STATE OF KERALA Vs. MEGA TRADERS

JUDGEMENT

(1.) A batch of writ appeals, two tax revision case and an original petition are coming up before us on a reference and we Shri Krishna Enterprises v. State of Andhra Pradesh, 1990 76 STC 67 REFERRED TO are disposing of them by this common judgment as common questions arise for consideration in all the cases.

(2.) THE writ appeals by the State are against the judgment of a learned single Judge of this Court allowing a batch of similar original petitions. THE challenge in the original petition was against the constitutional validity of certain provisions contained in the Kerala General Sales Tax (Second Amendment) Ordinance, 1989 (Ordinance 7 of 1989) (for short "the Ordinance") and the corresponding provisions in the Kerala General Sales Tax (Amendment) Act, 1990 (Act 3 of 1990) (for short "the amending Act") whereby entries 155 and 179 of the First Schedule to the Kerala General Sales Tax Act, 1963 (for short "the Act") were amended with retrospective effect. THE impugned provisions imposed sales tax on "agarbathis" and "garlic" at the rates mentioned in the relevant entries in the First Schedule with retrospective effect. As per the judgment, the learned single Judge has found that though the Legislature has legislative competence to enact the impugned provisions retrospectively, they are, in the facts and circumstances, totally unreasonably and arbitrary in nature in so far as it imposes heavy sales tax liability retrospectively on transactions which were concluded long before the enactment of the law itself. THE learned Judge has accordingly quashed the impugned provisions to the extent it has been given retrospective effect. THE judgment of the learned single Judge is under challenge in the writ appeals.

(3.) AS regards "agarbathis", the dispute relates to the actual rate of tax leviable on the turnover relating to it during the relevant period, namely, from April 1, 1984 to August 29, 1989. Regarding "garlic", the question is whether any tax at all is payable during the period from April 1, 1984 to August 29, 1989.