The State Legislature was not competent to enact the impugned provisions.

L. N. RAY (Judicial Member). - These are mostly applications under section 8 of the West Bengal Taxation Tribunal Act, 1987, numbered as RN-10 to 13, 15, 90, 259 and 282 to 285 of 1990. RN-213(T) of 1990 was received upon transfer from the High Court under section 15 of the said Act. Except RN-90 and 213(T), all other cases were heard analogously, as common constitutional questions are involved. Although not strictly analogously, RN-90 and 213(T) of 1990 were also heard along with the other cases, since the questions involved in these cases are no different. During hearing of all the cases it was agreed and understood by the learned Advocates for the applicants and the learned State Representative that these applications will be decided by a common judgment. The points which arise for determination in all these applications are - whether the State Legislature was competent to enact clause (ii) of sub-section (6) of section 4 of the Bengal Finance (Sales Tax) Act, 1941, and clause (i) of sub-section (2) of section 4 of the West Bengal Sales Tax Act, 1954, as inserted by West Bengal Act 23 of 1977 with effect from October 10, 1977, and whether the said provisions in the said two Acts as amended by the West Bengal Taxation Laws (Amendment) Act, 1990 and also sub-sections (2A) and (2B) of section 26A of the 1941 Act and section 28 of the 1954 Act, inserted by the West Bengal Taxation Laws (Amendment) Act, 1990, are constitutionally valid. Vires of the relevant rules framed for carrying out the purpose of 1990 amendments is also under challenge.

2. The case of the applicants may be summed up thus :

In RN-10 of 1990, Rasoi Ltd. is the first applicant. The applicant No. 2 is the Managing Director of the company, who is also a shareholder. The company is a registered dealer under the West Bengal Sales Tax Act, 1954 and the Central Sales Tax Act, 1956. It carries on the business of manufacturing vanaspati, soap and allied products for sale. The company has a wide network of distributors of its products throughout India. It has also a large number of consignment agents and branches all over India. It despatches goods manufactured in the State of West Bengal to different places outside the State on consignment basis or on branch transfer basis. The company makes purchases of vegetable non-essential oils (briefly called V.N.E. oils) of various descriptions and other goods within and outside the State of West Bengal for use as raw materials in the manufacture of the said finished products in West Bengal. A purchase tax was levied under the amended provisions of the 1954 Act and the Bengal Finance (Sales Tax) Act, 1941, at the rates and for the periods mentioned below :

(a) From October 10, 1977 to March 31, 1978 at 4 per cent.

(b) From April 1, 1978 to March 31, 1983 at 2 per cent.

(c) From April 1, 1983 till dated at 3 per cent.

Vanaspati was brought under the purview of the 1954 Act with effect from 1977 to May 31, 1987, but was denotified and brought back within the scope of the 1941 Act for a brief period, i.e., from June 1, 1987 to March 31, 1989. Again, since April 1, 1989 it has been restored to the 1954 Act. Among other provisions, clause (i) of section 4(2) of the 1954 Act was inserted by way of an amendment under the West Bengal Act 23 of 1977, with effect from October 10, 1977. A similar provision, being section 4(6)(ii) was inserted in the 1941 Act by the same Act 23 of 1977 and with effect from the same date. Under these provisions a registered dealer became liable to pay tax on all purchases of raw materials made within the State of West Bengal which were ultimately used in the manufacture of various products, when the manufactured products are transferred by him to a place outside West Bengal or disposed of by him otherwise than by way of sale in West Bengal. Vanaspati comprises the major share of the applicants' turnover. During the period from 1977 to 1988, vanaspati manufacturers had to use imported edible oils s