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1996 JLJ 564
A.K. Mathur, C.J. and S.K. Kulshreshtha, J.
Swastik Roadways and another v. Commercial Tax Officer and others
W.P. No. 3756 of 1995; Decided on 16.4.1996
(2) Vanijyik Kar Adhiniyam, 1994 (M.P.) – S.2 (d) – Constitution of India – Art. 366 Cl. 29A – word ‘commerce‘ as defined under – carriers cannot be included in the sale and purchase of goods. [Para 5
(3) Vanijyik Kar Adhiniyam, 1994 (M.P.) – S.2(h) – ‘dealer‘ as defined under—transport/carrier cannot be included in the definition. [Para 6
(4) Carriers Act, 1865 – S.2 M.P. Vanijiyik Kar Adhiniyam, 1994 – S.2 (h) – ‘common carrier‘ as defined under 1865 Act – cannot be a ‘dealer‘ as defined under 1994 Act. [Para 6
(5) Vanijiyik Kar Niyam, 1995 (M.P.) – R. 75 – transporters i.e. clearing and forwarding agents – are not covered within the definition of ‘dealer‘ – they are also not connected with the sale and purchase of goods – thus cannot be brought within the Act and penalised for the omission or commission of their principal. 1993 (91) STC 321 and AIR 1973 SC 376 followed. [Para 7
(6) Vanijiyik Kar Adhiniyam, 1994 (M.P.) – Ss. 57, 58 and 59 – Constitution of India – Sch. VII, List II, Entry 54 – inclusion of transporters in the Act – is beyond the legislative power of the Legislature.
There is no escape from the conclustion that section 57, 58 and 59 of the Act which bring the transporter under the Act, are certainly beyond the competence of the State Legislature in exercise of power of Entry 54 of List-II of VII Schedule of the India and the Rules made thereunder. 1993 (91) STC 321 and AIR 1973 SC 376 followed. [Para 7
(7) Vanijiyik Kar Adhiniyam, 1994 (M.P.) – Ss. 57, 58 and 59 – M.P. Vanijiyik Kar Niyam, 1995 – R. 75 Constitution of India – Sch. VII. List II, Entry 54 – sections 57, 58 and 59 of the Act and rule 75 of the rules – are untra vires of Entry 54 List II of Sch.VII. [Para 9
¼1½ Hkkjr dk lafo/kku & lkroha vuqlwph] lwph 2] çfof"V 54 & ifjokgd] eky ds Ø; vkSj foØ; ls fdlh çdkj laacaf/kr ugha gksrk & fo/kku eaMy ds foØ; vFkok Ø; ij dj ij fo/kku cukus ds fy, l{ke gS & ifjokgd foØ; dj vFkok okf.kfT;d dj ds N= esa ugha yk, tk ldrsA ¿iSjk 4 rFkk 5 ¼2½ okf.kfT;d dj vf/kfu;e] 1994 ¼e-ç-½ & /kkjk 2 ¼?k½ & Hkkjr dk lafo/kku & vuq-336 [kaM 29d & ;FkkifjHkkf"kr ‘‘kCn ^^okf.kT;** & okgd] eky ds foØ; vkSj Ø; esa lfEefyr ugha fd, tk ldrsA ¿iSjk 5 ¼3½ okf.kfT;d dj vf/kfu;e] 1994 ¼e-ç-½ & /kkjk 2 ¼t½ & ;FkkifjHkkf"kr ^^O;kSgkjh** & ifjokgd ifjHkk"kk esa lfEefyr ugha fd, tk ldrsA ¿iSjk 6 ¼4½ okgd vf/kfu;e] 1865 & /kkjk 2 & e-ç- okf.kfT;d dj vf/kfu;e] 1994 & /kkjk 2 ¼t½ & 1865 ds vf/kfu;e esa ;FkkifjHkkf"kr ^^lkekU; okgd** & 1994 ds vf/kfu;e esa ;FkkifjHkkf"kr ^^O;kSgkjh** ugha gks ldrkA ¿iSjk 6 ¼5½ okf.kfT;d dj fu;e] 1995 ¼e-ç-½ & fu-75 & okgd vFkkZr~ fudklh rFkk vxzs"k.k vfHkdrkZ & ^^O;kSgkjh** dh ifjHkk"kk ds varxZr vkosf"Vr ugha gSa & os eky ds foØ; rFkk Ø; ls Hkh lacaf/kr ugha gSa & bl çdkj] vf/kfu;e ds varxZr ugha yk, tk ldrs vkSj vius ekfyd ds yksi vFkok dk;Z ds fy, nafMr ugha fd, tk ldrsA 1993 ¼91½ ,l Vh lh 321 rFkk , vkb vkj 1973 ,l lh 376 vuqlfjrA ¿iSjk 7 ¼6½ okf.kfT;d dj vf/kfu;e] 1994 ¼e-ç½ & /kkjk 57] 58 rFkk 59 & Hkkjr dk lafo/kku & lkroha vuqlwph] lwph 2] çfof"V 54 & ifjokgdksa dk vf/kfu;e esa lfEefyr fd;k tkuk & fo/kku eaMy dh fo/kk;h ‘kfDr ds ijs gSA bl fu"d"kZ ls cpk ugha tk ldrk fd vf/kfu;e dh /kkjk 57] 58 rFkk 59] ftuds }kjk ifjokgd dks vf/kfu;e ds v/khu yk;k x;k gS vkSj muds v/khu fufeZr fu;e] Hkkjr ds lafo/kku dh lIre vuqlwph dh lwph 2 dh çfof"V 54 dh ‘kfDr ds ç;ksx esa fuf‘pr gh jkT; fo/kku eaMy dh l{kerk ds ijs gSaA 1993 ¼91½ ,l lh lh 321 rFkk , vkb vkj 1973 ,l lh 376 vuqlfjrA ¿iSjk 7 ¼7½ okf.kfT;d dj vf/kfu;e] 1994 ¼e-ç-½ & /kkjk 57] 58 rFkk 59 & e-ç- okf.kfT;d dj fu;e] 1995 & fu-75 & Hkkjr dk lafo/kku & lkroha vuqlwph] lwph 2] çfof"V 54 & vf/kfu;e dh /kkjk 57] 58 rFkk 59 vkSj fu;eksa 75 & lkroha vuqlwph dh lwph 2 dh çfof"V 54 ds vf/kdkjkrhr gSaA ¿iSjk 7
A.K. Mathur, C.J. -- 1. The petitioners by this writ petition have challenged the validity of sections 57, 58 and 59 of the Madhya Pradesh Vanijyik Kar Adhiniyam, 1994 (known as M.P. Commercial Tax Act) and have prayed that the same may be declared as ultra vires of the Constitution of India, as Entry 54 of List-II of VIIth Schedule of the Constitution, the State Legislature is not competent to legislate and cover the transporter/carrier subject to the provisions of the M.P. Vanijyik Kar Adhiniyam, 1994, (hereinafter referred to as the' Act of 1994') which repealed the M.P. General Sales Tax Act, 1958.
2. The petitioner are carrying on business of clearing and forwarding agents. They receive goods for being consigned to outside the area of their operation as also receive goods from place to place outside their principal place of business for delivery to consignees. In short, they are clearing and forwarding agents or Dalals transporting goods. They also provide warehouse facilities to the consignors so long as the goods are not delivered to them or despatched to places other than the place of their business. The Act of 1994 came into force with effect from 1.4.1995. It received the assent of the President on 7.1.1995 and the assent was published in the M.P. Gazette (Extra Ordinary) dated 7.2.1995. The validity of the three provisions, i.e. sections 57, 58 and 59 of the Act, have been challenged by this petition.
3. As per the said three provisions, the petitioner are required to furnish information and such particulars, including the statement of accounts, and affairs verified in the manner specified by the Commissioner, as he may require in respect of transactions of any dealer with them provided the petitioner handle the documents of title to goods or transport goods. By virtue of section 57 (2) of the Act, a penalty is provided of a sum equal to three times the amount of tax payable in respect of the goods involved in the transaction referred to above. Section 58 of the Act, speaks of control on clearing and forwarding agents to prevent or check evasion of tax. Section 59 of the Act defines 'clearing and forwarding agent' as including a person engaged in collecting goods from any place inside the State, including Railway premises, and arrange for transport and/or delivery of such goods to the principal or any other person or carrier of goods and on behalf of the principal and in the process of collection, transport or delivery handles documents of title to such goods. For ready reference, sections 57, 58 and 59 are reproduced as under:-
"S. 57. Furnishing of information by banks and clearing and forwarding agents –
(1) Every bank including, any branch of a bank and every clearing or forwarding agent shall, if so required by the Commissioner, furnish such particulars including statement of accounts and affairs verified in the manner, specified by the Commissioner as he may require in respect of transaction of any dealer with such bank or with such clearing or forwarding agent which during the course of its business handles documents of title to goods or transports goods.
(2) If any clearing or forwarding agent contravenes the provisions of sub-section (1), the Commissioner may, after giving such agent a reasonable opportunity of being heard, direct him to pay, by way of penalty, a sum equal to three times the amount of tax payable in respect of the goods involved in the transactions referred to in sub-section (i) and which appear to have been evaded by the owner of such goods due to the failure of such agent to furnish information pertaining thereto required of him by the Commissioner under sub-section (1).
"S.58. Control on clearing and forwarding agents to prevent to check evasion of tax –
(1) The State Government may, if it is satisfied that it is necessary so to do with a view to prevent or check evasion of tax under this Act in place or places in the State, direct that:
(i) Every clearing and forwarding agent wh
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