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Jameel and Co. Vs. Deputy Commissioner of Commercial Taxes and ors. - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtAndhra Pradesh High Court
Decided On
Case NumberWrit Petition No. 3083 of 1969
Judge
Reported in[1974]33STC207(AP)
AppellantJameel and Co.
RespondentDeputy Commissioner of Commercial Taxes and ors.
Appellant AdvocateDasaratharama Reddy, Adv.
Respondent AdvocateFifth Government Pleader
DispositionPetition dismissed
Excerpt:
- - 1. this case has come to us on a reference made by a bench on 17th june, 1971. 2. the facts in outline are that the petitioner-firm was doing groundnut business in 1962-63. the firm was purchasing groundnuts and after decorticating the same into kernel was selling the kernel to the dealers inside as well as outside the state. 10. before we consider the main question, it is perhaps necessary to remember that section 14(vi) of the central sales tax act, 1956, declares oil-seeds, that is to say, seeds yielding non-volatile oils used for human consumption, or in industries, or in the manufacture of varnishes, soaps and the like, in lubrication, and volatile oils used chiefly in medicines, perfumes, cosmetics and the like as goods of special importance in inter-state trade or commerce......gopal rao ekbote, c.j.1. this case has come to us on a reference made by a bench on 17th june, 1971.2. the facts in outline are that the petitioner-firm was doing groundnut business in 1962-63. the firm was purchasing groundnuts and after decorticating the same into kernel was selling the kernel to the dealers inside as well as outside the state. for the assessment year 1962-63, the commercial tax officer, cuddapah, determined the petitioner's net assessable turnover at rs. 8,20,683.90 after allowing the exemption of turnover of rs. 4,35,214.32 on the ground that the goods have suffered tax at the hands of subsequent dealers.3. the petitioner was still dissatisfied with the assessment order. he preferred an appeal to the assistant commissioner, nellore, disputing the turnover of rs......
Judgment:

Gopal Rao Ekbote, C.J.

1. This case has come to us on a reference made by a Bench on 17th June, 1971.

2. The facts in outline are that the petitioner-firm was doing groundnut business in 1962-63. The firm was purchasing groundnuts and after decorticating the same into kernel was selling the kernel to the dealers inside as well as outside the State. For the assessment year 1962-63, the Commercial Tax Officer, Cuddapah, determined the petitioner's net assessable turnover at Rs. 8,20,683.90 after allowing the exemption of turnover of Rs. 4,35,214.32 on the ground that the goods have suffered tax at the hands of subsequent dealers.

3. The petitioner was still dissatisfied with the assessment order. He preferred an appeal to the Assistant Commissioner, Nellore, disputing the turnover of Rs. 3,70,714.65 which was subjected to tax. The disputed turnover comprised, inter alia, one of Rs. 97,200.51 and the other comprised of the rest of the turnover which was subjected to tax.

4. The Assistant Commissioner allowed the appeal relating to the turnover of Rs. 97,200.51. He, however, disallowed the appeal in respect of the other item. He reduced the tax thus by Rs. 1,944.

5. The petitioner preferred further appeal to the Sales Tax Appellate Tribunal disputing the turnover of Rs. 2,73,514.14. The said appeal is still pending.

6. While the matter stood thus, the Deputy Commissioner of Commercial Taxes, Nellore, issued notice under Section 20 of the Andhra Pradesh General Sales Tax Act on 8th March, 1968. The proposal was to revise the order of the Assistant Commissioner relating to the item of the turnover of Rs. 97,200.51. It was also proposed to revise the order of the Commercial Tax Officer relating to the exemption of turnover of Rs. 4,35,214.32.

7. After the explanation was filed by the petitioner, the Deputy Commissioner rejected his contentions and by his order dated 14th November, 1968, set aside the order of the Assistant Commissioner by which the Assistant Commissioner had allowed the exemption of turnover of Rs. 97,200.51. The Deputy Commissioner also revised the order of the Commercial Tax Officer by disallowing the exemption granted on the turnover of Rs. 4,35,214.32. The order was served on the petitioner on 28th November, 1968. He did not prefer any appeal against the said order of the Deputy Commissioner. Instead he filed the writ petition in this court on 14th August, 1969, for the issue of a writ of certiorari to quash the order of the Deputy Commissioner dated 14th November, 1968.

8. In regard to the larger item of Rs. 4,35,214, the only contention was that as the petitioner is a decorticator, who merely separates the kernel from the shell and sells the kernel to dealers within and without the State, he does not come within the meaning of the term 'miller' used in column 2 of item 3-C in Schedule IV of the Andhra Pradesh General Sales Tax Act, 1957.

9. It is common ground that it is item 3-C as it stood at the time of the transactions in question that is applicable to the facts of the present case. The said provision, as it then stood, was in the following terms:

When purchased by a miller in the State, at the point of purchase by the miller and in all other cases at the point of purchase by the last dealer who buys it in the State.

10. Before we consider the main question, it is perhaps necessary to remember that Section 14(vi) of the Central Sales Tax Act, 1956, declares oil-seeds, that is to say, seeds yielding non-volatile oils used for human consumption, or in industries, or in the manufacture of varnishes, soaps and the like, in lubrication, and volatile oils used chiefly in medicines, perfumes, cosmetics and the like as goods of special importance in inter-State trade or commerce.

11. The result of it is that according to Section 15, sales tax law of a State shall be subject to certain restrictions and conditions when it imposes a tax on the sale or purchase of declared goods. The first restriction is that the tax payable under such law in respect of any sales or purchases of such declared goods inside the State shall not exceed 3 per cent of the sale or purchase price thereof. The second restriction is that such tax shall not be levied at more than one stage. Section 6 of the State Act is enacted to give effect to those restrictions.

12. Keeping in view these restrictions, we have to consider the implication of the provision in item 3-C. Before we consider it, it is useful to remember the antecedents of the provision as well as the subsequent amendment made therein.

13. Under the Madras General Sales Tax Act, groundnuts were taxed at multiple points. Every purchaser was liable to pay the tax. The Andhra Pradesh General Sales Tax Act, 1957, however, provided the point of levy to be the point of first purchase within the State.

14. By amending Act 3 of 1958, the tax was imposed on groundnuts at the point of last purchase in the State.

15. The said item 3-C was further subjected to an amendment under Act 26 of 1961 which provided that groundnuts 'when purchased by a miller in the State, at the point of purchase by the miller and in all other cases at the point of purchase by the last dealer who buys it in the State' would be taxed.

16. Although we are not concerned in the present case with the subsequent amendment made by Act 16 of 1963, it is perhaps profitable to notice it. According to the said amendment, the point of levy of tax on groundnuts when purchased by a miller 'other than a decorticating miller' in the State is at the point of purchase by such miller and in all other cases at the point of purchase by the last dealer who buys in the State.

17. Since we are concerned with the amended provisions of item 3-C made under Act 26 of 1961, we have to consider whether a decorticating miller is included within the ambit of the term 'miller' used in that provision.

18. Now, the word 'miller' is not defined in the Act. However, in Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, a Bench of this Court was invited to consider this very question, that is to say, 'whether the word 'miller' used in column 2 of item 3-C in Schedule IV of the Andhra Pradesh General Sales Tax Act, 1957, as amended by Act 26 of 1961, means only the oil miller or takes within its' meaning a decorticating miller also'. It was held that 'having regard to the meanings which, according to their common usages to the words 'mill' and 'manufacture' and even according to their dictionary meanings, the word 'miller' appearing in item 3-C of column 2 of Schedule IV would mean both the decorticating miller as well as the oil miller'. It was also found that the legislative history indicated that the Legislature used the word 'miller' to include both the decorticating as well as oil miller.

19. In State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C.489, another Bench of this Court held:

1. 'A miller' does not mean any 'miller'. The interpretation of the words 'a miller' if taken as any miller would firstly involve an arbitrary power in the hands of the Government to choose and select any miller, whether first, second or last. And secondly, it may possibly result in multiple taxation which is not permissible.

2. The words 'when purchased by a miller' can only mean that as soon as a miller makes a purchase the transaction in his hands becomes exigible to tax and the point of levy is at once fixed. Once the point of levy is fixed with reference to the first purchases, there is then no possibility of multiple tax. The first miller alone will be taxed irrespective of his conducting the milling operations with respect to the stocks. The Legislature never contemplated a miller taking the role of a mere dealer.

3. The High Court rejected the assessee's contention that the words 'purchased by a miller' means the last miller who crushes the groundnut into oil. The contention was that 'miller' means only the crushing miller and not a dealer-miller and, therefore, the point of levy should be fixed at the stage when the groundnut loses its character by being converted into oil in the hands of a miller.

4. Another argument that Section 15 of the Central Sales Tax Act does not contemplate the imposition of a tax on the same type of goods at different stages and, therefore, item 6 of the Third Schedule of the Andhra Pradesh General Sales Tax Act should be so construed as to tax only the miller who crushes 'the groundnut was also rejected by holding that when purchase tax is levied on transactions falling within the first limb, the tax is levied at one stage only while the second column comes into operation only in cases other than those governed by the first limb. In cases which fall within the second part of the said entry, the tax is also levied only at one stage.

20. It will immediately be seen that the court was concerned with a case arising after the entry was amended in 1963. It was obvious, therefore, that the Bench was not concerned with a case where the question had arisen as to whether 'a miller' includes a decorticating miller. Nevertheless, the decision is an authority for the proposition that 'a miller' does not mean 'any miller', but means only the first miller who purchases the groundnuts and it is he who would be liable to tax and not any subsequent miller merely because the last purchaser-miller happens to crush the groundnut into oil. Secondly, the second limb of column 2 comes into operation in cases other than those covered by the first limb. The said decision, however, cannot be said to be an authority for the proposition that the word 'miller' as it appeared in the entry prior to its amendment in 1963 meant decorticating miller as well as an oil miller. That is why Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, was neither cited nor considered by the court.

21. In Jowli Sunkiah and Co. v. Commercial Tax Officer [1968] 21 S.T.C. 300, which, like the present case, was under the 1961 Amendment Act, the correctness of the decision in Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, was not at all doubted. On the other hand, it was presumably taken to have been rightly decided. The learned Judges, however, thought that 'on the basis of the aforesaid ruling (Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, the further question is whether the petitioner who is a decorticating miller is at all liable to pay the tax as the crushing miller, who purchased the groundnuts from the petitioner, paid the tax'.

22. The argument of the Government Pleader before the court was that the petitioner-miller who happened to be the first purchaser was the person from whom the tax was exigible and, consequently, he was the right person from whom the tax can be levied. It was contended that if the subsequent miller, who crushed the groundnut into oil, had paid the tax, he can claim refund as it was wrongly collected from him. This argument was negatived. It was observed that 'it is significant to note that the 1957 Act regarded the the first purchase as the point of tax whereas the amending Act of 1959 shifted the point to the last purchase and when we came to the Amendment Act of 1961, no point of taxation is fixed at all. Hence, it logically follows that if the taxing authority levied the tax from any miller at any particular point of purchase, whether first, second or last, the power to tax comes to an end'.

23. Their Lordships went on to observe that 'it is not disputed that if the tax is collected from the petitioner, it is not open to the authority to collect the same from the subsequent purchasing miller. It equally follows that when the tax is collected from the crushing miller, who purchased the groundnut from the petitioner, the tax can no longer be levied against the petitioner who represented the first purchaser of the groundnut'.

24. Their Lordships, therefore, held that since there is no scope for any distinction between the first purchaser or the last purchaser among the millers who purchased the groundnut, if it is shown that the crushing miller has paid sales tax, the petitioner would not be liable to pay the tax.

25. It would immediately be seen that this decision goes quite contrary to State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489, in certain respects. Unfortunately, the earlier decision (State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489, was not cited before the learned Judges. We have already seen that Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, categorically holds that the words 'a miller' mean the first miller and that the Government has no choice to select for the purposes of tax any miller amongst the millers who purchase the groundnuts. The Government is obliged to levy tax on the first purchase by a miller irrespective of the fact whether he crushes the same into oil, decorticates into kernel or sells the groundnuts to other miller. The subsequent miller is not liable to tax.

26. This decision, Jowli Sunkiah and Co. v. Commercial Tax Officer [1968] 21 S.T.C. 300, also goes quite contrary to Sri Venkateswara Rice, Ginning and Groundnut Oil Mill Contractors Co. v. State of Andhra Pradesh [1971] 28 S.T.C. 599 (S.C.), to which we would make reference a little later. We are bound, however, to say that their Lordships were not quite correct when they said that 1961 amendment 'fixes no point of taxation at all'. It is true that it merely says 'at the point of purchase by the miller'. Does it necessarily mean that it leaves choice to the Government to select any miller first, second or last, if the groundnuts change hands amongst the millers? We do not think so. It would only mean the first purchaser-miller. We do not think that it was correct to hold that the Legislature intended to abolish the distinction between the first purchasing miller or the last purchasing miller. It is already noticed that the latter part of the second column of item 3-C comes into operation only when a case does not fall within the first limb. Although these two limbs are mutually exclusive, if a tax is collected under the first limb, it would not be permissible to levy tax on the groundnut under the second limb. Merely because the latter limb speaks of last dealer, we fail to see how it can necessarily mean that any miller first or last who can be taxed under the first limb. With profound respect to the learned Judges who decided that case, we find it impossible to agree either with their reasoning or with their conclusion. We are clear in our view that it is the first miller, be he a decorticating miller or an oil miller who alone can be taxed under the first limb of the entry. In our view State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489, correctly laid down the law to which we have already made reference.

27. We then come to Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes) [1971] 27 S.T.C. 18. That was also a case to which item 3-C as it stood under the 1961 Amendment Act was applicable. It was argued on behalf of the assessee who was only a decorticating miller that if a person who merely decorticates groundnuts and sells kernel is subjected to sales tax on the ground that he is a miller and if after the sale by such a person the groundnuts again pass from dealer to dealer by sale, the last dealer purchasing in the State would again be subjected to tax under the second limb of item 3-C of Schedule IV. That would be contrary to Section 15 of the the Central Sales Tax Act. But the Government Pleader contended that once sales tax had been paid at the stage of purchase by the person decorticating the groundnut, there is no further liability on subsequent purchasers to pay tax, the power of the State to levy having become exhausted at the stage of purchase by the person decorticating the groundnut. The learned Judges, however, found it impossible to agree with the submission of the Government Pleader. The reason they gave was that 'it would be impossible for the last dealer in the State to say with certainty that so much of groundnut purchased by him was already subject to tax and so much was not'.

28. The reason given by the learned Judges for rejecting the contention of the Government Pleader seems to us to be quite irrelevant. Once it is agreed that the moment a miller purchases groundnut tax becomes exigible, then it becomes irrelevant as to what happens subsequently. The difficulty of the last dealer sought to be pointed out is more imaginary than real. Once the groundnuts are subjected to tax in the hands of the miller and since it is not possible to tax the groundnut again either in the hands of a miller or in the hands of the last dealer what is required to be pointed out is that the groundnut has already suffered the tax. Millers or dealers whether first or last are aware of the incident of tax and it would not be difficult for them to keep track of the payment of tax on the groundnut in which they are dealing.

29. A similar contention was urged before the Supreme Court in Sri Venkateswara etc. Oil Mill v. State of Andhra Pradesh [1971] 28 S.T.C. 599 (S.C.): and the Supreme Court found such a contention as unacceptable. The Supreme Court answered the question by saying that '... the event which attracted tax is the act of the miller purchasing groundnut and not his act of crushing the groundnut purchased or dealing with that groundnut in any other manner. We have earlier mentioned that the very act of purchase by a miller attracts the liability to pay tax under Section 5 read with Schedule III, item 6. His subsequent dealings in those goods become irrelevant'.

30. Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, which had covered the very point was considered in Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes) [1971] 27 S.T.C. 18, as it was cited to the learned Judges. The case was sought to be distinguished on the ground that 'the learned Judges who decided the case, however, did not construe the word 'miller' as occurring in the Fourth Schedule with reference to the Central Sales Tax Act to which the schedule and Section 6 of the Act were subject'. With due respect to the learned Judges, we would like to point out that the learned Judges in Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, were fully conscious of these provisions as is evident from the judgment. And in any case that hardly can be a ground for distinguishing a case in contrariety to which a decision was being given. After observing that 'the second limb refers to a miller who purchases groundnut', which observation perhaps refers to the first limb, the learned Judges said: 'The scheme of item 3 appears to be to make groundnuts exigible to tax at the point when they cease to be taxable commodities either when groundnuts cease to be groundnuts by being crushed into oil or when groundnuts pass from the State. In our opinion, item 3 makes groundnuts exigible to tax at the point of purchase by a person who destroys the identity of groundnuts within the State.

31. It is difficult to agree with this understanding of item 3. It is firmly settled that sales tax becomes exigible the moment a sale or purchase, as the case may be, is made though quantification of tax liability is made at the end of the year. In the case of a miller, therefore, the moment he purchases the groundnut he becomes exigible to tax and not when he crushes the groundnut, which he has purchased, into oil. Any other interpretation would amount to fly in the face of the plain language of the said entry. It would involve a good deal of addition to the provision which is not possible for us to make. That this view is correct is seen from Sri Venkateswara etc. Oil Mill v. State of Andhra Pradesh [1971] 28 S.T.C. 599 (S.C.).

32. The Supreme Court at page 602 observed:

It is now well-settled that even under the sales tax laws, the charge in respect of a sale or purchase becomes effective as soon as the sale in the case of sales tax and purchase in the case of purchase tax is made, though the liability of the dealer can be computed only at the end of the year. The incurring of the charge is one thing and its computation is a totally different thing. Hence, the turnover relating to the purchases with which we are concerned in these appeals became charged with the liability to pay tax as soon as those purchases were made by the assessee-millers. To restate the position, whenever a miller purchases groundnut, the turnover relating to that purchase becomes exigible to tax subject to such exemptions as may be given under the Act. This means that as soon as a first miller purchases groundnut, the turnover relating to that purchase--the question of exemption apart--becomes liable to tax.

33. The same view was taken by the High Court in State of Andhra Pradesh v. Lakshmi Oil Milk [1967] 20 S.T.C. 489, from which decision appeal was preferred to the Supreme Court in the abovesaid case.

34. When the very basis on which or in the context of which the word 'miller' appearing in the said item is thus knocked out, then the interpretation put on the word 'miller' in Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes) [1971] 27 S.T.C. 18, must also fall to the ground. We have no manner of doubt that the contention advanced by the Government Pleader in that case before the learned Judges was quite sound and should have found favour with the learned Judges, particularly when Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, had taken that view and which had found support from State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489, and was accepted in Jowli Sunkiah and Co. v. Commercial Tax Officer [1968] 21 S.T.C. 300, as stated above. We find it therefore difficult to agree with the view of the learned Judges that the word 'miller' in entry 3 does not include a person who merely decorticates groundnut. We so fully agree with the reasoning and conclusion of Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, that we find it unnecessary to repeat what all is said therein.

35. The learned Judges in Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes) [1971] 27 S.T.C. 18, not only declined to agree with the conclusion of Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, but they also did not agree with the several of the observations and conclusions of the learned Judges in State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489, as well as Radhakrishna and Co. v. State of Andhra Pradesh [1969] 24 S.T.C. 320.

36. Both these cases took the view that it is the first miller who alone will be liable to tax irrespective of the fact whether the first purchaser-miller purchased the goods either wholly or in part for the purpose of crushing or whether he merely sold them as an ordinary dealer. Once the groundnut is purchased by the first miller that is enough to bring them within the net of taxation. It is not the duty of the taxing authority to examine whether he has crushed the groundnut into oil.

37. The learned Judges in Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes) [1971] 27 S.T.C. 18, thought that these cases result in adding the word 'first' in the first limb of item 3, which addition they said should be avoided. The learned Judges, therefore, thought that the word 'miller' means a person who converts groundnut into oil.

38. We have already said as to why it is not possible to accept this construction put upon the word 'miller'. This construction would be quite contrary to the two Bench decisions, we have referred to above. We have no doubt that those decisions correctly hold that the words 'purchased by the miller' can only mean first purchase made by a miller.

39. State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489, was carried in appeal to the Supreme Court. The Supreme Court in Sri Venkateswara etc. Oil Mill v. State of Andhra Pradesh [1971] 28 S.T.C. 599 (S C.), upheld the view taken by the High Court. It was urged before the Supreme Court that the court should not read into item 6 of the Third Schedule the word 'first' before the word 'miller' under column 2 thereof. The Supreme Court felt that there was no merit in that contention. After noting that in view of sections 14 and 15 of the Central Sales Tax Act and Section 6 of the State Act, purchase of groundnut can be taxed at only one stage, it is observed:

Once a particular quantity of groundnut has been subjected to payment of tax, the State's power to tax in respect of those goods gets exhausted and any further dealing in those goods cannot be brought to tax. This is clear from the scheme of the Act. There was no need for the Legislature to say 'when purchased by first miller' in column 2 of item 6 of the Third Schedule, because from the language employed therein, it is clear that the first purchase becomes exigible to tax and in view of Section 6 of the Act, the subsequent purchases of the same goods cannot be subjected to tax. Therefore, there is no question of adding any word into that item, as contended by Mr. M.C. Chagla on behalf of the assessees.

40. It is quite important to note that Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes) [1971] 27 S.T.C. 18, has thus been overruled by the above-said decision of the Supreme Court, in any case, in so far as the reasoning and conclusion which go against the reasoning and conclusion of State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489, are concerned. In spite of what has been stated in the last paragraph of the judgment in Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes) [1971] 27 S.T.C. 18 at 23, the Supreme Court clearly stated that 'our approach to the question before us is similar to that adopted by the High Court in the decision under appeal (State of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489). We are in entire agreement with the reasoning of the High Court'.

41. The Supreme Court went on to say that 'our attention was invited to a later decision of the same High Court in M. Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes), Anantapur [1971] 27 S.T.C. 18 at 23, which took a view contrary to that taken in the decision under appeal', and then made certain observations with which we are not concerned here. What is clear is that the Supreme Court expressly approved the reasoning and conclusion in Stale of Andhra Pradesh v. Lakshmi Oil Mills [1967] 20 S.T.C. 489, and by necessary implication disapproved the reasoning employed in Madar Khan and Co. v. Assistant Commissioner (Commercial Taxes) [1967] 20 S.T.C. 489. The said decision, therefore, not only because of the Supreme Court decision but also because of the reasons which we have given in upholding the view expressed in Aswathanarayana v. Deputy Commercial Tax Officer [1964] 15 S.T.C. 795, is no more valid and effective.

42. We have already noticed that item 3-C has been further amended in 1963. The amending Act by adding the words 'other than a decorticating miller' in the original entry 3-C has now excluded the decorticating miller from the purview of the first limb. What is the effect of this amendment in item 3-C? Is the amendment only declaratory made with a view to clarify the position which in the view of the Legislature always existed? In other words, whether the amendatory Act indicates that the Legislature intended to interpret the original entry 3-C legislatively or is the amendment made intended to exclude 'decorticating miller' prospectively.

43. Before we consider this question it is pertinent to note that the Legislature in the amendment has recognised the fact that both the decorticating as well as crushing millers are really the millers. The words used are 'decorticating miller'. It is in this background we have to examine the said question.

44. It is plain that the object in construing an amendatory Act is to determine the legislative intent. In determining the effect of an amendatory Act on transactions and events completed prior to its enactment, it is always necessary to distinguish between the provisions added to the original Act or section by the amendment and the provisions of the original Act or section or its part repealed by the amendment and the provisions of the original Act and section re-enacted thereby. It is presumed that provisions added by the amendment affecting substantive rights are intended to operate prospectively. Provisions added by the amendment that affect substantive rights will not be construed to apply to transactions and events completed prior to its amendment unless the Legislature has expressed its intent to that effect or such intent is clearly implied by the language of the amendment or by the circumstances surrounding its enactment.

45. Is there anything then in entry 3-C as amended in 1963 to suggest that it should be read as if it was originally enacted in 1961? We cannot find any language of the amendment which may even remotely indicate that the Legislature intended to interpret the original entry so as to disagree with the construction put upon it by the courts. We can see nothing in the surrounding circumstances of the enactment to suggest anything of that kind.

46. The Legislature was, it is presumed to be, aware of the decisions interpreting the word 'miller' to include also a decorticating miller. If the Legislature had thought at the time of amendment in 1963 that the interpretation so put by the courts was quite contrary to their original intention nothing could have been easier and nothing could have prevented them from expressly giving retrospective effect to the amendment they made. They could have declared their intention by adding an explanatory note. On the other hand, the way in which the entry is amended clearly shows that the Legislature accepted the prior construction of entry 3-C and that is why without allowing the prior transactions to be affected, for the purpose of future transactions excluded the decorticating millers. The mere fact that the Legislature enacts an amendment indicates that it thereby intended to change the original entry by withholding the right to tax a decorticating miller. It is useful to remember that in interpreting an amendatory Act, there is a presumption of change in legal rights. There are no indications anywhere to rebut this primary presumption. We are not inclined to think that the Legislature by this amendment intended to reopen the transactions and events which were concluded. The amendatory Act, 1963, also therefore supports the view which we have taken that the word 'miller' prior to its amendment in 1963 meant both decorticating as well as oil millers.

47. In the view which we have taken about entry 3-C as it stood at the relevant time, we hold that the tax on the turnover of Rs. 4,35,214.32 has been rightly levied.

48. The only other contention which was sought to be raised before us related to another item of the turnover of Rs. 97,200. It was, however, soon realised that there were no merits in the grounds raised in that behalf. It was, therefore, expressly stated before us that the petitioner does not desire to press the points raised in regard to that portion of the turnover.

49. Since no other contention was advanced, the result is that the writ petition fails and is dismissed with costs. Advocate's fee Rs. 250.


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