XEMBU GOVINDA SINAI CUVELCAR Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners in petitions Nos. 14, 24 and 25 of 1967 under Articles 226 and 227 of the Constitution have questioned the right of the respondents to levy and collect the mining taxes for the years 1962 to 1966 as indicated in the final mining tax lists, on the ground that such taxes are without the authority of law. The prayer is that assessments made in these lists should be quashed by a writ of certiorari or any other appropriate writ, direction or order. In petitions Nos. 24 and 25 the petitioners have been called upon to pay the taxes in accordance with these lists, while in petition No. 14, such a demand is imminent Learned Counsel for the parties are agreed that the decision in writ petition No. 14 will also govern petitions Nos. 24 and 25. The arguments are advanced in petition No. 14 only. This is because the questions involved are identical except for some minor variations, which are not material.

(2.) The respondents in this case are -

(3.) The case of the petitioner Xembu Govinda Sinai Cuvelcar and two others in Petition No. 14 is that they are the owners of some mining concessions. During the Portuguese regime these concessions were regulated by 'Regulamento das Minas' as approved by Decree-Law dated 20-9-1906, (hereinafter referred to as the 1906 decree'), The fixed tax known as 'Imposto fixo' under the 1906 Decree was 500 reis per hectare for mines containing non-precious stones or metals. By Decree Law dated 5th December, 1910. (hereinafter referred to as 'the 1910 Decree'), the Government of Portugal fixed the official rate of the Portuguese rupee as equivalent to 350 reis (hereinafter referred to as 'the Goan rupee'). In 'Estado de India', that is, Goa, Daman and Diu, (hereinafter referred to as 'the territory'), the Goan rupee was a legal tender in the territory. By Decree-Law of 1911 (hereinafter referred to as 'the 1911 Decree'), in metropolitan Portugal after 1911, the escudo was a legal tender with its sub-division into 100 centavos. Before 1911 in metropolitan Portugal the escudo was a legal tender with its sub-division into 1000 reis. Reis ceased to be a legal tender in metropolitan Portugal after 1911. The tax liability levied was increased ten times by Decree Law No. 32251 dated 9th September, 1942, (hereinafter referred to as 'the 1942 Decree'). As the Goan rupee was a legal tender in the territory the tax in reis under the 1906 Decree was payable in the Goan rupees at the official rate of one Goan rupee as equivalent to 350 reis. in terms of the 1910 Decree. This was the position upon 1958 when the Government of Portugal promulgated 'Reforma monetaria do Estado da India' (Currency Reform Law) known as Decree-Law No. 41680 dated 16th June 1958, (hereinafter referred to as 'the 1958 Decree'). The Goan rupee ceased to be a legal tender with effect from 1st January, 1959, when the 1958 Decree was brought into force in the territory. Under the 1958 Decree, the escudo (hereinafter referred to as 'the Goan escudo'), became the monetary unit exchangeable at par with the escudo of metropolitan Portugal. The escudo then became a legal tender. 1 Goan rupee was exchangeable at the rate of 6 Goan escudos. The territory was liberated with effect from 20th December 1961, but, before that date, for the years 1959 to 1961, the Portuguese Government published the final mining tax lists, as in the past. The tax liability in these lists was expressed in the Goan escudos. These lists, according to the petitioners, were prepared by merely multiplying the tax figures in the Goan rupees in the 1958 final mining tax list by six Goan escudos. The territory became part of India with effect from the 20th day of December, 1961, as a result of the Constitution (Twelfth Amendment) Act, 1962, enacted on 27th March, 1962. The Government of India withdrew the Goan escudo from circulation and, in its place, substituted the Indian rupee as a legal tender at the exchangeable rate of 6 Goan escudos for one Indian rupee, Under Section 5(1) of the Goa, Daman and Diu (Administration) Act, 1962, enacted by Parliament on 27th March, 1962 and brought into force with back effect from 5th March, 1962, the laws in force immediately before the 20th December, 1961, were continued in force in the territory until amended or repealed by a competent legislature or other competent authority. The Mines and Minerals (Regulation and Development) Act, 1957 and the Mines Act, 1952 and the rules made thereunder were made applicable to the territory with effect from 1st October, 1963, but the tax continues to be levied on the basis of the 1906, 1910, 1942 and 1958 Decrees, which were continued in force under the said Section 5 (1). The final mining tax lists for the years 1962 to 1966 were prepared by the respondents in terms of these Decrees except in place of the Goan escudo, the Indian rupee was substituted. The petitioners discovered in March 1967, for the first time, that the final mining tax lists for the years following 1959 were vitiated by a fundamental error. The 1958 Decree established a complete parity of exchange between the currency of metropolitan Portugal and the currency of the territory, and, in view of the application of the 1911 Decree and also in view of the repeal of the 1910 Decree by the 1958 Decree, the liability of the petitioners to pay the tax would be about seventeen times less than the liability assessed under the final mining tax lists for the years 1962 to 1966. The increase in taxation by about seventeen times after liberation is in contravention of Article 265 of the Constitution and, consequently, the assessment made therein ay be quashed. This, in substance, is the case of the petitioners.