SHIAM LAL SUNDER LAL Vs. STATE OF HARYANA

JUDGEMENT

(1.) THIS judgment will also dispose of Civil Writ Petitions Nos. 4165, 4564, 4792, 4990, 5436 and 6798 of 1986 as the question involved is common in all the cases.

(2.) EARLIER, these writ petitions were heard along with Civil Writ Petition No. 1573 of 1983 (Food Corporation of India v. State of Haryana [1987] 66 STC 7 (P and H)] and other connected writ petitions, calling in question the sales tax imposed upon the petitioners under the Haryana General Sales Tax Act on account of the procurement of rice by them through the State agency under the Haryana Rice Procurement (Levy) Order, 1979 and calling in question, inter alia, the imposition of the sales tax under Section 4b of the Punjab General Sales Tax Act, for the procurement of rice by them through the agencies of the State under the Punjab Rice Procurement (Levy) Order. Before the judgment could be pronounced in the said writ petitions, the State of Haryana filed identical civil miscellaneous applications, as Civil Miscellaneous Application No. 3369 of 1986 in Civil Writ Petition No. 4283 of 1986, in all the cases mentioned in paragraph 1 of this judgment, in which it was inter alia prayed that the cases of the Food Corporation of India being different from those of the private dealers of Haryana be separated from them and heard separately. The main reason for doing so, given therein was that in view of the Constitution (Forty-sixth Amendment) Act, 1982, the State of Haryana also amended the Haryana General Sales Tax Act so as to include in the terms "purchase" and "sale" acquisition/transfer of property in goods otherwise than in pursuance of a contract, by amending Sub-sections (j) and (1) of Section 2 of the Haryana General Sales Tax Act, 1973, by Act No. 11 of 1984. After issuing notice to the counsel for the writ petitioners, the Bench passed the following order on November 20, 1986 : Counsel for both sides agree that the writ petition referred to in this application may be reheard and decided after the pronouncement of the judgment in the connected Writ Petition No. 1573 of 1983, filed by the Food Corporation of India. The application is disposed of accordingly and it is directed that this writ petition be relisted for hearing after the pronouncement of the judgment in the abovementioned writ petition (No. 1573 of 1983 ). The judgment in Civil Writ Petition No. 1673 of 1983 [food Corporation of India v. State of Haryana [1987] 66 STC 7 (P and H)] was pronounced on November 26, 1986. In the said writ petition, the correctness of the Division Bench judgment of this Court in Food Corporation of India v. State of Punjab [1976] 38 STC 144 was challenged. It was held in the said writ petition : Under the circumstances, we do not find any merit in the contention of the learned State counsel that the Division Bench judgment of this Court in Food Corporation of India's case [1976] 38 STC 144 stands overruled and does not lay down correct law. In these transactions, there is no profit-motive at any stage nor do the goods vest in the State Government in the sense that it can bargain with the corporation and dictate its terms, nor does the corporation act as a dealer in the legal sense when it passes on these goods to the other States. It was further held that the corporation does not act as a dealer when it sends the goods to the other States and that no profit-motive is involved in the transactions entered into between the corporation and the deficit States. The same being the position in the present writ petitions, the same are liable to be allowed in view of the Division Bench judgment of this Court in Food Corporation of India's case [1976] 38 STC 144, as the transactions cannot be held to be sales which could be taxed.

(3.) IN the present petitions the main contention raised on behalf of the State of Haryana was that since there was divergence of the judicial opinion whether the acquisition of commodities under the various procurement and levy orders issued under the Essential Commodities Act, 1955, constituted sale or purchase for purposes of levy of sales/purchase tax, to set the controversy at rest, the Parliament inserted Clause (29a) in Article 366 of the Constitution of India by enacting the Constitution (Forty-sixth Amendment) Act, 1982. By the said clause, the Parliament enacted that tax on the sale or purchase of goods includes a tax on transfer otherwise than in pursuance of a contract of property in any goods for cash, deferred payment or other valuable consideration. Thus, all transfers of property in goods compulsorily acquired under levy orders issued by Government from time to time were brought within the ambit and scope of the term "tax on sale or purchase of goods". In view of the said amendment of the Constitution, the State of Haryana also amended the Haryana General Sales Tax Act, 1973, so as to include in the terms "purchase" and "sale" acquisition/transfer of property in goods otherwise than in pursuance of a contract. This was done by amending Clauses (j) and (1) of Section 2 of the Haryana General Sales Tax Act, 1973 by Act No. 11 of 1984, which was made applicable retrospectively with effect from February 2, 1983, the date on which the Constitution (Forty-sixth Amendment) Act came into force. Thus, according to the learned Advocate-General, the cases of the private dealers of Haryana are to be decided in the light of the amended provisions of the Haryana General Sales Tax Act.