M.M. Dutt, J.
1. This rule has been obtained by the petitioner against an order of assessment dated 30th December, 1964, of the opposite party No. 1, the Commercial Tax Officer, Jorasanko Charge, under Section 9(3) of the Central Sales Tax Act, 1956 (hereinafter referred to as the Central Act) read with Section 11(1) of the Bengal Finance (Sales Tax) Act, 1941 (hereinafter referred to as the State Act of 1941). The period of assessment is the year ending K.B. 15, 2018, and the commodity in respect of which the assessment has been made is betel-nut (supari).
2. The petitioner carries on the business of a commission agent, in respect of various commodities including commodities notified under the West Bengal Sales Tax Act, 1954 (hereinafter referred to as the State Act of 1954). The petitioner is a registered dealer under the State Act of 1941 and the State Act of 1954 and he is also a registered dealer under the Central Act.
3. Section 25 of the State Act of 1954 provides that if the State Government is at any time of the opinion that it would be in the public interest that any commodity which is liable to taxation under the State Act of 1941 should be taxed under the State Act of 1954, it may by notification in the Official Gazette specify such commodity and direct that with effect from such date as may be fixed in the notification, the State Act of 1941 shall cease to apply to such commodity and the State Act of 1954 shall apply to such commodity. In exercise of the said power under Section 25 of the State Act of 1954, the State Government by a notification No. 885-F.T. dated 1st May, 1955, directed that certain commodities mentioned in the said notification, one of which being betel-nut, should be taxed under the State Act of 1954. It may be noted here that prior to the said notification, commodities specified therein including betel-nuts, were liable to taxation under the State Act of 1941.
4. It was contended by Mr. Bhattacharjee, learned Advocate on behalf of the petitioner, that if the sales of the commodity for the said amount had taken place within the State of West Bengal, in that case, the petitioner would not be liable to tax under the State Act of 1954, for the said sales were not sales of first degree. The said contention of Mr. Bhattacharjee was not seriously disputed on behalf of the opposite party No. 1. The commodity relating to the particular transactions in question was neither manufactured, made or processed by the petitioner in West Bengal nor was brought by the petitioner into West Bengal within the meaning of the definitions of the words 'dealer', 'sale price' and 'turnover' under the State Act of 1954. The provisions of the State Act of 1954 undoubtedly would not apply if sales of the commodity had taken place inside the State of West Bengal inasmuch as the sales would not be first degree sales which are only made liable to taxation under the State Act of 1954.
5. It was next contended by Mr. Bhattacharjee, that the tax in respect of the turnover for the period in question should have been assessed as 'nil' as provided in Sub-section (2A) of Section 8 of the Central Act. The provisions of Sub-sections (1), (2) and (2A) of Section 8 of the Central Act as amended by the Central Sales Tax (Second Amendment) Act, 1958, are as follows :
8. (1) Every dealer, who in the course of inter-State trade or commerce--
(a) sells to the Government any goods ; or
(b) sells to a registered dealer other than the Government goods of the description referred to in Sub-section (3);
shall be liable to pay tax under this Act, which shall be three per cent. of his turnover.
(2) The tax payable by any dealer on his turnover in so far as the turnover or any part thereof relates to the sale of goods in the course of inter-State trade or commerce not falling within Sub-section (1)--
(a) in the case of declared goods, shall be calculated at the rate applicable to the sale or purchase of such goods inside the appropriate State; and
(b) in the case of goods other than declared goods, shall be calculated at the rate of ten per cent. or at the rate applicable to the sale or purchase of such goods inside the appropriate State, whichever is higher;
and for the purpose of making any such calculation any such dealer shall be deemed to be a dealer liable to pay tax under the sales tax law of the appropriate State, notwithstanding that he, in fact, may not be so liable under that law.
(2A) Notwithstanding anything contained in Sub-section (1) or Sub-section (2), if under the sales tax law of the appropriate State, the sale or purchase, as the case may be, of any goods by a dealer is exempt from tax generally or is subject to tax generally at a rate which is lower than three per cent. (whether called a tax or fee or by any other name), the tax payable under this Act on his turnover in so far as the turnover or any part thereof relates to the sale of such goods shall be nil or, as the case may be, shall be calculated at the lower rate.
Explanation.--For the purposes of this sub-section a sale or puchase of goods shall not be deemed to be exempt from tax generally under the sales tax law of the appropriate State if under that law it is exempt only in specified circumstances or under specified conditions or in relation to which the tax is levied at specified stages or otherwise than with reference to the turnover of the goods.
(3) The goods referred to in Clause (b) of Sub-section (1)--
(a) Omitted.]
(b) are goods of the class or classes specified in the certificate of registration of the registered dealer purchasing the goods as being intended for resale by him or subject to any rules made by the Central Government in this behalf, for use by him in the manufacture or processing of goods for sale or in mining or in the generation or distribution of electricity or any other form of power ;
(c) are containers or other materials specified in the certificate of registration of the registered dealer purchasing the goods, being containers or materials intended for being used for the packing of goods for sale ;
(d) are containers or other materials used for the packing of any goods or classes of goods specified in the certificate of registration referred to in Clause (b) or for the packing of any containers or other materials specified in the certificate of registration referred to in Clause (c).
(4) The provisions of Sub-section (1) shall not apply to any sale in the course of inter-State trade or commerce unless the dealer selling the goods furnishes to the prescribed authority in the prescribed manner--
(a) a declaration duly filled and signed by the registered dealer to whom the goods are sold containing the prescribed particulars in a prescribed form obtained from the prescribed authority ; or
(b) if the goods are sold to the Government, not being a registered dealer, a certificate in the prescribed form duly filled and signed by a duly authorised officer of the Government.
(5) Notwithstanding anything contained in this section, the State Government may, if it is satisfied that it is necessary so to do in the public interest, by notification in the Official Gazette, direct that in respect of such goods or classes of goods as may be mentioned in the notification and subject to such conditions as it may think fit to impose, no tax under this Act shall be payable by any dealer having his place of business in the State in respect of the sale by him from any such place of business of any such goods in the course of inter-State trade or commerce or that the tax on such sales shall be calculated at such lower rates than those specified in Sub-section (1) or Sub-section (2) as may be mentioned in the notification.
6. Section 8 prescribes the rates of tax on sales in the course of inter-State trade or commerce. For the purpose of rates, Sub-section (1) makes a classification between (1) inter-State sales to Government and inter-State sales to registered dealers of the description referred to in Sub-section (3). Under Sub-section (2), a further classification has been made between inter-State sales of declared goods and those of non-declared goods. Sub-section (2A) inter alia provides that notwithstanding anything contained in Sub-section (1) or Sub-section (2), if under the sales tax law of the appropriate State the sale or purchase, as the case may be, of any goods by a dealer is exempt from tax generally or is subject to tax generally at a rate which is lower than three per cent., the tax payable under the Central Act on his turnover or any part thereof relating to the sale of such goods shall be nil or, as the case may be, shall be calculated at the lower rate. The explanation to Sub-section (2A) states that a sale or purchase of goods shall not be deemed to be exempt from tax generally under the sales tax law of the appropriate State if under that law it is exempt only in specified circumstances or under specified conditions or in relation to which the tax is levied at specified stages or otherwise than with reference to the turnover of the goods.
7. There can be no doubt that in view of the non obstante clause in Sub-section (2A), where the provisions of Sub-section (2A) applies, the provisions of Sub-sections (1) and (2) will not apply. In order to attract the provisions of Sub-section (2A) and to claim that the tax payable on the turnover relating to the sale of any particular goods shall be nil, it must be shown as a condition precedent that the sale or purchase of that particular goods is exempt from tax generally under the sales tax law of the State. It is not disputed that under the State Act of 1941, all sales of betel-nuts are taxable as provided in Section 4 of that Act. Sub-section (1) of Section 6 of the State Act of 1941 directs that goods specified in the first column of Schedule I shall be tax-free goods and Sub-section (2) empowers the State Government to add to Schedule I by notification. The commodity in question, namely betel-nuts, is not one of the items of tax-free goods as specified in Schedule I nor has it been included in Schedule I by any notification by the State Government. So far as the State Act of 1954 is concerned, betel-nut is a commodity notified under Section 25 of that Act, as a result of which sales of betel-nuts by a dealer within the meaning of that Act, are liable to taxation. It is, therefore, apparent that betel-nut is not exempted from tax generally under the sales tax law of the appropriate State as contemplated by Sub-section (2A) of the Central Act. It is true that under the State Act of 1954, only sales of first degree are liable to taxation, but in my view, it cannot be said that the commodity is exempt from tax generally. The position is also made clear by the explanation to Sub-section (2A) tinder which sale or purchase of goods shall not be deemed to be exempt from tax generally under the sales tax law of the appropriate State, if it is exempt only in specified circumstances or in relation to which the tax is levied at specified stages. In the instant case, as the tax is levied at the specified stage, namely, at the stage of first sale, under the State Act of 1954, the commodity cannot be said to be exempt from tax generally under that Act. The goods which are specified in Schedule I under the State Act of 1941 are goods which are exempt from tax generally within the meaning of Sub-section (2A) of Section 8 of the Central Act. The contention of Mr. Bhattacharjee that the tax payable on the turnover relating to the sales of betel-nuts should be nil on the ground that sale of betel-nuts is exempt from tax generally under the State Act of 1954 within the meaning of Sub-section (2A) of Section 8 of the Central Act, is overruled.
8. Mr. Bhattacharjee strenuously urged that as the provisions of the State Act of 1954 were inapplicable' to the sales in question, or in other words, those sales having been exempted from taxation under the said Act, if the sales had taken place inside West Bengal, the petitioner was entitled to a similar exemption under the Central Act in view of the provisions of Sub-section (3) of Section 8 of the Central Act. Section 8 of the Central Act as amended by the Central Sales Tax (Second Amendment) Act, 1958, is as follows :
9. (1) The tax payable by any dealer under this Act on sales of goods effected by him in the course of inter-State trade or commerce whether such sales fall within Clause (a) or Clause (b) of Section 3 shall be levied and collected by the Government of India in the manner provided in Sub-section (3) in the State from which the movement of the goods commenced :
Provided that, in the case of a sale of goods during their movement from one State to another being a sale subsequent to the first sale in respect of the same goods, the tax shall, where such sale does not fall within Sub-section (2) of Section 6, be levied and collected in the State from which the registered dealer effecting the subsequent sale obtained the form prescribed for the purposes of Clause (a) of Sub-section (4) of Section 8 in connection with the purchase of such goods. (2) The penalty imposed upon any dealer under Section 10A shall be collected by the Government of India in the manner provided in Sub-section (3)--
(a) in the case of an offence falling under Clause (b) or Clause (d) of Section 10, in the State in which the person purchasing the goods obtained the form prescribed for the purposes of Clause (a) of Sub-section (4) of Section 8 in connection with the purchase of such goods;
(b) in the case of an offence falling under Clause (c) of Section 10, in the State in which the person purchasing the goods should have registered him-self if the offence had not been committed.
(3) The authorities for the time being empowered to assess, collect and enforce payment of any tax under the general sales tax law of the appropriate State shall, on behalf of the Government of India and subject to any rules made under this Act, assess, collect and enforce payment of any tax, including any penalty, payable by a dealer under this Act in the same manner as the tax pn the sale or purchase of goods under the general sales tax law of the State is assessed, paid and collected ; and for this purpose they may exercise all or any of the powers they have under the general sales tax law of the State; and the provisions of such law, including provisions relating to returns, appeals, reviews, revisions, references, penalties and compounding of offences, shall apply accordingly :
Provided that if in any State or part thereof there is no general sales tax law in force, the Central Government may, by rules made in this behalf, make necessary provisions for all or any of the matters specified in this subsection and such rules may provide that a breach of any rule shall be punishable with fine which may extend to five hundred rupees ; and where the offence is a continuing offence, with a daily fine which may extend to fifty rupees for every day during which the offence continues. (4) The proceeds in any financial year of any tax, including any penalty, levied and collected under this Act in any State (other than a Union territory) on behalf of the Government of India shall be assigned to that State and shall be retained by it; and the proceeds attributable to Union territories shall form part of the Consolidated Fund of India.
9. In support of his contention Mr. Bhattacharjee strongly relied on a decision of the Supreme Court in State of Mysore v. Yaddalam Lakshminara-simhiah Setty and Sons : [1965]2SCR129 . The facts of the Supreme Court decision are that under Section 5(3)(a) of the Mysore Sales Tax Act, 1957, tax shall be levied in the case of the sale of any of the goods mentioned in column (2) of the Second Schedule by the first or the earliest of successive dealers in the State, who is liable to tax under that section, at the rate specified in the corresponding entry of column (3) of the said schedule on the turnover of sale of such dealer in each year relating to such goods. The assessee who was not the first or the earliest of successive dealers in respect of inter-State sales of handloom and power-loom cloth was sought to be taxed under the Central Act. It was contended by the assessee that he, not being the first or earliest of the successive dealers of the disputed turnover and not being liable to tax under Section 5(3)(a) of the Mysore Sales Tax Act, 1957, if those sales had been effected intra-State, could not be taxed under the Central Act. It has been held by the majority decision of the Supreme Court that when Section 9(1) says that under the Central Act tax shall be levied in the same manner as the tax on the sale or purchase of goods under the general sales tax law of the State is assessed, paid and collected, it is reasonable to hold that the expression 'levied' in Section 9(1) of the Central Act refers to the expression 'levied' in Section 5(3)(a) of the Mysore Sales Tax Act, 1957. It has been observed by the Supreme Court that there is no reason why the Central Act made a departure in the manner of levy of tax on the specified goods which are taxed only at a single point under the Mysore Sales Tax Act, 1957, and that if any such radical departure was intended, the Central Act would have expressly stated so. Prior to the said Supreme Court decision there was some conflict of views of different High Courts as 'to the interpretation of the expression 'in the same manner' in Section 8(2) of the Central Act as it then stood before the amendment of 1958. Section 8(2) of the Central Act provided for the method of calculating the tax under that sub-section ; the tax should be calculated at the same rates and in the same manner as would have been done if the sale had, in fact, taken place inside the appropriate State. Section 9(1) of the Central Act as it then stood provides that tax payable by any dealer under the Central Act shall be levied and collected in the appropriate State by the Government of India in the manner provided in Sub-section (2). Sub-section (2) of Section 9 empowers the appropriate State authorities to assess, collect and enforce payment of any tax payable by any dealer under the Central Act in the same manner as the tax on the sale or purchase of goods under the general sales tax law of the State is assessed, paid and collected. The result of the Supreme Court decision is, that if the State law exempts any goods in respect of its sales within the State, that exemption will have to be granted under the Central Act in respect of inter-State sales of those goods.
10. Relying on the said Supreme Court decision, Mr. Bhattacharjee argued that in view of Sections 9(1) and 9(3) of the Central Act which are substantially the same as Sections 9(1) and 9(2) respectively of the Central Act as they stood before the amendment of 1958, the inter-State sales effected by the dealer of the commodity in question, could not be taxed under the Central Act. The said argument of Mr. Bhattacharjee might have been of some substance, had not the provisions of the Central Act been changed to a great extent with retrospective effect by the Central Sales Tax (Amendment) Act, 1969 (hereinafter referred to as the Amendment Act).
11. By Section 3 of the Amendment Act, Section 6 of the Central Act has been b1 amended. Section 3 of the Amendment Act states as follows :
3. Amendment of Section 6.--In Section 6 of the principal Act,--
(a) after Sub-section (1), the following sub-section shall be, and shall be deemed always to have been, inserted, namely:
(1A) A dealer shall be liable to pay tax under this Act on a sale of any goods effected by him in the course of inter-State trade or commerce notwithstanding that no tax would have been leviable (whether on the seller or the purchaser) under the sales tax law of the appropriate State if that sale had taken place inside that State.;
(b) in Sub-section (2), for the word, brackets and figure 'Sub-section (1)', the words, brackets, figures and letter 'Sub-section (1) or Sub-section (1A)' shall be, and shall be deemed to have been, substituted with effect from the 1st day of October, 1958.
12. Again by Section 6 of the Amendment Act, Section 9 of the Central Act has been substituted. Section 6 of the Amendment Act is as follows:
6. Substitution of new section for Section 9.--For Section 9 of the principal Act, the following section shall be, and shall be deemed always to have been, substituted, namely:
9. Levy and collection of tax and penalties.--(1) The tax payable by any dealer under this Act on sales of goods effected by him in the course of inter-State trade or commerce, whether such sales fall within Clause (a) or clause (b) of Section 3, shall be levied by the Government of India and the tax so levied shall be collected by that Government in accordance with the provisions of Sub-section (2), in the State from which the movement of the goods commenced:
Provided that, in the case of a sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods, the tax shall, where such sale does not fall within Sub-section (2) of Section 6, be levied and collected in the State from which the registered dealer effecting the subsequent sale obtained or, as the case may be, could have obtained, the form prescribed for the purposes of Clause (a) of Sub-section (4) of Section 8 in connection with the purchase of such goods. (2) Subject to the other provisions of this Act and the rules made thereunder, the authorities for the time being empowered to assess, reassess, collect and enforce payment of any tax under the general sales tax law of the appropriate State shall, on behalf of the Government of India, assess, reassess, collect and enforce payment of tax, including any penalty, payable by a dealer under this Act as if the tax or penalty payable by such a dealer under this Act is a tax or penalty payable under the general sales tax law of the State ; and for this purpose they may exercise all or any of the powers they have under the general sales tax law of the State; and the provisions of such law, including provisions relating to returns, provisional assessment, advance payment of tax, registration of the transferee of any business, imposition of the tax liability of a person carrying on business on the transferee of, or successor to, such business, transfer of liability of any firm or Hindu undivided family to pay tax in the event of the dissolution of such firm or partition of such family, recovery of tax from third parties, appeals, reviews, revisions, references, refunds, penalties, compounding of offences and treatment of documents furnished by a dealer as confidential, shall apply accordingly:
Provided that if in any State or part thereof there is no general sales tax law in force, the Central Government may, by rules made in this behalf make necessary provision for all or any of the matters specified in this sub-section. (3) The proceeds in any financial year of any tax, including any penalty, levied and collected under this Act in any State (other than a Union territory) on behalf of the Government of India shall be assigned to that State and shall be retained by it; and the proceeds attributable to Union territories shall form part of the Consolidated Fund of India.
13. The insertion of the new Sub-section (1A) in Section 6 of the Central Act rules out all arguments to the effect that where no tax is leviable under the sales tax law of the appropriate State in respect of sale of any goods by a dealer if the sale had taken place within the State, the dealer cannot be made liable to pay tax under the Central Act in respect of inter-State sales of the goods. In the Supreme Court decision referred to above, it was observed by the majority that 'there is no reason why the Central Act made a departure in the manner of levy of tax on the specified goods which are taxed only at a single point under the State Act; if any such radical departure was intended, the Central Act would have expressly stated so.' In my view, the new Sub-section (1A) of Section 6 of the Central Act, which is the charging section, has provided for an express departure when it says that a dealer shall be liable to pay tax under the Central Act on a sale of any goods effected by him in the course of inter-State trade or commerce notwithstanding that no tax would have been leviable under the sales tax law of the appropriate State if that sale had taken place inside that State.
14. The substitution of Section 9 of the Central Act with retrospective effect, by Section 6 of the Amendment Act, has also a great bearing to the contentions advanced on behalf of the petitioner. It may be noticed that the expression 'in the manner' and the expression 'in the same manner' which were there in the provisions of Sections 9(1) and 9(3) respectively before the Amendment Act, do not find place in the substituted Sections 9(1) nd 9(2). The substituted Section 9(2) dispels all ambiguity by providing that the authorities for the time being empowered to assess, reassess, collect and enforce payment of tax, including any penalty payable by such a dealer as if the tax or penalty payable by such a dealer under this Act is a tax or penalty payable under the general sales tax law of the State. Therefore, even if no tax is payable by a dealer under the general sales tax law of the State, by virtue of the substituted Section 9(2), the dealer will be liable to tax or penalty payable under the Central Act and the tax or penalty so payable shall be deemed to be the tax or penalty payable under the general sales tax law of the State. In view of the changes effected by Sections 3 and 6 of the Amendment Act in respect of Sections 6 and 9 of the Central Act and in view of the foregoing discussion, the contentions advanced on behalf of the petitioner on the basis of the unamended provisions of Section 9(3) of the Central Act and also on the basis of the said Supreme Court decision, must be overruled. This view which I take finds support from a recent decision of the Supreme Court in Deputy Commissioner of Agricultural Income-tax and Sales Tax v. Aluminium Industries Since reported at [1970] 25 S.T.C. 476 (S.C.), C. A. Nos. 1230-1231 of 1969 disposed of on 11th August, 1969, where it has been held that the law as stated in the majority decision of Lakshminarasimhiah's case : [1965]2SCR129 has been superseded by clauses 3 and 6 of the Central Sales Tax (Amendment) Ordinance, 1969 (4 of 1969) which preceded the Amendment Act.
15. It has been argued on behalf of the petitioner that the provisions of the Central Act in so far as the same impose tax on inter-State sales of goods not liable to tax under the sales tax law of the State if the sales had been effected within the State, impede the movement of goods and the free flow of trade and as such, the said provisions are ultra vires Article 301 of the Constitution of India. This point is now covered by the decision of the Supreme Court in State of Madras v. N.K. Nataraja Mudaliar A.I.R. 1969 S.C. 147. In the said Supreme Court decision, the contention that Sections 8, 8(2A) and 8(5) of the Central Act were ultra vires articles 301 and 303 of the Constitution of India was overruled. It has been held in the said Supreme Court decision that none of the provisions of the Central Act directly impede the movement of goods or the free flow of trade and that even assuming that the Central Act is within the mischief of Article 301, it is certainly a law made by Parliament in the public interest and is saved by Article 302. It has been further held that there is nothing in the Act which offends Article 303(1) of the Constitution. In view of the said decision of the Supreme Court, the said contention of the petitioner is overruled.
16. It is submitted on behalf of the petitioner that the provisions of the Central Act imposing tax on inter-State sales of the commodity in question make a discrimination without any reasonable basis therefor, between one dealer and another similarly situated, inasmuch as while a dealer effecting sales of second degree of the commodity within the State is exempted from payment of tax, a dealer effecting inter-State sales is made liable to payment of tax under the Central Act and that accordingly, the said provisions are ultra vires Article 14 of the Constitution of India. This contention presupposes that a dealer effecting sales within the State is similarly situated as the dealer effecting inter-State sales of the same commodity. In my view it cannot be said that a dealer effecting sales within the State is similarly situated as the dealer effecting inter-State sales. There is no discrimination at all. When the provisions of the State Act of 1954 which, in effect, exempt from tax second degree sales of betel-nuts within the State, only the turnover of sales of first degree being made liable to payment of tax, cannot be said to be discriminatory, there is no reason to hold that the provisions of the Central Act imposing tax on inter-State sales of betel-nuts, are discriminatory and hit by Article 14 of the Constitution of India. This contention advanced of behalf of the assessee is without any substance and is overruled.
17. Lastly, it has been contended by Mr. Bhattacharjee that the imposition, of penalty of Rs. 1,000 for the late filing of return is illegal. It is submitted by him that Rule 11 of the Central Sales Tax (West Bengal) Rules, 1958, is ultra vires the rule-making power of the State as conferred by Sub-sections (3) and (4) of Section 13 of the Central Act.
18. Section 10 of the Central Act provides for imposition of penalties and Section 10A provides for imposition of penalty in lieu of prosecution. Sections 10 and 10A are as follows:
10. If any person--
(a) fails to get himself registered as required by Section 7 ; or
(b) being a registered dealer, falsely represents when purchasing any class of goods that goods of such class are covered by his certificate of registration ; or
(c) not being a registered dealer, falsely represents when purchasing goods in the course of inter-State trade or commerce that he is a registered dealer; or
(d) after purchasing any goods for any of the purposes specified in Clause (b) of Sub-section (3) of Section 8 fails, without reasonable excuse, to make use of the goods for any such purpose ;
(e) has in his possession any form prescribed for the purposes of Sub-section (4) of Section 8 which has not been obtained by him or by his principal or by his agent in accordance with the provisions of this Act or any rules made thereunder;
(f) collects any amount by way of tax in contravention of the provisions contained in Section 9A;
he shall be punishable with simple imprisonment which may extend to six months, or with fine, or with both; and when the offence is a continuing offence, with a daily fine which may extend to fifty rupees for every day during which the offence continues.
10A. If any person purchasing goods is guilty of an offence under Clause (b) or Clause (c) or Clause (d) of Section 10, the authority who granted to him or, as the case may be, is competent to grant to him a certificate of registration under this Act may, after giving him a reasonable opportunity of being heard, by order in writing, impose upon him by way of penalty a sum not exceeding one-and-a-half times the tax which would have been levied under this Act in respect of the sale to him of the goods if the offence had not been committed : Provided that no prosecution for an offence under Section 10 shall be instituted in respect of the same facts on which a penalty has been imposed under this section.
19. Section 13(1) of the Central Act authorises the Central Government to make rules providing for certain matters as specified in the section. Sub-section (3) empowers the State Government to make rules, not inconsistent with the provisions of the Central Act and the rules made under Sub-section (1), to carry out the purposes of the Act, and Sub-section (4) enumerates the different matters in respect of which the rules may be made by the State Government. Sub-section (5) of Section 13 states that in making any rule under this section the State Government may direct that a breach thereof shall be punishable with fine which may extend to five hundred rupees and when the offence is a continuing offence with a daily fine which may extend to fifty rupees for every day during which the offence continues.
20. In exercise of the powers conferred by Sub-sections (3), (4) and (5) of Section 13 of the Central Act, the State Government has framed rules called the Central Sales Tax (West Bengal) Rules, 1958 (hereinafter referred to as the State Rules, 1958). Section 8 of the State Rules, 1958, provides for the submission of returns by a dealer in respect of each period of his turnover to the appropriate Commercial Tax Officer in the manner and by the date as prescribed in this behalf by the State Act of 1941 and the rules framed thereunder. Rules 17, 19 and 21 of the Rules framed under the State Act of 1941 have fixed the time-limits within which the returns are to be filed. Rule 11 of the State Rules, 1958, provides that the provisions of the State Act of 1941 and the rules made thereunder including the use of forms shall apply mutatis mutandis to all proceedings or other matters incidental to the carrying out of the purpose of the Act and for which no provision is made in the State Rules or in the Central Sales Tax (Registration and Turnover) Rules, 1957.
21. By virtue of Rule 11 of the State Rules, 1958, the provisions of the State Act of 1941 are attracted. Section 11 of the State Act, 1941, deals with assessment of tax and it inter alia provides that in case of failure by a registered or certified dealer to submit in respect of any period a return accompanied by a receipt from a Government Treasury or the Reserve Bank of India, by the prescribed date, the Commissioner may, if he is satisfied that the default was made without reasonable cause, direct that the dealer shall pay by way of penalty in addition to the amount of the tax so assessed a sum not exceeding one and a half times that amount. It is, therefore, clear that by virtue of Rule 11 of the State Rules, 1958, a dealer may be penalised for his failure to file returns within the prescribed date, in accordance with the provisions of Section 11 of the State Act of 1941.
22. It thus appears that the general power of the State Government to make rules is conferred by Section 13(3) of the Central Act. Section 13(4) of the Central Act only enumerates certain particular matters in respect of which rules may be made 'without prejudice to the powers conferred by Subsection (3)'. In Emperor v. Sibnath , the Privy Council observed as follows:
In the opinion of their Lordships, the function of Sub-section (2) is merely an illustrative one; the rule-making power is conferred by Sub-section (1), and 'the rules' which are referred to in the opening sentence of Sub-section (2) are the rules which are authorised by, and made under, Sub-section (1); the provisions of Sub-section (2) are not restrictive of Sub-section (1), as indeed is expressly stated by the words 'without prejudice to the generality of the powers conferred by Sub-section (1)'.
23. Therefore, the function of Sub-section (4) of Section 13 of the Central Act is merely an illustrative one and the rule-making power is conferred by Sub-section (3). The specific enumeration does not circumscribe the general power conferred to make any rules provided they are required for carrying out the purposes of the Act and they are consistent with the provisions of the Act--vide Ross Clunis v. Papadopoullos [1958] 2 All E.R. 23 (P.C). It is only when a rule or rules are pointed out, which subserve neither the special purpose of the section nor the general purposes of the Act, that they can be successfully questioned --vide Chandrakant v. Jasjit Singh : 1983ECR2183D(SC) .
24. The particular matters in respect of which the State Government may make rules as enumerated in Sub-section (4) of Section 13 of the Central Act do not include any matter for the imposition of penalty for failure to submit return within the prescribed period. It has now to be seen whether the rule as to the imposition of penalty has been made for carrying out the purposes of the Central Act. There can be no doubt that the purpose of the Central Act is to impose, assess and collect tax in respect of inter-State sales of commodities.
25. It is true that Sections 10 and 10A do not provide for imposition of penalty for the failure of a dealer to submit returns within the prescribed date nor does Sub-section (4) of Section 13 include any such matter. But, Section 9(2) as substituted by the Amendment Act provides that for the purpose of assessment, reassessment, collection and enforcement of payment of tax, including any penalty, payable by a dealer under the Central Act, as if the tax or penalty payable by such a dealer is a tax or penalty payable under the general sales tax law of the State, the provisions of such law, including provisions relating to returns etc., shall apply. It is, therefore, clear that Section 9(2) attracts the provisions relating to returns under the general sales tax law of the State. Section 11(1) of the State Act of 1941 provides for penalty for the default of the dealer to submit returns as required by Section 10 of the Act. In my opinion, Section 11(1) of the State Act of 1941 is a provision relating to returns. Therefore, the provisions of Section 11(1) will apply by virtue of Section 9(2) of the Central Act. Rule 11 of the State Rules, 1958, in so far as it makes applicable the provisions of Section 11(1) of the State Act of 1941, only does so for carrying out the purpose of the Central Act and it is not in any way inconsistent with the provisions of the Central Act. It may be that the substituted Section 9(2) of the Central Act was not there when Rule 11 of the State Rules of 1958 was framed, but Section 6 of the Amendment Act states that Section 9 shall be and shall be deemed always to have been substituted. In view of the deeming provisions, it must be assumed that the substituted Section 9 including Sub-section (2) thereof is all along in the statute. Moreover, if we refer to Section 9(3) as it stood before the Amendment Act, it will be found that it also provides that 'the provisions of such law, including provisions relating to returns * * * shall apply accordingly.' It is therefore clear that both under Section 9(3) before it was amended and under the substituted Section 9(2) of the Central Act, the provisions relating to returns of the general sales tax law of the State, are applied. In my view, the provision of Rule 11 of the State Rules, 1958, subserves the purpose of the Central Act, and it is quite consistent with the provisions of the Central Act. The contention of Mr. Bhattacharjee challenging the provisions of Rule 11 of the State Rules of 1958 as ultra vires the rule-making power of the State, is overruled.
26. All the contentions on behalf of the petitioner having failed, the Rule is discharged, but, in the circumstances, there will be no order for costs in this Rule.