The main legal point established in the judgment is that goods chargeable under the ADE Act cannot be taxed by the State under a State enactment, and the interplay between general exemption of specified goods from sales tax and the specification of rates of sales tax under State Acts.

JUDGMENT :

INDIRA BANERJEE J.

1. The main question raised in this batch of appeals is, whether, ‘Pan Masala’, which contains tobacco and gutka, covered by an Entry in the First Schedule to the Additional Duties of Excise (Goods of Special Importance) Act 1957, hereinafter referred to as the ‘ADE Act’, are taxable by the State under the Delhi Sales Tax Act 1975 and/or the Uttar Pradesh Trade Tax Act 1948 and/or the Tamil Nadu General Sales Tax Act, 1959.

2. In Shanti Fragrances v. Union of India and others, (2018) 11 SCC 305, a Division Bench of this Court observed:

12. It does appear that there is a direct conflict between Kothari Products [Kothari Products Ltd. v. State of A.P., (2000) 9 SCC 263], Radheshyam Gudakhu Factory [State of Orissa v. Radheshyam Gudakhu Factory, (2018) 11 SCC 505 : (1988) 68 STC 92 (SC)] and Reliance Trading Co. [Reliance Trading Co. v. State of Kerala, (2011) 15 SCC 762] judgments on the one hand, and Agra Belting Works [CST v. Agra Belting Works, (1987) 3 SCC 140 : 1987 SCC (Tax) 233], which was also followed by two other judgments, on the other. We may hasten to add that there are three-Judge Bench decisions on both sides....”

3. The Bench further observed:

“13. … One other interesting feature of this case is whether, after Union of India v. Raghubir Singh, (1989) 2 SCC 754; (1989) 3 SCR 316, SCR at pp. 335-37 : SCC pp. 777-78, para 27, it can be stated that Judges of this Court do not sit in 2s and 3s for mere convenience, but that a Bench which is numerically superior will prevail over a Bench of lesser strength. If the doctrine of precedent, as applied by this Court, is to be a matter of numbers, then, interestingly enough, as has been held by Beaumont, C.J. in Ningappa Ramappa Kurbar v. Emperor, 1941 SCC OnLine Bom 41 : AIR 1941 Bom 408, the position in law could be as under: (AIR p. 409 : SCC OnLine Bom)

“…The Court in that case consisted of five Judges, one of whom, Shah, J., dissented from that proposition. The authority of the case may be open to question, since there had been a previous decision of a Full Bench of this Court of four Judges in Queen Empress v. Mugappa Bin Ningapa [Queen Empress v. Mugappa Bin Ningapa, ILR (1893) 18 Bom 377], which had reached a different conclusion. Apparently it was considered that five Judges, by a majority of four to one, could overrule a unanimous decision of four Judges, the net result being that the opinion of four Judges prevailed over the opinion of five Judges of coordinate jurisdiction. There seems to be very little authority on the powers and constitution of a Full Bench. There can be no doubt that a Full Bench can overrule a Division Bench, and that a Full Bench must consist of three or more Judges; but it would seem anomalous to hold that a later Full Bench can overrule an earlier Full Bench, merely because the later Bench consists of more Judges than the earlier. If that were the rule, it would mean that a Bench of seven Judges, by a majority of four to three, could overrule a unanimous decision of a Bench of six Judges, though all the Judges were of coordinate jurisdiction. In Enatullah v. Kowsher Ali [Enatullah v. Kowsher Ali, 1926 SCC OnLine Cal 104 : ILR (1927) 54 Cal 266], Sanderson, C.J., stating the practice in Calcutta, seems to have been of opinion that a decision of a Full Bench could only be reversed by the Privy Council or by a Bench specially constituted by the Chief Justice. Even if this be the true rule, there is nothing to show that the Chief Justice acted upon it in Emperor v. Purshottam Ishwar Amin [Emperor v. Purshottam Ishwar Amin, 1920 SCC OnLine Bom 144 : ILR (1921) 45 Bom 834]. I do not recollect myself ever to have constituted a Special Bench to consider the ruling of a Full Bench, though I have constituted many Full Benches to consider rulings of Division Benches. However, I need not pursue this subject further, since, for the purpose of the present appeal, I am prepared to assume that an alternative charge of perjury lies,