PETITIONER:
V. M. SYED MOHAMMAD AND COMPANY
Vs.
RESPONDENT:
THE STATE OF ANDHRA.(With Connected Appeal)
DATE OF JUDGMENT:
11/03/1954
BENCH:
DAS, SUDHI RANJAN
BENCH:
DAS, SUDHI RANJAN
MAHAJAN, MEHAR CHAND (CJ)
MUKHERJEA, B.K.
BOSE, VIVIAN
HASAN, GHULAM
CITATION:
1954 AIR 314 1954 SCR 1117
CITATOR INFO :
R 1955 SC 661 (205)
R 1957 SC 877 (16)
R 1958 SC 538 (12)
R 1960 SC1254 (3,9)
RF 1992 SC1277 (85)
ACT:
Constitution of India, art. 14-Government of India Act,
1935, entry 48 in List II of the Seventh Schedule-Madras
General Sales Tax Act (IX of 1939)-Whether,ultra vires the
Constitution or Government of India Act, 1935-Rule 16(5)
framed under the Act-Whether ultra vires s. 5 (vi) of the
Act.
HEADNOTE:
Held, that the Madras General Sales Tax Act (IX of 1939),
is not ultra vires the Government of India Act, 1935 as
entry 48 in List II of the Seventh Schedule to the
Government of India Act, 1936 was wide enough to cover a law
imposing 'a tax on the purchaser of goods as well as on the
seller.
Held, also that inasmuch as there was nothing to suggest
that the purchasers of other commodities were similarly
situated as the purchasers of bides and skins in the present
case the Act
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was not void under art. 14 of the Constitution on the ground
that the impugned Act singles Out for taxing purchaser of
certain specified commodities only but leaves out purchasers
of Mother commodities.
Article 14 does not forbid classification for
legislative purposes provided such classification is based
on some differentia having a reasonable relation to the
object and purpose of the law in question.
Rule 16(5) framed under the Act contravenes the
provisions of s. 5(vi) of the Act but this sub-rule is
severable and does not affect the validity of the rules
which may otherwise lie within the ambit of the Act.
Chiranjit Lal Chowdhury v. The Union of India ([1950]
S.C.R.
869)relied upon.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 187 and 188
of 1953.
Appeals under article 132 of the Constitution of India
from the Judgment and Order, dated the 29th August, 1952, of
the High Court of Judicature at Madras in Writ Petitions
Nos. 21 and 41 of 1952.
K.V. Venkatasubramania Iyer (A. N. Rangaswami and. S.
K. Aiyangar, with him) for the appellant.
M. Seshachalapathi for the respondent.
V.K. T. Chari, Advocate-General of Madras (V. V.
Raghavan, with him) for the intervener (State of Madras).
T. R. Balakrishna lyer and Sardar Bahadur for the
intervener (State of Travancore-Cochin).
Nittoor Sreenivasa Rao, Advocate General Of Mysore
(Porus A. Mehta, with him) for the intervener (State of
Mysore).
Lal Narayan Sinha (B. K. P. Sinha, with him) for the
intervener (State of Bihar).
1954. March 11. The Judgment of the Court was delivered
by
DAS J.-These two appeals arise out of Writ Petitions Nos.
21 ‘and 41 -of 1952, filed in the High Court of Judicature
at Madras under article 226 questioning the validity of the
Madras General Sales Tax Act (IX of 1939) and of the
Turnover and Assessment Rules framed under that Act.
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The petitioners are tanners carrying, on business in
Eluru, West Godawari District, which is now part of the
newly created State of Andhra. They make large purchases of
untanned hides and skins and after tanning them in their
tanneries they export the tanned hides and skins or sell the
same to local purchasers. In the High Court the appellants
impugned the Act and the rules on the following grounds :-I
(a) The Provincial Legislature had no power under the
Government of India Act of 1935 to enact a law imposing a
tax on purchasers;
(b) The liability to pay tax on sales is thrown on the
purchaser not by the statute but by the rules. This is an
unconstitutional delegation by the legislature of its
functions to the executive and the imposition of ,the tax is
accordingly illegal;
(c) The Act has become void under article 14 of the
Constitution, as it singles out for taxation purchasers in
some trades and is, therefore, discriminatory; and
(d) The rules framed under the Act are inconsistent
with the provisions enacted in the body of the Act and are
void.
The High Court repelled each of the aforesaid grounds
except that under item (d). It held that rule 16(5) was
ultra vires in that it offended against section 5 (vi) of
the Act and dismissed their applications. Hence the present
appeals by the appellants under the certificate granted by
the High Court that it was a fit case for appeal to this
court.
Learned advocate appearing in support of these appeals
has not pressed the objection under item (b) but has
insisted on the remaining grounds of objection. In our
opinion the decisions of the High Court on those grounds are
substantially well-founded and correct. On the question of
legislative competency the learned advocate drew our
‘attention to entry 54 in List II of the Seventh Schedule to
the Constitution of India and argued that this entry clearly
indicated that entry 48 in List II of the Seventh Schedule
to the -Government of India Act, 1935; under which the
145
1120
impugned Act was passed, was much narrower in its scope and
could not be read as authorise in a the making of a law with
respect to taxes on the purchase of goods. This argument
appears to us to be fallacious, for the intention of the
Constituent Assembly as expressed in entry 54 in List II of
the Seventh Schedule to the Constitution cannot be a guide
for ascertaining the intention of a totally, different body,
namely, the British Parliament, in enacting entry 48 in List
11 of the Seventh Schedule to the Government of India Act,
1935. Further, we agree with the High Court that entry 48
in List II of the Seventh Schedule to the Government of
India Act, on a proper construction, was wide enough to
cover a law imposing tax on the purchaser of goods as well
and that the Constituent Assembly in entry 54 of List II in
the Seventh Schedule to the Constitution accepted this
liberal construction of the corresponding entry 48 and
expressed in clearer language what was implicit in that
corresponding entry.
The next point urged by the learned advocate was founded
on article 14 of the Constitution. The appellants’
grievance is that the impugned -Act singles out for taxing
purchasers of certain specified commodities only but leaves
out purchasers of all other commodities. The principle
underlying the equal protection clause of the Constitution
has been dealt with and explained in Chiranjitlal Chowdhury
v. The Union of India (1) and several subsequent cases and
need not be reiterated.It is well,settled that the guarantee
of equal protection of laws does not require that the
same law should be made applicable to all persons. Article
14, it has been said, does not forbid classification for
legislative purposes, provided that such classification is
based on some differentia having a reasonable relation to
the object and purpose of the law in question. As pointed
out by the majority of the Bench which decided Chiranjitlal
Chowdhury’s case, there is a strong presumption in favour of
the validity of legislative classification and it is for
those who challenge it as
(1) [1950] S.C.R.
1121
unconstitutional to allege and prove beyond all doubt that
the legislation arbitrarily discriminates between different
persons similarly circumstanced. There is no material on
the record before us to suggest that the purchasers of other
commodities are similarly situated as the purchasers of
hides and skins. The majority decision in Chiranjitlal
Chowdhury’s case(1) clearly applies to the case before us
and there is no getting away from the position that the
appellants before us have not discharged the burden of proof
that, according to the majority decision, was upon them to
do.
Lastly, the learned advocate urges that rule 16(5) clearly
contravenes the provisions of section 5(vi) of the Act.
This sub-rule has been held to be ultra vires by, the High
Court and, indeed, the learned Advocate-General of Madras
did not in the High Court, as before ,us, dispute that rule
16(5) was repugnant to section 5(vi). That sub-rule,
however, affects only unlicensed dealers and the appellants
who are admittedly licensed dealers are not affected by that
sub-rule. Further, it has not been suggested before us that
the appellants were ever called upon to pay any tax on
purchase of hides or skins in respect of Which tax had been
previously paid by some prior purchaser. That sub-rule is
clearly severable and cannot affect the validity of the
rules which may otherwise be within the ambit of the Act.
Our attention has not been drawn to any other infirmity in
the rules.
In the premises there is no substance in these appeals
which must, therefore, be dismissed with costs.
Appeals dismissed.
Agent for the respondent and for the interveners, States of
Madras, Mysore and Bihar: R. H. Dhebar.
(1) [1950] S.C.R. 869.
1122