1 98 e 6 1 9019 of2005 1 11 THI3 HIGH COT OF PUNJAB AND HARYANA AT 1 Ce t CHANDIGARH 461 PL CWP No9019 of2005 Date ofdecision2012010 Mls lndian SucroseLtd Petitioner Versus StateofPunjaband others ee 1 CORAM HONBLE MR JUSTICE MM KUMAR r HONBLE MR JUSTICE JASWANT SINGH 0 Presentl MrAshok AggarwalSr Advocate with O Mr lvRharma Advocate for thepctitioner Mr KLGoyal Sr Advocate with tD Mr SandeepGoyal Advocate Mr Vivek Bhandari Mr GRSethi Advocate for the petitioner Mr Amol Rattan Singhand Mr PlCJain Addl AGs Punjab Z for therespondents To be referred to theReporter or not 2 Y 2Whether thejudgementshould be reportedin theDigest2744 Z M M KUMAR J c2S This is a bunch of 52 petitions filed under Article 226 of Z the Constitution raisinga comrnon question of law The prayer made in all tlw thepetitionsis for quashingthe notiftcation dated 2751988 imposinga tax 50P for 100 Kg on the purchaseof sugar cane by or 011 behalf of the cane mill like the petitionersThc petitionershave also prayedfor issuancc of declaration to the effect that no purchasctax on purchase of sugarcanecould be levied and collected from the petitionerunder the provisions of the PunjabGeneral Sales Tax Act l 948 6forbrevity the PGST Act1948 2 in the face of levy and collection of such like tax under Section 17 of the PunjabSugarcane of Purchase and Supply Act 1953 or brevitytle 1953 Act9 which is claimed to be a specialAct governingall aspects supplyand levy of purchasetax on the Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document l 99 1 1 1 5 CWP No 9019 of2005 2 sugarcaneIn that regardprimaryreliance of the petitionerhas been on the judgementof Honble the SupremeCourt in the case of Govind SugarMill V StateofBihar 199909SCC 76 Likewise on the same analogya prayer has also been made for declaringSection 9 Item 40f Schedule H of the Punjab Value Added Tax Act 2005 Cfor brevity the 2005 Actl as unconstitutional as the same would not be applicable111 respectof sugarcane and purchaselx thus not leviable under the said Act 0 The petitioners are engagedlll the manufacture of sugar U molasses press muds and bagasseeTheypurchasesugarcane which is the tD main raw material from the farmersto produce sugar or molasses Both the aforesaid productsare sold under the Govemment Control Orders The rate Z of raw material purchased i sugarcanebeingagricultural produceto be 2 r paid to farmers 6producingand selling sugarcane is also fixed by the Government of India from time to time It can also be modified and c8 increased by the State Goveent under the 1953 Act The purchase taX lS 1 collected by the State of Punjabunder the provisionsof PGST Act 1948 Z The claim ofthe petitionersis that in pursuance ofpowerunder Entry54 of tlw List II of 7 Schedule of the Constitution the State of Punjabhas also enacted a specialAct which is referred as 1953 Actt has been claimed that 1953 Act deals with all aspectsof purchasesupplyand levy of purchasetax on the sugar cane suppliedto sugar factoryby cane growers A specificreference has been made to Section 17 of the 1953 Actwhich impositibnof purchaseta The case of the petitionersis that PGST Act 1948 imoses tax on sale or purchase of all goodsincluding sugarcane generally that Act has also been enactedin pursuance of exercise of power under Entry 54 of List II of 7 Schedule of the Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document S r 400 1 r 4 1 l b CWP No9019 of2005 3 1 Constitution Accordingto the provisionsof the PGST Act 1948 a tax is imposedwith reference to taxable retum of registereddealer and it its own machineryfor taxation and collection oftax The case of the petitionersas projected111the petitionand duringthe course of arguments1S that while considering similar legislationwith pari matena provisionsgovemingthe sale and purchaseof sugar cane in the State of 1C4 Bihar Honble the Supreme Court has held that levyunder the specialAct 0 alone would survive and reliance has been placedon the judgement of 1 C Honble the Supreme Court in Govind SugarMillss case supra 0 According to the avennents made in the petitionthepetitioner er rnill has been treated as a reserved area under clause 60f the SugarCane Z Control Order 1966 which has been issued by the Central Government 2 CE e under the Essential Coodities Act 1955 6forbrevitythe 1955 Act9 As a of the notiflcation the sugar cane grower in a paniculararea c8 1 0 as a reserved area are directed to supply750Ioof the sugar cane produced 1Ct 1 by them to the petitionermill The petitionermill is also bound to take Z lm deliveryof the sameA prohibitionis engrafted on the sugar cane growers from exportingtheir produceoutside the reserved area and Iike wise the petitioner mill is also prohibited8om purchasing sugar cane outside the reserved area Any violation of the Control Order and the notiOcations issued thereunderwould attract criminal prosecutionunder Section 70f the Essential Commodities Act 1955 The case of the petitionersis that neither the fanners are allowed to sell their produceoutside the reserved area nor the mill is permittto purchasesugar cane from outside the reservedarea Thereforethe between the cane growers and the mill partakes the characterof aquisition of propertybecausethere is no elementof free Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 401 V 4 t 4 0rr CWP No 9019of2005 4 consent which is an essential ingredientof a valid agreement It is also 1 assertedthat there is no scope for principleof demand and supplyto operate and the sugar mills like the petitionerare bound to pay the statutory minimum priceto the cane growers as fixed bythe Central Govemment In the written statement filed by the respondents the broad facts have not been disputedIt has however been pointedout that the petitioner 1 rnills have been payingtax on purchase of sugarcaneunder the PGST Act 0 1948 C 10Io They are also liable to pay the tax in accordance with the t provisions of 2005 Act The respondente State has assertedthat 1953 Act tD was enforced in order to control the supplyof sugar cane and tax on the basis of the rate of the sugarcane was levied As per the notification dated Z 2751998 issued under Section 17619ofthe 1953 Act 50 paisafor 100 Kgs 2 C4 of sugarcane becomes payableon the acquisitionof sugarcane from the farmers It has been clarified that under the 1953 Act tax is payable on the c25 basisof weightwhen the sugarcane is purchased from the farmerswhereas 1 under the 2005 Act the tax is payable on theebasisof rate The argument Z thatthere is no connection betweenthe tax paidunder the 1953 am Act or under the 2005 Act as the incidence of tax in both the cases 1S different It has thus been assert6d that two taxes under two different enactmentsdo not tantamount to double taxation It is also claimed that in anycase there is no bar under the Constitution to imposetwo taxes under two different enactments on the same goodswhich mightbe based on the same Entrylike Entry54 of List II of 7 Schedule Therefore the petitioner is under a legalobligkltion to pay purchase Tax under section 19 of the 2005 Act or under PGST 4ct 1948even if a nominal tax is claimed under the 1953 Act The primaryreliance by the State of Punjabin their replyhas Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 1 402 1 i 1 4 1 CWP No9019 of2005 5 1 been on thejudgementof Honble the SupremeCourt in the case of Jagatiit Sur Mills v State of Puniab and another 1995019 SCC 67 where the levy of tax underthe PGST Act 1948 has been upheldIt is claimed that the atloresaidjudgementhas not been consideted in the later judgement in the case of Govind SugarMills pra In JagatiitSugarMillss case lpra9it has been he1d that tax is payableto the State Goveent if not under m C4 Section4 B then under Section 4019ofthe PGST Act1948 The sugar mills 0 111 theStateofPunjabhave been assessedto tax after the decision ofthe Full U I Bench in the case of Morinda CooperativeSugar Mills Ltd v Assessing ta9 Authoritv and others 19956999STC 468 I 4 When the matter came up for consideration before this Coun Z for rnotion hearingan interlm order was passedrestrainingthe C4 t from resortingto coercive stepsfor recovery ofthe t3x demanded Mr Ashok AggarwalMr ICLGoyal Mr GRSethi and Mr c8 Vivek Bhandari leamed counsel have addressedargumentson behalfofthe 1 sm Their submission is inspiredby the judgmentof Honble the Z Govind SugarMillss case 6supra9Theyhave arguedthat 1953 Act beinga specialenactment for levyof purchase tax exclusively on sugar cane also deals with regulationofproductionsupplyand distribution of sugar cane Accordingto the learned counsel it would overide the of PGST Act 1948 or even the 2005 Act It has been submiued thatboth the PGST Act 1948 and 2005 Act are general Acts which provides for collection of commercial taxes on sale and purchaseof all goods whereas 1953 Act d6alsonlywith the purchase of sugar cane Placing relianceon various pras of thejudgementrendered in the case of Govind SugarMillss case suprait has been submitted that both the Acts have Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 403 1i 0 e 4 L 1 CWP No9019 of2005 6 1 been ed in exercise of legislativepowers derived from Entry54 of List 1 II of 7 Schedule and therefore the 1953 Act would govem the levy of 1 purchasetax as itis a specialAct Theyhave also referred to the statement of objectsand reasons which deals specifally with the purchaseof sugar cane to protectthe interest of the cane growers Refeningto the reasoning adoptedby a Division Bench of the Patna High Coun in New India Sugar 1r Mills Ltd and another v State of Bihar and others 1998 61091STC 394 0 which has been reversed in Govind Sugar Millss case 0supra9leamed 1 I Counsel have pointedout that no double taxation could be justifiedon the 0 same cornmodity or person by levyingthe same under different enactments without repealingthe other The Division Bench of the Patna HighCourt in Z New India SugarMillss case supralhas takenthe view that two taxation on the same commodityor person could be imposedby different enactments which has been reversed Accordingto the leamed counsel it cannot be c8 justifiedbykeepingin view the different objectsofboth the statutes 1a7 It has been Slrther submitted that judgement of Honble the Z Court in Jagatiit Sugar Mills case 6supra9althoughhas been renderedby a 3ludge Bench and thejudgementin Govind SugarMillscase 6supralhas been rendered by a 2JudgeBench yet the judgement which to laydown the law more elaborately and accuratelyand therefore it has to be followed Convassing for the view taken by the Honble Supreme Court in Govind Sugar Mills case Mr Sethi has submitted that earlierjudgement rendered in JagatiitSugarMillscase 6supralhas failed to take into account th4provisionsof the specialenactment as 1953 Act In support bfhis submission learned counsel has placedreliance on two Full Bench of this Court rendered in the cases of Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 404 1 n 1 e3 CWP No 9019 of2005 7 r Indo Swiss Time Ltd v Umrao and others 1981 PLR 335 and Mls Kulbhushan Kumar and Co v State ofPuniab and another 1983PLR 768 Per contra Mr PlCJain and Mr Amol Rattan leamed Additional Advocate Generals Punjabhave arguedthat the matter ls no longeresntegra as the questionhad fallen for consideration of Honble the SupremeCourt in the case ofJagatiit SugarMills pral Accordingto m C the Ieamed counsel the sugarcane sold by the cane growers themselvesto 0 1 the petitionermill or the sugar manufacturesmay not be excigableto 4 Z purchasetax under Section 4 B but would be so excigable under Section 4 0 11 read with Section 6 The aforesaid Vlew has been considered by a 5e Z 4r JudgeBench ofthis Court in the case of MoIinda CooperativeSugarMills Zt Udv AssessingAuthoritv and others 1995999STC 468 Followingthe Vlew taken by the Honble SupremeCourt in Jagatiit Slr Mills case the Full Bench held that the purchaserofsugarcane is liable to pay 6 purchaseta The leamed StateCounsel have also arguedthat even at the 1 mm time when the judgement 111 Jagatiit Sugar Mills case and Morinda Z 4lm CooperativeSugar Millscase 0supra9 was delivered the sugar mills have been payingpurchasetax on the purchaseof sugar cane frorn the cane growers under the 1953 Act Thus the argumentis that merelybecauseafter considering the Bihar Finance Act Bihar SugarCane Regulation of Supply and Purchase9Act 1981 has come would not necessarily Iead to reoening the questionwhich has alreadybeen settled Another submission made by the learned State Counsel is that there is nothingin Article 265 of the Constitutionwhich maylindicate that therecould be no double taxation In that regardreliance ha8been placedon the judgementof Honble the Court in the case of Arvinder Singh v State of PunjabAIR 1979 Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 405 d IO CWP No019 of2005 8 SC 321 It has been arguedthat even if on the same subjectmatter the legislaturechooses to levy tax twice there is no inherentinvalidityin the 6scal adventuresave where other prohibitions exist The aforesaid view has also been followed by Honble the Supreme Court in the case ofRadhakisan Rathi v Addl Collector Drug and others AIR 1995 SC 1540 Replyingto the other argumentslearned Statecounsel have 1C4 pointedout in JagatiitSugar Mills case was renderedbya 3 0 JudgeBench whereas judgementin Govind SugarMills case 6supra9 has U 1 i r been rendered by a 2TudgeBench It has been submittedthat Full Bench 1 0 judgements ofthis Court in the cases ofKulbhushan Kumar and Indo Swiss Ltd upraldo not advance the case of the petitionerin as much as both Z the Full Benches specificallyrefer to conflict of coeequalBenches of 1 superiorCourt Accordingto the leamed cel the of the Full t 1 Bench would applyif the coequal Benches of the superiorCourt have r2S delivered the contlictingjudgementswhereas in the present case the judgementcoveringthe issue has been delivered by a 3udge Bench and Z m therefore it is not open to this Court to conclude that purchasetax under Section 4ll ofthe PGST Act 1948 or 2005 Act are not payable The first questionwhich would arise for detennination is whether 3JudgeBench judgementof the Honble SupremeCoun rendered in the case of JagatiitSugar Mills lpraois bindingon the partiesIn the aforesaid case thequestionoflaw was posedin para 40fthejudgementand in namelywhether the sugar miII was liable to pay purchasetax on the sugarcane iby it from the growers of the sugarcane In a categorical answer to Iheaforesaid questionit has been held that Section 4 61 of the PGST Act 11948 contemplates levy of purchasetax on a11sales Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 4r1 0 406 4 CWP NoOl9of2005 9 and Once the aforesaidjudgementin the categoricalterms lays down that purchasetax 1S leviable under Section 4619then it is well nigh impossiblefor us to say that such a tax cannot be levied on the groundthat PGST Act 1948 is a statute of generalcharacter which deals with sale or purchaset in respectof all goodswhereas the 1953 Act is a specialAct which deals with all aspectsincludinglevy of purchase tax on sugar cane 1 C The petitionerhas convassed for the contraryview on the basis of the 0 rendered by2 JudgeBench of the Honble SupremeCourt in the U I case of Govind Su Mills supra9The aforesaid judgementhas been tD rendered by interpretingBihar Finance Act 1981 and Bihar Sugarcane I of Supplyand Purchase OAct 1981 by holdingthat both the Z Acts would operatein the same field The underlyingprinciplefollowed by C4 the Honble Supreme Court is that the SugarcaneAct beinga specialAct pertaining to 311aspeelsof coMtrol 6f the sugarcane 1115well as levy of C purchasetax has to be preferred over the Finance Act which empower the State to levy all coercial taxes generallywhereas the sugarcane Act Z the levy of purchasetax only on sugarcane Such a course Ll wouldnot be available to us as the specificAct which is applicable to the namelyPGST Act 1948 has been interpretedby a 3 JudgeBench in the case of Jagatiit Sugar Mills case 6supra9Furthennore we would preferthe interpretationadoptedby the Honble SupremeCourt for PGST Act1948 which is in questionbefore us The judgementof Govind Sugar Mills case 6supralhas emergedout of different statute It is needless to that the judgementby the Honble SupremeCoun is a law declaredin respectof the fleld occupiedby it which is bindingon all Courts within theterritoryof India includingthe HighCourts In that regard Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 407 4 CWP No019 of2005 10 Il reliancemay be placedon the observationsmade by a Constitution Bench of the HonbIe SupremeCourt in the case of Behram Khurshid Pesikack v StateofBombayAIR 1955 SC 123 Even otherwisethe decision of3 Judge Bench in Jagatiit StLearMills case supra9has to be followed becausethat decision is by a largerBench than the one decidingthe Govind Sugar Millss case supra9The 3 JudgeBench judgement decision is also under m 02 the PGST Act 1948 which is applicable to the petitionerTherefore in our 0 View there is no possibilitywhatsoever to reopen the questionby opining 0 that the provisionsof Section 4 of the PGST Act1948 would not apply 1 0 and those of 1953 Act alone would apply On the basis of the aforesaid C 1 1 premisethe writ petitionsare liable to be dismissed Z On account of the bindingprecedentavailable in the form of 2 CAf judgementof JagatiitSugarMills case lpra9we are not dealingwith any ofthe contentions raised by thepetitionerswhich could have been otherwise c8 examined in the light ofthe observationsmade in Govind SugarMills case supra Z U As a sequelto the above discussion all the wnt petitionsfail and the same are dismissed A copy ofthis order be Placedon the 81eofconnected cases 1 e 6MMKumar9 Judge 10 2010 Judge okg CWP Nol0300 of2005 Mls The Batala Coop SugarMiUs Ltd v State ofPunjaband others CWP No9998of2d06PicadilySugarand Allied Industries Ve Stateof Punjaband others Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 408 r 1 C7WPNo9019 of2005 11 CWP Nol641 of2006 Mis Wahid Sandhar SugarsLtd v State of Punjaband others CWP No20303 of2005 MlsThe Nakodar Coop SugarMillsLtd V StateofPunjaband others CWP No20312 of2005 Mls The Budhewal CoopSugarMills Ltd V StateofPunjaband others CWP No0332 of2005 Mls The Ajnalacoop SugarMills Ltd v State ofPunjaband others CWP No20335 of2005 Mls The NawanaCoopSugarMills Ltd V StateofPunjaband others CWP No20338 of2005 Mls The Faridkot coop SugarMills Ltd V m StateofPunjaband others tX CWP No20339 of2005 Mls The Gurdaspur SugarMills 0 Ltd v StateofPunjaband others CWP No 20345 of2005 Mls The Faziilka CooperativeSugarMills Ltd 8 1 V StateofPunjaband others CWP No20355 of 2005 Mls The Morinda SugarMills Ltc 0 V StateofPunjaband others CWP No989 of2006 Mls Rana SugarsLtd v StateofPunjaband I others CWP No 1613of2007 ABugars Ltd V others Z CWP N02O151Iof2005 Mls ru T1 6 n r4 r2 5 8 C4 1v 5 others 2 CWP No9024 of2005 Mls Indian SurcroseLtd V0 StateofPunjaband others CWP No11100 of2005 Bhagwanpura SugarMills V StateofPunjab and others r25 CWP NoS526 of2005 AB SugarsLtd v StateofPunjaband others C CWP No11107 of2005 Bhagwanpura SugarMills V StateofPunjab and others CWP No11134 of 2005 Bhagwanpura SugarMills Ve StateofPunjab Z and others CWP No20341 of2005 Mls The BhogpurCooperativeSugarMills Ltd C V StateofPunjaband others CWP No11442 of2007 Cosmos Inds Ltd V StateofPunjaband others CWP No11463 of2007 Coslnos Inds Ltd v StateofPunjaband others CWP No 41900f2003 Bhagwanpura SugarMills v StateofPunjab and others CWP No 4191 of2003 Bhagwanpura SugarMills V StateofPunjab and others CWP NoA192 of2003 Bhagwanpura SugarMills V StateofPunjab and others CWP Nc4l 93 Of2003 Bhagwanpura SugarMills V Stateof Punjab and others CWP No 4194 of2003 BhagwanpuraSugarMilIs Ve StateofPunjab and others No195 of2003 Bhagwanpura SugarMills v StateofPuniab others CWP No4196 of2003 Bhagwanpura SugarMills V Stateof Puniab and others CWP No197 of2003 Bhagwanpura SugarMills V StateofPunjab Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document 409 1 t59 14 CWP No 9019 of2005 12 and others CWP NoA198 of2003 Bhagwanpura SugarMills Ve StateofPunjab and others CWP No16892 of2001 Bhagwanpura SugarMills V StateofPunjab and others CWP No 16893 of2001 Bhagwanpura SugarMills V StateofPunjab and others CWP No 16894 of2001 Bhagwanpura SugarMills V StateofPunjab and others CWP No6895of2001 BhagwanpuraSugarMillsV StateofPunjab and others a CWP No 16896 of2001 Bhagwanpura SugarMills Va StateofPunjab r and others 0 CWP N016897 of200 I Bhagwanpura SugarMiIIs V StateofPunjab and others t CWP No 16898 of 2001 Bhagwanpura SugarMills V StateofPunjab I and others 9 CWP No 16899 of2001 Bhagwanpura SugarMills V StateofPunjab and others r CWP No16900 of2001 Bhagwanpura SugarMills V StateofPunjab and others Z CWPN012917 of2001 Bhagwanpura SugarMills Vp StateofPunjab r and others CWP No 12918 of2001 SugarMills V StateofPunjab and others C CWP No12919 of2001 Bhagwanpura SugarMills V StateofPunjab and others c8 CWP No 11683 of 2004 Bhagwanpura SugarMills V StateofPunjab C and others CWP No 9612 of2008 Mls ABugars Ltd V StateofPunjaband others Z CWP No641 of2008 Mls Indian SurcroseLtd Ve StateofPunjaband others tln CWP N08684 of2008 Mls Indian SucroseLtd Ve StateofPunjaband others CWP No17878 of2008 Mls A3Sugars Ltd v StateofPunjaband others CWP No7945 of2008 MJs Indian SucroseLtd v StateofPunjaband others CWP No 1578of2003 Mls Nakodar cooperativeSugarMills Ltd Ve StateofPunjaband others CWP No15324 of2003 Mls Wahid SandharSugarMills Ve Stateof Punjaband others eP P 9S Anita 2014.01.15 14: 27 True Scanned Copy Of The Original PHHC,Chandigarh JOYTI RANI 2016.03.28 10:57 I attest to the accuracy and integrity of this document