Civil Appeal No l502 of 1987 etc
From the Judgment and order dated 14787 of the Allahabad High Court in CMWP No 11907 of 1987
Rajinder Sachhar and KC Dua for the Appellant
Raja Ram Aggarwal Salman Khurshid Ishad Ahmed section Wasim N A Siddiqui and Mrs Rani Chhabra for the Respondents
The Judgment of the Court was delivered by RANGANATHAN J
These matters involve the interpretation of section 21d of the UP Urban Buildings Regulation of Letting Rent and Eviction Act 1972 Act No 13 of 1972 hereinafter referred to as the Act 
Section 21 of the Act exempt certain classes of buildings from the application of the Act
One such exemption under clause d is in respect of d any building used or intended to be used for any other industrial purpose that is to say for the purpose of manufacture preservation or processing of any goods or as a cinema or theatre where the plant and apparatus installed for such purpose in the building is leased out along with the building Though the question for our ultimate
decision is a short one there has been a multiplicity of proceedings between the concerned parties
The relevant facts therefore need to be set out at some length
The building known as Prem Talkies situated in Mohalla Sahadatpura Maunath Bhanjan District Azamgarh UP belongs to Behari Lal Tandon and five others hereinafter referred to as the landlords 
They had let out the building to Sunil Sharma and another
Though the landlords claim that the lease was of the building along with certain fixtures it has to be taken for the purposes of the present proceedings that the lease to the Sharmas was the lease of the building simplicity and that the building was then subject to the provi 684 sions of the Act
This was the finding given in the suit for eviction which the landlords had instituted against the Sharmas
That decree has since become final and the respondents have made out before us no grounds to differ from that finding The landlords succeeded in obtaining delivery of vacant possession of the building from the Sharmas on 30091984
It appears that the Sharmas had filed a revision petition in the High Court against the eviction order which was eventually dismissed on 1st August 1985
The landlords claim that subsequent to the recovery of possession they wished to let out the building along with plant machinery furniture and apparatus installed therein for running a cinema theatre
However steps in this direction by way of renovation of the building installation of plant machinery new furniture and electrical fittings and the execution of a lease deed could be embarked upon only after the revision petition of the Sharmas was dismissed
They claim that they proceeded to do the needful
Thereafter on 5th Feb 86 an agreement of lease was executed between the landlords and the Mehrotras respondents in the matters before us
Under this agreement the Mehrotras agreed to take the building fully equipped with projector machines fixtures and furniture in full running condition for a period of five years with an option to renew for a further period of two years on certain terms and conditions which are not relevant for our present purposes
It was provided that the Mehrotras should obtain a cinematographic licence from the appropriate authorities by the end of the year 1987 failing which the lease agreement would stand cancelled
It is claimed that a generator was purchased on 20th June 1986 and a projector on 2291986 and that these were duly installed in the building on 261086
A lease deed pursuant to the agreement of lease between the landlords and the Mehrotras was entered into on 30121986 more or less broadly on the same terms as the agreement of lease earlier referred to
It is claimed that actual physical possession of the building was given to the Mehrotras on the 8th of January 1987
In the meantime it appears the present appellant Satya Narain Pandey had made an application under section 16 of the Act praying that the building in question should be allotted to him
There is a dispute regarding the date of the application
Pandey claims that the application was filed on 25986 and that on the basis of this application the Additional District Magistrate had called for a report from the Rent Control and Eviction Inspector who submitted a report on 281086
stating that the building was vacant as on that date
On the 685 other hand the landlords claim that the vacancy of the building had been declared on 631987 that a notification calling for applications for allotment had been issued on 93 87 and that the application by Pandey for allotment has been made only on 9387
The landlords thereupon filed WP No 1034687 in the Allahabad High Court praying that the order dated 6387 and the notification dated 9387 be quashed
They also say that on coming to know of the alleged report of the Rent Control and Eviction Inspector dated 281086 they had applied to the Additional District Magistrate on 2331987 pointing out that the report of the Eviction Inspector had been obtained behind their back and requesting that a fairly high placed official should be sent to inspect the premises again and submit a report This application was granted by the Additional District Magistrate and in pursuance of the said order the Sub Divisional Magistrate submitted a report on 284 87 According to this report the building as on that date was a full fledged cinema building fully equipped with projector exhaust and electric fans electric fixtures diesel generating set etc and the building was not vacant
He also reported that the landlords appeared to have let out the building to the Mehrotras under the agreements of 5 2 86  30 12 86 5 When these proceedings were taking place the Mehrotras in pursuance of the lease deed entered into by them with the landlords applied for the grant of a licence for running a cinema in the premises in question under the U P Cinemas Regulation Act 1985 They did this on 811987
This application was granted by the Additional District Magistrate Azamgarh by his order dated 22 6 1987
Pandey who as mentioned above had applied for the allotment of the premises to himself
considered himself aggrieved by the grant of the cinematographic licence to the Mehrotras on 2261987 He therefore filed Writ Petition No 1190787 before the Allahabad High Court This writ petition was dismissed
The Court held that the order granting a licence to the Mehrotras could not be quashed on the ground of the pendency of the allotment proceedings before the Rent Control  Eviction officer and that Pandey did not have any right to challenge the grant of licence merely because the vacancy of the building was declared at his instance particularly when the dispute as to whether the Act applied or not to the premises in question is yet to be decided A no 150287 has been preferred against the judgment of the Division Bench in the above writ petition
This court granted special leave to Pandev by its order dated 14787 and also directed that in the meantime the proceedings for the grant of the cinema licence be stayed 
686 6
We have mentioned that the landlords had filed Writ Petition No 10346 of 1987 in the Allahabad High Court against the order of the Additional District Magistrate declaring a vacancy in respect of the premises in question by the order dated 6 3 87 and notice dated 9 387 inviting applications for allotment of accommodation thereto
Their contention was that the cinema building stood excluded from the purview of the Act by virtue of section 21d and that therefore
the question of declaring a vacancy or allotting it to any person did not arise
The Mehrotras also filed Writ Petition No 12263 of 1987 raising the same pleas and seeking the same relief These writ petitions were heard together and disposed of by a consolidated order of the High Court dated 2011 87 The High Court accepted the contentions of the petitioners and allowed the writ petitions The order dated 3 87 and notice dated 9 3 87 were set aside and the Rent Control  Eviction officer Azamgarh was directed not to proceed with the allotment of the cinema building in question under the Act Pandey who w as one of the respondents in the above writ petitions has filed SLP nos 15030 31 of 1987 for leave to appeal from the decision of the Allahabad High Court in these writ petitions 7
From the above narration of facts it will be seen that the short question that arises for decision in these matters is as to whether the cinema building in question is exempt from the purview of the Act by reason of the exemption contained in section 21d The other controversy in A 150287 regarding the grant of the cinema licence to the Mehrotras need not detain us long
The High Court was clearly right in holding that Pandey had no locus standi in the matter However the issue of a valid licence to Mehrotras will ultimately depend on the outcome of their right to occupy the premises in question
If Pandey succeeds in his contention that the building continues to be subject to the provisions of the Act then obviously the allotment of the building on its vacation by the Sharmas will have to be made by the Additional District Magistrate in accordance with law and the Mehrotras will not be in a position to occupy the building and run the cinema theatre in pursuance of the lease deed and the licence obtained by them This is clear from the provision contained in section 13 of the Act
If on the other hand the contention of Pandey is not acceptable then the Mehrotras will be entitled to run the theatre in pursuance of the lease deed in exercise of the cinematographic licence obtained by them In this view of the matter the grant of licence to the Mehrotras recedes to the background and is only relevant to this extent that in case the lease of the building to the Mehrotras is held to be contrary to the provisions of the Act they may not be entitled to the licence a condi 687 tion precedent for which will be the availability to the exhibitor of a building in which he has a right to exhibit cinema shows
We may therefore leave the controversy in Civil Appeal No 150287 aside for the time being
We shall therefore grant special leave to Pandey in the Special Leave Petitions and proceed to dispose of the same as we have heard the learned counsel on both sides 8
We may at this stage outline the scheme and salient provisions of the Act
Like other enactments of its type it was a measure designed to meet the acute shortage of urban accommodation in UP during and after the Second World War
The continuing increase in urban population and the relatively slow pace of house building activity mainly due to shortage of materials had rendered it necessary to continue the controls on rents letting and eviction imposed earlier as a war measure or temporary legislation
The long title of the Act shows that one its objects was to provide for the regulation of letting certain classes of buildings situated in urban areas and this object is given effect to by the provisions of Sections 1  2 of the Act
By section 1 the Act is made applicable to all buildings in the urban areas of the State
However section 2 exempts certain buildings form the operation of the Act
It is sufficient here to extract the provisions of section 21 which read thus Exemptions from operation of Act 1 Nothing in this Act shall apply to the following namely a any building of which the Government or a local authority or a public sector Corporation is the landlord or b any building belonging to or vested in a recognised educational institution the whole of the income from which is utilised for the purposes of such institution or c any building used or intended to be used as a factory within the meaning of the Act No LXIII of 1948 where the plant of such factory is leased out along with the building or d any building used or intended to be used for any other industrial purpose that is to say for the purpose of manufacture preservation or processing of 688 any goods or as a cinema or theatre where the plant and apparatus installed for such purpose in the building is leased out along with the building Provided that nothing in this clause shall apply in relation to any shop or other building situated within the precincts of the cinema or theatre the tenancy in respect of which has been created separately from the tenancy in respect of the cinema or theatre or e any building used or intended to be used as a place of public entertainment or amusement including any sports stadium but not including a cinema or theatre or any building appurtenant thereto or f any building built and held by a society registered under the Act No XXI of 1860 or by a cooperative society company or firm and intended solely for its own occupation or for the occupation of any of its officers or servants whether on rent or free of rent or as a guest house by whatever name called for the occupation of per sons having dealing with it in the ordinary course of business  9 The clear effect of this section is that if any building falls under any one of the above clauses it is exempt from the operation of the Act
The whole case of the landlords here is that the premises in question falls under clause d The appellant on the other hand starts from the uncontroverted position that as on 3009 1984 the building was covered by the provisions of the Act
It is contended that once this position is admitted there is no escape from the conclusion that any subsequent letting of the premises can only be in the manner prescribed in Chapter III of the Act which contains provisions for the regulation of letting of premises governed by the Act
The scheme of these provisions is that the District Magistrate maintains two registers one of all vacancies of buildings to which the Act applies and the other of all applications by needy persons for allotment The vacancies come to the notice of the District Magistrate by reason of an obligation imposed on landlords and tenants to notify the vacancy or expected vacancy to him within a stated period section 15
There are also provisions of deemed vacancy and a provision to ascertain whether a building is vacant or not with the details of which we are not con 689 cerned The requirements of accommodation are known from applications in prescribed forms received from needy persons from time to time seeking an allotment in general or of a specific building which is or is likely to fall vacant
The vacancies are notified to public specifying a date on which allotment will be considered with notice also to the landlord
On the date fixed the District Magistrate allots the vacant building to the applicants in accordance with the procedure and priorities outlined in the rules
The District Magistrate under section 17 is required to make an allotment order within a specified period
Failing this the landlord is entitled to require that the building shall be allotted to a person of his choice and the District Magistrate shall comply with his request unless there are special and adequate reasons not to do so but to allot the building to some other person
The landlord can also apply to the District Magistrate to release the building to himself The landlord however can secure a release order only in certain circumstances outlined in sub section 2 of section 16 It is unnecessary to set out these circumstances here and it is sufficient to say that these circumstances do not exist in the present case
Teeth are provided for the enforcement of the above scheme by providing that once there is a vacancy the building can be dealt with only on the basis of a release or allotment order s 16 that it cannot be let out to any person other than allottee section 11 and that any person occupying it otherwise than in pursuance of an allotment or release order shall be deemed to be an unauthorised occupant of the building or part thereof section 13
Any contravention of the provisions of the Act is made punishable as a criminal offence s31
On the strength of these provisions it is contended that when the premises became vacant on 30984 the provisions of the Act were applicable to it
It was not open to the landlords to flout the requirements of this Act and to proceed to let out the premises to persons of their own choice
There was no alternative for them but to let out the premises to an allottee or if they could to obtain release of the premises to themselves
They are not entitled to place the building outside the purview of the Act by merely declaring that they intended to let the premises thereafter along with the plant and machinery thus attracting the exemption under section 21d
To permit the landlords to do so would facilitate easy avoidance of the provisions of the Act by landlords purporting or claiming to change the nature or use of the property or the nature of the letting in such a way as to fall under the terms of one clause or other of the exemption section
This it is urged should not be permitted
On the other hand the stand taken by the landlords is that section 21 exempts certain categories of buildings altogether from 690 the purview of the Act
In the present case on the date of notification of the vacancy namely 6387 the building let out was a theatre with full cinematographic equipment and furniture installed therein
It was also the subject matter of lease as a running cinema theatre in favour of the Mehrotras
This being so the building fell within the class of buildings exempted under section 21d
It is submitted that the moment section 21d is attracted the building is automatically taken outside the purview of the Act even if earlier it had been a building to which the provisions of the Act were applicable
It is submitted that the Act is intended to regulate only the letting of buildings and not to regulate or control the development of commerce or to impair the rights of the landlords to deal with their property in any manner they like
It is therefore contended that the High Court was right in holding that the District Magistrate had no jurisdiction to deal with the building under the provisions of the Act
Though there is a plausibility in the contention urged on behalf of the appellant we are of opinion on a careful consideration of the scheme and language of the Act that the judgment of the High Court should be affirmed and the appeals dismissed
Section 21 of the Act exempts from the operation of the Act various clauses of buildings set out in clauses a to f of that sub section
The initial attempt on behalf of the appellants was to suggest that the above exemptions are available only where the premises in question was of the nature specified in one or the other of those clauses as on the date of the commencement of the Act namely 15th July 1972
We cannot accept this contention
A perusal of the various clauses makes it clear that the building should fulfill the character indicated therein on the date on which the provisions of the Act are sought to be made applicable thereto
To give an illustration clause a exempts any building of which the Government or a local authority or a public sector corporation is the landlord
 In our opinion it is clear that even a building which might have belonged to private individuals since 1972 will automatically fall within this exemption clause as soon as t is purchased by the Government or a local authority or a public sector corporation
It will not be correct to read the section as conferring an exemption only on the buildings which belonged to the government etc
On 15th July 1972 and not to those acquired by them thereafter
The position must be construed likewise in respect of the other clauses too
It is however strongly urged on behalf of the appellants is 691 that in any event the nature of the building has to be determined as on 30th September 1984 on which date the premises were vacated by the Sharmas
There is no dispute that as on that date the building was subject to the provisions of the Act
That being so and a vacancy having arisen in such a building it was the duty of the landlords to have intimated the same to the District Magistrate and then gone through the procedure prescribed under the Act before letting out the property to any person
Any letting out of the property by them to the Mehrotras was unlawful in view of section 13 of the Act and the landlords cannot be heard to contend on the strength of such an unlawful letting that the premises stand outside the purview of the Act
There is as we said earlier a plausibility about this contention but in our opinion it cannot be accepted as this construction of the provisions would render the exemption section totally unworkable
We may first consider the nature of the exemption conferred by section 21
It takes out of the provisions of the Act certain clauses of buildings
Some of these exemptions are based on the nature of the ownership of the property and some of them on the nature of the use to which the property is either put or intended to be put
So far as the former is concerned there can be no doubt that any building that satisfies the ownership requirements set out therein automatically goes outside the purview of the Act
Thus under clauses a and b even if a building was previously subject to the provisions of the Act it will cease to be so the moment it is purchased by a Government or a local authority or a public sector corporation or a recognised educational institution
The vesting of the ownership of the premises in one of the categories of bodies mentioned effects a statutory cut off of the building from the applicability of the provisions of the Act
The exclusion of the Act would be automatic and does not need any application by the previous or subsequent landlord or any order by the Additional District Magistrate under any of the provisions of the Act
So far as clauses e and f are concerned the exemption depends upon the nature of the use to which the property is put
There is no difficulty in cases where the building at the time it falls vacant was actually used for the purposes specified in these clauses say as a place of public entertainment or amusement
It would like the buildings described in clauses a and b fall outside the provisions of the Act
So far there is no difficulty
But the exemption conferred by these clauses takes in not only actual user but also intended user that is the use to which the property is proposed to be put whatever may have been the use it was put to earlier
Thus if a building let out privately earlier is intended to be used as a place of amusement or entertainment or a Cooperative 692 Society decides to convert a flat let out to an outsider earlier into one for occupation by its own officer it will stand outside the purview of the Act
Now we come to clauses c  d which not only talk of user or intended user but also impose a further requirement that plant and apparatus is leased out along with the building
This creates a somewhat anomalous situation
It is argued that if the building had been leased out earlier without the plant and machinery it would be subject to the provisions of the Act and cannot be leased out without the permission of the District Magistrate any such lease as may have been purportedly entered into without such permission would be contrary to the provisions of section 11 and therefore invalid and illegal
It is argued that where the building is let out wrongfully without an authorisation by the District Magistrate such letting should be ignored and it cannot be said that the building is let out along with plant and machinery
In our opinion this is not the correct interpretation of these clauses
What they exempt are a building intended to be used as a factory   where the plant of such factory is leased out along with the building and a building intended to be used for any other industrial purpose or a cinema or theatre where the plant and apparatus installed for such purpose in the building is leased out along with the building
Each of these clauses should be read as a whole and doing so the exemption is not restricted only to cases where there is a prior valid lease of the building with plant and apparatus but would also extend to cases where though the building earlier was without such plant and apparatus or was not being used for such purposes as are specified the owner intends to put them to the specified uses by letting them out with the necessary plant and apparatus
The words is leased therefore do not connote the idea of a valid actual subsisting lease of the building with plant on the date of vacancy they are only descriptive of the manner in which the building is intended to be used
What is needed is a that the building should be intended to be used by the prospective tenant for the purpose specified in either of the clauses and b that in order to facilitate the purpose being achieved the building is intended to be let out to him along with necessary plant and apparatus
In our view therefore even in respect of a building covered by the Act the Act will cease to be applicable if on a vacancy occurring therein the landlord intends to put it to the use specified in clauses c to f and in cases covered by clauses c and d also intends to let it out for such use along with the plant and apparatus necessary therefor
We lean in favour of this interpretation of an automatic exclusion of certain classes of buildings from the purview of the Act for the following reasons 693 i The declaration in section 21 that nothing in the Act applies to A the classes of buildings mentioned therein has to be given effect to
It is patent that buildings falling under clauses a and b go out automatically
A different rule cannot apply in respect of the other clauses
ii The Act does not contain any provision or machinery whereby the owner of a building subject to the provisions of the Act can ask the District Magistrate or other authority to record the purchase of the property by the bodies specified in clauses a and b or to grant permission for converting it into a category of building for which exemption would be applicable under clauses c to f
It does not specifically confer jurisdiction on any authority to adjudicate upon a claim that a building falls within the exemption clause and that the provisions of the Act are therefore not applicable to it
tiii on the other hand under the scheme of the Act on there being a vacancy in a building to which the Act applies it can only be re occupied in terms of either an allotment order or a release order
A release order under section 16 can be only got in certain circumstances
It cannot be obtained by a landlord for the mere asking
The District Magistrate cannot release the building to the landlord even if he is satisfied of the landlord s intention to use the building in the manner specified in one of the clauses of section 21 and his intention to let it out with plant and apparatus
This being so the interpretation suggested by the appellants would mean that once a building is subject to the provisions of the Act it can never be taken out of the Act even if the requirements of clauses a and b or the intended user in terms of clauses c to f of section 21 can be established
F iv The above interpretation does not result in facilitating any avoidance of the provisions of the Act as contended for by the appellants
As rightly pointed out on behalf of the landlords the Act is intended to regulate the letting of the premises but it is not intended to curb commercial activities or to impair the right of the landlord to change the nature of the use to which his building should be put
Rather the manner in which clauses c to f are phrased would show that the intention of the Legislature was to exempt buildings used or intended to be used for commercial or industrial purposes and that intention should be given effect to
A lease given by the landlord in this manner 694 cannot be attacked as illegal or collusive to get over the provisions of the Act as there is nothing in law to prevent the landlord from doing so
v The appellant s argument overlooks that the restrictions in sections 11 13 16 and other provisions are all applicable only where the building does not fall under section 21
When it does the right of the landlord to let it out to a tenant of his choice cannot be defeated by continuing to read those restrictions merely because they were applicable at one time to the property
Naturally the question would arise as to how the question regarding the applicability of the Act is to be determined
It can certainly not be ipsi dixit of the landlord
If a landlord acts on his own and lets out the porperty or otherwise deals with it he takes the risk and if he is found at fault will not only render himself
punishable but will also be unable to resist an allotment of the property by the District Magistrate in due course
Since the District Magistrate has been empowered to deal with buildings to which the Act applies it is for the District Magistrate to satisfy himself before he proceeds to deal with any premises that it is in fact a building to which the provisions of the Act are applicable
It is open to the landlord to intimate the vacancy but make a claim before the District Magistrate that the Act has ceased to be applicable to his building but he is not obliged to do this
Where the landlord fails to do so the Magistrate may consider the issue if the vacancy in respect of the building is brought to his notice
The District Magistrate has powers to inspect the property and then decide whether the Act continues to apply or not
It is for the District Magistrate to consider the circumstances and to satisfy himself that the landlord intends to let out the premises for one of the purposes specified and in respect of clauses c  d that he intends to let it out not as a mere building but with plant and apparatus
We would like to make it clear however that in this process the District Magistrate has to satisfy himself on the materials made available to him
But it will not be incumbent or proper on his part to give notice to or convene any of the proposed allottees of the property and hear them on this issue
Whether a building is one to which the provisions of the Act are applicable or not is a matter which has to be decided by the District Magistrate after hearing the landlord
It is a matter between the landlord and the Government
An application for allotment merely confers on the applicant a right to be considered for allotment of a building to which the provisions of the Act are applicable and he has no rights qua any property until the District Magistrate comes to the conclusion 695 that the building is one which he can deal with by way of allotment
It was contended on behalf of the appellants that the present case may be remanded back to the District Magistrate for a determination after hearing the appellants also on the question whether the landlords in the present case are entitled to an exemption
We are unable to agree
We are of the opinion that this determination has to be arrived at by the District Magistrate after hearing the landlord and on the basis of such inspection or enquiries as he may consider necessary
We are clearly of the opinion that at this stage he should not permit the intervention of any other party
A contrary interpretation would make the provisions almost impossible of being worked
There may be several applicants for allotment some general and some with regard to the specific property
If they are considered as having a right to be heard on the availability of a property for allotment every one of them must be allowed to intervene
Different persons might come in at different stages and challenge the contention of the landlord that the building is not available for allotment
The landlord may have to face innumerable challenges by various applicants at different points of time and they might claim that they want to lead evidence and thus delay the proceedings
We do not think that all this is envisaged under the Act
It is for the District Magistrate to come to the conclusion whether a building is available for allotment or not and once he decides that it is not a building to which the Act applies that is an end of the matter
If he comes to a conclusion that the building falls within the provisions of the Act and the landlord is aggrieved the landlord s remedy has only to be by way of a writ petition where such conclusion is on its face erroneous or based on no material or perverse
In the present case the District Magistrate registered the vacancy on 6387 in other words he came to a conclusion mainly on the basis of the appellant s averments that the Act continues to be applicable to the premises
The landlords challenged this conclusion successfully in the writ petition
As pointed out by them subsequent to 6387 the District Magistrate himself had the property inspected and there is a report available on record
Apparently the District Magistrate has not applied his mind to the terms of the report
Perhaps in the normal course we would have sent the matter back to enable him to do this
However in the circumstances of the present case we think no useful purpose would be served by remitting the matter back to the District Magistrate for fresh consideration
As pointed out by the High Court the report of the Sub Divisional Magistrate the terms of the lease agreement and the registered lease deed as 696 well as the application for and the grant of a cinematographic licence in the name of the Mehrotras clearly show that the landlord intended to let out the property as a fully equipped cinema theatre and that they have done so
In the face of this evidence the District Magistrate had clearly no jurisdiction to proceed with the allotment of the premises in question
We would therefore uphold the findings of the High Court in this regard
In the result the appeals against the order dated 201187 are dismissed
In consequence of the view taken by us CA No l50287 has also to be dismissed
We direct accordingly
In the circumstances however we make no order as to costs
Appeal and petitions dismissed


Summary:
 The respondent an unregistered firm of coal merchants with its place of business in Bihar and an office in UP was assessed to sales tax by the first appellant in respect of the turnover of coal supplied by the respondent assessee for the assessment years 1967 68 and 1968 69
The assessee filed writ petitions alleging that the assessment orders were without jurisdiction on several grounds
The High Court allowed the writ petitions holding that section 9 of the as it stood at the relevant time cast a liability to tax only on a registered dealer  and not an unregistered dealer 
In the appeals it was contended on behalf of the Department that by virtue of section 9 of the Central Sales Tax Amendment Act 1976 cl
b of the proviso to section 91 of the was deemed to have been in force since 5157 and therefore the position was as if the Act had always imposed a liability to pay tax even on unregistered dealers just as it had originally done on registered dealers and that the amendment only affected the venue of taxation and being procedural in nature it was required to be construed retrospectively Dismissing the appeals  HELD 1
Clause b of section 91 of the is operative only from 7976
573 The instant case is therefore governed by the earlier provision and the respondent assessee being an unregistered dealer is not liable to pay tax
573D State vs Kasturi Lal Har Lal 1987 67 STC 154 SC relied on
563 21 Where the statute Central Sales Tax Amendment Act 1976 on its face clearly indicates retrospective effect where intended there can be no justification to read retrospectivity into the amendment made by cl
c of section 6 of the Amending Act which does not contain any words to that effect
571D 22 The language of the validation section clearly concerns only penalties which are dealt with under section 92
The amending Act refers to section 9 in general and not to section 92 only because section 91 also contains a reference to sub section 2
From this circumstance alone it cannot be inferred that retrospectivity to the amendment of section 91 also is intended
572C D 23 The employment of word also cannot be treated as an indication of intention by the Legislature that the amendment of section 91 by section 6 of the Amending Act was to be effective from 5157
If the Legislature had intended it the intention could and would have been expressed clearly in cl
a of section 6 itself as it had been in the other clauses and in the other sections
If section 91 of the Amendment Act had been inserted as cl
d in section 6 thereof it could not have changed the prospective effect of cl
The position is not different merely because this provision is contained in section 9 and not section 6 of the Amendment Act
Section 91 of the Amendment Act talks only of reading these extra words into section 91 of the Principal Act between 5157 and 7976
It does not contain any operative words that require section 91 of the Principal Act being read in the form in which it has been amended by section 6 during that earlier period
572E G All that the provision requires is that for the period 5157 to 7976 the section is to be read as if it also included the additional substantive provisions referred to therein
It was earlier not clear whether all these provisions could be read into the section before 7976 the date when the amendment Act came into force
So the validation section declares that the section should be read even earlier as if it comprehended also these substantive provisions
It is in this context that the word also is used
572D E 24 The question whether a charge to tax can be imposed in one State or another is not a mere question of venue
It may have an impact on the rate of tax in certain cases and it also regulates the rights inter se of States to levy taxes on such inter state sales
573B C The amendment changes the position that an unregistered dealer 564 is not taxable under the proviso and imposes a substantive liability on such a dealer
It is also one which confers jurisdiction on an officer in a particular State to levy a tax which he otherwise cannot
It is thus a substantive provision
573B The amendment cannot therefore be treated as purely procedural and hence necessarily retrospective
573C STO vs Coal  Coke Supplies Corporation JT 19871 4 SC 472 Khemka vs State  and Shiv Dutt Rai vs Union 119831 3 SCC 529 referred to