IMPORTANT POINT
Rule 3 of the Tripura Transit Rules, except sub-rule (5) thereof, is declared to be perfectly valid and effective.

Headnote:(i) Indian Forest Act, 1927-Sections 41 and 42-Tripura Transit Rules-Rule 3-Validity of-Sub-rule (5) empowers State Government to levy export duty extending upto hundred percent of market value of timber/firewood concerned-Provision declared bad-There is nothing which empowers State Government to levy export duty-Power to levy duty conferred only upon Central Government. (Para 9)
       (ii) Tripura Transit Rules-Rule 3(3) and (4)-Levy of application fee and licence fee-It is regulatory fee and not compensatory fee-Levy must be held to be valid and competent, being fully warranted by Section 41. (Para 10)
       (iii) Tripura Transit Rules-Rule 3(2)-Validity of-It provides for a licence for removal of timber or firewood from within State to any place outside State and also for setting up or establishing a trading depot within State-This sub-rule is within four corners of Section 41, therefore, valid. (Para 11)
       (iv) Tripura Transit Rules-Rule 3(8)-Validity of-Meaning and ambit of expression regulate in Section 41(1)-Sub-rule (8) of Rule 3 is perfectly valid. (Paras 12 & 13)
       (v) Constitution of India-Art. 301-Tripura Transit Rules-Rule 3-Validity of-Whether Rule 3 is violative of Article 301 ?-(No)-It is not required to comply with requirement of proviso to clause (b) of Art. 304. (Paras 14 & 15)

JUDGMENT

B.P. Jeevan Reddy, J.-Leave granted. Heard the counsel for the parties.

2. The Gauhati High Court has declared Rule 3 of the Transit Rules framed by the Government of Tripura under Sections 41 and 42 of the Indian Forest Act, 1927 as illegal and ultra vires the Constitution. The correctness of the said decision is challenged by the State of Tripura.

3. The Indian Forest Act, 1927 (the Act) was enacted to consolidate the law relating to forests, the transit of forest-produce and the duty leviable on timber and other forest-produce. The Act was extended to the then Union Territory of Tripura by the Union Territories (Laws) Act, 1950 (Act 30 of 1950). It continues to be applicable to the State of Tripura. The Indian Forest Act is thus a post-constitutional enactment, so far as Tripura is concerned, vide Mithan Lal v. The State of Delhi & Anr.1 and New Delhi Municipal Committee v. State of Punjab etc. etc.2.

4. Chapter II of the Act deals with reserved forests while Chapter III deals with village forests. Chapter IV deals with protected forests and while Chapter V with State Government control over forests and lands not being the property of the Government. Chapter VI provides for levy of duty on timber and other forest-produce. Chapter VII provides for control on timber and other forest-produce in transit. Chapter VIII deals with drift timber. Chapters IX, XI and XIII contain machinery provisions. A perusal of the provisions of the Act shows that the Act is designed to protect and increase the forest wealth and its proper utilisation for the purposes of the State and the people. For the purpose of the present case , it is not necessary to notice the provisions of the several chapters of the Act except Chapters VI, VII and XII. Section 39 in Chapter VI confers upon the Central Government the power to levy duty on timber and other forest-produce. Section 39 reads as follows

"39. Power to impose duty on timber and other forest-produce-(1) The Central Government may levy a duty in such manner, at such places and at such rates as it may declare by notification in the Official Gazette on all timber or other forest-produce-

(a) which is produced in the territories to which this Act extends, and in respect of which the Government has any right;

(b) which is brought from any place outside the territories to which this Act extends.

(2) In every case in which such duty is directed to be levied ad valorem the Central Government may fix by like notification the value on which such duty shall be assessed.

(3) All duties on timber or other forest-produce which, at the time when this Act comes into force in any territory, are levied therein under the authority of the State Government, shall be deemed to be and to have been duly levied under the provisions of this Act.

(4) Notwithstanding anything in this section, the State Government may, until provision to the contrary is made by Parliament, continue to levy any duty which it was lawfully levying before the commencement of the Constitution, under this section as then in force;

Provided that nothing in this sub-section authorises the levy of any duty which as between timber or other forest-produce of the State and similar produce of the locality outside the State, discriminates in favour of the former, or which, in the case of timber or other forest-produce of localities outside the State, discriminates between timber or other forest-produce of one locality and similar timber or other forest-produce of another locality."

Sub-section (1) thus confers the power to levy duty only upon the Central Government and not upon the State Governments. Sub-section (3), however, says that if any duty levied under the authority of the State Government on timber or other forest-produce is in force in any territory on the date of coming into force of the said Act, the same shall be deemed to be and to have been levied under the said section. Sub-section (4) says that

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1997 Supreme(SC) 266

IMPORTANT POINTRule 3 of the Tripura Transit Rules, except sub-rule (5) thereof, is declared to be perfectly valid and effective.

Cases Referred (10)

IMPORTANT POINT
Rule 3 of the Tripura Transit Rules, except sub-rule (5) thereof, is declared to be perfectly valid and effective.