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PETITIONER: STATE OF PUNJAB & ORS.

       Vs.

RESPONDENT: SUKH DEB SARUP GUPTA

DATE OF JUDGMENT: 29/04/1970

BENCH: GROVER, A.N. BENCH: GROVER, A.N. SHAH, J.C. HEGDE, K.S.

CITATION:  1970 AIR 1641            1971 SCR  (1) 442  1970 SCC  (2) 177

ACT: East Punjab General Sales Tax Act, 1948---Exemption from tax under Entry 37, Sch.  B for alcoholic preparations on  which Excise duty was leviable under Punjab Excise Act 1914,-State Act  of  1914 superseded by  Central  Act-Whether  exemption still available by virtue of s. 8, General Clauses Act 1897.

HEADNOTE: The  respondent  was a manufacturer of medicinal  or  toilet preparations which fell within the definition of  "excisable articles"  on which excise duty was payable under s.  3  (6) (c)  of the Punjab Excise Act, 1914.  Under s. 6  read  with Entry 37 in Schedule B of the East Punjab General Sales  Tax Act,  1948, all goods on which duty was leviable  under  the Punjab Excise Act, 1914, were exempt from the levy of  sales tax.  After the commencement of the constitution,  alcoholic preparations which, under the Government of India Act, 1935, were a provincial subject, fell within the Union List and in 1955  the Union Parliament enacted the Medicinal and  Toilet Preparations (Excise Duties) Act.  This Central Act repealed any  State laws corresponding to the Act and  brought  about uniformity in all States in the imposition of excise duty on alcoholic preparations. The  respondent  was  assessed to  sales  tax  on  alcoholic preparations  for the years 1959-60 to 1961-62 as the  Sales Tax  authorities  considered that the  respondent  could  no longer claim the benefit of the exemption contained in Entry 37 of Schedule B of the Act.  The respondent challenged  the levy  of sales tax by a writ petition which was  allowed  by the  High  Court on the view that by virtue of s. 8  of  the General Clauses Act, 1897, the reference in Entry 37 to  the Punjab  Excise  Act must be taken to be a reference  to  the relevant provisions of the Central Act. On appeal to this Court, HELD:Dismissing the appeal, The High Court was right in saying that there was nothing in s.. 8 of the General Clauses Act to indicate that the  words "former  enactment" in that provision meant only  a  Central enactment and not a State enactment.  According to s.  3(19) "enactment"  shall  include any provision contained  in  any

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Act. [444 G-H] Furthermore  it  could never be intended that  when  an  Act passed  by  the  Union Parliament repeals a  State  Act  the principle  underlying s. 8 should never  become  applicable. [445 A]

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeal No. 528 of 1967. Appeal  by special leave from the judgment and  order  dated April  6,  1966 of the Punjab High Court in  Letters  Patent Appeal No. 143 of 1965. 4 43 V.   C.  Mahajan, R. N. Sachthey and B. D. Sharma,, for  the appellant. B.   R.  L. Iyengar , K. L. Mehta, and S. K. Mehta, for  the respondent. The Judgment of the Court was delivered by Grover,  J. This is an appeal by special leave from a  judg- ment  of  the Punjab High, Court holding that  medicinal  or toilet  preparations containing alchemist were  exempt  from the  payment of tax under the East Punjab General Sales  Tax Act, hereinafter called "the Act". The  respondent  is  running  a  factory  for  manufacturing spirituous and medicinal preparations containing alchohal at Jind  in  the district of Sangrur.  Before the  coming  into force  of  the Constitution of India on January 26,  1950  " medicinal or toilet preparations" fell within the definition of "excisable articles" on which the excise duty was payable under  s. 3 (6) (c) of the Punjab Excise Act 1914.  The  Act came  into,  force in 1948.  Under its  provisions  tax  was levied  on the sale of goods with the exception of  articles exempted  under s. 6 of the Act.  These articles were  given in Schedule B wherein Entry 37 was in these terms "All  goods  on  which duty is or may be  levied  under  the Punjab Excise Act, 1914." After   the  enforcement  of  the   Constitution   alcoholic preparations  which under the Government of India  Act  1935 was a provincial subject came to be dealt with in the  Union List.   Section  3  (6) (c) of the Punjab  Excise  Act  was, therefore,  omitted  by the Adaptation of Laws  Order  1950. However, by virtue of Art. 277 of the Constitution the State Government continued to levy and collect the excise duty  on the above articles even after January 26, 1950.  In 1955 the Union   Parliament   enacted  the   Medicinal   and   Toilet Preparations (Excise Duties) Act, hereinafter referred to as the "Central Act".  Section 21. of the Central Act provided               "If,  immediately before the  commencement  of               this  Act, there is in force in any State  any               law  corresponding  to this Act, that  law  is               hereby repealed." The effect of the Central Act was to bring about  uniformity in all States in the imposition of excise duty on  alcoholic preparations.   It is common ground that the  collection  of the duty leviable under the Central Act continued to be done by  the State Government and the duty so collected  went  to the  State Exchequer.  The respondent was assessed to  sales tax oh alcoholic preparations on which excise duty was being levied under the Central Act by the 444 State  authorities for the years 1959-60, 1960-61 and  1961- 62.   According  to the appellant State it was  entitled  to levy  I  sales tax on alcoholic preparations of  the  nature which  were covered by the Central Act, for the reason  that

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the  respondent  could no longer claim the  benefit  of  the exemption  contained in Entry 37 of Schedule B to  the  Act. The  respondent  filed  a petition under  Art.  226  of  the Constitution  challenging  the  levy of  sales  tax  on  the alcoholic  preparations on which excise duty was being  paid under  the ,Central Act.  This petition succeeded  before  a learned  Single  Judge of the High Court who  held  that  by virtue  of s. 8 of the General Clauses Act 1897 in Entry  37 reference  to  the Punjab Excise Act must be taken to  be  a reference  to  the relevant provisions of the  Central  Act. According  to  him the State could not levy  any  sales  tax under the Act on the preparations in question.  His judgment was affirmed by a division bench and the appeal filed by the State was dismissed. The short point which falls to be determined is whether s. 8 ,of  the General Clauses Act 1897 would govern the case  and whether  the  respondent  could claim  the  benefit  of  the exemption   in   Entry  37  of  Schedule  B   to   the   Act notwithstanding that the exemption related expressly only to goods on which duty could be levied under the Punjab  Excise Act 1914.  Section 8(1) of the General Clauses Act  provides :-               "8  (1) Where this Act, or any Central Act  or               Regulation made after the commencement of this               Act,  repeals  and reenacts, with  or  without               modification,   any  provision  of  a   former               enactment,   then  references  in  any   other               enactment   or  in  any  instrument   to   the               provision   so   repealed  shall,   unless   a               different  intention appears, be construed  as               references to the provision so re-ernacted." According  to.   S.  3 (19) of that  Act  "enactment"  shall include  any provision contained in any Act.  On  behalf  of the  State  it  has  been  argued  that  the  words  "former enactment"  in  s.  8 can refer only to  a  Central  Act  or provisions  contained  therein and ,hey  cannot  cover  Acts passed by the State legislature.  Such an argument cannot be entertained because it goes against the express language  of s. 3 (19) which does not lay down any such limitation.   The obvious  meaning of that provision is that  enactment  would include any Act or provision contained therein passed by the Union  Parliament  or the State  Legislature.   The  limited meaning  sought  to be attributed to  the  word  "enactment" cannot be given to it for another reason.  It could never be intended  that  when an Act passed by the  Union  Parliament repeals a State Act the 44 5 principle  underlying s. 8 should never  become  applicable. The  High  Court, in our opinion, was right in  saying  that there’  was  nothing  in s. 8 to  indicate  that  the  words "former enactment" meant only a Central enactment and not  a State  enactment and that the courts would not be  justified to  read in that section words which were not there  and  to place a narrow and limited construction on the words "former enactment."  It  has  not been disputed  on  behalf  of  the appellant  that if s. 8 is applicable the  respondent  would beexempt from payment of tax under the Act on the  alcoholic preparations on which excise duty is being levied under  the provisions of the Central Act. The appeal fails and is dismissed with costs. R.K.P.S. Appeal dismissed. 446

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