http://JUDIS.NIC.IN

SUPREME COURT OF INDIA

Page 1 of 88

PETITIONER:

STATE OF ORISSA & OTHER

Vs.

RESPONDENT:

THE TlTAGHUR PAPER MILLS COMPANY LTD.& ANR.

DATE OF JUDGMENT01/03/1985

BENCH:

MADON, D.P.

BENCH:

MADON, D.P.

TULZAPURKAR, V.D.

SEN, AMARENDRA NATH (J)

CITATION:

1985 AIR 1293 1985 SCR (3) 26

1985 SCC Supl. 280 1985 SCALE (2)410

CITATOR INFO :

RF 1986 SC1085 (12)

RF 1988 SC1164 (4)

R 1988 SC1531 (46)

RF 1991 SC 672 (2,3,10)

ACT:

Orissa Sales Tax Act 1947-Sections 3B and 5 (1)-Scope

of-Notifications levying purchase tax on bamboos agreed to

be served and standing trees agreed to be severed-Whether

Ultra vires the Act-Whether create new class of goods not

known to law-Whether amount to tax on immovable property -

and not on goods-notifications issued in supersession of all

previous notifications on the subject-Whether wipe out all

tax liability accruing under previous notifications.

"Timber" and "logs"-Whether mean the same thing.

Bamboo contract-Nature of-Whether an easement.

Interpretation-Nature and meaning of a document-Whether

can be determined by the end-result-Court-if could go into

policy matters.

Constitution of India-Article 141-Conflicting views of

the Supreme Court on same point-View of larger Bench to be

followed in preference to view of smaller Bench.

HEADNOTE:

Section 3B of the Orissa Sales Tax Act 1917 empowers

the State Government to declare from time to time any goods

or class of goods to be liable to tax on turnover of

purchases. The proviso provides that no tax shall be payable

on the sales of such goods or class of goods declared under

this section. Section 5(1) prior to its amendment by the

Orissa Sales Tax (Amendment) Ordinance, 1977 provides that

the tax payable by a dealer under the Orissa Act should be

levied on his taxable turnover at such rate not exceeding

thirteen percent and subject to such conditions as the State

Government might from time to time by notification specify.

On May 23, 1977 the State Government issued two

notifications. Notification No. SRO 372/77 was made under

section 3B amending the earlier notification dated April 23,

1976. This notification made standing trees and bamboos

agreed to be severed liable to tax on the turnover of

purchase with effect from

http://JUDIS.NIC.IN

SUPREME COURT OF INDIA

Page 2 of 88

27

June 1, 1977. Notification SRO No. 373177 issued under the

first proviso to section 5(1) of the Orissa Act amended with

effect from June 1, 1977 the second of the two notifications

of April 23, 1976 and directed that the tax payable by a

dealer under the Orissa Act on account of purchase of

bamboos agreed to be severed and standing trees agreed to be

severed would be at the rate of 10%.

On December 29, 1977 the Orissa Sales Tax (Amendment)

Ordinance, 1977 was promulgated amending the Orissa Act with

effect from January, 1978. With effect from the same date

two notifications SRO No 900177 and SRO No. 901177 were

issued; the first notification which was issued under the

provisions of section 3B and in supersession of all previous

notifications on the subject, declared that the goods

mentioned in Column (2) of the schedule to the notification

were liable to be taxed on the turnover of purchase with

effect from January 1, 1978. Entries 2 and 17 in the

schedule of this notification specified "bamboos agreed to

be severed" and "standing trees agreed to be severed"

respectively. Notification No. 901/77 issued under section 5

(1) was in supersession of all previous notifications in

that regard. The State Government, by this notification,

directed that with effect from January l 1978 the tax

payable by a dealer under the Orissa Act on account of

purchase of goods specified in column (2) of the schedule to

the notificatio