-existent and inapplicable and acted without jurisdiction. Counsel placed strong reliance on the decisions of the apex court in Printers (Mysore) Ltd. v. Assistant Commercial Tax Officer [1994] 93 STC 95, Whirlpool Corporation v. Registrar of Trade Marks [1998] 8 SCC 1, State of H.P. v. Gujarat Ambuja Cements Ltd. [2005] 142 STC 1, Agricultural ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the petitioner has got a remedy by way of a revision under the KGST Act. The apex court in A. S. Bava's case AIR 1968 SC 13 has held that it is settled that existence of remedy by way of revision does not bar the jurisdiction of the High Court under article 226 of the Constitution of India. The apex court in Whirlpool Corporation's case [1998] 8 SCC 1 and Gujarat Ambuja Cements' case [2005] 142 STC 1 has declared the law that even in cases where any statutory remedy is available, if the impugned order is without jurisdiction and without the authority of law or in violation of article 265 or in violation of the principles of natural justice, petition under article 226 of the Constitution is maintainable. The apex court in Harbanslal Sahnia v. Indian Oil Corporation Ltd. [2003] 2 SCC 107 held that the rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion and the court may still exercise its writ jurisdiction in at least three contingencies: (i) where the writ petition seeks enforcement of any of the fundamental rights; (ii) where there is failure of principles of natural justice; or (iii) wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find out as to how the item "newspaper" was dealt with by the sales tax laws prior to and after the coming into force of the Constitution of India. In the preConstitution period under the Government of India Act, 1935 there was a provision in entry 48 of List II of the Seventh Schedule which enabled the levy of sales tax on newspapers and advertisements. The United State of Travancore and Cochin General Sales Tax Act, 1125 (Act 11 of 1125) was enacted to provide for the levy of a general tax on the sale of goods in the United State of Travancore and Cochin. The word "goods" defined in section 2(e) of the KGST Act means all kinds of movable property and includes all materials, commodities and articles including those to be used in the construction, fitting out, improvement or repair of immovable property; or in the fitting out, improvement or repair of movable property and also includes all growing crops, grass and things attached to or forming part of the land which are agreed to be severed before sale or under a contract of sale, but does not include actionable claims, stocks and shares and securities. Thus "newspaper" was never excluded and dealt wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or purchase of goods other than newspapers, where such sale or purchase takes place in the course of inter-State trade or commerce." It is to be noted that though the sixth amendment to the Constitution came into force on September 11, 1956 the Central Sales Tax Act was enacted on December 21, 1956. Yet in the definition of "goods" in section 2(d) of the CST Act, 1956 "newspaper" was not excluded. This position continued till the CST (Second Amendment) Act 1958 was passed which came into force on October 1, 1958. The word "newspaper" was excluded from the definition of "goods" under section 2(d) only in the second amendment to the CST Act. We may in this connection refer to the definition of "goods" in the CST Act which reads as follows: "'goods' includes all materials, articles, commodities and all other kinds of movable property, but does not include (newspapers), actionable claims, stocks, shares and securities." The above facts would indicate that in the definition of "goods" though originally "newspaper" was included the same was not included by the CST (Amendment) Act 31 of 1958. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding spare parts, type metal, machine tools, stitching wire, coal and coke for casting purposes, etc. A Division Bench of this court held as follows: "The object of section 8(1) read with section 8(3)(b) of the Act is for providing a dealer a lower rate of tax under section 8(1)(b) for sales of goods described in section 8(3)(b) for being used by him in the manufacture or processing of goods which are intended for sale so that the goods which are ultimately sold should not become unduly expensive to the consumer by addition of a high rate of sales tax on the purchase of goods which are used in the manufacture or processing of the goods ultimately sold. Therefore in order to achieve the purpose of reaching the newspapers to the common man at a reasonable rate it is not only sufficient not to levy sales tax on newspaper but it is also essential that the dealer should be allowed concession provided under section 8(1) read with section 8(3)(b) for purchase of goods for use in the manufacture or processing of newsprint." Giving a strict meaning to the word "goods" occurring in section 8 the court took the view that petitioner is entitled to obtain certificate under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rinciple laid down by the apex court in Printers (Mysore) Ltd.'s case [1994] 93 STC 95 and decide whether the principle laid down therein would apply in understanding the scope of the above-mentioned provision in the settings under the State Sales Tax Act where it has been placed. We have already indicated in the pre-Constitution period and under the Government of India Act, 1935 that there was a provision in entry 48 of List II which enabled the States to levy sales tax on newspapers and advertisements. Act 11 of 1125 which was the general law applicable on the sale of goods in the United States of Travancore and Cochin enabled the State Government to levy tax on sale of goods in the State of Travancore as well as Cochin and provided for levy of general tax on sale of goods coming under the definition of "goods" in section 2(e) therein as meaning all kinds of movable property other than actionable claims, stocks and shares and securities and including all materials, commodities and articles. Thus "newspaper" was dealt with as goods and taxed as such under Act 11 of 1125. The Constitution of India made certain specific provision regarding newspapers. Under i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by Parliament by law. Parliament enacted the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 which came into force on April 1, 1957. Therefore once the provision to the contrary is made, effect of the saving clause under article 277 ceases to exist and the State Government cannot continue to levy any duty. Section 21 of the Act, repealed the State law, consequently the Excise Acts of the States under which duty was being levied on medicinal and toilet preparations containing alcohol were deemed to have been repealed. On coming into force of the Central Act, the power vested in the State Government ceased to exist. Reference in this connection may be made to the decision of the apex court in Adhyaksha Mathur Babu's Sakti Oushadhalaya Dacca (P) Ltd.'s case AIR 1963 SC 622. Identical is the situation with regard to the sales tax law, with which we are concerned in this case. The KGST Act was enacted to consolidate and amend the law relating to the levy of a general tax on the sale or purchase of goods in the State of Kerala. Section 2 deals with definition clauses. The word "goods" is defined in section 2(xii) which reads as follows: "'goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate has no power to impose sales tax on newspaper which has been specifically excluded. The Kerala General Sales Tax Act therefore cannot take in newspaper, that is the reason why newspaper has been specifically excluded in the definition clause of section 2(xii). As rightly pointed out by the Madras High Court in Indian Express (Madurai) Ltd.'s case [1972] 29 STC 88, it was unnecessary even to exclude the newspapers from the definition of "goods" from the Madras General Sales Tax Act, 1959; so also evidently under the KGST Act as well. The exclusion of newspaper in the definition clause was unnecessary. Even otherwise the State could not have legislated through the KGST Act to tax "newspapers" since under entry 54, List II of the Seventh Schedule State has no power to impose levy on newspaper. Since the definition clause specifically excludes newspaper from the expression "goods", sub-section (3) of section 5, would not take in newspaper, consequently no form 18 declaration could be issued for concessional rate of tax to the selling dealer. Resultantly the question as to whether the printing ink is an industrial raw material or not therefore cal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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