Bhaiyalal Shukla v. State of Madhya Pradesh

HIDAYATULLAH, J.-These six petitions under HiJ""""""" I. Art. 32 of the Constitution have been filed by one Bhaiyalal Shukla, who was doing business of cons-truction of buildings, roads, bridges etc. as con-tractor for the Public Works Department in Rewa Circle of the former Vindhya Pradesh State, now a part of the State of Madhya Pradesh. By these petitions, he "challenges the levy of sales tax on building matnials supplied by him in the cons-truction of buildings, roads and bridges for the years, 1953-54 to 1958.G9. For the first year in question, sales tax amounting to Rs. 1,840·5-Cl has 1961 already been charged and paid. He seeks refund BltaiJalal Sliokla of this a.mount. For the remaining years except

'" the last two, proceedings for assessment have been Stcteof completed, but the amounta have not been paid. M.ala.1• frd(f,14

For the remaining two years, proceedings are HidavaJu//ah .J, pending for assessment of the tax. The respon.

dents in the oase are the State of Madhya Pradesh, which Htands substituted for the State of Vindbya Pradesh, and diverse officel'8 connected with the &sseasment and levy of the tax. The contention of the petitioner is that the tax is not levi&ble in view of the decisions of this Court in two cases reported in The Stare of .Madras v. Gannon Dunkerky and Co., (Madras) Ltd., (1) and Pandit Banarsidas v, The State of Madhya Prade,sh ('). The respondent., however, claim that the tax is leviab]e, because the cnse fa.Ila within the decision of this Court reported in Mithan Lal T, The Stale of Delhi(').

Tho Unit-Od State of Vindhya Pradesh was formed by the Rulers of the States in Bal(helkhand and Bundhelkhand, who agreed to unite into a common State, with the Maharaja of R11wa as the Rajpramukh. By the Covenant which w&e entered into by them at that time, it was provided that until a Constitution for the United State was formed, the legislative authority of the United State would ve~t in the Rajpramukh, and he was autho· rised to make and promul!!ate Ordinances for the peace and good government of the United State or any part thereof, and any Ordinance made by him had the force of an Act passed by the legisl&ture of the United State.

The Rajpramukh. in exercise of his powers drawn from the Covenant, promul(!ated the Vindhya Pradesh Sales Tax Ordinance 2 of 1949 for the levy of a tax on the sale of goods in Vindhya Pradesh. On the ina.usrurstion of the present Constitution of India, Vindhya Pradesh became, at first, a part B IIMI State but later by the Constitution (Amendment of Bluiryalal Shuk1 the First and Fourth Schedules) Order, 1950, it was v. transferred from Part B to Part C of the Constitu-State of Madhya Pradesl tion. The Ordinance of the Rajpramukh was ap-plied to the whole of Vindhya Pradesh with effect Hiduyatul/ah J, from April l, 1950 by Notification No. 7 of March 28, 1950 by the Chief Commissioner, Vindhya Pra-desh, acting under s. 1(2) of the Ordinance.

Parliament then passed the Part C States (Laws) Act, 1950. Section 2 oft.hat Act provided :

"Pawer to extend enactments to certain Part C States :-The Central Government may, by notification in the Official Gazette extend to any Part C State ......... or to any part of such State, with such restrictions and modifications as it th,inks fit, any enactment which is in force in a Part A State at the date of the noti-fication and provision may be made in any enactment so extended for the repeal or amendment of any corresponding law (other than a Central Act) 'Which is for the time being applicable to that Part C State."

In exercise of the power conferred by the above section, the Central Government by Notifica-tion No. S.R.O. 6 dated December 29, 1950, exten-ded to the State of Vindhya Pradesh the Central Provinces and Berar l:lales Tax Act, 1947 (21 of 1947) as in force for the time being in the State of Madhya Pradesh, subject to certain modifications necessitated by the application of the Act to this new area. By the same Notification, a new section was added to the Madhya. Pradesh Act, which read as follows:

"29. Repeal and Saving : The Vindhya Pradesh Sales Tax Ordinance 2· of 1949 is hereby repealed, provided that ......... ,"

and here follow certain provisions saving the pre· vious operation of the Ordinance.

1961 On March 20, 1951, tho Central Government Bliaflo/111 SW/o issued Notification No. 52/ECON. in exercise of tho

y, powers conferred by sub-a. (3) of s. l of the Central SI.ii of Provinces and Berar Sales Tax Act, 1947, as exten-M UJuo Pr.Jtsh

ded to tho State of Vindhya Pradesh by ~otification llid'f1Clulla4 J · No. S.R.O. 6, ordering that from April l, 1951 the

extended Act would come into force in the State of Vindhya Pradeeh. On May 23, 1951, this Court rendered its judgment in In re the Dellli Laws Act 1912(' ). It was held by majority by this Court thats. 2 of the Part C States (Laws) Aot, 1950 was intra vires, except for the concluding sentence, "provision may be made in any enactment so exten-ded for the repeal or amendment of any corres-ponding law (other than a Central Act) which is for the time being applicable to that Part C State", ina.Hmuch as it was uUra vires the Indian Parlia· ment.

Parliament then passed the Government C;f Part C States Act, 1951 (49 of 1951) on September 6, 1951. Under that Act, Legislative A880mblies were set up, and under s. ~l, they· were investRd, subject to certain limitations, with Powers· of legislation with respect to any of the matters enumerated in the State List or in the Concurrent List. Section 22 of that Act provided :

"If any provision of a law made by the Legislative Assembly of a State is repugnant to any provision of a law made by Parlia-ment, then the law made by Parliamont whether passed before or after the law made by the Legislative Asaembly of the State, shall prevail and tho law made by the Legislative Assembly c•f the State hhall, to the extent of the repugnancy, be void.

Explanation : For the purposes of this section, the expression 'law made by Parlia-ment' shall not molude any law which provides

for the extension to the State of any law in 1;61 force in any other part of the territory of Bhai;>alal Shukla India." v State of In view of the decision of this Court in the Delhi Madhya Pradesh Laws Act case('), the· Part C States (Miscellaneous Hidayatullah J. Law) Repealing Act, 1951 (66 of 1951) waa enacted by Parliament on October 31, 1951. Bys. 2 of that Act, laws described in Column 2 of its Schedule were repealed or were deemed to have been repealed with effect from the dates specified in the corres-ponding entry in column 3 of that Schedule. In the Schedule, the Vindhya Pradesh Sales Tax Ordi-nance, 1949 (2 of 1049) wa.s repealed from Decem-ber 29, 1950. The Vindhya Pradesh Legislative Assembly, which was set up, then pqssed the Vindhya Pradesh Laws (Validating) Act, 1952 (6 of 1952). By that Act, which was ·to extend to the whole of Vfodhya Pradesh and to come into force on January 8, 1953, it was provided as follows :

"2. For the removal of all doubts it is hereby declared that ......... Central Provinces and Berar Sales Tax Act, 194 7 as extended to Vindhya Pradesh under section 2 of the Part C States Laws Act, 1950 (has been) and shall be deemed to be in force in Vindhya Pradesh from April 1, 1951.

¶7Repeal and savings :-As from the dates of the actual enforcement of the Acts specified in section 2 of this Act the oorr~sponding laws in force in Vindhya Pradesh immediately before the said dates shall be deemed to have been repealed without prejudice to anything done or suffered thereunder or any right, pri-vilege, obligation or liability acquired, a.corned or incurred thereunder before the aforesaid dates."

Section 2 of the Central Provinces and Berar Sales Tax Act, 1947, which was extended to 1H1 Vindhya Pradesh, defined "contract" to mean any llltM,.tal 8INIJ:l• agreement for the carrying out for cash or deferred

v. payment or other valuable consideration, the cons-SW. of truction, fitting out, improvement or repair of any Iii <div• Pru.sh

building, road, bridge or other immovable property, BiJq.iulU.• .J, and further defined "goods" to all kinds of m~an property including all materials, articles and com· modities, whether or not to be used in the construc-tion, fitting out, improvement or repair of immovable property, and finally defined "sale" as including a tranHfer of property in goods made in the course of the execution of a contract. By these definitions, the materials used or supplied by a building con-tractor in the construction of buildings, road11, bridges, etc. were made liable to sales tax in accor-dance with a schedule of rates to which reference seemH unneceBSary.

The legality of these and similar provisiona of law purporting to impose BAies tax on building materials in State Acts came up for consideration before High Courts in India, and two well-defined views were expressed, one holding that the power to disentangle in a building contra.ct the sale of materiaJs from the execution of works with a view to taxing such a sale, wr.s not beyond the legislative power of tbe States acting under Entry 48, List II, Seventh &hedule of the Government of India Act, 1935, corresponding to Entry 54 of the like List in the Constitution. It was held in those oases that a building contract, though entire, involved labour plus materials and in respect of the materials there was a sale involving transfer of property for consi-deration, and that the legislature had the power to frame a definition of "sale" to separate the two. The other view was that building contracts were entire. and tliat there was no sa.ie of goods 1111 con-t.empla.ted by the Indian Sale of Goode Aot, which wu the senoe in which the Entry wu fr&med, a eeDCe which had a well-recognised ~al import This Court in Ganrwn Dunkerley's case,(') approved the latter view, which is found in the decision of the Blt«iyalal .. Shukla '.\-lajras :Lligh Court in sub rwm Gannon Dunkerley v. •f State of Madras (2), and disapproved the contrary State Madhya Prahsh view. It was pointed out that though in a popular sense there was a sale of the. materials, there was H id•y•tulloh J. none in the sense in which the expression "sale of goods" is used in the Indian Sale of Goods Act, since there was no agreement to sell or sale of mate-rials as such, nor did the property !'ass therein as movables. In Pandit Banarsi Das's case (').

which was a case from the State of Madhya Pradesh and which was heard similltaneously, it was held that if the parties entered into distinct and separate contracts, one for transfer of materials fur money consideration and the other, for payment of remu-neration for services or works done, then there was a sale within the meaning of the Sale of Goods Act and the levy of tax was valid; but that if the con· tract was an entire one, the levy was without com-petence. The sections of the Central Provinces and Berar Sales Tax Act making such a division and taxing the so-called sales of materials were dec-lared to be beyond·the powers of the State Legisla-ture.

The petitioner contends that the impugned sec-tipns of the Central Provinces and Berar Sales Tax Act, as applied to Vindhya Pradesh, fell within these two rulings, and must also be declared ultra vires the Vindhya Pradesh State Legislature, when the latter enacted the Vindhya Pradesh Laws (Vali-dating) Act, 1952_

As against this, the respondents contend that the Notification S.R.O. No. 6, which added s. 29 repealing the Vindhya Pradesh Sales Tax Ordinance 2 of 1949, the Part C States (Miscellaneous Laws) Repealing Act, 1951 and the Vindhya Pradesh Laws (Validating) Act, 1952 all concurred in repe1.ling IHI Ordinance 2 of 1949 from December 29, 1950, but B4aiy.;al S""'l• left inta:ct the operation of the Central Provinces

v. and Berar Sales Tax Act as extt:nded to Vindhya Slat1 of Madla,J• Prt.Ct1h Pradesh by S. R. 0: No. 6 of 1950. The Vindhya lljj•y•trrllelt J. Pradesh Lawe (Validating) Act, 1952 merely remo-

ved the doubts by stating a11ain that the Central Provinces and Berar SaleH Tax Act had been and "shall be deemed to be in force in Vindhya Pradesh from April 1, 1951 ", but did not re-enact that Act. According to tho respandents, the Central Provinces and Berar Sales Tax Act was in force in Vindhya Pradesh as a result of its .extension by Notification S. R. 0. 6 and Notification No. 52 (Eoon), the repeal of Ordinance 2 of 1949 being achieved by the Part C States (Miscellaneous Laws) Repealing Act, 1951 from December \!9, 1950. The respondents, there-fore, seek to uphold the impugned provisions on the basis of the ruling of this Court in Mithan Lal's casu (' ), where it was pointed out that whatever might be said of the State Legislatures operating under List II did not hold good in the. case of Pa.r-lili.ment whioh derived its powers in relationt to legislation in Part C States, not only from all the Lists but also from the residuary powers of taxa-tion mentioned in Art. 248(2). It was also held that e. 2 of the Part C States (Laws) Act, 1950 was not repugnant to Art. 248(2), that tho extended law became incorporated by refer<'nce in the Part C States (Laws) Act, and that the tax was thus one imposed by Parliament itself. The respondents, therefore, contend that, as held in Mithan Lal'a case(') when parliament enacted the Part C States (Laws) Act, 1950 and conferred power on the Cen-tral Goverament to extend any Act of a Part A State to any Part C State, that power of extention carried with it the plenary powers of Parliament, and even though the law so extended migh~ have been outside the competence of the State Legisla-ture which enacted it, when extended under the authority of Parliament was a valid piece of law in 1961 a Part C State. ..

The rival contentions may be reduced to the Bh•iYalal Situkl• proposition that if the State Legislature of Vindhya &late of Pradesh extended the Central Provinces and Berar Jtadhy• Prad•sh 8ales Tax Act, then the extended Act would suffer Hidayatul/ah .I. from the disability pointed out in G1mnon Dun-kerky's case (1) , but if the Central Provinces and Berar Act was extended by the Notification under the Part C States (Laws) Act, 1950, then it must be treated as incorporated in that Act am! to have the authority of Parliament which, in relation to Part C States, had no limitations whatever. We have, therefore, to see whether the Central Provinces and Ber'ar Sales Tax Act, 1947 can be said to have been extended for the first time by the Vindhya Pradesh Legislature in 1952 when it passed the Vindhya Pradesh Laws (Validating) Act, 1952 to the exclusion of the order contained in the Notification No. S. R. O. 6, or whether the Act continue~ to be in force in Vindhya Pradesh even before, and all that the Vindhya Pradesh Act did was to remove any doubts a.bout its validity.

The contention on behalf of the petitionoir is that the Notification.dated December 29, 1950 was invalid in its latter part, as decided by thjs Court in the Delhi Laws Act case ('). That portion dealt with the repeal of Ordinance 2 of 1949, and if the Notification was invalid in that part, then the Central Provinces and Berar Sales Tax Act, which was extended by the opening part, never ca.me into force. Mr. Viswanatha Sastri contended that the Notification must be looked at compen-diously, andthat it was impossible to think that the Central Government would have extended the Central Provinces and Berar Sales Tax Act, if the ear lier Ordinance still continued to operate. He rd!ied in this connection upon the observations of this Court in Pesikaka' s case (') to urge that the

N<,tification which was beyond the powers Sh.kl• of the Central Government in its latter part must be Bho~4illl

v. regarded as a nullity, and contended that if the Stal1 of invalid.portion of the Yotification was fundamen-Al ~iiiya Pr•~sfi

tal to the operation of the valid, then the valid II iJ•J•lrdl.Ja J. portion also must equally fail because it could

not have been intended that two laws on the same topic were to operate sim•Jltaneously in Vindhya Pradesh. According to him, the extension of the Central Province& and Berar Act could not and would not have been made, if the Ordinance had not been first repealed. Section 29 whieh w&B added, though composed of two parts, was, accord· ing to him, really a part of a single scheme and the repeal of the Ordinance and the extension of the Central Provinces and Berar Act oould stand or fall together, and since the Ordinance was never validly repealed, it continued tv operate in Vindhya Pradesh till its repeal on October 31, 1951, by the Part C States (Miscellaneous Le.we) Repealing Act, J951, and when the Act repealed it from Decem-ber 29, 1950, the effect was that there was no sales tax law in operation in Vindhya Pradesh, because the Pa.rt U 8tates (Miscellaneous Laws) Repealing Aot, 1951, did not enact or extend any law on the subject of sa.lee tax in or to Vindhya Prade11h. According to him,. till the enactment oft~ Vindhya. Pradesh Laws (Valida.ting) Act 6 of 1952 on January, 8, 1953 there was no law impoeing sales tax in Vindhya. Pradesh, and the law was then made by the Legislature of Vi.udhya Pradeeh by extending the Central Provinces a11d Ber:u-Sales Tax Aetl from April 1, 1951. He therefore, oontended that since the powers.of the Vindhya Pradesh Legiala· ture did not include the power of impoeing sale& tax on building materials, thia Aet of the Vindhya Pradesh Legislature, if it BOUght to impose ealee tax on building material&, fell within the ruling in Ga'W11()n /)?tnkerkr/ s case (') and muat be declared as of no effect. He also referred to Aot 9 of 1953 \IJ [lg59J S. e, R. S79.

passed by the Vindhya Pradesh State Legislature, 1961 by which the Act was further amended, and stated Bh· iyalal Skuk that the extended Act, as amended, owed its exis-V, Sf.alt of tence neither to Parliament nor to the Central Ma4hy11 f'radtsh Government acting under thtt Part C States (Laws) H ida;•alullah J Act but to the Vindhya Pradesh Laws (Validating) Act, 1952 (6 to 1952) and the Vindhya Pradesh Amendment Act, 1953 (9 of 1953).

There is a fundamental fallacy involved in this reasoning. We are considering the applicability of the Central Provinces and Berar Sales Tax Act as extended to Vindhya Pradesh. The Vindhya Pradesh Amending Act made only verbal changes, but did not alter the structure of the tax. No doubt, that Aot, contained certain provisions under which sales of building materials are taxable, and if the authority to tax: the so-called sales emanated from a State Legislature, then the Jaw would fail.

But we have to remember, in this connection, that the law was first extended to Vindhya Pradesh by the C9ntral Government acting under the autho-rity of Parliament legislating for a Part C State.

Parliament and the Central Government were not subject to the disabilities pointed out in Gannon Dunkerley's case (1), and the matter was covered by the decision of this Court in Mithan Lal's case (').

Even if the Notification, S. R. O. No. 6, failed to repeal Ordinance 2 of 1949, Parliament by its own law effaced that Ordinance in Vindhya Pradesh from December 29, 1950, and enacted that the Ordinance shall be deemed to be repealed from that day. After the passing of the Repealing Act by parliament, it is impossible to argue that Ordi-nance 2 of 1949 continued in Vindhya Pradesh down to January 8, 1953, because by fiction .the Ordi· nance was repealed from December 29, 1950. Parlia· mentiiry legislation, therefore, came to the rescue, so to speak, of the Notification by making room for the extension of the Central Provinces and

270 SUPREME OOURT REPORTS [1962) BOPP.

I~/ Berar Act by repealing Ordinance 2 of 1949 whieh BA.i1olal ~hol/1 the Notification 'Pf"oprio vigore was unable to achieve

v. as laid down in the Delhi Law8 Act case('). The Noti-11&.u af fication of the Central Government (S. R. 0. No. 6) M odli,ya Pfadt JJi

and Act 66 of 1951, therefore concurred in remov-Hi1aJ14IUl/1\ J. ing the Ordinance on December 29, 1950 and in

extending the Central Provinces and Berar Sales Tax Act in its place on the same date.

Mr. Viswanatha Sastri argued, on the strength of ruling of this Court in Deep-chand v. State of Uttar Praduh [') that the validity of a law must be judged as on the date on which it was p8.8i!ed, and if the law was invalid on that date, then the law must be deemed not to have existed at a.II, unless it was later re-enacted. The passage relied upon is a.a follows :

"The validity of a statute is to be tested by the oonstitutional power of a legislature at the time of its enactment by that legisla-ture and, if thus tested, it is beyond the legislative power, it is not rendered valid without re.enactment if later, by consti· tutional amendment, the nece88Bry legisla-tive power is granted. An after acquired power cannot, ex proprio vigore, validate a statute void when enacted." (p. 24).

This argument would be applicable if we were to consider that Notification No. S. R. 0. 6 in isolation, and the question wa11 one of validation of that Notification. The Notification is being questioned, because it sought to repeal Ordinanoe 2 of 1949, which it coulrl not do. But, today we are not in a polition to say that Ordinance 2 of 1949 continued in Vindhya Pradc·sh, because Parlia-ment by the Part C States (Miieellaneous Lawe} Repealing .Act, 1951 has enacted ~bat the eaid Ordinance must be deemed to have been repealed from December ~9, 1950. Indeed, in the ruling of this Court at the same page are cited passages 1981 from Willoughby on Conqtitution of the United bliaiy i/'ll 8huk/a States (2n<l Edu.) Vol. I, p. l()based on the decision v, in v. to Staft of

John M. Wilkerson Olvtrles A. Rahrer (1) 1\Jadf~p1 Fradefh the effect that if the cause of the unconstitutiona-lity is removed then the law does not need to be Hiday ''utla~ .I. re-enacted. The facts of this cas~ are entirely diff"rent from those in Deepch'Lnd's case ('). The extended la.w did not depend on the repeal of the earlier law for its . valjdity .. It. would have been operative, even if the earlier law wa.s not repealed ; but the earlier law was, in fact, repealed from December, 29, 1950, and no question of conflict between the now and the old law ever arose. Parliament by repealing the ·Ordinance rendered the ineffective portion of the Notification a mere surplusage. The necessary.result thus was that its operative part survived and the Central Provinces and Berar Sales Tax Act, 19!7 was validly extended to Vindhya Pradesh, and was valid law as laid down in Mithanlal's case (8 ). It did not suffer from the defects pointed out by the this Court in Gannon Dunkerley's case (4), as it. was not enacted or exten-ded by the State Legislature.

It remains to consider the last argument on this point, and it is that tbe Central Provinces and Berar Sales Tax Act was re-extended to Viridbya Pradesh by Act 6 of 1952; and thus owed its existence to a law m<tde by a State Legis-lature w,Jiich was incompetent to enact a law that building materials in a works. contract, which was entire, were liable to sales tax. The preamble of the Act shows that it was enacted to remove certain doubts which were entertained as to whether the extended Sales Tax Act beca.me operative only from October 31, 1951 when Act 66 of 1951 WM passed, or from an earlier date, viz., April 1, 1951, from which date it was brought into force in II) (1891) 140 T}, S. 54;; 15 L. Ed, 572. (2) [JqS<J] Supp. 2 .~S.R, 8, 2+, 131 rI95'l]S,C.R.445. \4)[l959JS,C.R,379.

zg01 Vindhya Pradesh by Notification No. 52 (Econ.), BA.iva/•I dated .March 20, l!J51. To remove these doubts, the

.~hull• v. Vindhya Pradesh Laws (Vilida.ting) Act, 1952, enac-Stat.•! ted with the RB8•'Ilt of the President, declared by e. 2 Madh:to P••tU•h

(already quoted) that the Central Provinces and Hld•7•tulloh J. Ilerar Sales Tax Act had been and "shall be deemed

to be in force in Vindhya Pradesh from April 1, 1951." This declaration did not ~xtend proprio vigore the Central Provinces and Berar Sales Tax Act, but only declared that jt must be deemed to be validly in force from April I, 1951. Section 7, on which much reliance ha.a been placed, may be quoted again :

"Repeal and savinga !-As from the dates of the actual enforcement of the Acts specified in Section 2 of this Act the corr<>sponding laws in force in Vindhya Pradesh immediately before the said dates shall b" deemed to have been repealed without pt>rj11dicfl to anything done or suffered thereunder or any right, privilege, obligation or liability acquired, accrm·d or incurred thercundn before the aforesaid dates "

It is said that, if the two sections are read to~ether they mean that the Central Provinces R!ld Berar Sales Tax Act was freFhly extt·nded from April l, 1951 by the VindhyaPrad('sh Act and any Jaw made by any authority earlier was freshly repealed to make room for tlio extension. This argument, in our opinion, is erroneous.

To begin with, the powers of the Vindhya Pradesh .Legislature were circumscribed hy s. !?2 of the Government of part C Stat<>s Act, 1951, quoted earlier. Under that section, tl1e powers of the State f.Rgislatures did not extend to making Jaws repugnant to any law made by Parliament. The Explanation defines the expreBBion "law made by Parliamc,nt", and excludes a law which provides for the extension to the State of any law in form! in any other part of the territory of India. The IHI .. Vindhya Pradesh Legislature, however, did not . BltaiJalal Slouklo repeal either s. 2 of the Part C States (Laws) Act or Stat. the Notification, and all that the Legislature did of Madlo,10 Produh was to add its own authority by a declaration, to Hidip1.tull oh .T. the laws earlier extended. The law was extended first by Notification S.R.O. No. 6 on December 29, 1950, but it was brought into force only by Noti-fication No. 52 (Econ.) dated March 20, l!J50 from April 1, 1951. The Notification, S. R. O. No. 6 had substituted for sub-s.(3) of s.l of the Central Provinces and Berar Sales Tax Act, the following :

''(3) It shall come into force on such date as may be notified by the Central Government in the Official Gazette."

Till the Notification No. 52 (Econ.) was made, the Act was extended but was not in force in Vindhya Pradesh. There is a difference between the extension of a law subject to its being brought a into force latter anti its coming into force on later date. Section 7 of Act 6of1952 repealed only the lawsinforceprior tn the date on which the Central Provinces and Berar Sales Tax Act wa8 brought into force. It speaks of "laws in force in Vindhya Pradesh immedi-ately before April J, 1951 ", and the law which was in force immediately before that date was not the Central Provinces and Berar Sales Tax Act which had not been brought into force, but might be Ordinance 2 of 1949, if it had not been successfully repealed earlier. The former Act wa,s extended on December 29, 1950, but was not brought into force till April 1, 1951, an<l the section speaks of '"laws in force''. The section, therefore, refers to Ordi-nan<'.e 2 of 1949, which would be in force immedia-tely before April I, 1951, if not successfully repeal-ed, but not to the Central Provinces and Berar Sales Tax Act whic-h was only extended before that date but had not been brought into force. In other words, s. 7 of the Act does no more than rep1ea 11'&1 from April I, 1951 (if repeal was at all necessary) BluJiy•lal Shul:la Ordinance :! of 1949, which might be supposed to

v. have continued as law till October 31, 1951, when it Stale of was repealed by Act 66 of 1951. In point of fact M ad/oyd P.ad1>h

and altio in law, it was really repealed from Decem-Hid.,.tuUoA J. ber 29, 1950 under the Repealing Act 66 of 1951.

The Vindhya Pradesh Act 6 of 1952 cannot, tht>re-fore, he said to havo enacted for tlw first time that the CPntral Provinces and Berar Sales Tax Act ~hall come into force from April I, 1951 in Vindhya. Prad<'sh. It only declared what was a legal fact even without this declaration. Nor did the Central Provinces and Berar Sales Tax Act owe its E'Xist· ence to Act 6 of 19.)2. Act 6 of 1952 only dt•clart'd what the re8Ult of the earlier laws was, and adde<l the authority of the Vindhya Pradl'sh Li>gislature to removr do11hts and to save tho law from any attack on the ground that the wrong Legi.slature had repeal· ed tho Or1linance or extended th" Central Provinces and Berar Sales Tax Aet. In our opinion, this argu· r mcnt cannot be aecepti>d.

Ont> further argument was advanced to which we have not reforred so far, and which may now be noti,,cd. It is th'lt after the reorgani€ation of the States, Madhya Pradesh has as many as four Sales Tax Act"· It is contended that a person belonging to the are;i of the former State of M11dhya Pradesh is not liable to sales tax on buildi11iz Jlllllt·rials in a works contrac:t under the Central Provinces and Iler:i.r Sales Tax Aet becaUo<' of the decision in Pandit Rrmarsi Das's cast-('), but another person living in the area forming part of the formn Vindhyn Pradesh is liable to sales tax undn the 3am·1 At'!, as extended to Vinrlh~·a PradeHh. This, it is saiil, is patently contrary to the spirit of the equal pr"tcction clau8o in Art. 14.

The laws in different portions of the new State of Madhya Pradesh were enacwd by different Legis· latnres, and under s.119 of the States R"'organiBation Aot, all laws in force are to continue until repealed 1961 or altered by the appropriate Legislature. We Bh•iJ!•l•I Shuk/o have already held that the sale tax law in Vindhya v. Pradesh w\l.s validly enacted, and it brought its Stoll of Madhya Pradesh validity with it under s.119 of the States Reorganisa-tion Act, when it became a part of the State of Hidayatu//ah J Madhya Pradesh. Thereafter, the different laws in different parts of Madhya Pradesh can be sus-tained on the ground that the differentiation arises from historical reasons, and a geographical classi-fication based on historical reasons ha,s been upheld by this Court in M. K. Prithi Rajji v, The State of Rajasthan(') and again in The State of Madhya Pradesh v. The Gwalior Sugar Oo. Ltd.( 2). The latter case is important, because the sugarcane cess lev,ied in the former Gwalior State but not in the rest of Madhya Bharat of which it formed a part, was challenged on the same ground as here, but was upheld as not affected by Art. 14. We, therefore, reject this argument.

In the result, the Writ Petitions fail, and are dismissed; but in the circumstances of the case we make no order about costs.

P etitians dismissed (ll Civil Appeal No. 327of1956 decided on November 2, 1960.

(2) Civil Appeai. No!. 9R and 99of1%7 decided on ·November

30, 1960.

ORIGINAL JURISDICTION : Petitions Nos. 110 to 115 ofl960.

(Under Article 32 of the Constitution of India for enforcement of Fundamental Rights)

A. V. Viswanatha Sastri, R. K. Garg, D. P.

Singk, S. 0. Aggarwal and M. K. Ramamurthi, for the Petitioner.

B. Sen, B. K. B. Naidu and J. N. Shroff, for the Respondents.

1961. December 21. The Judgment of the Court was delivered by