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PETITIONER: JAWAHARMAL

       Vs.

RESPONDENT: STATE OF RAJASTHAN AND OTHERS

DATE OF JUDGMENT: 22/09/1965

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

CITATION:  1966 AIR  764            1966 SCR  (1) 890  CITATOR INFO :  RF         1975 SC1389  (11,15,17,26,28)  MV         1985 SC 421  (75)  RF         1988 SC 191  (30)

ACT: Rajasthan Passengers and Goods Taxation (Amendment and Vaii- dation)  Act 1964 (22 of 1964), ss. 2 and  4-Act  validating State Finance Acts of 1961 and 1962-Whether legislature  can itself validate defect caused by non-observance of Art.  255 of the Constitution-Retrospective taxation whether valid and reasonable.

HEADNOTE: The  Rajasthan  State Legislature passed Act 18 of  1959  to levy tax Oil passengers and goods carried in motor vehicles. For  the  purpose  of the tax roads were  divided  into  two categories  i.e. those which were asphalted etc. arid  those which were not.  In respect of goods Carried on the,  former category of roads the State Government was authorised by  s. 3 of ’he Act to levy tax at a maximum of 1/8th of the  value of the fares and freights in respect of goods carried on the second  category  of roads the maximum was  1/12th.   By,  a notification  under  the Act the maximum rates  were  levied with effect from May 1, 1959.  The said s. 3 was amended  by the Finance Acts of 1961 and 1962 to raise the maximum rates leviable  under that section and the relevant  notifications actually levied the same.  The Acts of 1961 and 1962 however suffered  from  the infirmity that  that the assent  of  the President  had  not  been obtained in  respect  of  them  as required  by  Art.  255 of the Constitution.   To  cure  the defect  Ordinance No. 4 of 1964 was issued.   The  Ordinance was  replaced  on September 9, 1964 by Act 22  of  1964  for which  the  assent  of  the  President  was  duly  obtained. Section 2 of the Act of 1964 retrospectively re-enacted  the amendments to s. 3 of the principal Act made law the Acts of 1961  and  1962.   Section 4 of the Act  validated  all  the collections  and  levies  under the earlier  Acts  and  also purported  to  cure the infirmity in the  said  earlier  Act arising from noncompliance with Art. 255.  The petition  who

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was asked to pay tax under the Ordinance of 1964  challenged the  validity of the said Ordinance -,is well as the Act  of 1964 in petitions under Art 32 of the Constitution of India. It   was  contended on behalf of the petitioners that ss.  2 and 4 of the imputed Act purported   to validate the earlier invalid Finance Act of 1961   1964.   It was urged that  the failure of the legislature to comply with the provisions  of Art.  255 rendered ’he said Acts void ab initio and as  such they  Could not be validated by subsequent legislation.   It was  further urged that the said earlier Acts had been  held invalid  by the Rajasthan -High Court in the case  of  Vijai Singh  and it would be incompetent to the State  Legislature to  validate  the said Acts in spite of the  decision  of  a court to competent jurisdiction HELD(i)  It was factually not correct to say that the  Acts of 1961 and    1962  had been struck down as void ab  initio by  a  court of competent jurisdiction.  The High  Court  in Vijai  Singh’s  case  had  on  the  office  hand  though  it unnecessary  to  pronounce its considered  opinion  on  that aspect  of  the  matter.   Act 22 of  19641  was  passed  on September   9,  1964   while  the  judgment  of   the   High Court was delivered in Novem- 891 be,  1964  and so at the time when the Act  was  passed  the earlier  Finance Acts had Dot been struck down at all.  [899 B-E] Vijai Singh and Another v. Deputy Commissoiner Excise &  Tax tion  (Appeals)  Ajmer and Kotah Divisions,  Jaipur  &  Ors. I.L.R. (1965) 15 Raj. 285, referred, referred to. (ii) An  Act which suffers from the infirmity that  it  does riot  comply  with  the  requirements of  Art.  255  can  be validated  by  subsequent legislation.  Article  255  itself provides  that no Act of the Legislature 01 a State  and  no provision  in any such Act shall be invalid by  reason  only that  some recommendation or previous sanction  required  by the  Constitution  was not given, if assent to the  Act  was given  by the President later.  If an Act is passed  without obtaining  the previous assent of the President it does  not become  void but remains unenforceable till such  assent  is obtained.  The said infirmity is cured by subsequent  assent and  the law becomes enforceable.  The legislature can  also in a suitable case adopt the course. of passing a subsequent law  reintroducing the provisions of the earlier  law  which had  not received the assent of the President and  obtaining his  assent  thereto  is  prescribed  by  the  Constitution. Legally  there is no bar to the legislature adopting  either of the courses mentioned above. [899 F-H; 900 A-D] (iii)     Section  2  of the Act of 1964 does  not  in  fact purport to validate the Finance Acts of 1961 and 1962.  What it  does is to amend retrospectively s. 3 of  the  principal Act  by  inserting  a  proviso to sub-s.  (1)  of  the  said section.  On  its  plain  reading s. 2  has  the  effect  of inserting the said proviso to s. 3(1) of the principal  Act; and  since the amendment so made is,in  term  retrospective, when a tax is levied for the periods covered by clauses  (a) and  (b)  of the proviso thus introduces in s. 3(1)  of  the principal  Act,  the  Court must proceed to  deal  with  the matter  on the basis that these clauses had been  introduced in the principal at Art right up from the commencement. [900 E-G] The  power  to legislate includes the  power  to  legislate. prospectively as well as retrospectively and in that behalf, tax legislation is no different from any  offer legislation. The  power  to  tax  can be  competently  exercised  by  the legislature  either  prospectively or  retrospectively;  and

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that  is precisely what s. 2 has done in the  present  case. Therefore  there was no substance in the argument that s.  2 of the Act was invalid [1900] (iv) The Act of 1964 and all its provisions had received the assent of the President and so prima facie the assent of the President  to  the Act would help the Act  to  validate  the provisions of The earlier Acts which were not enforceable by reason  of the fact that they had not secured his assent  as required by Art. 225.  But the assent of the President could not serve to make s. 4 valid. 1902 C-D] What s. 4 in truth and in substance says is that the failure to  comply  with  the  requirements of  Art.  255  does  not invalidate  the  Finance  Acts  in  question  and  will  not invalidate  any  action taken or to be  taken,  under  their respective   relevant  provisions.   In  other   words   the legislature  seems to say by s. 4 that even though Art.  255 may not have been complied with by the earlier Finance Acts, it is competent to  s. 4 whereby it will prescribe that  the failure  to comply with Art. 255 does not really matter  and the assent of the President to the Act amounts to this  that the President also agrees that the Legislature is  empowered to say that the infirmity resulting from the  non-compliance with  Art. 255 does not matter.  This approach  is  entirely misconceived. [902 D-F] The  legislature no doubt can validate an earlier Act  which -"s  invalid  by  reason of Art. 255 and  such  an  Act  may receive ’he assent of the 892 President   which   will  make  the  Act   effective.    The legislature  cannot, however, itself declare by a  statutory provision  that the failure to comply with Art. 255  can  be cured  by  its  own enactment, even if  the  said  enactment received  the assent of the President.  Even the  assent  of the  President  cannot  alter  the  constitutional  position tinder Art. 255.  The assent of the President cannot by  any legislative  provision be deemed ’to have been given  to  an earlier  Act  at a time when it was not so given.   In  this context  there  is  no scope  for  a  retrospective  deeming provision  in  regard to the assent of the  President.   The infirmity  in  question can be cured only by  obtaining  the assent of the President and not by any legislative flat.  In enacting  s.  4 the State Legislature clearly  exceeded  its jurisdiction. [903 A-D, F-G] M.   P.  V.  Sundararamier  & Co. v.  The  State  of  Andhra Pradesh & Another, [1958] S.C.R. 1422, distinguished. (v)  It  is  idle to contend that merely  because  a  taxing statute    purports   to   operate    retrospectively    the retrospective operation per se involves contravention of the fundamental right of the citizen guaranteed under Art. 19(1) (f) or (g).  In the present case having regard to the legis- lative background of the provision prescribed by s. 2  there could  be  little  doubt  that  there  was  no  element   of unreasonableness involved in the retrospective operation  of cl. (b) of the, proviso added by the said section to s. 2(1) of the principal Act. [905 D-F] (vi) Section  2 of the impugned Act had laid down the  rates of tax only up to the period ending March 26, 1962.  It  was silent  about  the period after that date.   The  petitioner therefore could not be taxed for the period after that  date on the strength of cls. (a) and (b) of the proviso to s.  2. If  s. 4 had been valid then the tax at the  enhanced  rates prescribed  by the Act of 1962 would also have  been  valid; but  r.ince  s. 4 was invalid the tax could be  validly  and legitimately  le-tied  for the period after March  26,  1962 only at the rates prescribed in 1959. [906 D-F]

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JUDGMENT: ORIGINAL JURISDICTION.-Write Petition No. 19 of 1965. Petition under Art. 32 of the Constitution of India for  en- forcement of fundamental rights. M.   M. Tiwari and Ganpat Rai, for the petitioner. G.   C. Kasliwala, Advocate-General Rajasthan, K. K. fain and R. N. Sachthey, for the respondents. The Judgment of the Court was delivered by Gajendragadkar C.J. The petitioner, Jawaharinal, carries  on business of plying his motor buses on four routes under  the Stage  Carriage  Permits granted to him under  the  relevant provisions  of  the  Motor Vehicles Act,  1939.   The  three respondents to his petition respectively are : The State  of Rajasthan,  the  Deputy Commissioner,  Excise  and  Taxation (Appeals), Jaipur, and the Taxation Officer, (The  Rajasthan Motor Vehicles) Sikar, State of Rajasthan.  It appears  that respondent No. 3 passed several :assessment orders  imposing different amounts of tax against his                             893 five  vehicles  which  were running on the  four  routes  in question.   The  periods for which these  assessment  orders were  passed differed from vehicle to vehicle; but,  on  the whole,  they covered the period between the 1st April,  1962 and  the  30th  September, 1964.  The total  amount  of  tax imposed  in  respect  of these vehicles  by  the  assessment orders  in  question is Rs. 19,062-93P.  These  orders  have been passed under section 2 of the Rajasthan Passengers  and Goods Taxation (Validation) Ordinance, 1964 (Ordinance No. 4 of  1964).  This Ordinance was made and promulgated  by  the Governor of Rajasthan on May 15, 1964. Aggrieved  by  these orders, the  petitioner  filed  appeals before  respondent  No. 2, but respondent No. 2  refused  to entertain  the  said appeals unless the petitioner  paid  in advance the tax imposed by the orders under appeal.   Whilst these  appeals  were pending before respondent  No.  2,  the petitioner moved for stay in respect of the recovery of  the tax  assessed, but the said application was rejected on  the ground that there was no provision in law to. entertain  any such  application.  That is why the petitioner submitted  an application  before  the  Commissioner,  Commercial   Taxes, Rajasthan  on  the 3rd February, 1962 and  prayed  that  his buses  should not be attached and sold in execution  of  the orders  of  assessment,  against  which  he  had   preferred appeals, pending the hearing and final disposal of the  said appeals.  The Commissioner rejected this application on  the 8th  February,  1962.  Respondent No. 3  then  proceeded  to attach  one  of the buses of the petitioner, viz.,  Bus  No. RJP-854 and took possession of it.  The petitioner thereupon paid  the  amount of the taxes as assessed by  the  impugned orders, but the payment was made under protest.. The present petition  has been filed by the petitioner under Art. 32  of the Constitution challenging the validity of the  assessment orders  in question.  The main ground on which the  validity of  the  said orders is challenged, is  that  the  Ordinance under  which  the  impugned  orders  were  passed  and   the Rajasthan  Passgengers  and Goods  Taxation  (Amendment  and Validation)  Act 1964 (No. 22 of 1964)  (hereinafter  called the Act) which repealed and replaced the said Ordinance, are constitutionally  invalid.  The petitioner prays  that  this Court should hold that the Act is invalid, and should, by an appropriate  writ, quash the impugned orders  of  assessment passed against him.  The petitioner also claims that pending

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the  final disposal of his petition, the respondents,  their servants,  and agents should be, restrained  from  realising the tax as directed by the impugned orders and from  seizing the  other  buses  of  the petitioner  for  the  purpose  of recovering the said tax. 894 In order to appreciate the contention of the petitioner that the  Act  is  invalid,  it  is  necessary  to  mention   the legislative  background  of  the Act.   The  Le-islature  of respondent No. 1 passed an Act in 1959 (No. 18 of 1959 known as  the  Rajasthan Passengers and Goods Taxation  Act,  1959 (hereinafter called the principal Act’).  This Act  received the assent of the President on April 2, 1959; was  published in  the Rajasthan Gazette on April 30, 1959, and  came  into force  on  May 1, 1959.  The validity of this Act  has  been upheld by this Court in M/s Sainik Motors, Jodhpur & Ors. v. The State of Rajasthan(1).  Section 3 of the, principal  Act authorised the State Government to levy, charge and  collect tax  on all fares and freights in respect of all  passengers carried  and goods transported by motor vehicles  in  Rajas- than.   The said section further provided that the  rate  of the  tax  shall  not exceed 1/8th of the value  of  fare  or freight   in  the  case  of  cemented,  tarred,   asphalted, metalled, gravel and kankar roads, and shall not exceed 1/12 of such value in other cases as may be notified by the State Government from time to time. Section 21 of the principal Act authorised the Government of Rajasthan  to frame rules consistent with the said  Act  for securing  the payment of tax and generally for the  purposes of  carrying into effect its provisions.   Accordingly,  the Government  of  Rajasthan framed suitable rules  which  came into force on the 21st May, 1959.  Thereupon, a notification was issued by respondent No. 1 on the 30th April, 1959 under s.  3  of the said Act and ;It came into force,  on  May  1, 1959;  it  directed the manner in which, and  the  rates  at which, the tax shall be charged and recovered.  These  rates were the same as had been prescribed by s. 3 of the same Act as  maximum permissible rates.  This notification  was  made effective  on and from the 1st May, 1959.  There is no  dis- pute   that  the  principal  Act  is  valid  and  that   the notification issued under it is also valid. In  1961,  the Rajasthan Finance Act (No. 14  of  1961)  was passed.   Section 8 of this Act purported to amend s.  3  of the  principal  Act.   As a result of  this  amendment,  the maximum  rate  at  which the State  Government  could  levy, charge  and collect tax on fares and freights was  increased from  1/8th to 15 per cent in the first category  of  cases; and  in the second category of cases it was  increased  from 1/12th  to 10 per cent.  In pursuance of the  provisions  of this Finance Act, respondent No. 1 issued a notification  on the  9th  March,  1961  levying  tax  at  the  said  maximum permissible rates.  Neither the bill in respect of this  Act received (1)  [1962] 1 S.C.R. 517.                             895 assent  of  the President before it was  introduced  in  the State Legislature, nor did this Act receive his assent after it was passed. In  1962,  the Rajasthan Finance Act (No. 11  of  1962)  was passed.  Section 9 of this Act amended s. 3 of the principal Act  authorised the increase of the two respective taxes  to 20  per cent and 15 per cent respectively.   A  notification was then issued respondent No. 1 under the provisions of  s. 9 of tile said Act. is notification authorised levy of taxes at  the  maximum rates permissible under s. 9.  Neither  the

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bill in respect of this Act before it was introduced in  the State Legislature, nor this Act after it was passed received the assent of the President. Then  followed the Finance Act (No. 13 of 1963).   This  Act purported to amend s. 11 of the principal Act; but with this amendment we are not concerned in the present proceedings. It appears that the constitutional validity of the, material provisions of the principal Act and rules and  notifications issued  under it as well as the constitutional  validity  of the Finance Acts 1961 and 1962 and the notifications  issued respectively  thereunder was challenged by a number  of  bus operators  by  writ  petitions  filed  by  them  before  the Rajasthan  High  Court under Art. 26  of  the  Constitution. During  the pendency of these writ petitions, the  Rajasthan Ordinance  No. 4 of 1964 was promulgated.  Later,  the  said Ordinance was repealed and replaced by the Act with which we are  concerned  in the present proceedings.  This  Act  came into  force on the 9th September, 1964, having received  the assent of the President on the 8th September, 1964. The  writ  petitions filed by the other bus  operators  were decided  by the said High Court on the 30th  November,  1964 vide Vijai Singh and another v. Deputy Commissioner,  Excise &  Taxation (Appeals), Ajmer and Kotah Divisions,  Jaipur  & other(1).   In  substance, the High Court has held  in  that case that the earlier Finance Acts of 1961 and 1962 suffered from  the  infirmity  that  they did  not  comply  with  the requirements of Art. 255 of the Constitution.  It,  however, did not think it necessary to finally determine the question as  to  whether by reason of the said  infirmity,  the  said earlier  Acts were void or not, because in its opinion,  the Act of 1964 "is not merely an amending and a curative Act in that limited sense, but it is really an Act which  virtually re-enacts the provisions of the earlier Acts which  suffered from  a constitutional infirmity" (P. 300).  The High  Court examined the contentions raised by the petitioners that (1)  [1965] I.L.R. 15 Raj. 285. 896 the provisions of the Act were invalid, and has rejected the petitioners’ case that the said provisions suffered from any constitutional  infirmity.   In the  result,  the  petitions filed before it challenging the validity of the Act  failed. It  appears  that the petitioners had  also  challenged  the validity of the recovery of penalty for non-payment of  tax, and  the High Court held, following its  earlier  decisions, that  the levy of any penalty in the cases before ,At  would be  illegal and, therefore, must be struck down.   In  other words,  except for the limited relief granted in respect  of the  levying  of  the penalty,  the  substantial  contention raised  by the petitioners challenging the validity  of  the Act  has  been  rejected by the High  Court.   Against  this judgment, the High Court has -ranted certificates of fitness for leave to appeal to this Court and the record in the said appeals is being printed in the High Court.  In that  sense, the  said  appeals  can be said to be  pending  before  this Court. The  learned Advocate-General who has appeared for the  res- pondents  in the present writ proceedings, requested  us  to postpone  the hearing of this writ petition and take  it  up along  with the appeals to which we have just referred.   We did not, however, accede to this request, because we thought that  it would not be right to postpone the hearing  of  the present  writ petition for an indefinitely long period,  and so,  we  allowed the learned Advocate General to  argue  the matter  fully and refer us to the judgment of the  Rajasthan High  Court which is under appeal in the said  appeals.   We

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made it clear to the learned Advocate-General that our deci- sion  in the present writ petition would cover the  decision of  the  said appeals in so far as it would  relate  to  the validity  of  the provisions of the Act which  are  impugned before  us  by the present petitioner and not to  that  part which  covered  the question of penalty.   Accordingly,  the learned Advocate-General has elaborately addressed us on the relevant  points  and  has taken  us  through  the  relevant portions of the judgment of the Rajasthan High Court in  the case of Vijai Singh(1). The respondents filed their written statement in the present proceedings and they urged that the petitioners challenge to the  validity of the relevant provisions of the  Act  should not   be   sustained.  According  to  them,   the   Act   is constitutionally valid and the impugned orders of assessment are fully justified by the said provisions.  That is how the main  question which falls to be considered in  the  present writ petition is whether the relevant provisions of the  Act are valid or not. (1)  (1965) I.L.R. 15 Raj. 285. 897 Let  us therefore proceed to refer to the provisions of  the Act   enquire  whether  the  petitioner  is   justified   in challenging  their  validity.   The  Act  consists  of  five sections.  Section 1 gives its tile; s. 2 amends s. 3 of the principal  Act; s. 3 deals with validation of  certain  lump sum  payments  in  lieu of tax s.  4  purports  to  validate certain  sections  of the Rajasthan Acts 14 of 1961,  11  of 1962  and 13 of 1963; it also purports to validate  the  tax levied,  paid  or payable and action taken  or  things  done during the period between the 9th day of March, 1961 and the date  of  commencement  of this Act.   The  last  section  5 repeals Ordinance No. 4 of 1964.  In the present proceedings we  are not concerned with lump sum payments; and so,  s.  3 does not fall to be considered. At this stage it is convenient to set out sections 2 and  4; they read as under               "2.  In section 3 of the Rajasthan  Passengers               and Goods Taxation Act, 1959 (Rajasthan Act 18               of  1959)  hereinafter  referred  to  as   the               principal   Act,   to  subsection   (1),   the               following  proviso  shall  be  and  be  deemed               always to have been added, namely --               Provided  that  the tax shall  be  charged  in               respect  of all passengers carried  and  goods               transported by motor vehicles,-               (a)   during the period between the 1st day of               May,  1959 and the 8th day of March, 1961,  at               the rate of-               (i)   one-eighth  of the value of the fare  or               freight   in   case   of   cemented,   tarred,               asphalted,  metalled, gravel and kankar  roads               and               (ii)  one-twelfth  of the fare or freight,  in               other cases, subject to a minimum of one  Naya               Paisa in any one case, the amount of tax being               calculated to the nearest Naya Paisa; and               (b)   during,  the period between the 9th  day               of  March,  1961 and the 25th  day  of  March,               1962, at the rate of-               (i)   fifteen  per  cent of the value  of  the               fare  or  freight  in the  case  of  cemented,               tarred, asphalted, metalled, gravel and kankar               roads, and               C.I/65-14

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             898               (ii)  ten  per cent of the fare or freight  in               other  cases subject to a minimum of one  Naya               Paisa in any one case, the amount of tax being                             calculated to the nearest         Naya  Paisa". "4.  Notwithstanding  any judgment, decree or order  of  any Court, but subject to the provisions of this Act, section  8 of  the  Rajasthan Finance Act, 1961 (Rajasthan  Act  14  of 1961),  section  9  of  the  Rajasthan  Finance  Act,   1962 (Rajasthan Act 11 of 1962), and section 14 of the  Rajasthan Finance  Act,  1963 Rajasthan Act 13 of 1963) shall  not  be deemed  to be invalid, or ever to have been  invalid  during the  period between the 9th day of March, 1961 and the  date of  commencement of this Act, merely by reason of  the  fact that  the Bills, which were enacted as the  Acts  aforesaid, were  introduced in the Rajasthan State Legislature  without the previous sanction of the President under the proviso  to Art. 304(b) of the Constitution and were not assented to  by the  President  and  the tax levied, paid  or  payable,  the composition  fee  paid ,or payable and any action  taken  or things done or purporting to have been taken or done  during the  period  aforesaid under the  Rajasthan  Passengers  and Goods  Taxation  Act, 1959 (Rajasthan Act 18  of  1959),  as amended  by  the Acts aforesaid, shall be deemed  always  to have  been validly levied, paid, payable, taken or  done  in accordance  with law and the aforesaid enactments shall  be, and  be  deemed  always  to  have  been,  validly   enacted, notwithstanding the aforesaid defects, and accordingly.               (a)   no  suit  or other proceeding  shall  be               instituted,  maintained  or continued  in  any               court for the refund of any tax or fee so paid               or  for  any  other relief on  the  ground  of               invalidity  of the said sections of  the  Acts               aforesaid; and               (b)   no  court  shall enforce any  decree  or               order directing any such refund or relief". Mr. Tiwari for the petitioner contends that ss. 2 and 4 pur- port  to validate the earlier invalid Finance Acts  of  1961 and 1962.  He argues that the failure of the Legislature  to comply  with the provisions of Art. 255 of the  Constitution renders the                             899 said  Acts  void  ab  initio and as  such,  they  cannot  be validated by subsequent legislation.  Mr. tiwari also  urges that  the ,aid earlier Acts have been held to be invalid  by the  Rajasthan High Court in the case of Vijai Singh(1)  and it would be incompetent to the State Legislature to validate the  said  Acts  in  spite of the decision  of  a  court  of competent jurisdiction. We are not impressed by this argument.  In the first place, it is not clear that the Rajasthan High Court has held  that the, said earlier Finance Acts are void ab initio; in  fact, as we have already pointed out, the said High Court  thought it  unnecessary to pronounce its considered opinion on  that aspect  of the matter, because it held that the Act of  1964 with which it was primarily dealing in the said  proceedings not  merely amended or cured the earlier Finance  Acts,  but re-enacted  the  provisions of the said Acts,  and  so,  the provisions  of the said Acts became operative by  their  own force.  Therefore, factually, it is not correct to say  that the  said  earlier  Acts have been struck down  as  void  ab initio by any court of competent jurisdiction.  Besides,  in assessing the validity of this argument, it is necessary  to remember  that the Act was passed on September 8,  1964  and

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the  judgment of the Rajasthan High Court was pronounced  on November 30, 1964; and so, it is clear that at the time when the  Act  was passed the earlier Finance Acts had  not  been struck down at all. The  next  question  to consider is  whether  an  Act  which suffers from the infirmity that it does not comply with  the requirements  of  Art. 255, can be validated  by  subsequent legislation.   There  are  two  answers  to  this  question. Article  255  provides,  inter  alia, that  no  Act  of  the Legislature  of  a State and no provision in any  such  Act, shall be invalid by reason only that some recommendation  or previous  sanction  required by this  Constitution  was  not given,  if  assent  to the Act was given  by  The  President later.   The position with regard to the laws to which  Art. 255 applies, therefore, is that if the assent in question is given  even after the Act is passed, it serves to  cure  the infirmity  arising from the initial non-compliance with  its provisions.   In  other words, if an Act is  passed  without obtaining the previous assent of the President, it does  not become void by reason of the said infirmity; it may be  said to  be unenforceable until the assent is secured.   Assuming that  such a law is otherwise valid, its validity cannot  be challenged  only  on  the  ground that  the  assent  of  the President was not obtained earlier as required by the  other relevant provisions of the Constitution.  The said infirmity is cured by the (1) (1965) I.L.R. 15 Raj. 285. 900 subsequent  assent and the law becomes -enforceable.  It  is unnecessary  for the purpose of the present  proceedings  to consider  when  such  a  law  becomes  enforceable,  whether subsequent  assent makes it enforceable from the  date  when the  said  law purported to come into force, or  whether  it becomes enforceable from the date of its subsequent  assent. Besides, it is plain that the Legislature may, in a suitable case,  adopt  the  course of passing a  subsequent  law  re- introducing the provisions of the earlier law which had  not received  the  assent of the President,  and  obtaining  his assent thereto as prescribed by the Constitution.  We see no substance in the argument that an Act which has not complied with  the  provisions of Art. 255, cannot  be  validated  by subsequent  legislation  even  where  such  subsequent   Act complies  with Art. 255 and obtains the requisite assent  of the  President as prescribed by the  Constitution.   Whether the infirmity in the Act which has failed to comply with the provisions  of  Art. 255, should be cured by  obtaining  the subsequent   assent  of  the  President  or  by  passing   a subsequent Act re-enacting the provisions of the earlier law and  securing the assent of the President to such Act, is  a matter which the Legislature can decide in the circumstances of  a  given  case.   Legally,  there  is  no  bar  to   the legislature  adopting  either  of  the  said  two   courses. Therefore,  the preliminary objection raised by  Mr.  Tiwari against the validity of the Act fails. That takes us to the construction of section 2 and 4 of  the Act.  It would be noticed that s. 2 in fact does not purport to validate the earlier Finance Acts of 1961 and 1962.  What it  does ;Is to amend retrospectively S. 3 of the  principal Act  by  inserting  a  proviso to sub-s.  (1)  of  the  said section.   On  its  plain reading, s. 2 has  the  effect  of inserting the said proviso to s. 3(1) of the principal  Act; and since the amendment so made is, in terms, retrospective, when a tax is levied for the periods covered by clauses  (a) &  (b)  of  the proviso thus introduced in s.  3(1)  of  the principal  Act,  the  Court must proceed to  deal  with  the

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matter  on the basis that these clauses had been  introduced in  the  principal Act right up from the  commencement.   We have already noticed that the principal Act has been held to be  valid  by this court; and so, we see no  basis  for  the argument that in amending s. 3(1) of the principal Act, S. 2 of the Act has contravened any Constitutional prohibition. It  is well-recognised that the power to legislate  includes the   power   to   Legislate  prospectively   as   well   as retrospectively,  and in that behalf, tax legislation is  no different  from any other legislation.  If  the  Legislature decides to levy a tax, it may levy such tax 901 either   prospectively   or  even   retrospectively.    When retrospective legislation is passed imposing a tax, it  may, in  conceivable cases, become necessary to consider  whether such retrospective taxation is reasonable or not.  But apart from this theoretical aspect of the matter, the power to tax can  be  competently  exercised by  the  legislature  either prospectively or retrospectively; and that is precisely what s.  2 has done in the present case.  Therefore, there is  no substance in the argument that s. 2 of the Act is invalid. As  the  said S. 2 has been drafted, it appears  clear  that clause  (a)  of the priviso added by it to s. 3 (1)  of  the principal  Act, covers the period between last of May,  1959 and  the 8th of March, 1961, whereas clause (b)  covers  the period between the 9th March, 1961 and the 25th March, 1962. The  first  period  had in fact been already  covered  by  a notification validly issued on April 30, 1959 under s. 3  of principal  Act; and so, it is not easy to understand why  it was  thought necessary to refer to this period by  the  said retrospective   amendment.   The  second  period  had   been attempted  to be covered by Finance Act 14 of 1961  and  the notification  issued  thereunder.   In  order  to  make  the provisions   of   the-said   notification   effective,   the Legislature  has  adopted  the legitimate  expedient  it  of making the said provisions a part of the amendment which has been  introduced to s. 3 (1) of the principal Act;  and  so, the  rates prescribed by clause (b) can be  validly  imposed during the said retrospective amendment.  The second  period had  been  the Finance Act 11 of 1962 and  the  notification issued  under it has not been included in the  retrospective amendment  introduced  by s. 2; this period  ranges  between 26th  March, 1962 and the 9th September, 1964; and  so,  the rates  prescribed  by  the notification  issued  under  the, relevant  provisions  of the said Finance Act  are  not  re- enacted  by the amendment made by s. 2. In other words,  s.2 does  not purport to re-enact, by  retrospective  amendment, the  rates prescribed by the notification issued  under  the Finance  Act 11 of 1962.  We are inclined to take  the  view that  the  draftsmen of the Act have referred to  the  first period unnecessarily in the said proviso and have failed  to refer   to  the  third  period,  through  oversight.    This infirmity  tends  to show that the drafting of :2  has  been casual  and somewhat careless.  As we will  presently  point out,  the  consequence  would  be  that  the  higher   rates prescribed  for the period between 26th March, 1962 and  the 9th September. 1964 by the notification issued under Finance Act  11 of 1962, are not saved by the general provisions  of s. 4 of the Act.  It is to the said provisions that we  must now turn. Section  4 consists of three parts.  In its first  part,  it provides that the several sections of the three Finance Acts enumerated by 902 it, shall not be deem-Id to be invalid, or ever to have been

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invalid, during the period there specified, merely by reason of  the fact that Art. 255 of the Constitution had not  been complied  with.  Part 2 of the said section  provides  inter alia that the tax levied, paid or payable during the  period as  amended  by  the said specified Acts,  shall  be  deemed always  to  have been validly levied, paid or  payable;  and part  3 prescribes that the aforesaid enactments  shall  be, and be deemed always to have been, validly enacted, notwith- standing  the aforesaid defects.  The question which  arises for our decision is whether this section is valid. ln  dealing with this question, we must, of course  bear  in mind  the  fact  that the Act and all  its  provisions  have received the assent of the President and so, prima a  facie, the assent of the President to the Act would help the Act to validate the  provisions of the earlier Acts which were  not enforceable by reason of the fact that they had not  secured his  assent as required by Art. 255.  But can the assent  of the  President to the Act serve the purpose of making  s.  4 valid ? What s. 4 in truth and in substance says is that the failure to comply with the requirements of Art. 255 will not invalidate  the  Finance  Acts  in  question  and  will  not invalidate  any  action taken, or to be taken,  under  their respective   relevant  provisions.   In  other  words,   the Legislature  seems to say by s. 4 that even though Art.  255 may not have been complied with by the earlier Finance Acts, it is competent to pass s. 4 whereby it will prescribe  that the failure to comply with Art. 255 does not really  matter, and  the assent of the President to the Act amounts to  this that  the  President also agreed, that  the  Legislature  is empowered to say that the infirmity resulting from the  non- compliance with Art. 255 doe,; not matter.  In our  opinion, the  Legislature is incompetent to declare that the  failure to  comply  with  Art. 255 is of no  consequence  and,  with respect,  the  assent of the President to  such  declaration also  does not serve the purpose which subsequent assent  by the President can serve under Art. 255. The  learned  Advocate-General  has  strenuously   contended before us that we should look at the substance of the matter and not decide the validity of s. 4 merely because the words used  in it may not be happy or appropriate.  We agree  that questions of this character must be judged on considerations of  substance and not merely of form, and we have  tried  to read  s.  4 as favourably as we can while  appreciating  the argument of the learned Advocate General; but the words used in  all the three parts of s. 4 are clear  and  unambiguous; they  indicate  that  the Legislature thought  that  it  was competent to it to cure, by its own legislative process, the 903 infirmity  resulting from the non-compliance with  Art.  255 When it passed the earlier Finance Acts in question, and  it was  probably  advised that such a  legislative  declaration would’be  valid  and  effective, provided  it  received  the assent  of  the  President.  In our  opinion,  the  approach adopted  by  the  Legislature  in  this  case  is   entirely misconceived.   The Legislature, no doubt, can  validate  an earlier  Act  which is invalid by reason  of  non-compllance with Art. 255 and such an Act may receive the assent of  the President   which   will  make  the  Act   effective.    The Legislature  cannot,  however, itself declare  by  statutory provision  that the failure to comply with Art. 255  can  be cured  by  its  own enactment, even if  the  said  enactment received  the assent of the President.  In our opinion  even -the   assent  of  the  President  cannot  alter  the   true constitutional  position under Art. 255.  The assent of  the President  cannot, by any legislative process, be deemed  to

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have been given to an earlier Act at a time when in fact  it was  not so given. in this context there is no scope  for  a retrospective  deeming provision in regard to the assent  of the  President.  It is somewhat unfortunate that the  casual drafting of s. 2 leaves the period covered by Act It of 1912 and  the notification issued thereunder as unenforceable  as before,  and the omnibus and general provisions of s. 4  are of no help in regard to the said period. The  learned  Advocate-General strongly relied on  the  last part  of  S.  4.  This  part  provides  that  the  aforesaid enactments  shall  be, and be deemed always  to  have  been, validly enacted, notwithstanding the aforesaid defects.  The clause "notwithstanding the aforesaid defects"  emphatically points  to  the fact that the Legislature  thought  that  it could  legislate retrospectively, and by such  retrospective legislation, it could itself cure the infirmity in question. What has been overlooked by the Legislature is the fact that the infirmity in question can be cured only by obtaining the assent of the President and not by any legislative fiat.  We have  given our anxious consideration to the problem  raised by  the wording of s. 4 and we have come to  the  conclusion that  it would not be possible to uphold its  validity.   On many  occasions,  this  Court  has  tried  to  look  at  the substance of the matter and determine the issue in spite  of the fact that the words or expressions used in the  relevant provisions  are  either slovenly inappropriate  or  unhappy. But in the present case, however benevolently or  favourably we look at the provisions of s. 4, we see no escape from the conclusion  that in enacting it, the Legislature appears  to have  clearly  assumed  that  it  can  by  itself  cure  the infirmity  resulting from the non-compliance with  Art.  255 and  all that it has to do in such a case is to  obtain  the a,-,sent of the President to its own view about its power to cure 904 such  an infirmity.  We are satisfied that it  is  necessary that the true position in regard to the scope and effect  of Art. 255 must be ,clearly brought out in order to avoid  any misapprehension in future. In  support  of his argument that the form  adopted  by  the Legislature  in  enacting  s. 4 is  not  inappropriate,  the learned  Advocate General has referred us to a  decision  of this  Court  in M.P.V. Sundararamier & Co. v. The  State  of Andhra  Pradesh  and Another(1).  It is true  that  in  that case, s. 2 of the Sales Tax Laws Validation Act, 1956 (No. 7 of 1956), which is a Central Act, used phraseology which  is similar  to the phraseology adopted by s. 4 of the Act;  but it would be fallacious to compare the said provision with s. 4,  because the ban which s. 2 of the said Act  intended  to lift  could  validly be Iifted by a  Parliamentary  statute. Art.  286(2) of the Constitution which was, in force at  the relevant  time had provided, inter alia, that except  in  so far  as Padiament may by law otherwise provide, no law of  a State shall impose, or authorise the imposition of, a tax on the  sale or purchase of goods where such sale  or  purchase takes place in the course of inter-State trade or  commerce. What s. 2 of the said Act did was to make a law as expressly authorised by Art. 286(2); and naturally in exercise of  the power conferred on it by the said provision, it enacted  the provisions  of  s.  2 and made them  retrospective.   It  is significant  that  the  power  to lift  the  ban  which  was exercised   retrospectively   by   Parliament,   vested   in Parliament  and  not  in  any  outside  authority  like  the President;  and  so, Parliament was perfectly  competent  to validate  the  several  State Acts which  were  held  to  be

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invalid,  by adopting the legislative expedient of making  a law  as  authorised  by Art. 286(2) and  providing  for  its retrospective operations The position with regard to s. 4 is logically  and fundamentally different; the infirmity  which rendered  the earlier Finance Acts unenforceable, could’  be cured  not by the Legislature itself acting on its own,  but by  the  assent  of  the President; and in  so  far  as  the Legislature  by enacting s. 4 purports to prescribe  by  its own fiat that the infirmity in question should be deemed  to have  been  cured, it has clearly exceeded  its  legislative jurisdiction.  Therefore, we do not think that the  decision of this Court in Sundararamier & Co.’s case(1) can be of any help  to  the  learned Advocate-General in  support  of  his argument that s.4 has been validly enacted. There   is  one  more  point  which  still  remains  to   be considered.   Mr.  Tiwari  urged  that   the   retrospective operation of the amend- (1)  [1958] S.C.R. 1422. 905 ment  made by s. 2 of the Act in s. 3 (1) of  the  principal Act,  should be held to be unconstitutional inasmuch as  the retrospective  operation of the provision prescribed by  cl. (b) of the proviso added by s. 2 suffers from the  infirmity that  it  imposes enhanced tax  duty  retrospectively.   His argument is, where a taxing statute purports to impose a tax retrospectively,  it  necessarily  involves  an  element  of unreasonableness and that virtually amounts to contravention of  the citizens’ fundamental rights guaranteed  under  Art. 19(1)(f) or (g) of the Constitution.  For the purpose of the present  writ petition, we will assume that  notwithstanding the proclamation of emergency issued by the President  under Art.  352, the constitutional bar created by Art.  358  does not  operate  against the petitioner inasmuch as  he  relies upon the contravention of his fundamental right prior to the date, of the proclamation.  It is on that assumption that we wish  to deal with the contention raised by Mr. Tiwari.   In our  opinion,  the said contention is plainly  unsound.   We have already stated that the power to make laws involves the power  to  make  them effective  prospectively  as  well  as retrospectively, and tax laws are no exception to this rule. So, it would be idle to contend that merely because a taxing statute    purports   to   operate   retrospectively,    the retrospective operation per se involves contravention of the fundamental right of the citizen taxed under Art. 19(1)  (f) or  (1). It is true that Cases may conceivably  occur  where the  Court may have to consider the question as  to  whether excessive  retrospective  operation prescribed by  a  taxing statute  amounts  to  the  contravention  of  the  citizens’ fundamental right; and in dealing with such a question,  the Court  may  have to take into account all the  relevant  and surrounding  facts  and  circumstances in  relation  to  the taxation.   In  the  present  case,  having  regard  to  the legislative background of the provision prescribed by s.  2, there  can  be  little doubt that there  is  no  element  of unreasonableness involved in the retrospective operation cl. (b)  of the proviso added by the said section to s. 3(1)  of the principal Act. The  result is that s. 2 of the Act is valid and the tax  in question  can  be  recovered from  the  petitioner  for  the periods  covered  by clauses (a) and (b) of the  proviso  as therein prescribed.  In this connection, it will be recalled that  the provision prescribed by cl. (a) of the proviso  is really  superfluous,  because the same lax could  have  been validly   recovered   at  the  prescribed  rates   under   e notification  issued  on April 30, 1959 under s.  3  of  the

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principal  Act.   But as we have already  pointed  out,  the period  between  arch 26, 1962 to September 9, 1964  is  not covered by the provisions inserted by s. 2 in s. 3(1) of the principal Act; and so, 906 the  provisions  of  s.  2  are  of  no  assistance  to  the respondents in imposing a tax against the petitioner at  the enhanced  rates initially prescribed by s. 9 of the  Finance Act  11  of 1962.  If we bad held that s. 4 of the  Act  was valid, then the impositoin of the tax at the enhanced  rates prescribed by ,he said s. 9 would also have been valid;  but ;in  view  of the fact that we have come to  the  conclusion that  s. 4 is invalid, it follows that the tax which can  be legitimately and validly imposed against the petitioner  for the said period must be levied under the notificaion  issued on  April  30,  1959 under s. 3 of the  principal  Act.   No doubt,  Mr.  Tiwari attempted to argue that in view  of  the fact  that  the said s. 3 had been amended by s.  9  of  the Finance  Act 11 of 1962, the notification issued  under  the original  section  3  of  the principal  Act  ceases  to  be operative.  This contention is clearly misconceived.  If the said Finance Act is unenforceable and the notification issu- ed  thereunder is of no effect, then S. 3 of  the  principal Act  would remain unamended for the period in  question  and the  notification  initially issued under it  would  remain. operative. As  a  consequence of this conclusion, it follows  that  the petitioner  is  entitled  to claim  that  the  tax  assessed against  him  in  respect of his  vehicles  for  the  period between  26th March, 1962and the 9th September, 1964 at  the enhanced  rates is invalid, and that the taxing  authorities concerned will have to levy the tax at the rates  prescribed by the notification issued on the 30th April, 1959 under  s. 3  of the principal Act as it originally stood.  It is  true that  this  result sounds very anomalous,  because  for  the period immedeately preceding the period in question, the tax is  validly recoverable at the enhanced rates,  whereas  for the  period in question, it has to be recovered at  a  lower Tate; but, for this anomaly, the defective drafting of S.  2 and s. 4 of the Act is entirely responsible.  Before  we part with this petition, we would like to  refer briefly to two decisions of this Court to which  --reference was made during the course of the argument, before us.   ’in Rai  Ramkrishna  &  Others v. The  State  of  Bihar(1),  the validity  of  the  Bihar Taxation on  Passengers  and  Goods (Carried by Public Service Motor Vehicles) Act, 1961 (No. 17 of  1961)  was challenged on the ground that  it  sought  to validate  taxes already recovered under an  invalid  Finance Act.    Rejecting  the  argument  that  such   retrospective validation  of  tax  illegally  recovered  amounts  to   the contravention of the citizens’ fundamental right under  Art. 19(1) (f) or  (g), this Court held that if in its  essential features a taxing (1) [1964] 1 S.C.R. 897. 907 statute  is within the competence of the  Legislature  which passed 1 its character is not necessarily changed merely  by its  rotrospec  tive  operation  so  as  to  make  the  said retrospective  operation either unreasonable or outside  its ’legislative competence. A  similar  view has been expressed by this Court  in  Jaora Sugar  Mills  (Pvt.) Ltd. v. The State of Madhva  Pradesh  & Others(1). The  result is, the writ petition is partly allowed and  the pugned orders of assessment are set aside in so far as  they

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relate  to the period between 26th March, 1962 and  the  9th Septemberm, 1964, and we direct the assessing authorities to levy a proper assessment in the ligght of the judgemnt.  The assement orders in respect of the remaining period are valid and  the petitioner’s prayer that they should be sot  aside, is  rejected.  in view of the fact that the  petitioner  has succeeded only partially, we direct that parties should bear their own costs. Petition allowed in part. (1) [1966] 1 S.C.R. 518. 908