The Sugarcane Cess (Validation) Act, 1961, is valid legislation within Parliament's authority, allowing the retrospective imposition of tax by validating past cess collections despite prior invalidation under state law.

1. In this application under Art.226 of the Constitution of India by a private limited company engaged in the business of manufacture, production and sale of sugar, the petitioner claims a declaration that the Sugarcane fess (Validation) Act, 1961 (XXXVIII of 1911). (hereinafter referred to as to the Act) passed by Parliament is beyond the constitutional powers of Parliament and is, therefore, invalid, and prays for the issue of a writ of certiorari for quashing a notice dated 17th March 1962 given to it by the collector of Ratlam calling upon it to pay a total amount of Rs. 6,33,917.52 nP. as due from it on account of cane cess and cane commission under the Act and the Madhya Pradesh Sugarcane (Regulation of Supply and Purchase) Act, 1958 , (hereinafter referred to as the local Act).

2. In order to appreciate the merits of the controversy arising in this case it is necessary to refer first to the local Act by which a cess on sugarcane entering into an area specified in a notification issued in that behalf for consumption, use or sale therein was imposed and me occupier of a sugar factory was made liable for the payment of commission on sugarcane purchased by the factory. The local Act was enacted in 1959 it came into force on 1st July 1959. S.23(1) of that net, so far as it is material here, ran as follows : -
"23. (1) The State Government may, fly notification, impose a cess not exceeding 25 nP. a maund, on the entry of cane into an area, schemed in such notification, for consumption, use or sale therein ;
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On 4th December 1959 the State Government issued a notification in exercise of the powers conferred on it by S.23(1) of the local Act imposing with effect from that date a cess at the rate of 12 nP. per maund on
"the entry of cane during a crushing season in the area, comprised within such of the factories in "which the total quantity of cane entering for consumption, use or sale to the factory during such season"
exceeded 10 lakhs maunds. S.21 of the local Act read with R.45 of the Madhya Pradesh Sugar - cane (Regulation of Supply and Purchase R.1959, made under that Act, makes the occupier of a factory liable for the payment of a commission on every maund of cane purchased by the factory in the circumstances and at the rate mentioned in the provision and the rule.
The validity of S.23 of the local Act was challenged before us in Bhopal Sugar Industries v. State of M.P. , M.P. No. 27 of 1961, D/-31-8-1961 (M.P.). In that case we held, following the decision of the Supreme Court in Diamond Sugar Mills v. State of U.P. , AIR 1961 SC 652 , that the notification dated the 4th December 1959, in so far as it imposed a cess on the entry of cane during a crushing season in the area comprised within such of the factories in which the total quantity of cane entering for consumption, use or safe to the factory during such season exceeded 10 lakh maunds, was invalid. In Diamond Sugar Mills case (supra) the Supreme court struck down as invalid the law as enacted in S.3 of the U.P. Sugarcane Cess Act, 1956, imposing a cess on the entry of sugarcane into the premises of a factory on the ground that the legislation did not fall within entry of the State List in the Seventh Schedule to the Constitution and there was no other entry either in the State List or in the Concurrent List in which the law could fall.
We pointed out in M.P. No. 27 of 1961