V LAKSHMINARAYANA K Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) THE petitioners in all these cases are resident-dealers who sold goods through their local commission agents, and have submitted certificates in respect of the said turnover to the effect that the tax due on the sales effected on their behalf has paid by the commission agents. To the extent of the tax due under section 5 of the Andhra Pradesh General Sales Tax Act (hereinafter to be referred to as the Act), they have been exempted from paying the tax in view of the certificates. But, in respect of the additional tax on the turnover payable under section 5-A of the Act at the rate of 1/4th paisa on every rupee of the turnover of Rs. 3,00,000 or more, the petitioners, who are the principals, have been assessed.

(2.) THE petitioners have contended before the taxing authorities, as also before the Tribunal, that their agents only are liable, and not they, the principals, in view of the express provisions of section 11 of the Act. Their plea having been rejected by the taxing authorities and the Tribunal, they have raised this question in these revision petitions, which is common to all these petitions filed under section 22 (1) of the Act.

(3.) THE learned counsel, Sri G. V. R. Mohan Rao, relies on the express language of the section and in particular the use of word "shall" and seeks to interpret the section as mandatory. He would therefore say that the tax shall be assessed or levied and collected from the agent only. No doubt, prima facie it appears so, but there are other consideration bearing on the question of interpretation of this provision - whether it is mandatory or directory only. There are numerous cases where the word "shall" has been construed as merely directory. Lord Esher, M. R. , observed that the word "'shall' is not always obligatory. It may be directory" : vide In re Lord Thurlow; Ex parte Official Receiver ([1895] 1 Q B. 724 at 729 (A. I. R. 1961 S. C. 1480 at 1485 ). This rule of interpretation has been adopted by the Supreme Court in M/s. Sainik Motors v. State of Rajasthan (A. I. R. 1961 S. C. 1480 ). It is not so interpreted if the context or the intention otherwise demands. The same rule of interpretation is evident from Raza Buland Sugar Co. Ltd. , Rampur v. The Municipal Board, Rampur (A. I. R. 1965 S. C. 895 ). This is what occurs at page 899 :