STATE OF UTTAR PRADESH Vs. MODI INDUSTRIES LIMITED

JUDGEMENT

(1.) This appeal by the State of Uttar Pradesh and three sales tax officers is directed against the judgment of the Allahabad High Court dated February 11, 1970. The High Court has granted a certificate of fitness under clause (c) of Article 133 (1) of the Constitution.

(2.) Respondent Modi Industries Limited, hereinafter referred to as the dealer, was known earlier as the Modi Sugar Mills Ltd. It manufactured various articles like sugar, oil, vanaspati and soap. It exercised the option under Section 7 (as it stood prior to its amendment by Section 7 of the U. P. Act XIX of 1956) of the U. P. Sales Tax Act, 1948, hereinafter referred to as the Act, to submit its returns of sales-tax on the basis of its turnover of the previous years and filed the returns accordingly. The assessment years for which the returns were filed were 1948-49 and 1949-50, and the corresponding previous years were November 1, 1946 to October 31, 1947, and November 1, 1947 to October 31, 1948 respectively. The rate of sales tax for certain commodities was enhanced during the assessment year 1948-49, with effect from June 9, 1948, and for some other commodities with effect from July 1, 1948. The dealer contended that sales tax on its entire turnover of the two previous years should be assessed at the old rate of 3 pies per rupee and not at the enhanced rate of 6 pies per rupee because the enhancement was made after both the previous years had expired. The Sales Tax Officer rejected that contention and assessed the sales tax at the enhanced rates. The appellate authority however upheld the dealer's contention and the matter went up in revision to the Judge (Revisions). He upheld the order of the Sales Tax Officer. The dealer applied for a reference under Sec. 11 (1) and the following two questions of law were referred to the High Court.-

(3.) We have made a mention of the facts bearing on the controversy, and we may as well refer to the relevant provisions of the law.