P. R. RAMACHANDRA MENON :-

Constitutional validity of sub-section (5A) of section 14 of the Act 15 of 1963 as amended by the Kerala Finance Bill, 2004, whereby the dealers having registered "under the Kerala General Sales Tax Act, 1963" and those having registered under "both the Kerala General Sales Tax and Central Sales Tax Acts" are required to pay a fee of Rs. 500 and Rs. 1,500, respectively, for the purpose of renewal of registration, is the basic issue involved herein.

The first petitioner, an association registered under the Travancore Cochin Literary, Scientific and Charitable Societies Registration Act 12 of 1958, is stated as representing the dealers/members, whose particulars have been given in exhibit P2. The second petitioner is stated as the Secretary of the first petitioner - association and a dealer/member as well. The third petitioner is one of the members of the first petitioner - association.

The writ petition was filed, challenging the proposed amendment vide Kerala Finance Bill, 2004, to have effect from April 1, 2004. Subsequently, the enactment came, when the petitioner got the writ petition amended by filing I.A. No. 12687 of 2005, challenging the concerned provisions in "the Act".

In the opening paragraph itself, it is stated that the first petitioner is presenting the writ petition "for and on behalf" of the members in a "representative capacity"; simultaneously giving the list of the members as per exhibit P2. It is also stated that the second petitioner, who is the Secretary of the first petitioner - association, is maintaining the writ petition, both in his individual capacity, as well as in his capacity as Secretary of the first petitioner - association. The third petitioner has joined the proceedings in his individual capacity and also as a member of the first petitioner - association. The case put forth by the petitioners is that undue loss and hardships have been resulted by virtue of the amendment brought in vide sub-section (5A), whereby the fees for "renewal of registration" have been enhanced to "Rs. 500" and "Rs. 1,500" in the case of dealers having "Kerala general sales tax" registration alone and those having both the "Kerala general sales tax and Central sales tax" registration, respectively, which is beyond the legislative competence of the State, particularly in view of the law declared by this court vide exhibit P3 judgment (Kerala Electric Trades Association v. State of Kerala [2004] 12 KTR 114 (Ker)), whereby sub-section (1A) and sub-section (5) of section 14, providing for additional fee for registration under the Kerala General Sales Tax Act, in respect of a person who is having Central sales tax registration and further providing for "renewal fee" payable at the same rate as required for the purpose of initial registration, were set aside as ultra vires the Constitution. It is contended by the petitioners that the same logic and reasoning, as applied in exhibit P3 verdict passed by the Division Bench of this court, is squarely applicable to the situation resulted herein, because of the introduction of sub-section (5A) to section 14, as well.

The main grounds of challenge raised by the petitioners are :

(i) Renewal fee, though labelled as a "fee", is actually a "tax" in disguise, which hence is not liable to be acted upon.

(ii) By virtue of the principle of "quid pro quo", no such levy is possible, as absolutely no service is being rendered by the State in connection with the registration or renewal of registration.

(iii) There is a clear finding rendered by a Division Bench of this court in exhibit P3 judgment that no service is being rendered by the State with regard to the registration of the dealers and as such, no registration fee can be sought to be realised under sub-section (5A).

(iv) The same logic and reasoning given by the Division Bench of this court in exhibit P3 judgment, while setting aside sub-sections (1A) and (5) of section 14, are very much applicable i