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1972 Supreme(Cal) 41
HIGH COURT OF CALCUTTA
ANIL KUMAR SEN
MADANLAL KHAITAN - Appellant
Versus
THE COMMERCIAL TAX OFFICER - Respondent
Civil Revision Case 447 (W) Of 1967
Decided On : FEBRUARY 15, 1972
Badal Chandra Chakravarty, P.K.SENGUPTA, Samarendra Nath Dutt, Saumen Kumar Ghose
Sugar candy is exempted from the operation of the West Bengal Sales Tax Act, 1954 by virtue of the notification dated 3rd March, 1958, issued under Section 26 of the said Sales Tax Act, 1954, and sugar candy does not come within the definition of any of the notified commodities taxable under the said Sales Tax Act, 1954, in the notification dated 6th February, 1967.
Headnote:
SALES TAX - Exemption - Sugar candy - Whether exempted from the operation of the West Bengal Sales Tax Act, 1954 - Whether sugar candy comes within the definition of any of the notified commodities taxable under the said Sales Tax Act, 1954.
Fact of the Case:
The petitioner, a manufacturer of sugar candy, challenged the imposition of sales tax on sugar candy under the West Bengal Sales Tax Act, 1954 and the West Bengal Sales Tax Act, 1941. The petitioner contended that sugar candy was exempted from the operation of the Sales Tax Act, 1954 by virtue of a notification dated 3rd March, 1958, issued under Section 26 of the said Sales Tax Act, 1954, and that sugar candy did not come within the definition of any of the notified commodities taxable under the said Sales Tax Act, 1954, in the notification dated 6th February, 1967.
Finding of the Court:
The court held that sugar candy was exempted from the operation of the Sales Tax Act, 1954 by virtue of the notification dated 3rd March, 1958, issued under Section 26 of the said Sales Tax Act, 1954, and that sugar candy did not come within the definition of any of the notified commodities taxable under the said Sales Tax Act, 1954, in the notification dated 6th February, 1967.
Issues: 1. Whether sugar candy was exempted from the operation of the West Bengal Sales Tax Act, 1954 by virtue of the notification dated 3rd March, 1958, issued under Section 26 of the said Sales Tax Act, 1954? 2. Whether sugar candy came within the definition of any of the notified commodities taxable under the said Sales Tax Act, 1954, in the notification dated 6th February, 1967?
Ratio Decidendi: 1. The court held that the term "sugar" in the notification dated 3rd March, 1958, under Section 26 of the Sales Tax Act, 1954 included sugar candy so that with effect from 14th December, 1957, sugar candy was no longer assessable to sales tax under the State Acts; steps taken by the respondents in the present case to impose sales tax under the State laws were inconsistent with and contrary to the said notification and as such, ultra vires the powers of the respondents. 2. The court held that sugar candy did not come within the meaning of any of the commodities notified under Section 25 of the Sales Tax Act of 1954 under the notification dated 6th Feburary, 1967, and as such, the respondents had no authority to impose any sales tax under the provisions of the Sales Tax Act of 1954.
Final Decision: The court issued a writ in the nature of mandamus directing the respondents not to enforce any of the aforesaid two Acts or the incidence thereunder on the sugar candy as manufactured by the petitioner and also not to enforce any order, notice or circular issued for the assessment already made for the period from 30th November, 1960, to 31st March, 1966.
( 1 ) THE question that arises for consideration in this rule is as to whether sugar candy is exempted from the operation of the West Bengal Sales Tax Act, 1954 (West Bengal Act 4 of 1954) (hereinafter referred to as the said Sales Tax Act, 1954) by virtue of the notification dated 3rd March, 1958, issued under Section 26 of the said Sales Tax Act, 1954, by the State Government and secondly whether such sugar candy comes within the definition of any of the notified commodities taxable under the said Sales Tax Act, 1954, in the notification dated 6th February, 1967,
( 2 ) IN order to decide the aforesaid issues it would be necessary to refer to the changes in the relevant statutory provisions and the notifications issued thereunder from time to time as also to certain undisputed facts. On 1st July, 1941, the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act6 of 1941) (hereinafter referred to as the Sales Tax Act, 1941) came into effect This Sales Tax Act of 1941 imposed incidence of tax on sale of goods but on the provisions of Section 6 read with entry No. 8, Schedule I of this Act "sugar" was exempted from the operation of this statute until the Schedule was amended by omission of the term "sugar" by Section 13 (a) of the Bengal Finance (Sales Tax) (Second Amendment) Act, 1955 (West Bengal Act 22 of 1955 ). On such amendment with effect from 25th September, 1955, sugar came under the incidence of the Sales Tax Act of 1941. It was so done obviously to bring it within the purview of the Sales Tax Act of 1954 by a notification issued under the provisions of Section 25 of the said Sales Tax Act of 1954. The said notification was issued on the day following, that is, 26th September, 1955, and as a result of the aforesaid amendment and the notification "sugar" came to be taxable under the Sales Tax Act of 1954. In the background of this position on 24th December, 1957, a Central Act known as the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (Act 58 of 1957) (hereinafter referred to as the said Additional Duties Act, 1957), came into force. By virtue of the provisions of Section 3 of this Additional Duties Act, 1957, excise at the rate specified in the First Schedule thereto was imposed on sugar. The Government of West Bengal in order to share the distribution of additional duties on sugar in terms of the provisions of the Second Schedule thereto issued a notification dated 3rd March, 1958, referred to hereinbefore. It is necessary to set out this notification as we shall have to find out the true scope and import of this notification. NOTIFICATION no. 506 F. T.-3rd March, 1958-Whereas the Governor is of opinion that it would be in the public interest so to do now, therefore, in exercise of the power conferred by Section 26 of the West Bengal Sales Tax Act, 1954 (West Bengal Act 4 of 1954), hereinafter referred to as the said Act, the Governor is pleased hereby to exempt from the operation of the said Act with effect from the 14th December, 1957, sugar, being a notified commodity within the meaning of Clause (i) of that section, subject to the condition that in respect of sugar which had been sold before the commencement of the West Bengal Sales Tax (Amendment) Ordinance, 1958, and also in respect of sugar on which no additional duties of excise have been levied under the Additional Duties of Excise (Goods of Special Importance) Act, 1957, the dealer claiming such exemption shall make, to the satisfaction of the prescribed authority referred to in Sub-section (1) of Section 3 of the said Act, a lump payment on account of sales tax in respect of such sugar. By order of the Governor, b. Dasgupta secy, to the Govt. of West Bengal.
( 3 ) IT is not in dispute that on the basis of the aforesaid notification dated 3rd March, 1958, sugar was exempted from the incidence of the Sales Tax Act, 1954. In the meantime with effect from 29th April, 1961, sugar was also declared to be one of the goods of specia
