ORDER
Ajit K. Sengupta, J.
1. This appeal is from an order dated 7th May, 1992 vacating an earlier order dated 10th December, 1 991 ofstay of recovery of cess on coal made in an application filed under Art. 226 of the Constitution. It is submitted on behalf of the appellant/ writ petitioner that the controversy lies within a short compass and the basic questions involved are concluded by the judgments of the Supreme Court in India Cement Limited v. State of Tamil Nadu, and Orissa Cement Ltd. v. State of Orissa, : [1991]2SCR105 .
2. According to the appellants the 3 levies under the three Acts namely, Cess Act, 1880, West Bengal Primary Education Act, 1973 and the West Bengal Rural Employment and Production Act, 1976 in so far as they purport to levy cess on the basis of despatches of coal are beyond the legislative competence of the State legislature on the principles laid down in the aforesaid Supreme Court decisions in India Cement (supra) and Orissa Cement. (supra). The appellants contend that this court is only to examine whether the 3 levies (including the amendments thereof) which are in question are pari materia with the levies which were declared to be unconstitutional by the Supreme Court in India Cement (supra) and Orissa Cement (supra).
3. The writ petition was filed in Sept. 1991. On 10th December, 1991 the learned trial Judge made an interim order restraining Eastern Coalfields Limited and Coal India Limited from including in the sale bills of coal any amount representing any levy of cess under the Cess Act, 1980. The West Bengal Primary Education Act, 1973 and West Bengal Rural Employment and Production Act, 1976 as well as an injunction restraining the State of West Bengal from realising any cess through the said coal companies under the aforesaid 3 Acts. This order was made presumably on the basis of the order of the Supreme Court dated 18th Nov. 1991 in Writ Petition (Civil) No. (s) 993/91 (Coal Consumers Association of Eastern v. State of West Bengal) where on a petition filed underArt. 32 of the Constitution by the Coal Consumers Association of Eastern India challenging the three levies, the Supreme Court had granted an ex parte stay of realisation of cess. It appears that by a subsequent reasoned order dated 20th December, 1991 the Supreme Court vacated the order of stay made on 18th Nov. 1991. The interim order granted by the learned trial Judge in this matter on 10th December, 1991 was subsequently continued by him by order dated 12th March, 1992. But on 7th May, 1992 the learned trial Judge vacated the interim order. It is pointed out that the learned trial Judge did so after his attention was drawn to the order dated 20th December, 1991 made by the Supreme Court in the writ petition filed by the Coal Consumers Association of Eastern India. The propriety of vacating the interim order dated 10th December, 1991 as continued by 12th March, 19921 is questioned in this appeal.
4. This appeal was filed on 25th May, 1992, When the matter came up before this Court for considering the question of interim stay the learned counsel for the appellant did not press of any interim order as we acceded to the request of the parties that the appeal itself could be disposed of if the aforesaid decisions of the Supreme Court covered the field and accordingly by our order dated August 4, 1992 fixed the appeal for hearing on August, 26, 1992.
5. The Court was informed by learned counsel for the parties that a number of writ petitions are pending in this court involving the same issues and that some of them were heard in September and November, 1991 and judgment reserved but no judgment has yet been delivered.
6. The learned Counsel appearing for the parties made their respective submissions in the course of hearing of the appeal and also suggested that they would file brief notes of submissions which were submitted on 9th Sept. 1991. In the written notes submitted by the parties the point made in the course of hearing were more or less reiterated except that in the notes submitted on behalf of the State one or two cases were cited which werenot cited in the course of hearing. At the hearing a preliminary issue was raised on behalf of the State regarding the jurisdiction of this court to entertain the writ petition. It is contended that the jurisdiction of the High Court under Art. 226 of the Constitution is totally ousted in respect of the questions involved in the writ petition by reason of the provision of Sections 6 and 14 of the West Bengal Taxation Tribunal Act, 1987 as amended by West Bengal Taxation Tribunal (Amendment) Act, 1992 read with notification of Finance Department No. 2697 FT dated 28th April, 1992. Our attention was also drawn to Art. 323B of the Constitution and particularly sub-clause (3)(d) thereof. It has also been pointed out that an application for transfer of the writ petition to the Tribunal constituted under the Tribunal Act, 1987 filed under Sec. 15 thereof is pending before the learned trial Judge. Since the point has been strenuously urged, it is necessary to examine the issue in some detail.
7. Learned counsel for the State contended that the West Bengal Taxation Tri-buna1 (hereinafter referred to as the 'Tribunal') has been constituted under the Tribunal Act, 1987 in accordance with the provision of Art. 323B of the Constitution. Reliance has been placed on sub-clause (3) of Art. 323B which provides that a law made under that article may exclude the jurisdiction of all courts, except the jurisdiction of the Supreme Court under Art. 136 with respect to all or any of the matters falling within the juirsdiction of the Tribunal. The Tribunal Act, 1987 has expressly provided for the exclusion of the jurisdiction of all Courts excluding the Supreme Court for adjudication of disputes or complaints or offences with repect to all matters of levy, collection etc. of any tax under any specified State Act and the levies in question are all specified (under) State Acts because they are specified in the schedule to the Tribunal Act, 1987. It is urged that the Tribunal Act, 1987 has also provided for transfer of all pending cases from the High Court. It has been urged that a Tribunal constituted by a law made under Art. 323B is an effective alternative adjudicative body vis-a-vis the High Court and in this context learned Counsel for the State citedthe judgment of the Supreme Court in S.P. Sampath Kumar v. Union of India, AIR 1987 SC 386.
8. For proper appreciation of this issue it is necessary to refer to Art. 323B of the Constitution and the relevant provision of the Tribunal Act 1987. Article 323B of the Constitution to the extent material for deciding this controversy provides as follows:--
323B. 'Tribunal for other matters -- (1) The appropriate Legislature may, by law, provide for the adjudication or trial by tribunals of any disputes complaints, or offences with respect to all or any of the matters specified in clause (2) with respect to which such Legislature has power to make law:--
(2) The matters referred to in clause (1) are the following, namely:--
(a) Levy, assessment, collection and enforcement of any tax.
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(3) A law made under Clause (1) may exclude the jursdiction of all courts, except the jurisdiction of the Supreme Court under Art. 136, with respect to all or any of the matters falling within the jurisdiction of the Tribunals;'
Explanation:
In this Article, 'appropriate Legislature', in relation to any matter, means Parliament or, as the case may be, a State Legislature competent to make laws with respect to such matter in accordance with the provisions of Part XI.
9. The relevant provisions of the Tribunal Act, 1987 are as follows :--
Section 6. 'Jurisdiction, Powers and Authority of the Tribunal.
(1) Save as otherwise expressly provided in this Act, the Tribunal shall exercise, with effect from such date as may be specifed by the State Government by notification in this behalf of all the jurisdiction, powers and authority exercisable immediately before thatday by all Courts including the High Court but excluding the Supreme Court of India for adjudication or trial of disputes or complaints or offences with repect to all matters of levy, assessment, collection and enforcement of any tax under any specified State Act and matters connected therewith or incidental thereto:
Provided that where the matter relates to disposal of question of constitutional validity of any provision of any specified State Act, the matter shall be decided by a Bench constituted of at least three Members of which the Chairman shall be one.
(2) Notwithstanding anything contained elsewhere in this Act, all proceedings triable by any Court or courts in accordance with the provisions of the Code of Criminal Procedure, 1973 (2 of 1974), shall continue to be tried by such Court, and the Tribunal shall have no jurisdiction to try such proceedings.
Explanation -- For the purpose of his subsection,' proceedings shall include proceedings under Chapter XXIX and Chapter XXX of the Code of Criminal Procedure, 1973.
...................................
Section 14. Exclusion of jurisdiction of Courts.-- (1) On and from the date from which jurisdiction, powers and authority becomes exercisable under this Act by the Tribunal, the High Court or any Civil Court except the Supreme Court of India shall not be entitled to entertain any proceeding or to exercise any jurisdiction or shall not have any jurisdiction, powers and authority in relation to the adjudication or trial of disputes, complaints or offences with respect to levy, Collection, assessment and enforcement of any tax under any specified State Act, and any matter connected therewith or incidental thereto.
(2) Notwithstanding anything contained in sub-section (1), the High Court shall have, and the Tribunal shall not have, jurisdiction, power and authority in relation to any appeal pending before the High Court on the date specified by the State Government under subsection (1) of Section 6.
Section 15. Transfer of pending cases from the High Court. -- (1) All matters and proceedings (other than appeals) relating to the levy, assessment, collection and enforcement of tax and matters connected therewith or incidental thereto, pending before the High Court (on the date specified by the State Government under) sub-section (I) of Section 6, shall stand transferred to the Tribunal for disposal in accordance with the provisions of this Act:
Provided that, if any matter or any proceeding (other than appeal) has been heard in part or heard but judgment is not delivered on or before the aforesaid date, nothing in this section shall apply to such matter or proceeding.
10. It is necessary to note that although learned counsel appearing for the State raised his preliminary issue in the course of hearing and made extensive submissions thereon, in the written notes submitted on behalf of the State it has been strangely submitted as follows:--
'The question of maintainability of application has been raised because of a separate application filed by the State of West Bengal before the First Court raising this question of maintainability and praying for transfer of records of such applications to the Tribunal. The said applications are pending after completion of affidavits and in fact those were partly heard.'
11. We find this perplexing and disturbing. Having argued the question of maintainability on the ground of jurisdiction extensively, it is difficult to appreciate how in the written submissions the State could possibly contend that the question of maintainability has not been raised. We are of the view that this is a tactical strategy devised because of certain observations which we made and questions which we put to learned Counsel for the State with regard to the interpretation of Art. 323B. We should have thought that having raised the issue the State should have invited the appellate Court to decide the same so that litigation is shortened at least as far this issue and this Court is concerned particularly in view of the fact that quite a number of cases are pending in this Court challenging these levies and the order of the Supreme Court dated 20th December, 1991 where the Supreme: Court has noted that this very question is pending before the High Court in proceedings under Art. 226 of the Constitution. We will deal with the submission extracted from the note after dealing with the preliminary objection raised at the hearing.
12. In meeting the preliminary objection, Mr. Samaraditya Pal, learned Counsel appearing on behalf of the appellant submitted that the provisions of Art. 323B would reveal that the issue as to ouster of jurisdiction of this Court under Art. 226 of the Constitution in relation to the question in controversy in the writ petition must be resolved in favour of the appellant. It is submitted that a law made under Art. 323B which provides for the adjudication by Tribunals of any disputes etc. must be with respect to the matters specified in clause (2) of Art. 323B and the appropriate legislature must have power to make laws with respect to any such matter. It is contended that the expressions 'appropriate Legislature', 'matters specified in Clause (2)' and 'with respect to which such legislature has power to make laws' in Art. 323B on plain appreciation cannot result in ouster of this Court's power to entertain and decide the writ petition. It is pointed out that sub-clause (2) enumerates the matters referred to in clause (1) and one of such matters is levy, assessment, collection, enforcement of any tax. It is also submitted that the Explanation to Art. 323B provides that the expression 'appropriate Legislature' in relation to any matter means Parliament or, as the case may be, a State legislature competent to make laws with respect to such matters in accordance with the provisions of Part XI. It is argued that the exclusion of jurisdiction of courts under Art. 323B(3)(d) can only be achieved by a law validly made under clause(1) of that Article and such exclusion must be with respect of all or any of the matters falling within the jurisdiction of the said Tribunals.
13. The crux of the submissions of Mr. Pal is that in the context of these provisions ofthe Constitution, a law ousting the jurisdiction of courts must be a law which provides for adjudication of taxation matters with respect to which the legislature has power to make laws. If the State Legislature does not have power or competence to make laws in relation to particular taxation, then the ouster clause will not apply. According to Mr, Pal this is a case where a decision on merits i.e. as to whether the State had legislative competence to enact the laws imposing the levies in question would also automatically decide the question as to whether the Tribunal had jurisdiction to decide the dispute.
14. We have no hesitation in accepting the submissions made on behalf of the appellant and before we proceed to give our reasons we have it on record that learned Counsel appearing for the State was unable to give any satisfactory reply on the aspect. The expressions 'appropriate Legislature', the opening words of Art. 323B, have been explained by an Explanation in that very Article. The Explanation makes it clear that the basic scheme of the Constitution regarding legislative relations and distribution of legislative powers contained in Part XI is not in any way affected by the insertion of Art. 323B in the Constitution. The Explanation clearly says that 'appropriate Legislature' in relation to any matter means Parliament or, as the case may be, a State Legislature competent to make laws with respect to such matter in accordance with the provision of Part XL The expression 'in relation to any matter' in the Explanation obviously refers to any matter enumerated in Clause (2) of Art. 323B. The Parliament or the State Legislature, therefore, must be competent to make laws with respect to 'such matter'. The words 'such matter' will obviously refer to 'any matter' in the earlier part of the Explanation and, therefore, to any of the matters enumerated in clause (2). It is therefore clear that when the 'appropriate Legislature' is the State Legislature it must be competent to make a law on a matter enumerated in clause (2). The Tribunal would have power to adjudicate a taxation dispute if the State Legislature which makes the law providing for such trial by the Tribunal is competent to levy the tax orlegislate in respect of that tax having regard to the provision of Part XI of the Constitution. If it is not so competent then obviously it cannot make any law to provide for the adjudication of such taxation dispute by Tribunals. For example, could it be said that the State Legislature of West Bengal was empowered by Art. 323B of the Constitution to set up a Tribunal for adjudication of dispute in relation to Income-tax or Customs duties which are within the exclusive legislative domain of the Parliament by reason of entries 82 and 83 in List I of the Seventh Schedule read with Art. 246 of the Constitution? The answer must obviously be in the negative. S. P. Sampath Kumar v. Union of India, AIR 1987 SC 386 on which reliance was placed by learned Counsel appearing for the State, is not at all relevant in the present context. In that case the Supreme Court was considering the scope of the jurisdiction of Administrative Tribunals set up under Art. 323A of the Constitution and held that such Tribunals were effective alternative ad-judicative bodies for exercising powers of judicial review. It is enough for the present purpose to note that Art. 323A authorises only Parliament to make laws -- the concept of 'appropriate legislature' is significantly absent. We do not consider it necessary to dilate further on this issue.
15. The question may be considered from a slightly different angle. Section 6 of the Tribunal Act, 1987 provides that with effect from the dates specified by the State Government by notification the jurisdiction of all Courts including the High Court but excluding the Supreme Court for adjudication of disputes with respect to all matters of levy etc. ,pf tax under any specified State Act shall be replaced by the jurisdiction of the tribunal and this is reiterated in a negative way in S. 14 which expressly states that the High Court or any Civil Court except the Supreme Court of India shall not have any jurisdiction in relation to the adjudication of disputes with respect to levy etc. of tax under any specified State Act, Section 2(k) of the Tribunal Act, 1987 defines specified State Act in the following terms :--
' 'Specified State Act' means a State Act specified in the Schedule to this Act.'
In the Schedule to the Tribunal Act 1987, amongst the Acts specified were the West Bengal Primary Education Act, 1973 and the: West Bengal Rural Employment and Production Act, 1976. Subsequently, as noted earlier, by reason of the West Bengal Taxation Tribunal (Amendment), Act, 1992 read with notification of Finance Department No. 2697 FT dated 20th April, 1992 the Cess Act, 1880 also became a specified State Act. It is therefore clear that as far as the West Bengal Primary Education Act, 1973 and West Bengal Rural Employment & Production Act, 1976 are concerned they were specified State Acts within the meaning of S. 2(k) of the: Tribunal Act, 1987 before the Supreme Court-decided India Cement (supra) and Orissa Cement : [1991]2SCR105 (supra). By reason of the application of the principles laid down in India Cement (supra) and Orissa Cement (supra) if it is held (which we have held later on merits) that the levies of cess were still-born then the specification of these two Acts must be considered to be ineffective because specification of Acts which are void cannot have any legal efficacy. As far as the Cess Act is concerned this became a specified State Act within the meaning of S. 2(k) of the Tribunal Act, 1987 by reason of the West Bengal Taxation Tribunal (Amendment) Act, 1992 read with Finance Notification dated 20th April, 1992 i.e, long after the judgments delivered in India Cement and Orissa Cement and must suffer the same consequence. Therefore since the specification of the Acts imposing these levies do not have any legal efficacy, the conferment of jurisdiction on the Tribunal by S. 6 or the exclusion of jurisdiction of Courts by S. 14 in relation to disputes in respect of levy etc. of any tax under any specified State Act will not have any legal force. In other words, neither the conferment by S. 6 nor the exclusion by S. 14 can effectively fasten on these 3 levies under the Cess Act, the West Bengal Primary Education Act, 1973 and the West Bengal Rural Employment & Production Act, 1976.
16. It was also submitted that the principal relief claimed in the writ petition is against the Coal Companies in that mandamus was sought directing them not to include the element of Cess on Coal in the Coal bills raised by them on the petitioners and such a dispute was not covered by S. 6 or S. 14 and not even by Art. 323 as well as the effect of the India Cement (supra) and Orissa Cement : [1991]2SCR105 (supra) judgments of the Supreme Court on the expression 'Specified State Act' in S. 6 and S. 14 of the Tribunal Act, 1987, it is not necessary to decide the question.
17. It is also submitted on behalf of the respondent and highlighted in the Notes of Submissions that since an application for transfer of the writ petition is pending before the learned single Judge the appellate Court should not intervene. It has been correctly pointed out on behalf of the appellant that S. 15 deals with transfer to the Tribunal of cases pending before the High Court on the date specified by the State Government under sub-sec. (1) of S. 6. The date so specified is 27th February, 1989 and therefore if any proceeding (other than appeals) was pending before the High Court on that date the same would stand transferred. The question of transfer of any matter which was filed after that date in the High Court could not arise. In such a case the question that could arise is whether the High Court had jurisdiction to entertain such a proceeding. If it did not then the proceedings would have to be dismissed on the ground of lack of jurisdiction. Therefore, the question of transfer of a proceeding instituted after the specified date like the instant writ petition cannot and/or does not arise. Therefore the pendency of such a transfer application cannot have any material hearing as far as the hearing of the appeal is concerned and particularly because of the view we have taken on the issue of jurisdiction.
18. We now propose to examine whether the learned Counsel for the appellant is right in contending that there is ne distinction of substance between the levies which are challenged in the writ petition and the levies whichwere declared to be beyond the competence of the State Legislature in India Cement (supra) and Orissa Cement : [1991]2SCR105 (Supra).
19. In India Cement (supra) the Supreme Court dealt with S. 115 of the Madras Village Panchayat Act which reads as under:--
'(1) There shall be levied in every panchayat development block, a local cess at the rate of 45 naya paise on every rupee of land revenue payable to Government in respect of any land for every fasli.
Explanation : In this section and in S. 116, 'land revenue' means public revenue due on land and includes water-cess payable to the Government for water supplied or used for the irrigation of land, royalty, lease amount or other sum payable to the Government in respect of land held direct from the Government on lease or licence, but does not include any other cess or the surcharge payable under S. 116, provided that land revenue remitted shall not be deemed to be land revenue for the purpose of this Section.
(2) The local cess payable under this subsection (1) shall be deemed to be public revenue due on the lands in respect of which a person is liable to pay local cess and all the said lands, the buildings upon the said lands and their products shall be regarded as the security for the local cess.
(3) The provisions of the Madras Revenue Recovery Act 1984 (Madras Act II of 1864) shall apply to the payment and recovery of the local cess payable under this Act just as they apply to the payment and recovery of revenue upon the lands in respect of which the local cess under this Act is payable.
(4)(a) Out of the process of the local cess so collected in every panchayat development block, a sum representing four-ninths of the proceeds shall be credited to the Panchayat Union (Education) Fund.
(b) Out of the proceeds of the local cess collected in every panchayat town in a panchayat development block, a sum repre-senting two-ninths of the said proceeds shall be credited to the town panchayat fund.
(c) Out of the balance of the local cess credited in panchayat development block, such percentage as the panchayat union council may fix shall be credited to the village-panchayat fund, and the percentage shall be fixed so as to secure as nearly as may be that the total income derived by all the village panchayats in the panchayat union does not fall short of an amount calculated at 20 naye paise for each individual of the village population in the panchayat union.
(d) The balance of the proceeds of the local cess collected in the panchayat development block shall be credited to the funds of the panchayat union council.'
20. In Orissa Cement : [1991]2SCR105 (supra) the Supreme Court dealt with levies in 3 states namely Orissa, Madhya Pradesh and Bihar and they were as follows:--
ORISSA
Orissa Cess Act 1962
'4. All lands to be liable to payment of cess -
(1) From and after the commencement of all lands shall be liable to the payment of cess determined and payable as herein provided:
XX XX XX XX XX XX XX' '5.(1) The cess shall be assessed on the annual value of all lands on whatever tenure held calculated in the manner hereinafter appearing.
(2) The rate per year at which such cess shall be levied shall be twenty five per centum of the annual value of the land.
(3) xx xx xx xx xx' '(2) The rate at which such cess shall be levied shall be -
(a) in the case of land held for carrying on mining operations in relation to any mineral, such per centum of the annual value as the State Government may, by notification, specify from time to time in relation to suchmineral.' '7. Annual Value -- (1) The annual value of lands held by a raiyat shall be the rent payable by such raiyat to the landlord immediately under whom he holds the land :
(3) In the case of lands held for carrying onmining operations, the annual value shall bethe royalty or, as the case may be, the deadrent payable by the person carrying on miningoperation (s) to the Government or the pit'smouth value wherever it has been determined.' ' 10. Application of proceeds of the cess:--
(1) Notwithstanding anything contained in any other law, all amounts collected as cess, shall be credited fifty percentum of those, which represent cess collected in respect of lands, other than lands held by carrying on mining operations, shall be utilised for the following purposes, namely:--
(a) primary education;
(b) contribution to Gram-Panchayats;
(c) contribution to Samities.
(2) The allotment of amounts to be utilised for the purposes mentioned in clauses (a), (b) and (c) of sub-sec. (1) shall be made in suchproportion as may be prescribed.'
Madhya Pradesh
Madhya Pradesh Upkar Adhiniyam, 1981 (Act 1 of 1982).
11. (1) There shall be levied and collected a cess on land held in connection with mineral rights at such rate as may be notified by the State Government per ton of major mineral raised and the rate of cess prevailing in respect of coal during the period commencing from the date of commencement of the principal Act and ending on the date of commencement of the Madhya Pradesh Upkar (Sanshodhan) Adhiniyam, 1987, shall be deemed to be the rate of cess notified under this sub-section in respect of coal:
Provided that subject to the limitation mentioned above the State Government may, by notification, increase or reduce the rate ofcess at an interval of not less than one year, where the rate is increased it shall not be, in excess of fifty per cent of the rate for the timebeing in force:
Provided further that every notification under the above proviso shall be laid on the table of the Legislative Assembly and the provisions of S. 24-A of the Madhya Pradesh General Clauses Act, 1957 (3 of 1958) shall apply thereto as they apply to rule.
(2) The rate of cess to be notified for the first time in exercise of the powers conferred by sub-sec. (1) shall be effective from the first day of April 1987.
(3) The cess levied under sub-sec. (1) shall, Subject to and in accordance with the rules made in this behalf, be assessed and collected by such agencies and in such manner as may be prescribed.
(4) The agencies prescribed under sub-sec. (3) shall for the purpose of assessment, collection and recovery of cess and all matters connected therewith, exercise such of the powers conferred upon the authorities specified in S. 3 of the Madhya Pradesh General Sales. Tax Act, 1958 (2 of 1959) for the purposes aforesaid in respect of sales tax under the said Act and the rules made thereunder, as may be prescribed as if such agencies were the authorities specified in S. 3 and the cess on land held in connection with mineral rights were the tax levied under the said Act.
M.P. Karadhan Adhiniyam, 1982 (Act 15 of 1982)
9. (1) There shall be levied and collected -
(a) on the land held under mining lease for undertaking mining operations for a major mineral other than coal a mineral areas development cess at the rate of one hundred per centum of the rental value thereof;
(b) on the land held under mining lease for undertaking mining operations for coal, a mineral areas development cess at the rate of the hundred twenty-five per centum of the rental value thereof.'
(2) For the purpose of sub-sec. (1), rental value shall be equal to the royalty or deadrent, as the case may be, whichever is higher.
(3) The mineral areas development cess shall be payable by the person to whom the mining lease is granted.
(4) the mineral areas development cess shall, subject to and in accordance with the rules made in this behalf, be collected by such agencies and in such manner as may be prescribed and shall be applied towards development of mineral bearing areas.'
10. 'Application of cess -- The State Government shall decide from time to time the manner in which the amount collected from cess shall be utilised for the development of mining lease areas.'
BIHAR
Bengal Cess Act 1880
Section 4. 'Royalty for the purpose of this Act in respect of mines and quarries means payment (which includes dead rent) made or likely to be made to the owner of mines and minerals for the right of working the same on the quantity or value of such produce by a lessee if the land had been under a lease granted under MMRD Act, 1957 and rules made thereunder and includes any amount which Government may demand from the appropriation of mines and minerals belonging to the Government and any amount that may be paid as or in lieu of royalty for the right of working mines and quarries in areas held or acquired under any Act or agreement.'
Interpretation Clause
'Valuation of mineral bearing land' means with reference to assessment of local cess in any year on land held for working mines and quarries the value at pit's mouth of all the mineral extracted from the land in that year......'
'S. 6. Cess how to be assessed :-- The local cess shall be assessed on the annual value of the lands and, until provision to the contrary is made by the Parliament, on the royalty ofmines and quarries or on value of mineral bearing land as the case may be, sale value of other immovable properties including forest produce and annual net profits from tramways and railways ascertained respectively as prescribed in the Act and the rate at which the local cess shall be levied for each year shall be-
(a) in the case of royalty, the rate will be determined by the Government from time to time but it will not exceed five times the amount of royalty, provided that the local cess payable in any one year shall not be less than the amount arrived at by multiplying the dead rent with the rate of cess determined under clause (a);
(aa) in the case of value of mineral bearing land, where the local cess payable in any year in respect of any mineral bearing land as assessed in clause (a) is less than 30 per cent of the value of mineral bearing land in that year, then, notwithstanding anything hereinbefore contained, the State Government may assess the local cess at such percentage of the value of the mineral bearing land, not exceeding 30 per cent, as may be notified in the Official Gazette from time to time although the cess so assessed may exceed five times the amounts of royalty;
(b) in the case of annual net profit, fifteen paise on each rupee of such profits;
(c) in the case of annual value of land, twenty five paise per rupee of the annual value; and
(d) in the case of sale value of immoveable properties including first produce, the rate will not exceed 30 per cent and the State Government may, by notification prescribe from time to time the commodities on the sale of which cess would be levied along with the rates at which it would be levied.'
'9. Application of the proceeds of cess.--The proceeds of local cess and all sums levied or recovered as interest or otherwise shall in each district be paid in the district fund -
(i) at such rate as may, from time to time, be determined by the State Government in thecase of local cess on annual value of land; and
(ii) at such rate as may, from time to time, be determined by the State Government, subject to a maximum of twenty per cent, in case of local cess on royalty of mines and quarries, or value of mineral bearing land, sale value of other immoveable properties, forest produce and annual net profit from tramways and railways, and the remaining amount shall be deposited in the consolidated fund of the State for the construction and maintenance of other works of public utility;
XXX XXX XXX XXX XXX Provided further that out of the remaining amount not less than ten per cent of the amount of the local cess collected under clause (a) or clause (aa) of S. 6 shall be spent for purposes relating to mineral development.'
21. The levies which arc the subject matter of the challenge here are as follows:
The Cess Act, 1880
'S. 5 All immoveable property to be liable to a road cess and public works cess. From and after the commencement of this Act in any district or part of a district, all immoveable property situate therein except as otherwise in (Section 2) provided, shall be liable to the payment of a road cess and a public works cess.'
'S. 6. Cesses how to be assessed. The road cess and the public works cess.
[shall be assessed -
(a) in respect of lands on the annual value thereof,
(b) in respect of all mines and quarries, on the annual despatches therefrom, and,
(c) in respect of tramways, railways and other immoveable property, on the annual net profit thereof, ascertained respectively as in this Act prescribed]
and the rates at which such cesses respectively shall be levied for each year shall be determined for such year in the manner in this Act prescribed:
Provided that -
(1)the rates of such road cess and public works cess shall not exceed six paise and twenty-five paise respectively on each rupee of such annual value,
(2) the rates of each of such road cess and public works cess shall not exceed -
(i) fifty paise on each tonne of coal, minerals or sand of such annual despatches, and
(ii) six paise on each rupee of such annual net profits,
Explanation.-- For the purposes of this proviso, one tonne of coke shall be counted as one and a quarter tonne of coal.'
2. West Bengal Primary Education Act, 1973
'78. Education cess.-- (1) All immoveable properties on which road and public works cesses are assessed, [or all such properties which are liable to such assessment] according to the provisions of the Cess Act, 1880, shall be liable to the payment of education cess.
(2) The rate of the education cess shall be determined by the State Government by notification and shall not exceed -
(a) [in respect of lands, other than a tea estate] ten paise on each rupee of the annual value thereof;
(aa) xx xx xx xx xx xx xx (b) in respect of coal mines [five per centum of the value of coal] on-the despatches therefrom;
(c) in respect of quarries and mines other than coal mines, [one rupee on each tonne of materials or minerals other than coal on the annual despatches therefrom]
Explanation.-- For the purpose of clause (b) the expression 'value of coal' shall mean -
(i) in the case of despatches of coal as a result of sale thereof, the prices charged by the owner of a coal mine for such coal, butexcluding any sum separately charged as tax, cess, duty, fee or royalty for payment of such sum to Government or a local body, or any other sum as may be prescribed or
(ii) in the case of despatches other than those referred to in item (i), the prices chargeable by the owner of a coal mine for such coal if they were despatched as a result of sale thereof, but excluding any sum separately chargeable as tax, cess, duty, fee or -- royalty for payment of such sum to Government or a local body or any other sum as may be prescribed:
Provided that if more than one price is chargeable for the same variety of coal, the maximum price chargeable for that variety of coal shall be taken as the basis of valuation for the purpose of this item.'
3. West Bengal Rural Employment and Production Act, 1976.
'S. 4. Rural employment cess.-- (1) On and from the commencement of (his Act, all immoveable properties on which road and public work cesses [are assessed or liable to be assessed] according to the provisions of the Cess Act, 1880, shall be liable to the payment of rural employment cess;
Provided that on raiyat who is exempted from paying revenue in respect of his holding under clause (a) of sub-sec. (1) of S. 23B of the West Bengal Land Reforms Act, 1955 shall be liable to pay rural employment cess.
(2) The rural employment cess shall be levied annually -
(a) [in respect of lands, other than a tea estate,] at the rate of six paise on each rupee of development value thereof;
(aa) xx xx xx xx xx xx (b) in respect of coal mines, at the rate of [thirty-five paise per centum] on each tonne of coal on the xxx despatches therefrom;
(c) in respect of mines other than coal mines and quarries, [at the rate of fifty paise on each tonne of materials other than coal on the annual despatches therefrom]
Explanation.-- For the purose of clause (b) the expression 'value of coal' shall mean -
(i) in the case of despatches of coal as a result of sale thereof, the prices charged by the owner of a coal mine for such coal but excluding any sum separately charged as tax, cess, duty, fee or royalty for payment of such sum to Government or a local body, or any other sum as may be prescribed, or
(ii) in the case of despatches, other than those referred to in item (i), the prices chargeable by the owner of a coal mine for such coal if they were despatched as a result of sale thereof, but excluding any sum separately chargeable as tax, cess, duty, fee or royalty for payment of such sum to Government or a local body, or any other sum as may be prescribed:
Provided that if more than one price is chargeable for the same variety of coal, the maximum price chargeable for that variety of coal shall be taken as the basis of valuation for the purpose of this item.'
22. The provisions of West Bengal Primary Education Act, 1973 and West Bengal Rural Employment and Production Act, 1976 which levied cess were amended by the West Bengal Taxation Laws -- (Amendment) Act, 1992 with effect from 1-4-1992. The material amendments made by the said Amendment Act are as follows:
'2. In the West Bengal Primary Education Act, 1973,- (1) in section 78 for sub-sec. (2), the following sub-section shall be substituted -
(2) The education cess shall be levied annually -
(a) in respect of land, except when a cess is leviable and payable under clause (b) or clause (c) of sub-sec. (2A) at the rate of ten paise on each rupees of annual value thereof as assessed under the Cess Act, 1880;
(b) in respect of a coal-bearing land, at the rate of five per centum of the annual value of the coal-bearing land as defined in clause (1)of S. 2 of the West Bengal Rural Employment and Production Act, 1976;
(c) in respect of a mineral-bearing land (other than coal-bearing land) or quarry, at the rate of one rupee on each tonne of minerals (other than coal) or materials despatched within the meaning of clause (1b) of S. 2 of the West Bengal Rural Employment and Production Act, 1976, from such mineral bearing land or quarry;
Provided that when in the coal-bearing land referred to in clause (b) there is no production of coal for more than two consecutive years, such land shall be liable for levy of cess in respect of any year immediately succeeding the said two consecutive years in accordance with clause (a);
Explanation.-- For the purposes of this chapter, 'coal-bearing land' shall have the same meaning as in clause (1a) of S. 2 of the West Bengal Rural Employment and Production Act, 1976.'
'3. In the West Bengal Rural Employment and Production Act, 1976,-- (1) in S.2 -
(a) for clause (1), the following clauses shall be substituted:--
(1)'annual value of coal-bearing land' in relation to a financial year, means one-half of the value of coal produced from such coal-bearing land during the two years immediately preceding that financial year, the value of coal being that as could have been fetched by the entire production of coal during the said two immediately preceding years, had the owner of such coal-bearing land sold such coal at the price or prices excluding the amount of tax, cess, fee, duty royalty, crushing charge, washing charge, transport charge or any other amount as may be prescribed, that prevailed on the date immediately preceding the first day of that financial year.
Explanation.-- Where different prices are prevailing on the date immediately preceding the first date of that financial year for different grades or qualities of coal, the valueof coal of each grade or quality produced during the two years immediately preceding that financial year shall be determined accordingly;
(1a) 'coal bearing land' means holding or holdings of land having one or more seams of coal comprising the area of a coal mine;
(1b) 'despatched', for a financial year, shall, in relation to a mineral-bearing land (other than coal-bearing land) or a quarry, mean one-half the quantity of minerals, or minerals, despatched during two years immediately preceding that financial year from such mineral-bearing land or quarry;
(1c) 'development value' means a sum equivalent to five times the annual value of land as assessed under the Cess Act, 1880;
(b) after clause (3), the following clause shall be added and shall be deemed -
always to have been added:--
(4) 'year' means a financial year as defined in clause (15) of S. 3 of the Bengal General Clauses Act 1899;
(2) in section 4, for sub-sec, (2) the following sub-section shall be substituted;
(2) The rural employment cess shall be levied annually -
(a) in respect of land, except when a cess is leviable and payable under clause (b) or clause (c) or sub-section (2 A), at the rate of six paise on each rupee of development value thereof;
(b) in respect of a coal-bearing land, at the rate of thirty-five per centum of the annual value of coal-bearing land as defined in clause (1) of S. 2;
(c) in respect of a mineral-bearing land (other than coal-bearing land) or quarry, at the rate of fifty paise on each tonne of minerals (other than coal) or materials despatched therefrom;
Provided that when in the coal-bearing land referred to in clause (b), there is no production of coal for more than two consecutive years, such land shall be liable for levyof cess in respect of any year immediately succeeding the said two consecutive years in accordance with clause (a):
Provided further that where no despatch of minerals or materials is made during a period of more than two consecutive years from the mineral-bearing land or quarry as referred to in clause (c), such land or quarry shall be liable for levy of cess in respect of any year immediately succeeding the said two consecutive years in accordance with clause (a).'
23. In India Cement (supra) the language of the charging provision apparently indicated that it was a levy on land. This is clear from the expression 'in respect of any land'in sub-sec. (1) of S. 115 of the Madras Village Panchayat Act and the provision of sub-sec. (3) of that Act which provided that the Madras Revenue Recovery Act, 1864 will apply for recovery of the local Cess payable under the Act just as they applied to the payment and recovery of Revenue 'upon the lands in respect of which the local Cess under this Act is payable.' The Orissa Act considered in Orissa Cement : [1991]2SCR105 (supra) was more direct and S. 4 provided that 'all lands shall be liable to the payment of Cess.' The Madhya Pradesh Upkar Adhiniyam, 1981, considered in Orissa Cement (Supra) also provided in S. 11 that 'there shall be levied and collected a Cess on land.....'. The Madhya Pradesh KaranadhaAdhiniyam, 1981 which was also considered in Orissa Cement (supra) provided vide S. 9 thereof that there shall be levied collected 'on the land held under mining lease'. In Orissa Cement (supra) the Supreme Court also considered the Cess Act, 1880 in its application to Bihar. Section 5 of the Cess Act, 1980 in its application to Bihar (as well as West Bengal) provides that all 'immovable property....... shall be liable to payment of Cess.'
24. But having regard to the other relevant provisions of these Acts the Supreme Court came to the conclusion that these levies could not be considered to be 'Tax on Land' within the meaning of Entry 49 of List II of the Seventh Schedule to the Constitution, nor Taxes on mineral rights' within Entry 50 of List II of the Seventh Schedule nor LandRevenue within Entry 45 of List II of the Seventh Schedule. The Supreme Court also concluded that these levies could not also come within Entry 23 of List II. The Supreme Court held that by reason of the Parliament declaration contained in S. 2 of the Mines and Minerals Regulation & Development Act,' 1957, the entire field of mines and minerals were occupied by Parliament by reason of Entry 54 of List I of the Seventh Schedule to the Constitution.
25. We propose to refer to some of the important passages from India Cement (supra) and Orissa Cement : [1991]2SCR105 (supra) for deciding as to whether the levies impugned in these proceedings are pan materia with the levies which were held to be beyond the legislative competence of the State Legislature in India Cement (Supra) and Orissa Cement (Supra).
26. In India Cement Sabyasachi Mukharji J. (as his Lordship then was) delivering the judgment on behalf of himself and 5 other Learned Judges analysed the various entries in the Seventh Schedule and came to the conclusion that the Madras levy was unconstitutional, because it was beyond the legislative competence of the State Legislature. The following passages from the judgment are highly instructive for the present purpose (paras 22, 23, 24 & 32 of AIR) :--
'It was also contended on behalf of the respondent State of Tamil Nadu by Mr. Krishnamurthy Iyer that it could also be justified under Entry 49 of List II of the Seventh Schedule as taxes on lands and buildings. This, however, cannot be accepted. In this connection, reference may be made to the decision of this Court in Raja Jagannath Baksh Singh v. State of U.P. where : [1962]46ITR169(SC) it was indicated that the expression 'land' in Entry 49 is wide enough to include agricultural land as well non-agricultural land. Gajendragadkar, J. as the learned Chief Justice then was, observed that the cardinal rule of interpreting the words used by the Constitution in conferring legislative power was that these must receive the mostliberal construction and if they are words of wide amplitude the construction must accord with it. If general word was used, it must be so constructed so as to extend to all ancillary or subsidiary, matters that can reasonably be included in it. So construed, there could not be any doubt that the word 'land' in Entry 49, List II of the Seventh Schedule includes all land whether agricultural or non-agricultural. Hence, since the impugned Act imposed tax on land and building which was within the competence of the State legislature and its validity was beyond challenge but the court observed that as there was Entry 46 in List II which refers to taxes on agricultural income, it is clear that agricultural income is not included in Entry 49. If the State legislature purports to impose a tax on agricultural income it would not be referable to Entry 49 Mr. Krishnamurthy Iyer relied on the said principle. But in the instant case, royalty being that which is payable on the extraction from the land and cess being an additional charge on the royalty, cannot by the parity of the same reasoning, be considered to be a tax on land. But since it was not a tax on land and there is no entry like Entry 46 in the instant situation like the position before this Court in the aforesaid decision enabling the State to impose tax on royalty in the instant situation, the State was incompetent to impose such tax. There is a clear distinction between tax directly on land and tax on income arising from land. The aforesaid decision confirmed the above position. In New Manek Chowk Spinning & Weaving Mills Co. Ltd. v. Municipal Corpn. of the City of Ahmedabad, : [1967]2SCR679 this Court after referring to the several decisions observed that Entry 49 of List II of the Seventh Schedule only permitted levy of tax on land and building. It did not permit the levy of tax on machinery contents (sic) in or situated on the building even though the machinery was there for the use of the building for a particular purpose. Rule 7(2) of the Bombay Municipal Corporation Rules was held to be accordingly ultra vires in that case. In S. C. Nawn v. W.T.O., Calcutta, : [1969]68ITR897(SC) this Court had occasion to consider this and upheld the validity of the Wealth Tax Act,1957 on the ground that it fell within Entry 86 of List I and not Entry 49 of List II. Construing the said entry, this Court observed that Entry 49 List II contemplated a levy on land as a unit and the levy must be directly imposed on land and must bear a definite relationship to it. Entry 49 of List II was held to be more general in nature than Entry 86, List I which was held tp be more specific in nature and it is well settled that in the event of conflict between Entry 86, List I and Entry 49 of List II, Entry 86 prevails as per Article 246 of the Constitution.
In Asstt. Commr. of Urban Land Tax v. Buckingham & Carnatic Co. Ltd. : [1970]75ITR603(SC) , this Court reiterated the principles laid down in S.C. Nawn case : [1969]68ITR897(SC) and held that Entry 49 of List II was confined to a tax that was directly on land as a unit. In Second Gift Tax Officer, Mangalore, v. D. H. Nazareth, (AIR 1970 SC 999 at p. 1002) it was held that a tax on the gift of land is not a tax imposed directly on land but only on a particular user, namely, the transfer of land by way of gift. In Union of India v. H. S. Dhillon, : [1972]83ITR582(SC) this Court approved the principle laid down in S. C. Nawn case as well as Nazareth case. In Bhagwan Dass Jain v. Union of India, : [1981]128ITR315(SC) this Court made a distinction between the levy on income from house property which would be an income tax, and the levy on house property itself which would be referable to Entry 49 List II. It is, therefore, not possible to accept Mr. Krishnamurthy Iyer's submission and that a cess on royalty cannot possibly be said to be a tax or an impost on land. Mr. Nariman is right that royalty which is indirectly connected with land, cannot be said to be a tax directly on land as a unit. In this connection, reference may be made to the differentiation made to the different types of taxes for instance, one being professional tax and entertainment tax. In the Western India Theatres Ltd. v. Cantonment Board Poona Cantonment, : AIR1959SC582 it was held that an entertainment tax is dependent whether there would or would not be a show in a cinema house. If there is no show, there is no tax. It cannot be a tax onprofession or calling. Professional tax does not depend on the exercise of one's profession but only concerns itself with the right to practice. It appears that in the instant case also no tax can be levied or is leviable under the impugned Act if no mining activities are carried on. Hence it is manifest that it is not related to land as a unit which is the only method of valuation of land under Entry 49 of List II but is relatable to minerals extracted. Royalty is payable on a proportion of the minerals extracted. It may be mentioned that the Act does not use dead rent as a basis on which land is to be valued. Hence there cannot be any doubt that the impugned legislation in its pith and substance is a tax on royalty and not a tax on land.
On behalf of the State of Tamil Nadu, learned counsel Mr. Krishnamurthy Iyer sought to urge that it can also be sustained under Entry 50, List II of the Seventh Schedule deals with taxes on mineral rights subject to limitation imposed by Parliament relating to mineral development. Entry 23 of List II deals with regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union and Entry 54 in List I deals with regulation of mines and minerals under the control of Union declared by the Parliament by law to be expedient in public interest. Even though minerals are part of the State List they are treated separately, and therefore the principle that the specific excludes the general, must be applied. See the observations of Waverly Jute Mills Co. Ltd. v. Raymon & Co. (I) Pvt. Ltd. : [1963]3SCR209 , where it was held that land in Entry 49 of List II cannot possibly include minerals.
It was contended by Mr. Krishnamurthy Iyer that the State has a right to tax minerals. It was further contended that if tax is levied, it will not be irrational to correlate it to the value of the property and to make some kind of annual value basis of tax without intending to tax the income. In view of the provisions of the Act, as noted hereinbefore, this submission cannot be accepted. Mr. Krishnamurthy Iyer also further sought to urge that in Entry50 of List II, there is no limitation to the taking power of the State. In view of the principles mentioned hereinbefore and the express provisions of S. 9(2) of the Mines and Minerals (Regulation and Development) Act, 1957, this submission cannot be accepted. This field is fully covered by the central legislation.'
27-30. In Orissa Cement : [1991]2SCR105 (supra) the Supreme Court made an indepth analysis of the Orissa, Madhya Pradesh and Bihar levies and specifically dealt (in great detail) with the submissions made on behalf of the States that those levies were different in character than the levy considered by the Supreme Court in India Cement (supra). In Orissa Cement (supra), the Supreme Court also considered the matter from a historical perspective i.e. how the question of Parliamentary control or Parliamentary occupation of the field of mines and minerals was considered from time to time and the extent to which it was effective. We, therefore, propose to extract passages from the Orissa Cement (supra) case and particularly those which deal with the argument on behalf of the States that the levies considered there were different from the levy in India Cement (supra).
31. After setting out the relevant provisions of the Acts levying Cess in Orissa, Madhya Pradesh and Bihar, the Supreme Court in Orissa Cement (supra) dealt with each of these levies separately and concluded that each of them were in substance taxing minerals and clearly stated that the entire field was occupied by reason of Entry 54 of List I read with the declaration contained in S. 2 of the Mines and Minerals Regulations & Development Act. The following passages from the judgment in Orissa Cement (supra) clarify the position.
32. We will refer to that part of the judgment in Orissa Cement : [1991]2SCR105 (supra) which deals with S. 11 of the Madhya Pradesh Upkar Adhiniyam, 1981, since that Section provides that 'there shall be levied and collected cess on land held in connection with mineral rights at such rate as will be notified by the State Government perton of major mineral raised......' The expression 'per ton of major mineral raised' is more or less simitar to the levies in question which also provide the basis as per ton of coal. The only distinction is that under the, Madhya Pradesh Levy it is on the basis of raising whereas in respect of the levies questioned here it is on the basis of 'despatches'. In respect of this Madhya Pradesh Levy the Supreme Court observed in para. 62 as follows:--
'The other statute viz. the Madhya Pradesh Upkar Adhiniyam (Act 1 of 1982 came up for the consideration of a Full Bench of the Madhya Pradesh High Court in M.P. Lime ., : 1983ECR653D(SC) , the Court concluded ;
The character of impost in the instant caseis that though in form it appears to be a tax onland, in substance, it is a tax on mineralsproduced therefrom. The subject matter oftax is, therefore, not covered by Entry 49 ofthe State List'. 'As for Entry 50, after referring Hingir Rampur, : [1961]2SCR537 , the Courtobserved;
Now from a perusal of S. 11 of the Act, it would be clear that in the instant case by the charging, section, tax is not imposed on the mineral rights of every holder of mining lease. The tax is levied on minerals produced in land held under mining lease. In these circumstances, the tax levied by the Act cannot be held to be a tax covered by Entry 50 of List II of the Seventh Schedule to the Constitution. In our opinion, therefore, it has not been shown that the State Legislature is competent to levy the impugned cess.' 'This conclusion is obviously correct in the light of our earlier discussion. The Court, however, expressed an opinion, in paras 10 to 12 of the judgment, that in case the levy could be treated as a tax imposable under Entry 49 or 50 of List II in the Second Schedule to the Constitution, such power 'has not been taken away by the provisions of the MMRD Act.' We think, as already pointed out by us that though the MMRD Act, 1957, unlike S. 6(2) of the 1948 Act, does not contain a specific provision for the levy of taxes, S. 25 of the former does indicate the existence of such power. The above observations of the High Court, therefore, in our view, do not attach sufficient importance to S. 25 of the MMRD Act and the field covered thereby. This aspect, however, is not of significance in view of the conclusion that the tax is not referable to Entry 49 or Entry 50'.
33. We are of the view that there is no difference of any substance between the levies considered by the Supreme Court in India Cement (supra) and Orissa Cement : [1991]2SCR105 (supra) and the levies challenged here. Mr, Pal is right in pointing out that these are stronger cases than the levy considered in India Cement (supra)because under the impugned provisions of the Cess Act, 1880, West Bengal Primary Education Act, 1973 and West Bengal Rural Employment and Production Act, 1976 the levy is directly on coal. All these 3 Acts provide that Cess shall be assessed or levied on different types of lands. Section 6 of the Cess Act 1880 deals with 3 types of immovable properties namely 'in respect of lands'; 'in respect of all mines and quarries' and 'in respect of tramways, railways and other immovable property'. The West Bengal Primary Education Act, 1973 divides the subject matter of the levy into broadly two categories 'in respect of Coal Mines' etc. The same is more or less repeated by the West Bengal Rural Employment and Production Act, 1976. Having made these divisions, each of these Acts provide for assessment of Cess in respect of Coal Mines on the value of the annual despatches of coal. It is on this basis that Coal India Limited and its subsidiaries are including Cess in the coal bills payable by the appellant i.e. adding the statutory percentage of the value of the coal which is the subject matter of the bill. We accept the submission of Mr. Pal that there is no distinction of any consequence in the context of the question which has arisen in this case between the levies considered in India Cement (supra) and Orissa Cement (supra) and here. For example, the Madhya Pradesh Upkar Adhinyam, 1981. S. 11(1) thereof provides : 'There shall be levied and collected a Cess on land held in connection with the mineral rights at such rate as has been notified by the State Government per ton of major mineral raised.....' The Orissa Act provided (videunder S. 5(1)) that Cess shall be assessed on the annual value of all lands and S. 7 thereof defines 'annual value' to mean 'In the case of lands held for carrying on mining operations, the annual value shall be the royalty or, as the case may be, the dead rent payable by the person carrying on mining operation (s) to the Government of the pit's mouth value wherever it has been determined.' Similarly the Cess Act, 1880 in its application to Bihar also provided for levied on the basis of pit's mouth value. Apart from Orissa Cement : [1991]2SCR105 , (supra) the Bihar levywas considered by a Division Bench of the Patna High Court (Ranchi) and by a judgment reported in : AIR1991Pat