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PETITIONER: A.B.ABDULKADIR AND OTHERS

       Vs.

RESPONDENT: THE STATE OF KERALA AND ANOTHER(AN

DATE OF JUDGMENT: 24/01/1962

BENCH: WANCHOO, K.N. BENCH: WANCHOO, K.N. SINHA, BHUVNESHWAR P.(CJ) GAJENDRAGADKAR, P.B. HIDAYATULLAH, M. SHAH, J.C.

CITATION:  1962 AIR  922            1962 SCR  Supl. (2) 741  CITATOR INFO :  D          1967 SC1512  (17,26,54,68)  D          1969 SC1306  (9)  RF         1970 SC1912  (4)  RF         1975 SC 360  (36)  RF         1976 SC 182  (2)  RF         1991 SC 735  (8,20)

ACT:      Central Excise-Control  of tobacco-System  of auctions License  for storage-Repeal of state law- Cochin   and   Travancore   enactments,   if   law corresponding  to   (Central  Excises  Act-"Excise duty", meaning of-Cochin Tobacco Act, 1084 (Cochin 7- of  1084.  .)- Travancore   Tobacco  Regulation, 1087 (Travancore  1 of  1087M.E.) Finance Act,1950 (25 of 1950),ss.11(1),13(2).

HEADNOTE:      ln 1909  the Ruler  of the erstwhile State of Cochin enacted  the Cochin  Tobacco  Act  of  1084 (M.E.)  with   the  object   of  controlling   the cultivation, production,  manufacture, storage and sale of  tobacco. Rules  were framed under the Act for  regulating   the   cultivation,   possession, transportation and sale of tobacco and a system of -  licensing  was  introduced  for  that  purpose. Licences for  storage were  to be annual and to be issued on  payment of licence fee. The authorities administering the  provisionals of the Act and the Rules framed  thereunder were the (commissioner of Excise and  his subordinates.  The system in force for the  collection  of  tobacco  revenue  was  to auction what were called A class and class shops.     A law similar to that prevailing in Cochin was promulgated in  1911 by the Ruler of Travancore as the Travancore  Tobacco Regulation of 1087 (M.E.). The two  States merged  themselves in  1919 as the State  of  Travancore  Cochin  but  the  two  Acts continued to  remain in  force in  the  respective

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territories.  On   April  1,   1950,   after   the Constitution of  India had  come  into  force  and Travancore    cochin     had    become           a 742 Part B State thereunder by s.11 of the Finance Act, 1950, the central Excises and Salt Act,194,was ex- tended to that State. Section 13(2) of the Finance Act, 1950,provided that "if immediately before the 1st day of April,.1950, there is in force  in  any State other than Jammu and Kashmir a law correspo- nding to,but other than, an Act referred to in sub s.(1) or (2) of  s.11,  such law  is repealed with effect from  the said  date.... .  . "  After this provision in  the Finance  Act,  1950,  the  Rules which were in force on April 1, 1950, were changed in the  Cochin area by a notification dated August 3, 1950,  and the  system of  auction sales  of  A Class and  Class shops  was  done  away  with  and instead graded  licence fees  were introduced  for various classes  of licensees.  Similar change was made for the Travancore area by notification dated January 25, 1951. The appellants who were carrying on business  in tobacco  within the territories of Travancore and  Cochin challenged the legal its of the notifications  of August  3, 1950,and  January 25, 1951,  on the  ground that  the Cochin Tobacco Act and  the Travancore Tobacco Regulation under - which  the  notifications  were  purported  to  be issued, were  law  corresponding  to  the  Central Excises and  Salt Act,  1944, and  so  they  stood repealed from  April 1,  1950, by  virtue  of  the operation of  ss. 11 and 13(2) of the Finance Act. It was  contended for the State of Kerala that the main feature  of the  Central Excise and Salt Act, 1944, was  the imposition  of a  duty of excise on goods produced  or manufactured in ,India and that there was  no provision  for charging  duty in the Cochin Act  or  the  similar  Travancore  Act  and therefore all  these provisions  in the  Rules for the  control   of  tobacco   from  the   time   of cultivation to the time of the final stage of sale to the  consumer, even though they-were similar to the Rules  under the  Central Act,  would not make the Cochin Act or the similar Travancore Act a law corresponding to the Central Act. ^      Held, that  the rules framed under the Cochin Tobacco  Act  of  1084(M.E.)  and  the  Travancore Tobacco  Regulation   of  1087  (M  E.)  requiring licences to  be taken  out for storage and sale of tobacco and  for payment of licence fee in respect thereof were  law corresponding  to the provisions of the  Central Excises  and Salt  Act, 1944, and, hence, were superseded on April 1, 1950, by virtue of  s.   1312)   of   the   Finance   Act,   1950. consequently, the  new Rules framed in August 1950 and January  1951  for  the  respective  areas  of Cochin and  the respective  areas  of  Cochin  and Travancore for the issue of license and payment of fee therefore for storage of tobacco, were invalid ab initio.      Per Sinha, C. J., ’Gajendragadkar,Wanchoo and Hidayatullah, JJ.-(I) The Cochin Tobacco Act, 1084 743 (M.E.),  as   well  as   the  Travancore   Tobacco

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Regulation,  1087(M.E.),  were  in  substance  law corresponding to the Central Excises and Salt Act, 1944, and  therefore, stood-repealed  on April  1, 1950.      (2) The  auction system  which was  in  force under the  Cochin and  Travancore Acts  was only a method of  realising duty  through  the  grant  of licences to  those who made the highest bid at the auctions. The  fact  that  this  system  was  used instead of-the  system  of  charging  of  duty  as provided in  s.3 of  the Central  Excise and  Salt Act, 1944,  would not  make any  difference to the nature of the impost; the income from auctions was in the nature of excise duty.      Per Shab, .J.-An Excise duty is, according to the Indian  statute, a  duty on the manufacture or production of  goods and the duty which was levied in the  States of  Travancore and  Cochin  on  the storage of tobacco cannot be regarded as a duty of excise.      In re  The Central  Provinces and Berar Sales of Motor Spirit and Lubricants Taxation Act, 1938, [1939] F.C.R  18, The Province of Madras v. Messrs Boddu  Paidanna   and  Sons,   [1942]  F.A.R.  90, Governor-General-in-Council v. Province of Madras, (1945)’ L.R.  72 I.A.  91 and Chaturbhai, M. Petal v. The  Union  of  India,  [1960]  2  S.C.R.  362, considered.

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil Appeals. Nos. 89, 90 and 126 to 128/61.      Appeals from the judgment and order dated      November 8, 1957, of the Kerala High Court in o. Ps. Nos. 70 and 71 of 1956(K) and 2, 6 and 7 of 1955 E.      M.C. Setalvad,  Attorney-General of India and R. Gopalakrishnan,  for the  appellants in  a. As, Nos. 89 and 90 of 61.      G. S.  Pathak and  V, A.  Seyid Muhammad, for the respondent in C. As. Nos. 89 and 90 of 61.      A. V.  Viswanatha Sastri, A. George Titus, R. Mahalingier and  M. R.  Krishna  Pillai,  for  the appellants in C. As. Nos. 126 to 128 of 61.      G. S.  Pathak and  Sardar  Bahadur,  for  the respondents in a. As, Nos, 126 to 128 of 1961. 744      1962. January  ‘ 24.  The Judgment  of B.  P. Sinha, C.  J., P. B. Gajendragadkar, K. N. Wanchoo and  M.   Hidayatullah,  JJ.,   Was  delivered  by Wanchoo, J,  J. C.  Shah, J., delivered a separate judgement.      WANCHOO,    J.-These    five    appeals    on certificates-granted by  the High  Court of Kerala raise a  common question  of law and will be dealt with together. Two of them (appeals 89 and 90) are from what  was formerly  the Cochin  area and  the other three are from what was the Travancore area. They relate to a tax on tobacco in these areas. As the facts,  laws and  rules in  the two  areas are similar we  propose to  deal in  detail  with  the appeals from the Cochin area.      In 1909,  Act VII  of 1084  was passed by the

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Maharaja of  Cochin to  consolidate and  amend the law relating  to tobacco and was called the Cochin Tobacco Act,  VII of  1084 (hereinafter called the Cochin  Act).   Section  4   of  the   Cochin  Act prohibited the  possession  for  sale,  transport, import or  export, sale and cultivation of tobacco except as  permitted under  the Act  or the  rules framed thereunder. section 5 of the Act gave power to the  Diwan to  make rules  - from  time to time consistent with  the Act  to permit. absolutely or subject to  any conditions,  and also  to regulate the possession  for  sale,  transport,  import  or export, sale and cultivation of tobacco as well as the form  of duty  leviable on the sale of tobacco by retail. The remaining provision of the Act deal with    offences,     prosecutions     punishment, confiscation and  other ancillary  matters such as arrest  and   siezure,  with   which  we  are  not concerned in  the present  appeals. Reference  may however be  made to  s. 18 which provided that "no action shall lie against the sirkar or against any officer of  the Excise  department for  damages in any civil  court for  any act  bona fide  done  or ordered to be done in pursuance of this Act, or of any law for 745 the  time  being  in  force  relating  to  tobacco revenue. Rules  were framed  under the  Cochin Act called the  Tobacco Cultivation  Rules, which,  by the first  rule provided  that "the cultivation of tobacco plant is prohibited except under a licence and  shall   be  restricted   to  such   parts  or localities of  the State,  as may,  from  time  to time, be  fixed by  the Diwan............ " Rule 3 provided for  drying,  curing,  manufacturing  and storing of  the tobacco,  cultivated in the State, to be  done under the supervision of an officer of the Excise  Department in  licensed  manufacturing yards  and   storehouses.  Rule   4  provided  for licensed for manufacturing yards and store houses. Rule 5  laid down  that the  licences would  be in force for  one official year and were to be issued on payment  of a fee of Rs. 50/- for each licence, Under  r.  6,  the  tobacco  crop  could  only  be harvested  after   permission  obtained  from  the Inspector of  Excise and  under r.7 the harvesting was to  be done  by the  licensed cultivator under the general  superintendence of the Sub-Inspector. Of the  locality in  which the area cultivated lay and the  harvested corp was to be transported only under permits granted by him from such area to the manufacturing yard  where alone manufacture was to be undertaken. Rule 8 provided for the maintenance of a stock book by a licensee of a storehouse or n manufacturing yard.  Rule  13  provided  that  the licensed manufacturer  and the  storehouse  keeper would sell  or otherwise dispose of his stock only to licensed  dealers  and  there  was  prohibition against the  disposal or  sale of  tobacco to  any person who had not the required license to possess the same. Rule 15 made it an office for any one to cultivate,   dry,    cure,   manufacture,   store, transport, sell  or otherwise   dispose of tobacco in contravention of the Rules.      In  addition   to  these  Rules,  there  were

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further Rules  also framed  under the  Cochin  Act with, 746 respect  to  import of tobacco into the State, and all  import   was  prohibited   except  under  the provisions of  the Diwan’s notification describing the sale of tobacco shops and licences. Possession of tobacco  for  the  purpose  of  sale  was  also prohibited except  under the  provisions  for  the sale of  tobacco shops  and  licences.  Export  of tobacco  was   also  prohibited  except  with  the special sanction of the Commissioner of Excise.      It further  appears that  the system in force for the collection of tobacco revenue up to August 1950 was to auction what were called A class and B class shops  and the last of such auction was held under the  notification dated  May  30,  1919.  In addition there were a class shops, the licence for which was  granted either on the recommendation or in  consultation   with  class  licensees  at  the discretion of the Excise Commissioner or any other officer  authorised  by  him  on  payment  of  the prescribed fee.  This system  along with the Rules already referred to was in force on April 1, 1950.      On April  1, 1950, after the Constitution had come into force and Travancore-Cochin has become a Part State  thereunder, the   Finance Act, No. XXV of 1950,  extended the  Central Excises  and  Salt Act, No.1   of  1944  -  (hereinafter  called  the Central Act),  to the  Part  State  of  Travancore Cochin by  s. 11  thereof. Section  13 (2)  of the Finance Act, further provided that "if immediately before the  1st day  of April,  1950, there  is in force in  any State other than Jammu and Kashmir a law corresponding  to,  but  other  than,  an  Act referred to  in sub-s.  (1) or  (2) of s. 11, such law is  hereby repealed  with effect from the said date.. "  It seems  that in  consequence  of  this provision in  the Finance  Act,  1950,  the  rules which were in force on April l, 1950, were changed in the  Cochin area by a notification dated August 3, 1950,  and the  system of  auction sales  of  A clause and shops was done away with and instead 747 graded licence  fees were  introduced for  various classes of  licensees, including  class licensees. Similar change was made for the Travancore area by notification dated  January 25,  1951. These Rules introduced by  these two  notifications  also  did away with  the  control  of  cultivation,  drying, curing, manufacturing and wrare-housing which were in force  under the  earlier Rules,  so that these new Rules were only concerned with licensing of A, and C class shops. A class licensees under the new Rules were  called stockists, class licensees were wholesale  sellers  and  a  class  licensees  were retailers. The  system for  A class  licensees was that they  were to  pay a minimum annual fee for a Maximum  quantity  of  tobacco  or  tobacco  goods possessed by  them and  additional fee for further additional quantity,  Thus, for  example,  in  the case   of jaffra  tobacco  it  was  provided  that maximum  annual   fee  would  be  Rs.1,500/-for  a minimum of 100 candies and further fee of Rs.1,000 for additional  quantity of  100 candies  or  part

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there of.      The appellants  of Cochin  area were  tobacco dealers and  holders at  the time they filed their petitions in  1956 of  A class  licences. The main contention  raised   on  their   behalf  in  their petitions was  that the  Cochin Act stood repealed by the  Finance Act  1950, on  the introduction of the Central  Act in  the part State of Travancore- Cochin from  April 1,  1950  in  consequence,  the notification which  was issued  on August 3, 1950, or on  January 25, 1951, framing new Rules for the issue of  licences and  prescribing rules therefor under the powers conferred under the Cochin Act or the similar  Travancore Act  were ab initio  void, because the  Acts under  which  the  notifications were; purported  to be  issued stood repealed from April 1,  1950. In  addition various other grounds were raised  challenging the  validity of  the new Rules which, however, we do not think it necessary for the purposes of these appeals to set out here, 748      The petitions  were opposed  on behalf of the State and  it was contended that the Cochin Act or the similar  Travancore Act did not stand repealed from April  1, 1950,  In consequence  it was urged that the  State was  competent to  frame new Rules which it  did under  the Cochin Act or the similar Travancore Act.  Further the case of the State was that the graded licence fee introduced after April 1, , was a tax which was sustainable under item 60 or 62  of List  II of  the Seventh Schedule to the constitution.      The  High   Court  dismissed   the  petitions holding that  the laws  under which  the new Rules were framed  were in  force and  were  justifiable under item  62 of List II of the Seventh Schedule. Unfortunately, though  the judgment  of  the  High court mentions  the contention  of the  appellants that on  the extension  of the  Central  Act  with effect from  April 1,  1950, by  the Finance  Act, 1950, the  Cochin  Act  as  well  as  the  similar Travancore Act  ceased to  be operative  from that date, there  is no discussion in the judgment with regard to  this contention, and the High Court did not consider  whether in  view of  s.13(2) of  the Finance Act,  1950, the  Cochin Act as well as the similar Travancore  Act stood  repealed from April 1, 1950.  If the effect of s. 13(2) of the Finance Act, 1950, was to repeal the Cochin Act as well as the similar  Travancore Act,  from April  1, 1950, there will  be no  law in  operation  which  would justify the  framing of  the new  Rules either  in August 1950  or‘in January  1951 and it would then be unnecessary  to consider  whether a law contain in,as provisions similar to those contained in the notification would be within the competence of the State legislature under item 62 of‘ List ll of the Seventh Schedule.  That question  would only arise if the  Cochin Act  or the  similar Travancore Act survived the  repeal effected  by s.  13(2) of the Finance Act. 749      We have  therefore to see what the provisions of the  Finance Act  are in  this  Connection.  As already indicated,  B. 11(1)  of the  Finance  Act

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extends the  Central Act  and the Rules and orders made thereunder  which were  in force  immediately after the  commencement of  the Finance Act to all Part  States,   except  the  State  of  Jammu  and Kashmir. Consequently,  the Central Act as well as the Rules  and  orders  made  there  under  become applicable to  the Part State of Travancore-Cochin from April  l,  1950.  Further  s.  13(2)  of  the Finance Act  specifically provides that from April 1, 1950,  any law corresponding to the Central Act will be repealed from that date. The contention on behalf of the appellants is that the Cochin Act as well as  the similar  Travancore  Act  was  a  law corresponding to  the Central  Act  and  therefore stood repealed  as from  April 1,  1950, under  B. 13(2) of  the Act.  and it is this contention that we have to examine.      It was  pointed out  by  this  Court  in  The Custodian of  Evacuee Property v. Khan Saheb Abdul Shakoor, etc.  (1) that  where  the  Act  repealed provides substantially  for all  matters contained in  the   Act  effecting   the  repeal   there  is correspondence  between   the  two  Acts  and  the earlier Act  would thus  stand repealed; it is not necessary that  there should  be complete identity between the  repealing Act and the Act repealed in every respect,  Therefore, when  s. 13  (2) of the Finance Act  provides that on the extension of the Central Act  from April 1, 1950, to the Part State of Travancore Cochin, any law corresponding to the Central Act  is repealed  with  effect  from  that date, all  that we  have to  see whether  the  law repealed  substantially   provided  for  the  same matters as the Central Act, even though it may not be identical in all respects.      Let us  therefore turn  to the Cochin Act and the  rules   framed  thereunder   to  see   if  it substantially 750 provides for  the  same  matters  with  which  the Central  Act   and  the   Rules  and  Orders  made thereunder deal.  The main contention on behalf of the respondent  in this  connection  is  that  the Central Act is an Act imposing a duty of excise on tobacco under  item 45  of List  I of  the Seventh Schedule to the Government of India Act, 1935 (now corresponding to  item 84 of List I of the Seventh Schedule to  . the constitution), and such duty of excise is a duty on goods manufactured or produced in India.  Thus according  to the  respondent, the main feature  of the Central Act is the imposition of a  tax on  goods produced  or  manufactured  in India and  unless the  Cochin Act  or the  similar Travancore.  Act  also  imposes  a  tax  on  goods produced or  manufactured  in  what  was  formerly Cochin or  Travancore  State  these  would  be  no question of correspondence between the Central Act and the  Cochin Act or the similar Travancore Act. Reference was  also made  to  In  Re  the  Central Provinces and  Berar Sales  of  Motor  Spirit  and Lubricants Taxation  Act. 1938  Central  Provinces and Berar  Act XIV  of 1938)  Province of Madras v Messrs. Boddu  Paidanna and  Son(2) and  Governor- General in  Council v.  Provinces of  Madras  (3), where  the   nature  of   a  duty  of  excise  was

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considered. In the first case it was held that the primary meaning  of "excise  duty" was of a tax on articles produced  or manufactured  in the  taxing country (see  p. 40). It was also observed in that case that it could not be denied that laws were to be found  which impose  a duty of excise at stages subsequent to  the manufactures  or production. In the second  case it was held that duties of excise were duties  levied on the manufacture or producer of the  commodity taxed.  In the   third case, the Privy council  approved of the view of the Federal Court as  to the  nature of the duty of excise. It may therefore be accepted that a duty of excise is a 751 tax on  goods  produced  or  manufactured  in  the taking country.  It  may  also  be  accepted  that generally speaking  the tax is on the manufacturer or the  producer,. though it cannot be denied that laws are to be found which impose a duty of excise at  stages   subsequent  to   the  manufacture  or production. We  cannot  however  forget  that  the Cochin Act  or  the  similar  Travancore  Act  was passed by  State  in  which  there  were  no  such Constitutional provisions  as are  to be  found in the Government  of India  Act and  it  legislative Lists and  this aspect  will have  to be  borne in mind when  judging the  question of correspondence between the  Central Act and the Cochin Act or the similar Travancore Act.      Now the  Central Act provides by s. 3 for the levy and  collection of  duties of  excise on  all excisable goods other than salt which are produced or manufactured  in India  and also a duty on salt manufactured in  or imported by land into any part of India.  Further s.  6 of  the central Act gives power to  the central Government to issue licences and prohibits  any person  from  engaging  in  the wholesale purchase  or also  whether  on  his  own account or  as a broker or commission agent or the storage of  any excisable  goods except  under the authority and  in accordance  with the  terms  and conditions of  a licence granted under the Central Act. In  Chaturbhai.M. Patel v. The Union of India (1) where  the various  provisions of  the Central Act  (including   s.  6)   and  the  rules  framed thereunder were  attacked on  the ground that they had nothing  to do with the levy and collection of duties of excise, this court held that the various provisions of  the Central  Act and the Rules made thereunder were essentially Connected with levying and collection  of excise  duty and  in  its  true nature and  character the Central Act remained one under item  45 of  List I  and that the incidental trenching upon  the  provincial  field  would  not affect its  constitutionality. The  nature of  the Rules the 752 considered  will   appear   from   the   following observations at p. 371:           "It  (the   Central  Act)  is  a  fiscal      measure to  levy and realise duty on tobacco.      The method  of realising duty must be left to      the wisdom  of the  legislature  taking  each      individual trade  and its  peculiarities  and

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    difficulties  which  arise  in  that  matter.      Various provisions  of the  Act and the Rules      show that the authorities are on the track of      the movement  of tobacco  from the time it is      grown to the time it is manufactured and sold      in the  market and  the various provisions of      the Act  and the  Rules made  thereunder have      been considered  necessary  for  effectuating      the purpose of the Act."      It is  true that the Central Act provides for the levy of excise duty under s. 3 but in order to carry  out   that  purpose  it  has  provided  for licences under  s. 6.  The Rules  also provide  in Chap. III  for levy and refund of duty, in Chap. V for manufactured  goods other  than salt, in Chap. VII for  warehousing, in Chap. VIII for licensing. Thus in  order  to  levy  excise  duty  under  the Central Act,  there are  provisions in  the  Rules which start  in the case of tobacco from the stage of cultivation  and continue  right up to the time the finished  product  reaches  the  hand  of  the retailer and  thus becomes  a part  of the commons stock for  purposes of  sale to  the consumers. We have also  seen  that  the  Cochin  Act  similarly provides for control- on tobacco from the stage at which it  is grows  to the  stage till‘it  reaches Glass licensees  who sell  it  in  retail  to  the consumers. The Cochin Rules may not be so detailed as the  Rules under the Central Act but their main object and  purpose is the same, namely, to keep a check on  tobacco from the time it is grown to the time  it   reaches  the   a  Glass   licensee  who eventually sells  it to  the consumer.  Further if one looks at the Rules 753 under the similar Travancore Act in vol. II of the Travancore Excise  Manual which were in force on A April 1,  1950, in  relation to tobacco it will be found that  there are  elaborate rules in Part III from pp.  257 to  325 dealing  with all aspects of control relating  to tobacco.  Chap. IV deals with bonding and  issue;  Chap.  V  with  licences  for sales, Chap.  VI with  transport  and  possession. Further there are rules at p. 296 for cultivation, curing and  warehousing. Then  at p.  14 are rules for the  manufacture of cigars, cheroots and snuff in bond.  It will  thus be clear r that the Cochin as well  as  the  Travancore  Rules  provided  for similar central  of tobacco  as under  the Central Act and  show that  the authorities  in Travancore and Cochin  were also on the track of the movement of  tobacco   from  the  time  it  was  grown  and manufactured to  the  time  it  was  sold  in  the market. It  would therefore follow that the Cochin Act as  well as  the similar  Travancore Act along with the  Rules corresponded  to the  Central  Act substantially and  would thus  be repealed  by  s. 13(2) of the Finance Act, 1950.      But it  is urged  on behalf of the State that there is  no provision  for charging  duty in  the Cochin Act  or  the  similar  Travancore  Act  and therefore all  these provisions  in the  Rules for control from  the time  of cultivation to the time of the  final stage  of sale to the consumer, even though they  are similar  to the  Rules under  the

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Central Act,  would not make the Cochin Act or the similar Travancore  Act a corresponding Act to the Central Act.  There is  no doubt  that there is no provision corresponding to s. 3 of the Central Act in the  Cochin Act  or in  the similar  Travancore Act. Under  the Cochin  Act the  tax was levied by virtue of  the power  conferred on the Diwan under s. 5  to make  rules for  the purpose.  Under  the similar Travancore Act, the provision is contained in s.  31 which  provides that  the Diwan may with the sanction of the ruler make rules permitting 754 absolutely or  subject to  the payment of any duty or fee  or to any other conditions, and regulating within  the   whole  or   any  specified  part  of Travancore,    the    cultivation,    manufacture, possession, transport, import and sale of tobacco. So in  both the  former States,  the Act  did  not contain a charging section and the duty was levied by the  Rules framed by the Diwan under the powers conferred  on   him  by   the  Act.   In  essence, therefore, the  provision for charging the tax was made in  the Rules.  Further it  is true  that the method by  which the  tobacco revenue was realised was through  auction sales of the right to possess and sell  tobacco. But we must not forget that the Cochin Act  as well  as the similar Travancore Act was passed  by a Ruler who was not trammelled by a constitution like  the Government  of  India  Act, 1935,  and   its  Legislative  Lists.  The  method evolved  for  realising  tobacco  revenue  was  to auction the  right to  poses and  sell tobacco and the amounts  received at such auctions would cover what would  be duty  under s. 3 of the Central Act and licence  fee under  s. 6  thereof. It is urged however that this does not amount to duty on goods produced, nor  is the  duty in such a case paid by the manufacturer or producer of the goods. We have already indicated  that the essence of the duty of excise as  held by the Federal Court and the Privy Council  is  that  it  is  a  duty  on  the  goods manufactured or  produced in  the taxing  country. Further as  generally the  duty is  on  the  goods produced  or   manufactured  it  is  paid  by  the producer or manufacturer, though as in the case of all indirect  taxes it  is passed on eventually to the consumer in the shape of being included in the price and  is thus  really borne  by the consumer. Further the  cases  on  which  reliance  bas  been placed on  behalf of the State also show that laws are to  be found  which impose  duty of  excise at stages subsequent to manufacture or 755 production. As  a matter  of fact, even in British India before 1935 there used to be public auctions of the  right to  possess and sell excisable goods like country  liquor,  ganja  and  bhang  aid  the amount realised  was excise  revenue. It  is  also obvious that  this system  of  auction  is  not  a system of levying sales tax because it has nothing to do  with the  levy on  each sale,  which is the essence of  a sales  tax. It  seems  that  in  the former States  of Travancore  and Cochin,  auction system  continued   right  up   to  the  time  the constitution came into force and even for sometime

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thereafter. It  seems under the circumstances that the auction  system which  was in force was only a method of  realising duty  through  the  grant  of licences to  those who made the highest bid at the auctions. The  fact therefore that this system was used instead  of the system of charging of duty as provided in  s. 3  of the Central Act would not in our opinion  make any  difference to the nature of the impost  which was  in force  on  the  relevant date, namely,  April 1, 1950. It was however urged that under  this system even tobacco which was not produced or  manufactured in  the  State  but  was imported from outside was included for the purpose of licences  granted under it. That is undoubtedly so.  But  from  the  Rules  which  were  in  force regarding cultivation,  curing, manufacturing  and so on  of tobacco within the State it would not be unreasonable to infer that the substantial part of the income  from auctions  was still in the nature of excise  duty. Even  in  the  case  of  imported tobacco, only  with respect  to that  part  of  it which was  eventually sold  to the  consumer as it was imported  without any  processing or treatment in the State, it can be said that the impost which fell on  it was  not in the nature of excise duty. However, there  is no  way of differentiating this part of  the revenue from the rest and considering the elaborate  provisions as  to  the  control  of tobacco trade from the grower right up to the time that the 756  goods  were sold  to the public in retail sale it would r in our opinion be not unreasonable to hold that the  Cochin Act as well as the Travancore Act was in   substance  an Act  corresponding  to  the Central Act.  Therefore when  the Central  Act was extended to the Part State of Travancore-Cochin by s. 11  (1) of  the Finance Act and the Finance Act specifically provided  by s. 13 (2) for the repeal of corresponding  law, the  result  was  that  the Cochin Act  as well  as the similar Travancore Act stood repealed.  There would  be no  power in  the State Government  thereafter to  frame  new  Rules either in August 1950 or in January 1951 for there would be  no law  to support  the  new  Rules  and without such  law the new Rules could not impose a tax as  that would  clearly offend Art. 265 of the Constitution. Further as soon as the Cochin Act as well as  the similar Travancore Act stood repealed on April  1, 1950,  by virtue  of a  13(2) of  the Finance Act  there could  be no  question of their being sustained  under item  62 of  List II of the Seventh Schedule  for that  would  only  arise  if these were  not repealed  as corresponding  law by s.13(2).      Turning now  to the  three Travancore appeals it is  enough to  pay that  they stand on the same footing as the two Cochin appeals. If anything the Travancore Act  as well  as the  Travancore  Rules which were  in force  on April  1, 1950  are  more elaborate than  the  Cochin  Act  and  the  Cochin Rules.  Further   the  Travancore  Act  by  s.  31 actually refers  to manufacture  also. The  Cochin Act did not refer to manufacture in the Act itself though there  was provision for manufacture in the

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Rules framed under the Act. What applies therefore to the  Cochin Act and the Rules framed thereunder applies in  force to  the Travancore  Act and  the Rules framed thereunder and there is no doubt that the Travancore Act and the Rules framed thereunder were also  a law  corresponding to the Central Act and the  Rules framed  thereunder. The  Travancore Act therefore  also stood  repealed from  April 1, 1950. There 757 would thus  be no  law to support the Rules framed by the  State  Government  in  January  1951  and, therefore the Rules must fall.      It appears  that these  new Rules  have  been abrogated as from January 1958. So it Was urged on behalf of  the State  that this  Court should  not grant a  mere declaration  as to the invalidity of the Rules  when they  are no  longer in existence. This argument  in our opinion has no force because we must  look to  the situation as it was when the petitions were  presented.  The  Cochin  petitions were  presented   in  1956   and  the   Travancore petitions were  presented in 1955 and at that time the Rules  were in  force and  they  continued  in force   till    December   1957.   Therefore   the petitioners would  be entitled  to  a  declaration that the  Rules were  invalid because  at any rate that would  give them  relief so far as the period after their petitions is concerned while the Rules remained in force.      We therefore  allow the appeals and set aside the order  of the  High Court.  The petitions  are allowed and  it is  hereby declared  that the  new Rules purporting  to be  framed either  under  the cochin Act  or under  the Travancore Act in August 1960 and  thereafter in  January 1951 were invalid ab initio   and  have no  force  and  effect.  The appellants will get their costs from the State-one set of hearing costs.      SHAH, J.-In  this group  of five  appeals the principal question which falls to be determined is whether within  the meaning  of a  1:3(2)  of  the Finance Act, 1950 (which by s. 11 thereof extended the Central  Excise &  Salt Act, I of 1944, to the Part b  States), there was, immediately before the 1st of  April 1950,  in force  in  Part  State  of Travancore-Cochin,  a  law  Corresponding  to  the Central Excise  & Salt  Act,  1944  It  is  common ground that  if there  was such a law in force, by virtue of s.13(2) of the Finance Act of 1950, that law stood repealed, 758      The appellants in Civil Appeals Nos.89 and 90 of 1961  were carrying  of  the  former  state  of Cochin. Appellants  in Civil Appeals 126 to 128 of 1961  were residents of and carried on business in tobacco with  in territory  of the former State of Travancore.  On   July  1,   1949  the  States  of Travancore and Cochin from themselves into a Union under a  common administration,  but by the virtue of Travancore Cochin Administration Law ,6 of 1125 (M.E.), the  Acts which  were previously in force. In the Territory of the former State of Travancore ,  there  was  in  force  the  Travancore  Tobacco Regulation I of Travancore in 1911. By s. 3 of the

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Act,"Tobacco"  was  define  as  including  "snuff, cigars cigarettes,  beedies,  tobacco  powder  and other  preparations   or  admixtures  of  tobacco" Section 4  of the Act imposed excepts as permitted by the  Act or  by any other enactment relating to tobacco for  the time  being in force by the Rules published  under   the  Act   or  any  other  such enactment   prohibitions    against   cultivation, manufacture  possessions   transport,  importation exportation or  sale of tobacco. By Chapter III of the Act  power was  conferred upon the officers of the Excise Department to search house suspected to contain  tobacco   and  provision   was  made  for incidental matters. Chapter IV dealt with offences and punishments  and by  s. 31  the Diwan  of  the State was  authorised, with  the sanction  of  the Ruler, from  time  to  time,  by  Notification  in Gazette to  make rules  consistent  with  the  Act amongst other  subject  permitting  absolutely  or subject to  the payment  of any  duty or fee or to any other  conditions and  regulating  within  the whole or  to any  other conditions  and regulating within the  whole or  any specified  part  of  the State  of   Travancore,  cultivation   manufacture possession transportation 759 import  and   sale  of  tobacco;  authorising  the establishment  of  warehouses  or  bankshalls  for storing tobacco  legally  cultivated  or  imported into the territory fixing the mode, time and place of levy  T of duty, regulating the special custody of tobacco  warehoused and  the levy  of fees  for warehousing and  transport, and generally to carry out the  provisions of  the Act. Rules were framed in 1913  in exercise  of the powers under s. 31 of the Tobacco  Act whereby restrictions were imposed upon  the   import  and   export  of  tobacco  and provision  was   made  for   bonding  tobacco   in warehouses and  for  the  issue  of  licences  for bonding  tobacco.  Provision  was  also  made  for licensing  retail   sale  for   tobacco  and   for transport and  possession thereof.  Certain  other rules   regulating    cultivation,   curing    and warehousing tobacco  and for the issue of licences for those purposes were promulgated in 1937. Rules were also  framed regulating  the  manufacture  of cigars, cigarettes  and cheroots  in  bonds  under licences. It is unnecessary to set out these rules in  detail,   it  may   suffice  to  observe  that cultivation,  curing,   manufacture,   possession, transport, importation and exportation and sale of tobacco was  controlled by  a system of licensing. Certain licences were issued free of charge and in respect  of  certain  other  licences,  especially storage and sale, fee had to be paid to the State.      Similarly, in  the State  of Cochin there was enacted by  the Ruler of Cochin the Cochin Tobacco Act of  1084 (M.E.)  on May 3, 1909. By s. 3(d) of that Act,  tobacco was  defined  as  inclusive  of "snuff, cigars  and preparations  of which tobacco forms a part " By s. 4, except as permitted by the Act or  by the  Rules made  thereunder, possession for  the  purposes  of  sale,  transport,  import, export,  sale  and  cultivation  of  tobacco  were prohibited. By  a 5,  the Diwan  of the  State was

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authorised  from   time  to  time  after  previous publication, to make rules consistent with the Act to permit abso. 760 lutely or subject to any Conditions regulating the possession,   transportation,    importation    or exportation and  sale and  cultivation of tobacco. Contravention of  the Act  and the Rules or orders made under  the Ace  were penalised by s. 6. Rules were framed  in 1923  under the Cochin Tobacco Act providing  for   a   system   of   licensing   for cultivation, manufacture  and storage  of  tobacco and for incidental matters. Control was maintained over harvesting,  weighment, storage, stock taking and transport  of tobacco,  and also on the export and   import    of   tobacco.    The   authorities administering the  provisions of  the Tobacco  Act and  the   Rules  framed   thereunder   were   the Commissioner of Excise and officers subordinate to him in the Excise Department. Licences for storage were to  be annual  licences and  to be  issued on payment of  licence fee.  Under the Cochin Act and the Rules framed thereunder control was maintained on tobacco  at all  the stages  of its production, manufacture and disposal.      From a  resume’, of  the provisions  of these two  Acts   and  rules  and  notifications  issued thereunder, it is manifest that on the production, manufacture storage  and sale  of tobacco  control was imposed and the administration of this control was left in the hands of the Excise Departments of the two  States. As stated hereinbefore, by virtue of  Act  VI  of  1125  (M.E.),  the  two  Acts  in operation within the territories of the two States were continued  even after the Union of Travancore and Cochin  as formed,  and by  Art.  372  of  the constitution  the   provisions  of  the  two  Acts remained in  operation in  the respective  area of the former  States even  after the Part‘B State of Travancore-Cochin came  into being  on January 26, 1950. By  s.11 of  Finance Act  25 of 1950 certain Acts including  the Central  Excises & Salt Act, 1 of 1944,  and all Rules and orders made thereunder in force from time to time before the commencement of the 761 Finance Act  were extended  with effect from April 1, 1950, to the part B States (except the State of Jammu &  Kashmir), It  was provided  by  s.  13(2) "that if  immediately before  the  1st  of  April, 1950, there  was in  force in any State other than Jammu &  Kashmir a  law corresponding to but other than the  Act referred to in sub-s. (1) s. 11 such law" shall  stand repealed  with effect  from  the said  date.   Presumably,  on   account   of   the application of  the Central  Excises & Salt Act, I of 1944,  by s.  11 of  the Finance Act, 1950, the Part B  State of Travancore-Cochin published fresh sets of  Tobacco Rules. These Rules were issued on January 25,  1951, in  purported exercise  of  the powers conferred by the Travancore Regulation I of 1087 (M.E.)  and the  Cochin Tobacco  Act of  1084 (M.E.). Rule  14 (which is common to both the sets of Rules)  provides that  "the vend  of tobacco of all kinds  is  prohibited  throughout  the  state,

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except under a licence". Rule 15 provides that the "licence for  the vend  of tobacco shall be of the following description:-           (i)  Stockist or ’A’ Class licence;           (ii) Wholesale  or ’B’  Class licence  ; and           (iii)Retail or ’C’ Class licence."  Rule 16(i) and (ii) provides:           "(i) Holders  of Stockist  or ’A’  Class                licences  shall   be  entitled   to                purchase tobacco  from  any  dealer                within or without the State without                any quantitative  restriction. This                class of  licensees shall sell only                to other  ’A’ Class licensees or to                ’B’ Class licence,           (ii) The  annual fees for these licences                shall be as follows:-                     (Then follows  a  table  which                sets out minimum fee prescribed for                varieties of  tobacco stocked  upto                the maximum 762                prescribed   quantity    and    the                additional fee payable for stocking                additional quantities.)"      The appellants  in all these appeals were ’A’ Class  stockists  and  were  called  upon  to  pay licence  fee   prescribed  by  these  Rules.  They claimed that  they were  not liable to pay licence fee under  the Rules  framed in 1951 because there was absolute  delegation of  legislative power  by the  Rules,   that  the   levy   infringed   their fundamental rights  under Arts. 14 and 19(1)(g) of the Constitution,  that the duty levied was in any event  an   excise  duty,   and  because  the  fee represented a  tax on trade, calling or employment and  on   that  account   was   subject   to   the constitutional restriction imposed by Art. 276 (2) of the  Constitution. They also contended that the Tobacco Acts  of  the  Travancore  State  and  the Cochin State,  which had  been kept alive by Act 6 of 1125 (M.E.) and by Art. 372 of the Constitution were superseded  by the application of the Central Excises and  Salt Act,  1944,  by  s.  11  of  the Finance Act, 1950.      The High  Court of  Travancore-Cochin in  the petitions for  writs of  mandamus and  other writs negatived the contentions raised by the appellants that the  Acts and  the  Rules  amounted  absolute delegation  of   legislative  power  or  that  the fundamental rights under Arts. 14 and 19(1)(g) and the restrictions  imposed by  Art. 276(2)  of  the Constitution  were  infringed  thereby.  The  High Court also  held that  the duty  levied was not an excise  duty   and  presumably   on  that  account declined to  consider  the  question  whether  the Tobacco Acts  of  the  States  of  Travancore  and Cochin  had   been  superseded  either  wholly  of partially  by   the  application  of  the  Central Excises and Salt Act of 1944.      The Travancore  and the  Cochin Acts  do  not directly  levy   any   duty   on   production   or manufacture of  tobacco. Restrictions, it is true, are imposed

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763 the growing,  curing, manufacture, storage, import and export  by requiring  that licences  shall  be obtained  for   those  purposes   and  prescribing penalties for violating the provisions of the Acts and the  Rules. It  also appears that the trade in tobacco was  regulated before the formation of the B State  of Travancore-Cochin, by holding auctions for the  rights to  sell tobacco.  These  auctions were held  by Excise Commissioners and the highest bidder in  the auction  got the  right to  deal in tobacco,  and   the  two  Acts  were  enacted  for regulating and  controlling the  sale of  tobacco, but the  State  did  not  levy  any  duty  on  the manufacture or  production of tobacco. The licence fee for  the  issue  of  a  licence  for  growing, curing,  manufacturing,  exporting,  importing  or storing is  not in  itself an  excise duty  on the manufacture or production.      The  Federal  Court  In  the  matter  of  the Central Provinces  and Berar Sales of Motor Spirit and lubricants Taxation Act, 1938 observed:           ....... at  the date of the Constitution      Act (Government  of India Act 1935) though it      seems  that   the  word   ’excise’  was   not      infrequently  for  the  administration  of  a      particular indirect  tax (as  salt excise  or      opium excise), the only kind of excise duties      which were  known in  India by that name were      duties  collected   from   manufacturers   or      producers, and  usually payable  on the issue      of the  excisable articles  from the place of      manufacture or  production. This also may not      be conclusive  in itself,  but it seems a not      unreasonable   inference    that   Parliament      intended the expression ’duties of excise’ in      the Constitution  Act to be understood in the      sense in  which upto  that time it had always      in fact been used in India, where 764      indeed excise  duties of  any other kind were      unknown.  Nor   indeed  are   excise   duties      properly so-called  often to  be found at the      present day  which are  not collected  at the      stage of  production or manufacture, whatever      may have  been the  case in Blackstone’s time      and whatever  may have  been the  reasons for      Johnson’s definition of ’Excise’ in the first      edition of  his Dictionary  (1755)......"(Per      Gwyer C.J.)      This  view   was  approved  by  the  Judicial Committee in  The Governor-General  in Council  v. The Province of Madras      An excise  duty is  according to  the  Indian Statute, a  duty on  the manufacture or production of goods  and the  duty which  was levied  in  the States of  Travancore and Cochin on the storage of tobacco cannot  be regarded  as a  duty of excise. But that conclusion is not decisive of the problem under consideration.  The question has still to be considered whether  the Travancore and Cochin Acts and  the   Rules  framed   thereunder   were   law "corresponding" to  the Central  Excises and  Salt Act, 1944,  extended under  the Finance Act, 1950. The expression  "corresponding" does not postulate

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identity of the State Law and the statute extended by s. 11 of the Finance Act: if there was in force at the  material time  law in  the  Part  B  State dealing with  a particular  subject matter and the law extended  by s.  11 of  the Finance Act, 1950, dealt with  the same  subject matter  and the  two laws though  not identical still were such that if they  stood   together  there   would  have   been legislative duplication or overlapping, the law in force  in  Part  B  State  would  be  regarded  as corresponding to  the law  extended by  the Indian Finance Act and hence repealed by the operation of s. 13(2).      Let us  examine the  scheme  of  the  Central Excises and Salt Act of 1944 for the purpose of 765 ascertaining whether the Travancore and the Cochin Tobacco Acts  and Rules  frame thereunder  are law corresponding to the Central Excises and Salt Act, 1944, wholly or partially. The Central Excises and Salt Act,  1944, was  enacted to  consolidate  and amend the law relating to Central duties of excise on goods manufactured or produced in certain parts of India  and to  salt. The  expression "excisable goods" is  defined in  s. 2(d)  as meaning  "goods specified in  the First  Schedule as being subject to a duty of excise and includes salt". By s. 2(f) the  expression   "manufacture"  is   defined   as inclusive of  "any process incidental or ancillary to the  completion of  a manufactured product, and (i)  in   relation   to   tobacco   includes   the preparation  of   cigarettes,  cigars,   cheroots, biris,  cigarette   or  pipe  or  hookah  tobacco, chewing tobacco,  or snuff  x       x       x". By s. 3 it is provided that there shall be levied and collected in  such manner  as  may  be  prescribed duties of excise on all excisable goods other than salt which are produced or manufactured in India x x        x and at the rates set forth in the First Schedule. By  s. 6,  certain incidental operations are made  subject to  licence and  it is provided: The Central  Government may,  by  notification  in Official Gazette,  provide that, from such date as may be  specified in  the notification,  no person shall,  except   under  the   authority   and   in accordance with  the terms  and  conditions  of  a licence granted  under this Act, engage in (a) the production or  manufacture of  any specified goods included in  the First schedule or of saltpetre or of any specified component parts or ingredients of such goods  or  of  specified  containers  of  any specified excisable  goods, or  (b) the  wholesale purchase or sale (whether on his own account or as a broker or commission agent or the storage of any excisable goods specified in this behalf in Part A of  the  Second  Schedule".  By  virtue  of  these provisions power  is conferred  upon  the  Central Government to impose restrictions 766 upon the  rights to  produce, manufacture  and  to engage in any process of production or manufacture of  the   excisable  goods  or  in  the  wholesale purchase or  sale of excisable goods this power is conferred indisputably  as ancillary  to enforcing the law  enacted for  the levy  and collection  of

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excise  duty.   By  s.  9  contraventions  of  the provisions of the Act and notifications thereunder are penalised. Power to forfeit goods is conferred by s.  10. By  Chapter III, power to arrest and to summon  persons   to  give   evidence  or  produce documents in inquiries under the Act to search and the procedure to be followed by officers in-charge of  police-stations,   inquiries  to  be  made  by Central Excise  Officers against  arrested persons forwarded to  them are made. Chapter VI deals with adjudication of  confiscations and  penalties, and Chapter   VII    enacts   certain    supplementary provisions. The  Schedule to this Act sets out the descriptions of  various goods  and the  rates  of duty chargeable in respect thereof.      The primary purpose of the Act is to levy and collect excise  duty in respect of goods specified in the  First Schedule  and with  that  object  in view, diverse  provisions are  enacted. Tobacco is under the  Act an excisable commodity, and duty at rates specified  in the  Schedule is  leviable  in respect of  different forms of tobacco. By s. 6(b) wholesale  purchase   or  sale,   or  storage   of excisable articles is prohibited.      By Rule  7 of the Central Excise Rules, 1944, duty  is   made  payable   by  every  person,  who produces, cures, manufactures or who stores in any warehouse any  excisable  goods.  Rule  174  which occurs in  Chapter VII  deals with  licensing.  It provides, in so far as it is material, that.           "Every  manufacture,  trader  or  person      hereinafter mentioned,  shall be  required to      take out  a licence and shall not conduct his      business in regard to such goods otherwise 767      than by  the authority,  and subject  to  the      terms and  conditions of a licence granted by      a  duly  authorised  officer  in  the  proper      From:-                (1) Matches           x           x x                (2)  Unmanufactured   products.   -           Curers, brokers,  Commission agents  and           wholesale  dealers   who  purchase  such           products  from   cures,   all   brokers,           commission agents  and wholesale dealers           doing   business    in    unmanufactured           tobacco; all  holders of  private bonded           store-rooms or warehouses;                (3) Other  excisable  goods  except salt-                (a) Manufacturers; and                (b)      x           x            x Rule 175  deals with the procedure for obtaining a licence. By  the 1st clause it provides that every person desiring  to engage in operations requiring the possession  of a licence aforesaid shall apply in writing  every year  for a  licence or  renewal thereof to  the licensing  authority who  shall be such officer  as the  Central Board of Revenue may authorise in  this  behalf.  Rule  176  prescribes Forms  application   for  licences   and  cl.  (2) provides that  every such  application for licence shall, where  a fee is prescribed in the subjoined Table, be  accompanied by a Central Excise Revenue

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Stamp showing payment of such fee under item No. 2 in the Table "a wholesale dealer in unmanufactured tobacco who  purchases for the purpose of trade or manufacture" the  to pay graded fee set out in the second and  the third  columns. Item  6 deals with the duty payable by the holder of a private bonded store-room or warehouse. Rule 178 provides for the Forms of licence. The appropriate forms of licence in respect of storage of tobacco for sale are Form L-2 (application for licence to carry on wholesale trade 768 in unmanufactured  products liable  to  a  central duty of excise), Form L-3 (application for licence as  broker  or  commission  agent  in  respect  of unmanufactured products  liable to  a central duty of excise),  and Form L-5 (application for licence for a  private bonded  warehouse-storeroom for the storage of  excisable goods).  It is manifest that under the  Rules so  framed  duty  is  imposed  to obtain a  licence on payment of fee for storage of tobacco for  sale. It  is not  disputed  that  the appellants in  all the  appeals took  out licences under rules 174 and 178 of the Central Excises and Salt Act  and paid  the licence fee in that behalf to the  Central Government.  The  appellants  were also required  to pay  licence fee for the storage of tobacco  for sale  under the  provisions of the Travancore and  the Cochin  Tobacco Acts  and  the Rules framed thereunder on January 25, 1951.      It is true that under the Central Excises and Salt  Act,   1944,  the  provision  for  obtaining licences for  storage is  a provision ancillary to the recovery  of excise  duty, whereas  under  the Travancore  and  the  Cochin  Acts,  the  levy  of licence fee  was imposed  in pursuance of a scheme for maintaining  control on  the sale  of  tobacco without expressly  levying any excise duty. But on that  account,   it  cannot   be  said   that  the provisions relating to the requirement of licences and the  payment of  licence fees  for storage  of tobacco for  sale under  the  Travancore  and  the Cochin Acts  were not  provision corresponding  to the  provisions  of  s.  6(b)  under  the  Central Excises and  Salt Act,  1944 and  the rules framed under the  Act requiring  that licences  shall  be taken out  for storage of tobacco for sale and fee shall be  paid in  respect thereof. In my judgment the relevant  rules made  under the Travancore and the Cochin  Tobacco Acts  requiring licences to be taken for  storage of  tobacco  and  in  force  on April, 1,  1950, were  law  corresponding  to  the provisions of  the Central  Excise and  Salt  Act, 1944, and the rules 769 framed thereunder  which required  licences to  be taken out  for storage  of tobacco and for payment of licence  fee in  respect thereof  and  to  that extent the  provisions imposing  an obligation  to take out  licences and  to pay  licence fees under the Tobacco  Acts  of  Travancor  and  the  Cochin States were superseded and the State of Travancore Cochin had no authority to promulgate rules 14, 15 and  16  under  the  Notification  issued  in  the Travancore Cochin Government Gazette dated January

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25,1951, and  to levy  licence fee  for storage of tobacco.      It is  unnecessary to  consider  whether  the remaining provisions  of the  Travancore  and  the Cochin Tobacco  Acts and  the Rules  framed  there under were  law  corresponding  with  the  Central Excises and Salt Act, 1944.      For these reasons I agree that the appeals be allowed, and the order passed by the High Court be set aside.  In each  petition a  writ  will  issue declaring that  the levy  of licence fee under the Notification dated  January 25,  1951, is  without authority  of   law,  and   that  the   State   of Travancore-Cochin  do  forbear  from  levying  and collecting the licence fee.                                   Appeals allowed.