Judgment

SARKARIA, J. :- In this petition under Article 32 of the Constitution the petitioner, a Private Ltd. Company challenges the validity of the Cane Cess and Purchase tax levied on it for the month of January, 1968. Respondents 1, 2 and 3 are the State of Bihar, Certificate Officer and the Collector of Champaran, respectively.

2. The facts are these :

There was in force in the State of Bihar a pre-Constitution law known as Bihar Sugar Factories Control Act, 1937 (Act 7 of 1937). By notification issued under Section 29 of that Act, cane cess and purchase tax were being levied in respect of sugar cane intended to be used or used in a sugar factory. It was a temporary enactment. Ordinarly, it was to remain in force until June 30, 1941. But its life was extended from time to time by different amending Acts. The last extension was made by Bihar Act 6 of 1950 up to January 30, 1955, which came into force on January 9, 1950 when it was published in the Bihar Government Gazette. Thereafter, Bihar Act 7 of 1955, which came into force on March 30, 1955 amended Section 1(3) of Act 6 of 1950 extending the life of Act 7 of 1937, indefinitely beyond June 30, 1955. In the meantime, the Essential Commodities Act No. 10 of 1955 (hereinafter called the Central Act) was enacted by Parliament. After the assent of the President, it came into force on April 1, 1955. Section 16(1)(b) of the Central Act expressly repealed "any other law in force in any State immediately before the commencement of this Act in so far as such law controls or authorised the control of the production, supply and distribution of, and trade and commerce in, any essential commodity."

3. Bihar Act 17 of 1963 substituted in Act 7 of 1937 with retrospective effect from January 1, 1962, this new Section 29:

"Cess and tax on cane - The State Government may by notification impose -

(a) a cess not exceeding fifty-one naya paise per quintal on the entry of sugarcane into a local area, specified in such notification, for consumption, use or sale therein;

(b) a tax not exceeding fifty-one naya paise per quintal on the purchase of sugarcane by or on behalf of the occupier of a factory :

Provided that such tax shall not be payable in respect of sugarcane for which a cess imposed under Clause (a) is payable."

4. The Government of Bihar, acting under this Section, issued and published a notification on October 21, 1963, in the Gazette whereby cane cess and purchase tax at certain rates were levied in the local areas specified in the notification.

5. The constitutional validity of Bihar Act of 1937 and the rules framed thereunder was challenged by a writ petition in the High Court of Patna which by its judgment, dated July 4, 1966 in A. K. Jain v. Union of India, 1968 Pat LJR 179, held Act 7 of 1937 and the rules framed thereunder to be unconstitutional and invalid. On appeal against that judgment, this Court in A. K. Jain v. Union of India, (1969) 2 SCC 340 held that if the Bihar Act 7 of 1937 provides anything contrary to Rule 3(3) of the Sugarcane (Control) Order 1955, issued under the Central Act, it must be held to have been altered in view of Article 372 of the Constitution. The Patna High Court followed its earlier decision in A. K. Jain s case, 1968 Pat LJR 179, in Sugauli Sugar Works Pvt. Ltd. v. Co-operative Development and Cane Marketing Union Misc. J. C. No. 1344 of 20-4-1966 (Pat) Belsand Sugar Co. Ltd. v. Thakur Girja Nandan Singh, AIR 1969 Pat 8.

6. After Bihar Act 7 of 1937 was struck down by the High Court, no legislative measures were taken until January 12, 1968 when Ordinance No. 3 was promulgated by the Governor of Bihar with instructions of the President.

7. Section 35 of the Ordinance correspondend to S. 29 inserted in Act 7 of 1937 by the Amending Act of 1963, excepting that the maximum rate of the cess/tax leviable was fixed at 67 paise per quintal.

8. Section 50 of the Ordinance repealed the Bihar Act 7 of 1937. Its sub-section (2) contained a saving and validating provis