JUDGMENT
B.L. Hansaria, C.J.
1. The petitioner has assailed the vires of Section 5-A of the Orissa Sales Tax Act, 1947 (for short “the Act”) as inserted by the Orissa Act 11 of 1990 which came into force on 1-7- 1990.
2. Though a Bench of this Court had upheld the validity of the aforesaid section in O.J.C. No. 172 of 1992 (M/s. Sitania Enterprisers v. State of Orissa) decided on 13-7-1993, Shri Agrawal appearing for the petitioner contends that the point which he seeks to urge had not been canvassed in that O.J.C. We have, therefore, heard the learned counsel on the new point on the strength of which he seeks to assail the validity.
3. Let us note the relevant part of the section at the threshold.
“5-A (1) Every dealer whose gross turnover during any year exceeds rupees ten lakhs shall, in addition to the tax payable by him under this Act, also pay a surcharge at the rate of ten percentum of the total amount of the tax payable by him ;
Provided that the aggregate of the tax and surcharge payable under this Act shall not exceed in respect of goods declared to be of special importance in inter-State trade or commerce by Section 14 of the Central Sales Tax Act, 1956, the rate fixed by Section 15 of the said Act :
xxx xxx xxx”
4. Shri Agrawal has two points to canvass. The first is that in view of what has been stated in the proviso no surcharge can be leviable on those declared goods the rate of tax of which under the Act has been fixed at 4 per cent. The learned counsel does not, however, stop there and urges that the proviso itself must be treated to be non est because the surcharge is not payable in respect of goods though the proviso speaks of the same. The learned counsel then contends that if the proviso be non est. Sub-section (1) would be invalid being hit by Section 15 of the Central Sales Tax Act (hereinafter referred to as “the Central Act“).
5. Let us examine the contentions. The first submission is advanced on the basis of what has been prescribed in Section 15 of the Central Act. We may note the relevant part of that section.
“15. Restrictions and conditions in regard to tax on sale or purchase of declared goods within a State ;
(a) the tax payable under that law in respect of any sale or purchase of such goods inside the State shall not exceed four per cent of the sale or purchase price thereof, and such tax shall not be levied at more than one stage ;
xx xx xx xx xx xx"
6. The aforesaid shows that in respect of declared goods the tax payable cannot exceed four per cent. Section 14 of the Central Act contains a list of goods which are stated to be a special importance in inter-State trade or commerce, colloquially known as declared goods, A reference to that section shows that paddy is one such good, so is iron and steel. Shri Agrawal brings to our notice SRO No. 366/90 dated 30-6-1990 which has fixed the rate of sales tax on iron and steel at four per cent. We are also referred to SRO No. 206/82 by which rate of tax on purchase of paddy has been fixed at four per cent. After referring these two rates of taxation, the learned counsel contends that if surcharge at the rate of 10 percent has to be paid over and above this amount of tax, the same would be definitely more than four per cent and would, therefore, exceed the rate fixed by Section 16 of the Central Act.
7. Shri Patnaik appearing for the Department fairly states that in respect of those declared goods relating to which the rate of taxation has been fixed by the State either on the sale or purchase at the rate of four per cent, the surcharge cannot be realised. The learned counsel for both sides state that this is also the view taken by this Court in some other cases.
8. Shri Agrawal, however, proceeds further and submits that as surcharge is not payable in respect of goods as would appear from Sub sec. (1) of Section 5-A, as distinguished from tax, the proviso ceases to have any meaning, because of which Sub-section (1)would run against the mandate of Sec 15 of the Central Act and would, therefore, be invalid. Let us closely examine this submission. For this purpose, we may first note what purpose a proviso serves. As has been stated in S. Sundaram Pillai v. V. Pattabiraman, AIR 1985 SC 582, one of the purposes of the proviso is excepting certain provisions from the main enactment. ( See paragraph 42). The proviso at hand has excepted from Sub-section (1) the payment of surcharge in respect of those declared goods whose aggregate of tax and surcharge would be more than that fixed by the Central Act. Sub-section (1) cannot, therefore, be read de hors the proviso, and so read, the reasonable view to be taken would be that in respect of those declared goods for which the rate of taxation has been fixed at 4% by the State Government either on purchase or sale surcharge would not be payable.
9. Shri Agrawal’s next contention is that the proviso should be treated to be as non est because it has stated about payability of surcharge in respect of goods declared to be special importance. The learned counsel states that Sub-section (1) itself has not made surcharge payable in respect of the sale of goods as such, but on the total gross turnover exceeding ten lakhs. But then, the definition of gross turnover in Section 2(dd) shows that it means total of “turnover of sales” and “turn- over of purchase”. The definition of turnover of sales in Section 2 (i) is the “aggregate of the amounts of sale prices and tax, if any” and so, turn- over has intimate relationship with sale of goods. We cannot, therefore, by hypertechnically reading Sub-section (1) along with the proviso concede the argument of Shri Agrawal that the proviso itself should be taken to be non est because the proviso as drafted may indicate as if surcharge is payable on sale of goods. A legislative provision has to be read reasonably, and so doing, we would hold that what the proviso lays down is that in respect of declared goods what has been stated therein shall prevail. We would not, therefore, be justified in ignoring the proviso by taking it to be meaningless as contended by Shri Agrawal.
10. We, therefore, hold that Section 5-A (1) cannot be held to be invalid being hit by Section 15 of the Central Act as its first proviso saves it. But then, in view of what has been stated in the first proviso, we state that in respect of these declared goods relating to which the State Government has fixed the rate of four per cent as tax either on the sale or purchase on the same, no surcharge would be payable.
11. The petition is disposed of with the aforesaid observations.
B.N. Dash, J.
I agree.