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PETITIONER: ASHOKA MARKETING LTD.

       Vs.

RESPONDENT: STATE OF BIHAR AND ANR.

DATE OF JUDGMENT: 30/01/1970

BENCH: SHAH, J.C. BENCH: SHAH, J.C. HIDAYATULLAH, M. (CJ) HEGDE, K.S. GROVER, A.N. RAY, A.N. DUA, I.D.

CITATION:  1971 AIR  946            1970 SCR  (3) 455  1970 SCC  (1) 354  CITATOR INFO :  F          1973 SC1333  (4,5)  RF         1975 SC 198  (10)  R          1975 SC1991  (10)  RF         1977 SC2279  (57)  RF         1985 SC 218  (20)  RF         1986 SC 178  (2)  O          1987 SC  27  (4)

ACT: Constitution  of  India  Schedule VII, Entry  54,  List  II, Entries 6, 7 and 13, List III-Scope of.  Bihar Sales Tax Act 1959, section 20-A (3), (4) and (5)-Validity of.

HEADNOTE: In  determining the Appellant’s turnover for  assessment  to sales tax for the year 1956-57, the Superintendent of  Sales Tax  included an amount representing Railway freight in  the Appellant’s  sales of Cement.  The Appellate  authority  set aside  the  orders directing the inclusion  of  the  Railway freight in the turnover.  After the introduction of  section 20-A  in  the Bihar Sales Tax Act 19 of 1959 by  Act  20  of 1962,  the  Assistant Commissioner issued a  notice  to  the Appellant  under section 20-A (3) of the Act  requiring  the Appellant to show cause why an amount representing Sales tax on  the  Railway freight which became refundable  under  the orders  of  assessment, be not forfeited.   The  Appellant’s contention  that  section  20-A was ultra  vires  the  State Legislature was rejected by the Assistant Commissioner,  and by  the High Court in a writ petition under Article  226  of the Constitution. On appeal to this Court, HELD  : The appeal must be allowed and the petition  of  the assessee must be granted.  Sub sections (3), (4) and (5)  of section  20A  are ultra vires the State Legislature.   As  a corollary thereto, sub sections 6 and 7 must also be  deemed invalid. Sub-section (8) of s. 20A does not alter the true nature  of

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the demand or  appropriation which can be made under sub-ss. (3), (4) and (5) of s.   20-A.   The  intention   underlying sub-ss.  (3), (4) and (5) is to enable the State to  collect from the dealer tax which the State is not entitled to  levy and  to  appropriate it to itself except in  the  very  rare cases  in which the purchaser may approach the State and  be able to satisfy it that he has a claim, that the claim is in order,  and that it is within  limitation.   Notwithstanding the addition of sub-s, (8), the amount received by the State or appropriated by the State continues to have the character of  a  tax  collected which the State  is  not  entitled  to collect.   A provision which enables the dealer to  pass  on the   liability  for  payment  of  tax  is   incidental   to legislation  for  sales-tax.  But it cannot be held  that  a provision under which a dealer is called upon to pay to  the State  an  amount  which  has been collected  by  him  on  a representation-express  or implied-that an equal  amount  is payable by him under the Bihar Sales Tax Act, is a provision incidental to the power to levy "tax on sale or purchase  of goods"  within  the  meaning of Entry 64, List  II,  of  the Seventh  Schedule.   In  effect the  provision  is  one  for levying  an amount as tax which the State is incompetent  to levy.   A  mere  device cannot be permitted  to  defeat  the provisions of the Constitution by clothing the claim in  the form  of  a demand for depositing the money with  the  State which  the  dealer  has  collected, but  which  he  was  not entitled to collect. [464 F, 463 E, H] 456 The  power to legislate in respect of sub-ss. (3),  (4)  and (5)  of  s. 20A does not fall under Entries 6, 7 and  13  of List III expressly, nor is it necessarily incidental to  the power contained in Entries 6, 7 and 13 of List III. [465  E- F] The Orient Paper Mills Ltd. v. The State of Orissa and  Ors. [1962] 1 S.C.R.     549 distinguished. R.   Abdul  Qader  &  Co. v. Sales  Tax  Officer,  Hyderabad [1964] 6 S.C.R.     867 followed. State of Bombay v. United Motors (India) Ltd. [1953]  S.C.R. 1069 referred to.

JUDGMENT: CIVIL  APPELLATE  JURISDICTION : Civil Appeal  No.  2004  of 1966. Appeal by special leave from the order dated March 14,  1966 of the Patna High Court in C.W.J.C. No. 143 of 1966. S.  V. Gupte, H. K. Puri for K. K. Jain, for the appellant. Lal  Narain Sinha, Advocate-General for the State  of  Bihar and U. P. Singh, for the respondents. The Judgment of the Court was delivered by Shah,  J.  Ashoka  Marketing  Ltd.-hereinafter  called  ’the assessee’-returned  for  the year 1956-57  under  the  Bihar Sales Tax Act, 1947, an amount of Rs. 2,46,67,517-1-6 as its turnover  from  sale of cement and other  commodities.   The Superintendent  of  Sales Tax brought to tax  an  additional amount of Rs. 7,67,70213-0 being the railway freight paid in respect  of  the goods supplied by the assessee.   By  order dated  April 2, 1961 the Appellate Authority set  aside  the order  directing  inclusion of the railway  freight  in  the turnover, and ordered that the assessment be revised. In the meantime the Bihar Sales Tax Act, 1947, was repealed and  was  replaced by the Bihar Sales Tax Act, 19  of  1959. By Act    20  of  1962 s. 20A was introduced  in  the  Bihar Sales Tax Act  19  of 1959.  The relevant provisions  of  S.

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20A were : "(1) No person who is not a registered,dealer shall  collect from any person any amount, by whatever name or  description it may be called, towards or purporting to be tax on sale of goods. (2)  No registered dealer shall collect from any person, any such amount, except in a case in which and to the extent  to which such dealer is liable to pay tax under this Act. (3)  (a) Notwithstanding anything to the contrary  contained in any law or contract or any judgment, 457 decree or order of any Tribunal, Court or ’authority, if the prescribed  authority has reason to believe that any  dealer has  or  had,  at  any time, whether  before  or  after  the commencement  of this Act, collected any such amount,  in  a case  in which or to an extent to which the said dealer  was or is not liable to pay such amount, it shall serve on  such dealer a notice in the prescribed manner requiring him on  a date and at a time and place to be specified therein  either to ’attend in person or through authorised representative to show  cause  why he should not deposit into  the  Government treasury the amount so collected by him. (b)  On the day specified in the notice under clause (a)  or  as  soon  thereafter  as  may  be,  the  prescribed authority  may,  after giving the dealer or  his  authorised representative  a reasonable opportunity of being heard  and examining  such  accounts  and  other  evidence  as  may  be produced  by  or  on behalf of the dealer  and  making  such further  enquiry  as it may deem necessary, order  that  the dealer shall deposit forthwith into the Government treasury, the amount found to have been so collected by the dealer and               not  refunded  prior  to the  receipt  of  the               notice  aforesaid to the person from  whom  it               had been collected. (4)  Where  any  amount  so  collected  by  the  dealer  and deposited  by him into the Government treasury  has  already been  refunded to the dealer in pursuance of or as a  result of  any judgment, decree or order of any Tribunal, Court  or authority, but the dealer has not refunded the amount to the person  from  whom  he  had  collected  it,  the  prescribed authority shall, notwithstanding such refund to the  dealer, proceed to take action in accordance with the provisions  of sub-section (3)     for securing deposit of such amount. (5)  Where  any  such amount has not been  refunded  to  the dealer before the commencement of this Act but a refund  has been directed by a Court, Tribunal or authority, the  amount shall,  notwithstanding such direction, be deemed ’to  be  a deposit made in pursuance of an order under sub-section (3). (6).............................................. (7)  Notwithstanding anything to the contrary in any law  or contract,  when  any  amount is deposited  by  a  dealer  in compliance with an order under sub-section (3)    or    sub- section (4) or is deemed, under sub-section 458 (5),  to  have been so deposited, such  deposit  shall  con- stitute  a good and complete discharge of the  liability  of the dealer in respect of such amount to the person from whom it was collected. (8)  The  person  from  whom the dealer  has  collected  the amount deposited in pursuance of an order under  sub-section (3) or sub-section (4) or deemed, under sub-section (5),  to have  been  so deposited shall be entitled to apply  to  the prescribed authority in the prescribed manner for refund  of the  amount  to him and the said authority shall  allow  the refund if it is satisfied that the claim is in order :

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Provided  that  no such refund shall be allowed  unless  the application  is made before the expiry of the period  within which  the applicant could have claimed the amount from  the dealer by a civil suit had his liability not been discharged in accordance with the provisions of sub-section (7) : Provided  further  that no claim for such  refund  shall  be rejected   without   giving  the  applicant   a   reasonable opportunity of being heard. On  July 31, 1963, the Assistant Commissioner of  Commercial Taxes.  Shahabad Circle. issued a notice under s. 20A (3) of the  Bihar  Sales Tax Act, 1959, requiring the  assessee  to show cause why an amount of Rs. 23.990-11-0 being the sales- tax on the railway freight which had become refundable under the  order of assessment be not forfeited.  The assessee  in reply contended, inter alia, that s. 20A of the Bihar  Sales Tax  Act was ultra vires the State Legislature and  that  in any  case it had no application to his case.  The  Assistant Commissioner of Commercial Taxes rejected the contention and passed an order directing that the amount of Rs. 23,990-11-0 do  stand forfeited to the Government and  further  directed that the amount be deposited in the Government treasury. The assessee then moved a petition before the High Court  of Patna under Art. 226 of the Constitution for a writ quashing the order of the Assistant Commissioner of Commercial  Taxes and  for  consequential orders restraining recovery  of  the amount.  The High Court of Patna, relying upon the  judgment of this Court in The Orient Paper Mills Ltd. v. The State of Orissa 459 and  Ors.  (1) rejected the petition.  With  special  leave, this appeal has been preferred. Two questions fall to be determined in this appeal (1)  Whether  s.  20A of the Bihar Sales Tax  Act,  1959  is within the competence of the State Legislature; and (2)  Whether  an  order  may  be  made  under  s.  20A   for depositing  with the State Government - an amount  collected by  a  registered  dealer from  his  constituent  to  recoup himself  for payment of sales-tax under the Bihar Sales  Tax Act, 1947 which amount, according to law then in force,  the constituent was not liable to pay. Counsel  for the assessee, relying upon the judgment  in  R. Abdul  Quader  & Co. v. Sales Tax Officer, Hyderabad  (2)  , contended  that  an  Act  passed  by  a  State   Legislature authorising  the  State  Government  to  recover  an  amount collected  under  a sale, by a registered  dealer  from  the purchaser, to recoup himself for payment of salestax,  which was not liable to tax, is beyond the competence of the State Legislature.   In  Abdul  Quader’s case (2)  the  Court  was dealing with the interpretation of s. 11(2) of the Hyderabad General  Sales Tax Act 14. of 1950.  By s. 1(2) it was  pro- vided: "Notwithstanding  anything to the contrary contained in  any order of an officer or tribunal or judgment, decree or order of a Court, every person who has collected or collects on or before the 1st May, 1950, any amount by way of tax otherwise than in accordance with the provisions of this Act shall pay over  to the Government within such time and in such  manner as may be prescribed the amount so collected by him, and  in default  of such payment the said amount shall be  recovered from him as if ’it were arrears of land revenue." This Court held that s. 11(2) of the Hyderabad General Sales Tax Act provided for recovery of an amount collected by  way of tax, as arrears of land revenue though the amount was not due as tax under the Act.  In rejecting the contention  that the  provision  fell  within Entry 54  List  II,  the  Court

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observed at (p. 872) "The  provision however is attempted to be justified on  the ground that though it may not be open to a State Legislature to make provision for the recovery of an                (1) [1962] 1 S.C.R. 549.                (2) [1964] 6 S.C.R. 867. 460 amount which is not a tax under Entry 54 of List II in a law               made for that purpose, it would still be  open               to the legislature to provide for paying over’               all  the  amounts collected by way of  tax  by               persons,  even  though  they  really  are  not               eligible as tax, as part of the incidental and               ancillary power to make provision for the levy               and  collection of such tax........ But  where               the  legislation  under  the  relevant   entry               proceeds   on  the  basis  that   the   amount               concerned is not a tax eligible under the  law               made  under that entry, but even so lays  down               that though it is not exigible under the  law,               it  shall be paid over to  Government,  merely               because  some dealers by mistake or  otherwise               have collected it as tax’, it is difficult  to               see  how such provision can be,  ancillary  or               incidental   to   the   collection   of    tax               legitimately  due under a law made  under  the               relevant taxing entry." An  attempt to sustain the validity of the provision as  one imposing  a penalty was also. negatived, and the Court  held that  s. 11 (2) of the Hyderabad General Sales Tax  Act  was not within the competence of the State Legislature. In  Abdul Quader’s case(1) this Court hold that in  exercise of  the power under Entry 54 List II, the State  Legislature is  incompetent  to  enact  a  law  authorising  the   State Government  to call upon a dealer to pay an amount which  he has  collected from the purchaser of goods under a sale,  to recoup himself for payment of tax which he is not liable  to pay  in  respect  of  that  transaction,  for  such  a   law authorises  a  levy of tax which the  State  Legislature  is incompetent to levy. The  learned Advocate General for the State of  Bihar,  how’ ever,, contended that the legislation impugned in this  case is  in truth not for levy or collection of an amount as  tax which the State is not competent to levy or collect, but for compelling  a  registered  dealer to  pay  over  the  amount collected  on behalf of the State as tax so that it  may  be made  available  to  a person from whom  it  was  unlawfully recovered.  He contends that the legislation which is not of the nature which this Court was called upon to interpret  in Abdul  Quader’s  case(1) falls within Entry 54 List  II  and that  in  any event it falls within Entries 6, 7 and  13  of List III. Counsel  strongly relied upon the judgment of this Court  in The  Orient Paper Mill’s case, (2 But the principle of  that case, (1) [1964] 6 S.C.R. 867.          (2) [1962] 1 S.C.R. 549. 461 in our judgment, has no bearing on the question whether  the State by statute was competent to enact s. 20A of the  Bihar Sales  Tax Act in exercise of the power under Entry 54  List II  of  the  Seventh Schedule.  In that  case  a  registered dealer  had  collected, in respect of  sales-tax,  from  the purchasers amounts for recoupment of tax which he would have to  pay to the State Government under the Orissa  Sales  Tax Act,  1947,  in the belief that the tax  was  payable.   The

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dealer  was assessed to and paid tax on the turn.over  which included  inter-State  sales.  After the  decision  of  this Court  in State of Bombay v. United Motors  (India)  Ltd.(1) the dealer applied under s. 14 of the Act for refund of  tax paid  on the plea that the turnover from  inter-State  sales was  not  taxable.  The High Court of  Orissa  issued  writs directing  the  amount of tax collected by the State  to  be refunded.  Thereafter by an amendment of the Act, the  State Legislature incorporated s. 14A providing that refund of tax may be claimed only by the person from. whom the dealer  had realised  the amount by way of sales tax or  otherwise.   At the  hearing of the petition, the tax-payer  challenged  the levy  on the ground that it infringed his fundamental  right under Art. 19 (1) (f ) and did not press the contention that the State Legislature was incompetent to enact s. 14A of the Orissa Sales Tax Act.  This Court observed that the power to legislate with respect to a tax comprehends the power to imp se  the tax, to prescribe machinery for collecting the  tax, to  designate  the  officers by whom the  liability  may  be enforced  and  to prescribe the  authority,  obligation  and indemnity of those officers.  It was then observed : "The Legislature of the Orissa State was therefore competent to exercise power in respect of the subsidiary or  ancillary matter  of  granting refund of tax improperly  or  illegally collected,  and  the competence of the Legislature  in  this behalf  is not canvassed by counsel for the  assessees.   If competence  to  legislate for granting refund  of  sales-tax improperly  collected  be granted, is there  any  reason  to exclude the power to declare that refund shall be  claimable only  by  the  person  from whom  the  dealer  has  actually realised  the amounts by way of sales-tax or otherwise ?  We see none." The  Court  then  rejected the contention that  s.  14A  was invalid.  because  it impaired the fundamental  right  under Art.  19(1)(f)  of  the Constitution.  That  case  does  not support the plea that the State Legislature is competent  to legislate  for  demanding payment of  or  retaining  amounts recovered,  by a registered dealer but which are not due  as sales-tax to the State. (1)  [1953] S.C.R. 106. 462 The learned Advocate-General contended that in any event the impugned provision is not of the nature which this Court was concerned to interpret in Abdul Quader’s case(1).  He  said, that  whereas  in Abdul Quader’s case(2) the  Court  dealing with  a  case in which the State Legislature enacted  a  law authorising  the State to recover and appropriate to  itself amounts collected by a dealer on the representation that he- the  dealer-was  entitled to recoup himself for  payment  of sales-tax  which  he was not liable to pay, in  the  present case  the, amount either collected or retained by the  State from the dealer is to be held for the benefit of the  person from  whom  it  has  been  improperly  collected.   On  that account,  the  Advocate-General contended,  the  Legislature exercised its power for setting up machinery for  compelling refund  of  amounts  collected  by  the  dealer  under   the authority  of  the  Legislature which he could  not  in  law collect.   Counsel, argued that Entry 54 List II  authorises the  State  Legislature to legislate for  collection  of  an amount which -has been improperly collected by a  registered dealer  as tax on behalf of ,he State and for refunding  the amount  to  the  person from whom  it  has  been  improperly collected. This argument proceeds upon two assumptions : (1) that under the Bihar Sales Tax Act the purchaser of goods is liable  to

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pay  sales-tax  to  the State,  and  the  registered  dealer collects  the  tax  from the purchaser as an  agent  of  the State;   and  (2)  that  tile  amount  recovered  from   the registered  dealer  under  s. 20A is  intended  only  to  be refunded  to the person from whom it has been  collected  by the registered dealer, and the State is merely an agency for enforcing the obligation of the dealer. The  first assumption is plainly contrary to the  scheme  of the  Bihar Sales Tax Act, 1959.  By s. 3 charge of tax  lies upon  every dealer whose gross turnover during a period  not exceeding  twelve months immediately preceding  exceeds  the specified  amount.   The  expression  "gross  turnover"   is defined in S. 2(k) as meaning "the aggregate of the  amounts of sale-prices received and receivable by    a       dealer, during  any  given  period,  in respect  of  sale  of  goods (..  ... .)","and the expression "sale-price" is defined  in S.  2(q)  as  meaning "the amount payable  to  a  dealer  as valuable consideration in respect of the sale of goods".  By sub-s. (2) of s. 3 tax is made payable by a dealer on  sales made inside the State, and when the dealer sells goods,  the price received by him for sale of goods forms a component of the  gross turnover and the dealer is liable to pay  tax  on the: turnover.  The Act does not impose liability to pay tax upon the purchaser either directly or indirectly.  Under  S. 7,  it  is  true,  the  taxable  turnover  of  a  dealer  is determined  to  be  that part of the  gross  turnover  which remains (1)  [1964] 6 S.C.R 867. 463 after deducting several items including the amount of sales- tax actually "collected as such", along with the  sale-price received  or receivable in respect of sale of goods.  It  is implicit  that the dealer may recover from the purchaser  in addition to the value of the goods a certain amount which he will have to pay as tax on that value.  The price payable by the purchaser on that account is the value of the goods  and the amount paid for recouping the dealer for payment of tax. The  Act  enables  the dealer to pass on  the  liability  of sales-tax  to the purchaser and if by invoice  or  otherwise the  dealer charges in respect of the goods sold by him  the value  of the goods and the tax which he may have to pay  on the  value, sales-tax will be computed on the value  of  the goods  and  not on the total amount paid by  the  purchaser. The   amount  payable  by  the  purchaser  is  however   the consideration  paid  by him for purchasing the  goods.   The dealer  may apportion the value of the goods and the  sales- tax payable by him on the sale to the State.  If he does so, he  is liable to pay sales-tax only on the value and not  on the  amount of tax collected by him which he is  payable  as sales-tax to the State.  If he does not apportion the  value and  the  tax, he is liable to pay sales-tax  on  the  total amount received by him, calculated at the appropriate  rate. In  either case the liability to pay tax under the Act  lies upon  the  dealer : he does not collect any tax for  and  on behalf  of the Government.  The dealer may recover from  the purchaser  the tax payable by him as part of the price,  but on  that account the purchaser is not the person  liable  to pay tax on the sale to the State. A  provision  which  enables  the  dealer  to  pass  on  the liability  for payment of tax is incidental  to  legislation for  sales-tax.  But we are unable to hold that a  provision under  which a dealer is called upon to pay to the State  an amount which has been collected by him on a  representation- express  or implied-that an equal amount is payable  by  him under the Bihar Sales Tax Act, is a provision incidental  to

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the power to levy "tax on sale or purchase of goods"  within the  meaning  of Entry 54 List II of the  Seventh  Schedule. Entry  54 List II, of the Seventh Schedule, comprehends  the power  to impose tax, to prescribe machinery for  collecting the tax, to designate officers by whom the liability may  be imposed  and  to  prescribe the  authority,  obligation  and indemnity of the, officers.  The State Legislature may under Entry  54 List II be competent to enact a law in respect  of matters  necessarily  incidental  to "tax on  the  sale  and purchase of goods".  But a provision compelling a dealer who has deliberately or erroneously recovered an amount from the purchaser on a representation that he is entitled to recover it  to recoup himself for payment of tax, to pay  over  that amount to the State cannot, in our judgment, be regarded  as necessarily incidental to Entry 54 List II.  In  effect  the provision is one for levying an amount as tax 464 which  the  State  is incompetent to levy.   A  mere  device cannot  be  permitted  to  defeat  the  provisions  of   the Constitution  by clothing the claim in the form of a  demand for depositing the money with the State which the dealer has collected, but which he was not entitled to collect. The learned Advocate General contended that sub-s. (8) of s. 20A authorises the person from whom the dealer has collected the amount deposited in pursuance of an order under  sub-ss. (3),  (4), or deemed to have been so deposited under  sub-s. (5), to apply to the prescribed authority for refund of  the amount  to  him and the authority is obliged,  if  satisfied about  the claim, to make that refund.  The power to  demand an  amount collected by the dealer applies  to  transactions governed by the Bihar Sales Tax Act, 1959, as well as to the pre-existing  Acts.   There  is  no  period  of   limitation prescribed  within which the demand for payment  of  amounts collected by the dealer may be made.  But an application for refund is to be made before the expiry of the period  within which  the purchaser could have claimed the amount from  the dealer  by a civil suit.  In the light of the scheme of  the Act  and the various provisions made, it would be futile  to expect   that  a  purchaser  would  normally  be   able   to enforce  .he  liability  of  the State  to  pay  the  amount collected by the dealer and which is deposited or deemed  to be deposited with the Government.  The period of  limitation does not commence to run from the date on which the money is deposited  or  deemed to be deposited  into  the  Government treasury  but  from the date on which the purchaser  may  be entitled to file a suit against the dealer in a civil court. The  State is in law under no obligation to hold the  amount as trustee for the purchaser.  The amount to be recovered or appropriated  remains part of the Consolidated Fund  of  the State and becomes the property of the State. Sub-section  (8) of s. 20A, in our judgment, does not  alter the true nature of the demand or appropriation which can  be -made under sub-ss. (3), (4) & (5) of s. 20A.  The intention underlying sub-ss. (3) (4) & (5 ) is to enable the State  to collect from the dealer tax which the State is not  entitled to  levy and to appropriate it to itself except in the  very rare cases in which the purchaser may approach the State and be able to satisfy that he has a claim, that the claim is in order.  and that it is within  limitation.   Notwithstanding the  addition  of sub-s. (8), in our  judgment,  the  amount received  by  the State ’or appropriated by the  State  con- tinues to have the character I of a tax collected which  the State is not entitled to collect. The  learned Advocate-General contended that  assuming  that the  first proviso of sub-s. (8) of s 20A  which  prescribes

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the period of limitation is indicative of the nature of  the claim, that proviso 465 alone  may  be  declared  ultra  vires,  and  the  remaining provisions declared valid.  But the first proviso to  sub-s. (8) does not invest the recovery with the character of tax : the  provisions  of  sub-ss. (3), (4)  and  (5)  invest  the recovery with the nature of a levy of tax which the State is not entitled to collect, and sub-s. (8) is merely an attempt to  disguise  the  true  nature  of  the  claim.   We   are, therefore,  unable  to  accede to  -.he  contention  of  the learned Advocate-General. It was then contended that the power to legislate in respect of recovery of the amount collected by a dealer which in law he is not entitled to collect, falls within Entries 6, 7 and 13  of List III.  These entries are in the  Concurrent  List and provide : "6.  Transfer  of  property other  than  agricultural  land; registration of deeds and documents. 7.   Contracts, including partnership, agency, contracts  of carriage,  and  other special forms of  contracts,  but  not including contracts relating to agricultural land. 13.  Civil Procedure, including all matters included in  the Code  of  Civil  Procedure  at  the  commencement  of   this Constitution, limitation and arbitration." We  fail to appreciate how power to legislate in respect  of Entries 6, 7 and 13 would authorise the State Legislature to legislate  in  respect  of recovery from the  dealer  of  an amount which the dealer was in law not entitled to  collect, but  which  he  has collected.  The power  to  legislate  in respect of sub-ss. (3), (4) and (5) of s. 20A does not  fall under Entries 6, 7 and 13 of List III expressly, nor can  it be   said  that  the  power  to  legislate  is   necessarily incidental  to  the power contained in Entries 6, 7  and  13 List  III.   As  already  pointed out,  this  Court  in  the judgment in Abdul Quader’s case(1) has clearly held that the State has no power to legislate for recovering amount  which is collected by the tax-payer in order to recoup himself for payment  of tax which under the law he is not bound to  pay. Even though the competence of the State to legislate was not sought  to  be supported under Entries 6, 7 and 13  of  List III,  the  decision of the Court plainly  implies  that  the State has no such power under any Entry in the third List. On  the view we have expressed, we do not deem it  necessary to  express  any  opinion on the second  question.   We  may observe  that validity of sub-ss. (1) and (2) of s. 20A  has not been challenged.  We  are, of the view that the appeal must be  allowed,  and the  petition  of  the  assessee must  be  granted.   It  is declared that sub- (1)  [1964] 6 S.C.R. 867. 466 ss.  (3),  (4) and (5) of s. 20A are ultra vires  the  State Legislature.   As  a corollary thereto sub-ss. (6)  and  (8) shall  be deemed invalid.  The assessee will be entitled  to its costs in this Court and the High Court.  There will  be, one hearing fee in C.As. 2004 and 2005 of 1966. R.K.P.S. Appeal allowed. 467