Thottathil B. Radhakrishnan, J.

1. These writ appeals, in their sum and substance, raise the efficacy of first proviso to Section 8(a)(ii) of the Kerala Value Added Tax Act, 2003, hereinafter referred to as "the KVAT Act". The question raised is as to whether the said proviso, after the amendment made to the KVAT Act as per the Kerala Finance Act, 2009 with effect from 01.04.2009, hereinafter referred to as "the Amending Act", would compel any works contractor in respect of works contracts awarded by Government of Kerala, Kerala Water Authority or Local Authorities to pay four percent of the whole contract amount as value added tax, under the Compounding Scheme.

2. We have heard Sri.Raju Joseph, the learned Senior Advocate appearing on behalf of the appellants and Sri. V. Krishna Menon, the learned standing counsel appearing on behalf of the third respondent as well as Sri. C.K. Govindan, the learned Senior Government Pleader for Department of Commercial Taxes.

3. We see that the writ petitions were filed before the learned single Judge essentially calling in question the constitutional validity of the relevant provisions and seeking reliefs, in the wake of the apparent conflict between contents of Section 8(a)(ii) and its proviso. The conflict is that while Section 8(a)(ii) prescribes a rate of three percent of the contract amount, after enumerated deductions as the compounded tax with effect from the coming into force of the Amending Act, the proviso which had stood earlier continues to remain requiring payment of tax at four percent. This obligation that was cast through the proviso on works contracts awarded by Government of Kerala, Kerala Water Authority and Local Authorities, thus stood at one percent over and above the rate that was reflected through Section 8(a)(ii) after the coming into force of the Amending Act, that is to say, 01.04.2009.

4. The learned single Judge adjudicated on different issues argued before him and ultimately held that the amendment is a conscious and legislative exercise even going by the materials available and there is no unconstitutionality or arbitrariness that could be sustained even on the face of Article 14 of the Constitution.

5. But, hearing the learned counsel for parties, we wondered for ourselves as to why the laborious exercise of considering the issue of constitutionality had arisen because on a plain reading of the statute, it is clear that the content of the proviso exceeds the sweep of the fiscal obligation created through Section 8(a)(ii) while the Compounding Scheme provided through Section 8(a)(ii) provides the rate of eight percent, the proviso had provided for four percent insofar as Government contracts and contracts for Water Authority, Local Authority etc. were concerned. However, while the Amending Act payment came with effect from 01.04.2009, the charging provision was modified by reducing eight percent to three percent, however, keeping intact the proviso, thereby, the rate of four percent in the proviso became something which is larger when compared to the provision in Section 8(a)(ii). It is fundamental jurisprudential principle that the normal function of a proviso is to except something out of the enactment or to qualify something enacted therein which but for the proviso would be within the purview of the enactment - see for support, the plethora of judgments commencing from Kedarnath Jute Manufacturing Co. Ltd. v. The Commercial Tax Officer and Others [AIR 1966 SC 12], Ishverlal Thakorelal Almanla v. Motibhai Nagjibhai [AIR 1966 SC 459], H.E.H. Nizam's Religious Endowment Trust, Hyderabad v. Commissioner of Income Tax, Andhra Pradesh [AIR 1966 SC 1007], Kush Sahgal and others v. M.C.Mitter and others [AIR 2000 SC 1390], Haryana State Cooperative Land Development Bank Ltd. v. Haryana State Cooperative Land Development Banks Employees Union and another [(2004) 1 SCC 574], Romesh Kumar Sharma v. Union of India and others [(2006) 6 SCC 510] and Nagar Palika Ni