Judgment

HEGDE, J. :- These are appeals by certificate. They raise common questions of law for decision, and they are directed against a common judgment of the Allahabad High Court.

2. The facts of the case lie within a narrow compass. The appellants are dealers in foodgrains including cereals and pulses especially split or processed foodgrains and dal. The dispute in this case centres round the question whether the Government is competent to levy sales tax on the purchases made by the appellants of split or processed foodgrains and dal under the provisions of the United Provisions Sales Tax Act, 1948 as amended by the Uttar Pradesh Sales Tax Act (Amendment and Validation Act, 1970 (which will hereinafter be referred to as the Act).

3. Under the Sales Tax Act as it originally stood (which will hereinafter be referred to as the principal Act), the purchases of split or processed foodgrains and dal by dealers were sought, to be brought to tax under Section 3-D of the principal Act read with the notification issued. The validity of the levy was challenged by Tilock Chand Prasan Kumar, the appellant in Civil Appeal No. 1625 of 1971 in respect of the assessment made on him for the assessment year 1966-67 by assessment order dated June 30, 1968 by means of a writ petition under Art. 226 of the Constitution. The High Court of Allahabad struck down the levy holding that the dal purchased by the petitioner before it could not be said to be a commodity essentially different from the arhar dal purchased by the dal mills and accordingly the purchases effected by the petitioner could not be regarded as the first purchases. This decision is reported in (1970) 25 STC 118 (All). Thereafter the Governor of U. P. issued an ordinance known as Uttar Pradesh Sales Tax (Amendment and Validation) Ordinance, 1970 (U. P. Ordinance No. 2 of 1970) adding inter alia Explanation II to Section 3-D as well as Section 7 to the principal Act. This Ordinance was later on enacted as an Act to which we have already made reference. The provisions of the Amending Act are identical with the provisions in the Ordinance. Though at the time of the institution of the writ petitions from which these appeals arise, the Ordinance had not yet been made into the Act, the Amending Act came into force during the pendency of the writ petitions. Hence we shall refer to the provisions of the Amending Act.

4. Under the principal Act a dealer is defined in Section 2 (c) as :

" "dealer" means any person or association of persons carrying on the business of buying or selling goods in Uttar Pradesh whether for commission, remuneration or otherwise, and includes any firm or Hindu joint family and any society, club or association which sells goods to its members and also includes any department of the State Government or the Central Government which carries on such business and any undertaking engaged in the generation or distribution of electrical energy or any other form of power."

(Explanation to the section is not relevant for our present purpose).

5. Section 3 of the Act provides for the levy of multi-point tax. The portion of that section which is material for our present purpose reads :

"Subject to the provisions of this Act, every dealer shall, for each assessment year, pay a tax at the rate of two naye paise per rupee on his turnover of such year, which shall be determined in such manner as may be prescribed.........."

6. Section 3-A provides for a single point taxation in respect of sale of certain goods. At present we are only concerned with Section 3-D (1). It provides :

"Except as provided in sub-section (2), there shall be levied and paid, for each assessment year or part thereof, a tax on the turnover, to be determined in such manner as may be prescribed, of first purchases made by a dealer or through a dealer, acting as a purchasing agent in respect of such goods or class of goods, and at such rates, not exceeding two paise per rupee in the case of foodgrains, including cereals a