The central legal point established in the judgment is the unconstitutional nature of the retrospective amendment to Sec.14A of the Bihar Sales Tax Act, which violated Article 20(1) of the Constitution.

Ramaswami, J.

1. In this case the petitioner has obtained a rule from the High Court asking the respondents to show cause why the order of the Superintendent of Sales Tax, dated 10-2-1955, forfeiting the amount of Rs. 2,11,222/9/6 under the proviso to Sec.14A, Bihar Sales Tax Act should not be called up and be quashed by a writ in the nature of certiorari under Article 226 of the Constitution. Cause has been shown by the Advocate-General on behalf of the State of Bihar and the other respondent to whom, notice of the rule was ordered to be given.

2. The petitioner, Rai Bahadur Hurdut Roy Moti Lall Jute Mills, was registered as a dealer under the Bihar Sales- Tax Act and was carrying en its business at Katihar in the district of Purnea. The main business of the petitioner was the manufacture and sale of gunny bags, hessian and other jute products. Under a notification dated 1-4-1950, made under Sec.27 of Part 4, Bihar Finance Act (Act 17 of 1950) the Governor of Bihar fixed the rate, of 3 pies in the rupee as tax on the sale and purchase of jute and jute products. During, the period 1-4-1950 to 31-3-1951; the petitioner sold and despatched jute and jute products amounting to Rs. 92,24,386-1-6 to dealers outside the State of Bihar. A sum of Rs. 2,11,223/9/6 was realised by the petitioner as sales tax from such, dealers. Sec.14A, Bihar Sales Tax Act was introduced by Bihar Act 6 of 1949 which came into force from 1-10-1948. Sec.14A then read as follows:

"14A. Unregistered, dealers not to collect tax. --No dealer who is not a registered dealer shall realise any amount by way of tax on sale of goods from purchasers, nor shall any registered dealer make any collection of such tax except in accordance with such restrictions and conditions as may be prescribed."

A proviso was added to Sec.14A by the Bihar Finance Act, 1952 (Bihar Act 4 of 1952). The proviso Was in the following terms :

"Provided that if any dealer collects any amount by way of tax, in contravention of the provision of this section or the conditions and restrictions prescribed thereunder, the amount so collected shall, without prejudice to any punishment to which the dealer may be liable for an offence under this Act, be forfeited to the State Government and such dealer shall pay such amount into the Government treasury in accordance with a direction issued to him by the Commissioner or any officer appointed under Sec.3 to assist him and in default of such payment, the amount shall be recovered as an arrear of land revenue."

3. On 30-3-1953, the Supreme Court decided that sales tax cannot be levied on goods despatched to other States for consumption in those States. The decision of the Supreme Court was pronounced in State of Bombay V/s. United Motors Ltd., 1953 SCR 1069: (AIR 1953 SC 252) (A).

The question of assessment of sales tax upon the petitioner for the period from 1-4-1950 to 31-3-1951, was taken up by the Superintendent of Sales Tax on 31-5-1953, and it was decided that the petitioner was not liable to pay sales tax on the sales of jute and jute products to dealers outside Bihar. The order of the Superintendent of Sales Tax is annexure A to the application. But on 17-6-1954, the Superintendent of sales Tax took proceedings against the petitioner under Sec.14A, Bihar Sales Tax Act and asked him to show cause why the amount of Rs. 2,11,222/- and odd should not be forfeited to the State Government. The petitioner showed cause and on 10-2-1955, the Superintendent of Sales Tax ordered that the petitioner should deposit Rs. 2,11,222/- and odd into the Government treasury within a month of the receipt of the order. The order of the Superintendent of Sales Tax is annexure D to the application.

4. Against this order the petitioner made the present application to the High Court on 24-3-1955. On the next day the High Court issued a rule against the respondents. On 1-4-1955, however, the Bihar Legislature amended Sec.14A, Bihar Sales Tax Act so as to make it expre