ORDER
motilal b. Naik, J.
1. In these three writ petitions, the petitioners have sought a writ of mandamus declaring G.O. Ms. No. 780 dated September 12, 1997 and Section 14-C(2) of the Andhra Pradesh General Sales Tax Act, 1957 as arbitrary, illegal and violative of Articles 14 and 19(1)(g) of the Constitution of India and beyond the power of the Legislature and the Government, and consequently to set aside G.O. Ms. No. 780 dated September 12, 1997 and Section 14-C(2) of the Andhra Pradesh General Sales Tax Act and to direct the first and second respondents to complete the assessment of the petitioners on the basis of Section 14-C and pass such orders in the interest of justice.
2. Since the issue is common in these three writ petitions, for appreciating the issue we record the facts of the case relating to Writ Petition No. 30752 of 1997 and dispose of these three writ petitions by the following common order.
3. Writ petitioners who are dealers of Napa slabs in Macherla town of Guntur district, have been carrying on business activity in Napa slabs. According to the petitioner, NAPA SLABS are taxed at 16 per cent under item 92A of the First Schedule to the Andhra Pradesh General Sales Tax Act. However, in the year 1995, the Andhra Pradesh legislature brought in an amendment in the Act through Act No. 22 of 1995. As a result of the said amendment, Section 14-C came to be inserted in Andhra Pradesh General Sales Tax Act, with effect from April 1, 1995. By virtue of introduction of Section 14-C in the Act with effect from April 1, 1995, it was provided that the persons, who are dealing with Napa slabs business and whose turnover is less than rupees five lakhs, per year, are entitled to pay sales tax at 2 per cent on their turnover irrespective of the actual rate of tax on the goods sold by them. It is their case that all the petitioners have opted to pay sales tax under Section 14-C as their turnover was less than rupees five lakhs for the year 1995-96 and onwards. In order to get such benefit, it is further provided that the dealers who wish to avail the benefit of Section 14-C are obligated to file returns in form A9 showing the turnover and signifying their option to be taxed under Section 14-C of the Andhra Pradesh General Sales Tax Act. All the petitioners filed their declarations and returns under form A9.
4. While so, through G.O. Ms. No. 519, dated July 1, 1996 the Government of Andhra Pradesh exercising powers under Section 14-C(2) of the Andhra Pradesh General Sales Tax Act, 1957, as amended by the Third Amendment, 1995, notified that dealers dealing with Napa slabs are not entitled to reap the benefits as provided under Section 14-C of the Act. In tune with the desire of the Government as reflected under G.O. Ms. No. 519 dated July 1, 1996, the Government issued G.O. Ms. No.780 dated September 12, 1997, whereby it is clarified that G.O. Ms. No. 519 would have retrospective effect from April 1, 1995. It is this Government Order, that is challenged in these writ petitions.
5. We have heard Sri K.V. Simhadri, learned Counsel for the petitioners in W.P. No. 30752 of 1997 and also Sri S. Jagadeesh, learned counsel for the petitioners in W.P. No. 31707 of 1997 and 6192 of 1999. According to the learned counsel for the petitioners though the dealers in Napa Slabs were obligated to pay tax at 16 per cent prior to the amendment inserting Section 14-C to the Act, which came into force with effect from April 1, 1995, dealers who are doing business in Napa Slabs are given the option either to pay tax at the rate of 16 per cent or choose to pay at 2 per cent if their turnover is less than rupees five lakhs per year. According to the learned counsel, as the writ petitioners' turnover was less than rupees five lakhs, they opted to pay the tax at the rate of 2 per cent and they have also filed necessary forms under form A9 before the appropriate authority. According to the learned counsel for the petitioners by virtue of G.O. Ms. No. 780, which is dated September 12, 1997, the benefit which these writ petitioners were entitled to with effect from April 1, 1995 has now been withdrawn retrospectively though the said G.O. which came to be issued on September 12, 1997. Learned counsel submitted that though the Government has got power to withdraw certain benefits, it could not do so under the subordinate legislation giving it retrospective effect. Learned counsel therefore pleaded that the action of the respondents in withdrawing the benefit arising out of Section 14-C of the Act retrospectively is without jurisdiction and submitted that the G.O. Ms. No. 780 dated September 12, 1997 has to be declared as ultra vires only to the extent of extending its operation retrospectively.
6. In support of the aforesaid contention learned counsel relied upon the judgment of the Allahabad High Court in Modi Food Products Ltd. v. Commissioner of Sales Tax : AIR1956All35 ; of the Supreme Court in Dr. Indramani Pyarelal Gupta v. W.R. Natu : [1963]1SCR721 and Income-tax Officer, Alleppey v. M.C. Ponnoose : [1970]75ITR174(SC) , of this Court in BPL Limited v. State of A.P. .
7. On the other hand, the learned Government Pleader submitted that the powers exercised by the executive could not be said to be ultra vires, as according to the learned Government Pleader, amendment was introduced to the Act by virtue of Third Amendment (22 of 1995) to Section 14-C with effect from April 1, 1995 by exercising powers under Section 14(2). The Government has such power to make amendments to the provisions, which could be either prospective or retrospective. Learned Government Pleader justified the action of the respondents and contended that the plea of the petitioners is not justified and pleaded the court to dismiss the writ petitions.
8. Having regard to the submissions made on behalf of the writ petitioners and on behalf of the State Government, the point for consideration is whether G.O. Ms. No. 780 dated September 12, 1997 issued by the Government of Andhra Pradesh under subordinate legislation withdrawing the benefits retrospectively granted to the dealers in Napa slabs through insertion of Section 14-C to the Andhra Pradesh General Sales Tax Act and as per Third Amendment Act (22 of 1995) which came into force from April 1, 1995, could be held as permissible legislation as contended on behalf of the respondents.
9. In Modi Food Products Limited v. Commissioner of Sales Tax : AIR1956All35 , Dr. Indramani Pyarelal Gupta v. W.R. Natu : [1963]1SCR721 and Income-tax Officer, Alleppey v. M.C. Ponnoose : [1970]75ITR174(SC) , it is categorically held that the Parliament can delegate its legislative power within the recognised limits. Where any rule or regulation is made by any person or authority to whom such powers have been delegated by the Legislature it may or may not be possible to make the same so as to give retrospective operation. It will depend on the language employed in the statutory provision which may in express terms or by necessary implication empower the authority concerned to make a rule or regulation with retrospective effect. But where no such language is to be found it has been held by the courts that the person or authority exercising subordinate legislative functions cannot make a rule, regulation or bye-law which can operate with retrospective effect.
10. In view of the law laid down by the Supreme Court, we have no hesitation to hold, in the facts and circumstances of the case, the issue raised in these writ petitions is squarely covered by the decisions cited supra and it is no more res Integra. Subordinate legislation is an accepted proposition which enables the executive to frame certain rules, regulations/guidelines in tune with the principal objectives of the enactment. As long as the executive is not authorised in clear terms by the Legislature, through a particular provision of the Act indicating its intention that a provision shall come into operation retrospectively also, the executive, under subordinate legislation, cannot exercise such power, withdrawing a benefit extended by the Legislature through an executive order. If such a power is exercised, it has to be declared as ultra vires the powers of the State Government under the Act.
11. It is not brought to our notice by the learned Government Pleader appearing on behalf of the respondents that the Legislature had authorised the executive to withdraw the benefits extended to the dealers in Napa slabs by insertion of Section 14-C to the Act, retrospectively through G.O. Ms. No. 780 dated September 12, 1997. In the facts and circumstances of the case, having regard to the law laid down by the Supreme Court in the decisions cited supra, we declare that G.O. Ms. No. 780 dated September 12, 1997 issued by the Government of Andhra Pradesh exercising powers under Sub-section (2) of Section 14-C of the Andhra Pradesh General Sales Tax Act, 1957 to the extent of its application retrospectively is without authority and ultra vires the powers of the State Government under the Andhra Pradesh General Sales Tax Act, 1957.
12. Learned counsel for the petitioners submitted that though pursuant to the amendment brought to the Andhra Pradesh General Sales Tax Act through Third Amendment Act (22 of 1995), i.e., insertion of Section 14C, the liability to pay tax by the petitioners is at 2 per cent, but they had been paying the tax at 16 per cent. Learned counsel therefore stated that as a result of declaration of law by this Court for the said period they are entitled for refund of excess tax paid over and above the 2 per cent.
13. The learned Government Pleader on the contrary submits that the assessments have not been completed so far for this period and for later periods also as a result of the stay granted by this Court and submits that the writ petitions could be disposed of directing the assessing authority to complete the assessment for the relevant period and the liability could be restricted to only 2 per cent tax and in the event if the authority realises that the petitioners have not passed on the burden on the customers and have paid tax at 16 per cent, the authority shall make necessary provision in the order for refund. In the light of these submissions, we direct the assessing authority to complete the assessment for these years and examine whether the petitioners have paid tax at the rate of 16 per cent as was in force prior to the Third Amendment Act (22 of 1995) and whether the petitioners have not passed on the burden to the customers and if it is realised that the statement made by these petitioners is correct, necessary provisions be made in the order for refund of the excess tax paid over and above 2 per cent for the relevant period. We desire that the assessment shall be completed within a period of four months from the date of receipt of a copy of this order.
14. The writ petitions are accordingly allowed. There shall be no order as to costs.