Judgment Case ID: 573

Judgment:
220	 222	 240 and 380 to 395 of 1955. Petitions under Article 32 of the Constitution of India for the enforcement of Fundamental Rights. Dec. 10	 11	 12	 13	 17	 18	 19. Jan. 7	 8	 9. D. Narsa Raju	 Advocate General for the State of Andhra Pradesh and T. M. Sen	 for the respondent. The petitions are premature and incompetent as the facts of each transaction of sale are yet to be investigated and it is not possible to know the character of each sale	 nor can it be determined which sales can be and which cannot be taxed by Andhra Pradesh. [CHIEF JUSTICE. You should be reasonably satisfied that the sales are of such a nature that you can levy tax on them before you issue a notice. BOSE J. You must state the facts on which you think you can tax the sales.] section K. DAS J. Your stand is that all transactions could be taxed by the delivery State.] D. Narsa Raju. My State is taxing under the decision of this Court in the United Motors case ( [1953]S. C. R. 1069). [ Upon the counsel for the petitioners stating that he would confine his arguments to the imposition of tax on Explanation sales only	 which some of the transactions indisputably were	 the Court indicated that it would hear the petitions. ] K. section Krishnaswami Iyengar	 N. Srinivasan and R. Ganapathy Iyer	 for the petitioners. The Andhra (Madras) Act does not seek to tax Explanation sales 1427 at all. It talks of " property passing " only and as such Andhra can tax only such sales where property passes in Andhra. See Poppatlal Shah vs State of ' Madras	 ( [1953] section C. R. 677). Section 22 does not enlarge the definition of sales; it only restricts the power of the State to tax. The explanation to section 22	 like the explanation to article 236(1)	 is merely for the purpose of defining what is an outside sale and not for determining what is an inside sale. See Bengal Immunity Company case ( at 640). The power of the President under article 372(2) being merely to bring the State laws into conformity with article 286	 section 22	 which was introduced by the Presidential Adap tation Order under article 372(2)	 cannot be construed as permitting the imposition of tax on Explanation sales which was prohibited by article 286. If section 22 was construed to permit such imposition it was unconstitutional	 illegal and void and must be deemed to be non est. See Bengal Immunity Company case ( at 667). What did not exist could not be validated. The Sales Tax Laws (Validation) Act	 1956	 was not valid legislation under article 286(2). Article 286(2) only empowers Parliament to lift the ban on the imposition of tax on inter State ales and after it has lifted the ban the State legislature may impose the tax. Parliament is not competent to impose sales tax; such power is vested only in the State legislatures. Article 286(2) does not give Parliament power to validate or ratify laws of the State legislatures. The power under article 286(2) can be exercised only once and finally and fully	 not partially. Parliament can only lift the ban as from the day the power is exercised and riot retrospectively. Punjab Province vs Daulat Singh	 (73 I. A. 59); Behram Khurshed Pesikaka vs The State of Bombay ( [ 1955 ] I section C. R. 613	 654 and 655). The case of Dialdas vs Talwalkar (A. 1. R. has been wrongly decided. But even this decision helps the petitioners in so far as it lays down that where tax had neither been collected nor levied the Validation Act did not confer power to assess or levy. The whole 181 1428 policy of the Validation Act was to save the State from disgorging the	 tax illegally collected. Both levy and collection must be within the period specified in section 2 of the	 Act. Mettur Industries Ltd. vs The State of Madras (A. 1. R. and Mysore Spinning and Manufacturing Co. Ltd. vs Deputy Commercial Tax Officer (A. 1. R. are against the petitioners. R. Ganapathy Iyer followed. Section 22 of the Andhra (Madras) Act did riot enlarge the powers of taxation. Mathew vs Travancore Cochin Board of Reventue (A. 1. R. 1957 T. C. 300). The validation being for a temporary period which expired on September 6	 1.955	 no action can be taken after that date under the validated laws. Kesavan Madhava Menon vs The State of Bombay	 ( ; 	 234	 235)	 section Krishnan vs The State of Madras	 ( [1951]S. C. R. 62 1	 and State of Punjab vs Mohar Singh	[1955 ] I section C. R. 893). The tax being a sinole pointtax under the Act	 and the petitioners having already paid the tax at the time of the purchase of the yarn from the Mills	 no second tax was payable. The Andhra (Madras) Act being a new Act the tax on yarn is hit by the Essential Commodities Act (52 of 1952) read with article 286(3) of the Constitution. Petitioners are not dealers in Andhra Pradesh and cannot be assessed. There are no sales in Andhra; all sales being in Madras. V.L. Narasimhamoorthy	 J. B. Dadachanji and Rameshtvar Nath	 for the Mysore Spinning & Mfg. Co.	 Ltd.	 and Minerva Mills Ltd.	 (Interveners)	 supported the petitioners. Section 22 does not authorise the imposition of tax on Explanation sales. It could not have been the intention of the President to allow the State to add a new category of sales the Explanation Sales to be taxed. The language of article 286(2) indicates that the lifting of the ban is a condition precedent to legislation by the States imposing tax on inter State sales. Alternatively	 the power to tax inter State sales is with Parliament under Entry 97 of List I of Schedule VII of the Constitution. Section 22 was wiped out and obliterated by the judgment in the 1429 Bengal Immunity Company case. See Behram Khurshed Pesikaka vs The State of Bombay	 ([1955] 1 section C. R. 613); Newberry vs United States; 	 The same interpretation must be given to the explanation to section 22 as has been given to the explanation to article 286(1)(a). The non obstante clause in section 22 has only the effectof subtracting something from the power to tax andriot of adding to it. Ram Narain Sons Ltd. vs Asst. Commissioner of Sales Tax ([1955] 2 S.C. R. 483); Aswini Kumar Ghosh vs Arbinda Bose ([1953] S.C.R. 1	 22	 24); A. V. Fernandez vs The State of Kerala	 ([1957] section C. R. 837). N. A. Palkhiwala	 J. B. Dadachanji and Rameshwar Nath	 for Tata Iron & Steel Co.	 Ltd.	 (Intervener). There must be a factual levy before Parliament can validate it. Section 22(ii) removes inter State sales from the purview of the Act. Fernandez 's case supports this contention. On a proper construction of article 286(2)	 according to the decision in the Bengal Immunity Company case	 there was no levy on interState sales and there was nothing for Parliament to lift the ban for. ( [ 1955 ] 2 section C. R. 603	 621	 662	 667). There is a vital difference between retrospective and retroactive operation. There is no power in Parliament to validate ex post facto a violation of article 286(2). Parliament must first lift the ban and then the State legislation may come imposing tax on inter State sales. Parliament is competent to prevent what otherwise would have been a violation of the Constitution	 but it is not competent to condone an accomplished violation. Section 2 of the Validating Act will operate only where taxes have already been collected or have been finally assessed. P. N. Bhagwati and .1. N. Shroff	 for Pashebbhai Patel & Co.	 Ltd.	 (Intervener) supported the petitioners. D. Narsa Raju	 Advocate General of Andhra Pradesh and T. M. Sen	 for the respondents. Article 372(2) must take regard of the provision of the Constitution to bring the State laws into conformity with which the power of adaptation is to be exercised. That provision 1430 is article 286. Implicit in article 286(1) is the recognition that the delivery State alone may tax. The President would be acting within his power to enable the delivery State to tax Such power is in accordance with the provisions of the Constitution. The power of the legislature to bring the laws in accordance with the Constitution is conferred upon the President. Consequently	 the explanation to section 22 can be read along with the definition of sale and it does add to that definition by bringing Explanation sales within it. K. V. Subramania Iyer	 D. N. Mukherjee and B. N. Ghosh	 for Madura Mills Co.	 Ltd.	 (Intervener). The Adaptation Order made by tile President is not 'law of a State ' within the meaning of the Validating Act. 'Law of a State ' in the Validating Act must mean the same thing as in article 286(2). The President exercising power under article 372(2) is not controlled by article 286; he exercises a power which belongs to the President and not a power on behalf of the State. Section 22 of the Andhra (Madras) Act is not law made by the State Legislature and is not validated by the Validating Act. The power of imposition of sales tax on inter State sales was taken away from the States. The bail under article 286(2) is only in respect of existing laws; there is no power in the States to enact laws imposing tax on interstate sales. The power to impose tax on inter State sales is within the exclusive domain of Parliament under Entry 42 of List I of the Seventh Schedule of the Constitution and Entry 54 of List 11 must be construed as not including such power. A reference to article 301 reinforces this interpretation. The freedom under article 301 includes freedom from sales tax. See The Commonwealth vs The State of South Australia	 (38 C. L. R. 408). The Validation Act is not legislation within Entry 42. See Bank of N. section W. vs The Commonwealth	 (76 C. L. R. 1	 381); Robbins vs Taxing District of Shelby County ((1877) ; ; McLeod vs Dilworth Co. ((1944) 88 L. Ed. 1304). C. K. Daphtary	 Solicitor General of India	 G. N. 1431 Joshi and T. M. Sen	 for the Union of India (Intervener). The Sales Tax Laws Validation Act	 1956	 is valid legislation tinder article 286(2). In effect and in substance the Validation Act is a law which removes the ban imposed by article 286(2)	 and is not really a Validating Act. Article 286(2)	 in respect of existing laws	 merely said that they should not be effective or operative. It did not take away the competency of the legislatures to make laws providing for taxes oil inter State sales. Such a law may be against the provision of the Constitution	 but that does not repeal or obliterate it. It is only in abeyance. See Bhikaji Narain Dhakra	s and others vs The State Of Madhya Pradesh and another	 ([ ; 	 600). Legislative power generally includes the power to legislate retrospectively. There is no limitation in article 286(2) as respects retrospective legislation. Parliament could	 therefore	 lift the ban retrospectively. Section 22 is a piece of conditional legislation. As soon as the ban under article 286(2) was lifted by Parliament it came into operation. The Validation Act is not a temporary statute. A temporary statute is one which says that it is to be effective for a particular period. The Validating Act operates even now and is effective	 though it is in respect of sales of a particular period. It is open to the States to initiate proceedings now for taxing the Explanation sales made during the period mentioned in section 2 even though no such proceedings had been taken during that period. Entry 42 of List I which reads: " Inter State trade and commerce " does not confer any power of taxation on Parliament. In the scheme of our Constitution a general Entry does not include the power of taxation. Taxes	 duties	 etc.	 are enumerated in a separate group in Entries 82 92 in List I. V. K. T. Chari	 Advocate General for the State of Madras	 B. R. Gopalakrishnan and T. M. Sen for the State of Madras (Intervener). In construing section 22 of the Andhra (Madras) Act regard must be had to the law as it stood till September 6	 1955	 when judgment was delivered in the Bengal Immunity Company case. In view of the decision in the United Motors 1432 case ([1953] section C. R. 1069	 1085	 1086	 1093	 1094)	 Explanation sales were regarded as 'inside sales ' in the delivery State	 and the delivery State was entitled to tax sales. The law of a State which imposed tax on Explanation sales would remain on the statute book	 in spite of the decision in The Bengal Immunity Company case	 but could not be enforced. See Bhikaji Narain Dhakras and others vs The State of Madhya Pradesh and another ([1955] 2 S.C.R. 589); Ulster Transport Authority vs James Brown & Sons Ltd. ((1953) Northern Ireland Reports 79). Section 2 of the Validating Act refers to such a law. Mahabir Prasad	 Advocate General for the State of Bihar	 Rajeshwar Prasad and section P. Varma	 for the State of Bihar (Intervener); G. C. Mathur and C. P. Lal	 for the State of Uttar Pradesh (Intervener) supported the respondents and the Union of India. R. Ganapathy Iyer	 for the petitioners	 replied. K. V. Subramania Iyer	 for Madura Mills Co.	 Ltd.	 (Intervener)	 also replied with the permission of the Court. March II. The judgment of Das C. J.	 Venkatarama Aiyar	 section K. Das and Vivian Bose	 JJ. was delivered by Venkatarama Aiyar J. Sarkar J. delivered a separate judgment. VENKATARAMA AIYAR J. The petitioners are dealers carrying on business in the City of Madras in the sale and purchase of yarn	 and they have filed the present applications under article 32 of the Constitution for the issue of a writ of prohibition or other appropriate writ restraining the State of Andhra from taking proceedings for imposing tax on certain sales effected by them in favour of merchants who are residing or carrying on business in what is now the State of Andhra Pradesh	 on the ground	 inter alia	 that the said sales were made in the course of inter State trade	 and that no tax could be levied on them by reason of the prohibition contained in article 286(2) of the Constitution. The course of dealings between the parties resulting 1433 in the above sales has been set out in para. 5 in Petition No. 220 of 1955. It is therein stated that the dealers in Andhra would place orders for the purchase of yarn with the petitioners in Madras	 that the contracts would be concluded at Madras	 that the goods would be delivered ex godown at Madras and would thereafter be despatched to the purchasers either by lorries or by rail as might be directed by them	 that when the goods were sent by rail	 the railway receipts would be taken either in the name of the consignees	 and sent to them by post or in the name of the consignor and endorsed to the purchasers and delivered to them in Madras or sent to them by post endorsed in favour of a bank and the purchasers would take delivery of those receipts after payment to the bank. It is said that in all cases price of the goods was paid in Madras. On the above allegations	 it is manifest that the sales mentioned therein are not all of the same kind	 and in point of law	 the incidents attaching to them might be different. A consideration of the validity of the imposition with reference to the several classes of sales mentioned above would he wholly airy and pointless without a determination of the facts relating to them	 which	 however	 have not been investigated. Counsel for the petitioners	 however	 concedes that the	 dispute in these proceedings is confined to the proposed imposition of tax	 in so far as it relates to sales of the character mentioned in the Explanation to article 286(1)(a)	 that is to say	 sales in which the property in the goods sold passed outside the State of Andhra but the goods themselves were actually delivered as a result of the sale for consumption within that State. These sales have been referred to in the arguments before us as "Explanation sales "	 and it will be convenient to adopt that expression in referring to them in this judgment. It will be seen that the above sales would all of them have been intrastate	 so long as the Andhra State formed part of the composite State of Madras	 and questions of the character now agitated before us could not then have arisen. On September 14	 1953	 1434 Parliament enacted the Andhra State Act (30 of 1953)	 whereby a separate State called the State of Andhra was constituted incorporating therein territories which had previously thereto formed part of the State of Madras	 and this Act came into force on October 1	 1953. Under section 53 of the Andhra State Act	 the laws in force in the territories in the Andhra State prior to its constitution are to continue to be in force even thereafter	 and one of those laws is the Madras General Sales Tax Act (Madras 9 of 1939)	 hereinafter referred to as the Madras Act. Section 54 of the Andhra State Act conferred on the Government a power to adapt laws for the purpose of facilitating the application of any law previously made	 and in exercise of the power conferred by this section	 an Adaptation Order was passed on November 12	 1953	 whereby the word " Andhra " was substituted for the word "Madras" in the Madras Act. We shall hereafter refer to the Madras Act as continued and applied in the State of Andhra as the Andhra (Madras) Act. It will be convenient at this stage to refer to the relevant provisions of this Act. The preamble to the Act states that " it is expedient to provide for the levy of a general tax on the sale of goods in the State of Madras". "Sale" is defined in section 2(h)	 omitting what is not material	 as meaning " every transfer of the property in goods by one person to another in the course of trade or business for cash or for deferred payment or other valuable consideration. " Section 2(i) defines " turnover " as " the aggregate amount for which goods are either bought by or sold by a dealer	 whether for cash or for deferred payment or other valuable consideration ". Section 3 is the charging section and provides that every dealer shall pay for each year tax on his total turnover for such year. By the Madras General Sales Tax (Amendment) Act No. 25 of 1947	 a new Explanation was added to the definition of " sale "	 and it is as follows: Explanation 2: " Notwithstanding anything to the contrary in the Indian Sale of (Goods Act	 1930	 the sale or purchase of any goods shall be deemed	 for 1435 the purposes of this Act	 to have taken place in this Province	 wherever the contract of sale or purchase might have been made (a) if the goods were actually in this Province at the time when the contract of sale or purchase in respect thereof was made	 or (b) in case the contract was for the sale or purchase of future goods by description	 then	 if the goods are actually produced in this Province at any time after the contract of sale or purchase in respect thereof was made. " This amendment came into force on January 1	 1948. In Poppatlal Shah vs The State of Madras (1)	 this Court had to consider the scope of the definition of " sale " in section 2(h) and of Explanation 2	 and it was therein held that though the power to tax a sale was really a power to tax a transaction of sale and a law imposing such tax would be competent if any of the ingredients of sale had taken place within the State	 the Madras Act had	 by its definition of " sale " in section 2(h) prior to the enactment of Explanation 2	 imposed a tax only when the property in the goods passed within the State	 and that in respect of sales which had taken place prior to the amendment	 the tax would be unauthorised if the property in the goods passed outside the State of Madras. It was also observed that after the amendment came into force	 a tax on a sale which came within Explanation 2 would be valid. That was the position in law under the Madras Act prior to the enactment of the Constitution. It is now necessary to refer to the changes effected in the law by the Constitution. Article 286	 which is relevant for the present purpose	 is as follows: 286(1). " No law of a State shall impose	 or authorise the imposition of	 a tax on the sale or purchase of goods where such sale or purchase takes place (a) outside the State; or (b) in the course of the import	 of the goods into	 or export of the goods out of	 the territory of India. (1) ; 182 1436 Explanation. For the purposes of Sub clause (a)	 a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State	 notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State. (2) Except in so far as Parliament may by law otherwise provide	 no law of a State shall impose	 or authorise the imposition of	 a tax on the sale or purchase of any goods where such sale or purchase take		; place in the course of interstate trade or commerce: Provided that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State immediately before the commencement of this Constitution shall	 notwithstanding that the imposition of sucli tax is contrary to the provisions of this clause	 continue to be levied until the	 thirty first day of March	 1951. (3) No law made by the Legislature of a State imposing	 or authorising the imposition of	 a tax on the sale or purchase of any such goods as have been declared by Parliament by law to be essential for the life of the community shall have effect unless it has been reserved for the consideration of the President and has received his assent. " Article 372(2) enacts that	 " For the purpose of bringing the provisions of any law in force in the territory of India into accord with the provisions of this Constitution	 the President may by order make such adaptations and modifications of such law	 whether by way of repeal or amendment	 as may be necessary or expedient	 and provide that the law shall	 as from such date as may be specified in the order	 have effect subject to the adaptations and modifications so made	 and any such adaptation or modification shall not be questioned in any court of law. " In exercise of the power conferred by this provision	 1437 the President made Adaptation Orders with reference to the Sales Tax Laws of all the States	 and as regards the Madras Act	 he issued on July 2	 1952	 the Fourth	 Amendment inserting a new section	 section 22 in that Act. It runs as follows: " Nothing contained in this Act shall be deemed to impose or authorise the imposition of a tax on the sale or purchase of any goods where such sale or purchase takes place (a) (i) outside the State of Madras	 or (ii)in the course of import of the goods into the territory of India or of the export of the goods out of such territory	 or (b) except in so far as Parliament may by law otherwise provide	 after the 31st March	 1951	 in the course of inter State trade or commerce	 and the provisions of this Act shall be read and construed accordingly. Explanation: For the purposes of cl. (a) (i) a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State	 notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State. " It will be noticed that the Explanation to article 286 (1) (a) is reproduced verbatim in section 22 of the Madras Act. The true meaning and scope of this Explanation came up for consideration before this Court in The State of Bombay and another vs The United Motors India Ltd.	 and others (1). Therein	 it was held by a majority that though the sales falling within the Explanation would	 in fact	 be in the course of interState trade	 they became	 by reason of the fiction introduced therein	 invested with the character of intra State sales	 and would be liable to be taxed by the State within which the goods were delivered for consumption. Acting on this judgment	 the Board of Revenue (Commercial Taxes) Andhra State	 issued a (1) ; 1438 notification on July 13	 1954	 calling upon dealers to submit returns of their turnover of sales in which goods were delivered in the Andhra State for consumption	 and a copy thereof was sent to the Madras Yarn Merchants ' Association	 of which the petitioners are members. The Association disputed the liability of the Madras dealers to pay any tax in respect of the sales to the Andhra dealers	 and after some correspondence	 the Andhra State finally issued on June 30	 1955	 notices to the petitioners to send their returns of turnover by July 15	 1955	 failing which it was stated that assessments would be made on the best judgment basis	 and that	 further	 the dealers would be liable to the penalties prescribed by the law (Vide Annexure H to the petition). Thereupon	 the petitionera have filed the present petitions challenging the validity of the demand made by the Andhra State on the ground	 inter alia	 that the sales proposed to be taxed were inter State sales	 and that they were immune from taxation under article 286(2). These petitions were filed on various dates in July and August	 1955. While they were pending	 the question of the true scope of the Explanation to article 286 (1) (a) came up again for consideration before this Court in The Bengal Immunity Company Limited vs The State of Bihar and others (1). By its judgment dated September 6	 1955	 this Court held	 again by a majority	 that the sales falling within the Explanation being inter State in character	 could not be taxed by reason of article 286(2)	 unless Parliament lifted the ban	 that the Explanation to article 286 (1) (a) controlled only that clause and did not limit the operation of article 286 (2)	 and that the law had not been correctly laid down in The United Motors case (2). On the decision in The Bengal Immunity Company case(1) it cannot be doubted that the claim of the Andhra State to tax Explanation sales would be unconstitutional	 and indeed	 that was admitted by the State in a statement filed on October 21	 1955	 wherein it was stated that having regard (1) [1955]2 S.C.R. 603. (2) ; 1439 to the decision aforesaid	 the petitions might be allowed but without costs. Before final orders were passed on the petitions	 however	 the Sales Tax Validation Ordinance No. III of 1956	 was promulgated on January 30	 1956	 and that was later replaced by the Sales Tax Laws Validation Act (7 of 1956) and that came into force on March 21	 1956. Section 2 of this Act runs as follows: " Notwithstanding any judgment	 decree or order of any court no law of a State imposing	 or authorising the imposition of	 a tax on the sale or purchase of any goods where such sale or purchase took place in the course of inter State trade or commerce during the period between the 1st day of April	 1951	 and the 6th day of September	 1955	 shall be deemed to be invalid or ever to have been invalid merely by reason of the fact that such sale or purchase took place in the course of interstate trade or commerce; and all such taxes levied or collected or purporting to have been levied or collected during the aforesaid period shall be deemed always to have been validly levied or collected in accordance with law." On February 19	 1957	 the Andhra State which had become the State of Andhra Pradesh under section 3 (1) of the States Reorganisation Act (37 of 1956) filed a fresh statement that by reason of the Validation Act the State was entitled to impose a tax on the Explanation sales	 which had taken place during the period between the 1st day of April	 1951	 and the 6th day of September	 1955 (which will hereinafter be referred to as the specified period)	 and that the petitions should therefore be dismissed. The petitioners challenge the correctness of this position. They contend that the Andhra (Madras) Act does not	 in fact	 impose a tax oh the Explanation sales	 and that	 in consequence	 the Validation Act can have no effect on it; that the Validation Act is itself unconstitutional and void; that the Act even if valid	 does not validate section 22 of the Andhra (Madras) Act; that it validates only levies and collections of tax already made	 and does not authorise the initiation 1440 of fresh proceedings for assessment of tax or for realisa tion of the same; that even if the Act authorised fresh imposition of taxes	 that could not be done without further legislation pursuant thereto by the State	 and that no action could be taken on the basis of section 22 of the Andhra (Madras) Act	 as	 being unconstitutional when enacted	 it was for all purposes non est ; that tax on the sale of yarn could under the Act be levied only at a single point and the State of Madras having imposed a tax on the sale of goods now proposed to be taxed	 the Andhra State could not impose a tax once again on the sale of the self same goods	 and that	 further	 the tax on yarn would	 so far as the Andhra State is concerned	 be bad as being hit by the Essential Commodities Act (52 of 1952)	 read with article 286 (3). It must be mentioned that similar to the Adaptation Order which enacted section 22 in the Madras Act	 there were Adaptation Orders by the President with reference to the Sales Tax Laws in all the States	 and provisions similar to section 22 were enacted therein. As any decision by this Court on the questions raised in the petitions must conclude similar questions under the laws of other States	 those States applied for and obtained permission to intervene in these proceedings	 and we have heard the Advocates General of Madras	 Uttar Pradesh and Bihar on the questions. As the main point for determination is the vires of the Sales Tax Laws Validation Act (which will hereinafter be referred to as the impugned Act)	 the Union of India has intervened	 and the learned Solicitor General has addressed us on the questions relating to the validity of that Act. Certain assessees who are interested in the decision of the above questions also applied for and obtained permission to intervene	 and they are the Mysore Spinning and Manufacturing Co.	 the Minerva Mills	 Ltd.	 the Tata Iron and Steel Co. Ltd.	 and the Madura Mills Co. Ltd.	 and counsel appearing for them have	 in general	 supported the petitioners. Counsel for the Madura Mills Co. Ltd.	 raised a further contention different from and inconsistent with 1441 the position taken by the petitioners and other inter. veners	 and that is that under Entry 42 in List I of the Seventh Schedule to the Constitution	 inter State trade and commerce is the exclusive domain of the Union Legislature	 that tax on inter State sales is comprised therein	 that the States have accordingly no power to tax such sales	 and that Parliament is not competent to authorise them to impose such a tax	 and that	 accordingly	 the impugned Act is wholly misconceived and inoperative. On these contentions	 the questions that arise for our determination are: (I) Whether the Andhra (Madras) Act	 in fact	 imposes a tax on the class of sales falling within the Explanation to article 286 (1) (a); (II)Whether the impugned Act is ultra vires the ground that it is not authorised by the terms of article 286(2); (III) (a) Whether section 22 of the Andhra (Madras) Act is within the protection of the impugned Act	 and (III)(b) Whether the impugned Act validates only levies and collections made during the specified period	 or whether it authorises the imposition and collection of taxes on such sales in future; (IV)Whether section 22 of the Madras Act was null and void on the ground that it was in contravention of article 286 (2)	 and whether the proceedings sought to be taken thereunder on the strength of the impugned Act are incompetent; (V) Whether tax on inter State sales is within the exclusive competence of Parliament	 and whether the impugned Act is	 in consequence	 bad as authorising the States to levy tax ; (VI)Whether the proposed imposition of tax is illegal on the ground that successive sales of yarn are subject under the law to be taxed at only one point	 and as the State of Madras has already taxed the present sales	 the State of Andhra cannot again levy a tax on them ; and (VII)Whether the proposed imposition of tax on yarn by the Andhra State is hit by the Essential Commodities Act	 read with article 286(3)	 and is illegal? 1442 (1):The first question that falls to be determined is whether the Andhra (Madras) Act	 in fact	 imposes a tax on the Explanation sales. Only if it does that	 would the further questions as to the vires and the operation of the impugned Act arise for consideration. We have already referred to the relevant provisions of the Madras Act and to the decision of this Court in Poppatlal Shah vs The State of Madras (1)	 wherein it was held that under the definition of " sale " in section 2(h) of that Act and apart from the Explanations to it which are not material for the present discussion	 power had been taken by the Province of Madras to tax only sales in which property in the goods passed inside the State. It must	 therefore	 be taken that under the Act	 as it stood prior to the Constitution	 the State of Madras had no power to impose a tax on sales of the kind mentioned in the Explanation to article 286 (1)(a). Now	 the question is whether the Adaptation Order of the President (Fourth Amendment) dated July 2	 1952	 has	 by the insertion of section 22 in the Madras Act	 altered the position. The contention of the respondent is that it has	 because it has bodily incorporated the Explanation to article 286 (1) (a) in the section itself	 and as under that Explanation	 all sales falling within its ambit would be sales inside the State of Madras	 they became taxable as sales within the definition in section 2 (h) of the Madras Act; and that accordingly under section 22 of the Andhra (Madras) Act the Explanation sales become taxable by the Andra State as sales within that State. The petitioners dispute this position	 and contend that that is not the true effect of the Explanation	 and that properly construed	 it does not authorise the in position of any tax which was not leviable under the provisions of the Act	 prior to its enactment. It is argued that the object of article 286 of the Constitution was merely to impose restrictions on the power which the States had under Entry 54 in List 11 to enact laws imposing tax on sales	 and that	 in that context	 the true scope of the Explanation to article 286 (1) (a) was that it merely took away from the State its power to (1) ; 1443 tax a sale in which the property passed inside it if the goods were actually delivered under the sale for consumption in another State and not to confer on the delivery State a power to tax such a sale	 and that the Explanation in section 22 which is	 word for word	 a reproduction of the Explanation to article 286 (1) (a) must be construed as having the same import. Reliance is placed in support of this contention on the following observations of this Court in The Bengal Immunity Company case(1) at p. 640: " In clause (1) (a) the Constitution makers have placed a ban on the taxing power of the States with respect to sales or purchases which take place outside the State. If the matter had been left there the ban would have been imperfect	 for the argument would have still remained as to where a particular 	ale or purchase took place. Does a sale or purchase take place at the place where the contract of sale is made	 or where the property in the goods passes or where the goods are delivered ? These questions are answered by the Explanation. That Explanation is 'for the purposes of sub clause (a) '	 i.e.	 for the purpose of explaining which sale or purchase is to be regarded as having taken place outside a State. By saying that a Parti cular sale or purchase is to be deemed to take in a particular State the Explanation only indicates that such sale or purchase has taken place outside all other States. The Explanation is neither an Exception nor a Proviso but only explains what is an outside sale referred to in sub clause (a). This it does by creating a fiction. That fiction is only for the purposes of subclause (a) and cannot be extended to any other purpose. It should be limited to its avowed purpose. To say that this Explanation confers legislative power on what for the sake of brevity has been called the delivery State is to use it for a collateral purpose which is not permissible. .Further	 it is utterly illogical and untenable to say that article 286 which was introduced in the Constitution to place restrictions on the legislative powers of the States	 by a side wind	 as it were	 (1) 183 1444 gave enlarged legislative powers to the State of delivery by an explanation sandwiched between two restrictions. This construction runs counter to the entire scheme of the article and the explanation and one may see no justification for imputing such indirect and oblique purpose to this article. " Now	 the contention of the petitioners is that these observations are decisive of the present controversy	 because the same provision expressed in ipsissima verba cannot have one meaning in article 286(1) (a) and quite a different one in section 22 of the Madras Act; and on the construction put by this Court on the Explanation to article 286(1) (a)	 the Explanation to section 22 of the	 Andhra (Madras) Act must be interpreted as prohibiting States other than Andhra from taxing sales under which goods are delivered for consumption outside those States	 even though property passed inside them and not as authorising the State of Andhra to tax sales in which goods are delivered therein for consumption 	 even though property in the goods passed outside that State. It is argued that this conclusion is reinforced by the opening words of section 22	 viz.	 "Nothing contained in this Act shall be deemed to impose or authorise the imposition of a tax on the sale or purchase of any goods". The effect of this	 it is said	 is to impose a restriction on the power which the State previously possessed	 of taxing sales coming within the definition in section 2 (h) and not to enlarge it. The decision in Government of Andhra vs Nooney Govindarajulu (1) is cited in support of these contentions. The error in this argument lies in this that it focusses attention exclusively on the terms in which the Explanations are couched in article 286(1) (a) and in section 22 and completely overlooks the fundamental difference in the context and setting of these two enactments. The scope and purpose of article 286 have been considered at length in the decisions of this Court in The United Motors case (2) as also in The Bengal Immunity Company case (3)	 and it is sufficient to briefly recapitulate them. Under Entry 48 in List 11 of the (1) (1957) 8 Sales Tax Cases 297. (2) ; (3) 1445 Seventh Schedule to the Government of India Act	 1935	 the Provincial Legislature had the exclusive competence to enact a law imposing a tax on the sale of goods	 and under section 99 (1)	 such a law could be made " for the Province or for any part thereof ". In Wallace Brothers & Co. Ltd. vs Income tax Commissioner (1)	 the question arose as to the validity of certain provisions of the Indian Income tax Act	 which sought to tax non resident foreigners in respect of their foreign income. The Indian Legislature had under Entry 54 in List I of the Government of India Act power to enact laws imposing tax on income other than agricultural income	 and under section 99(1) the law could be made " for the whole of :British India or for any part thereof ". It was held by the Privy Council that the requirements of section 99 were satisfied if there was sufficient territorial connection between the State imposing the tax and the person who was sought to be taxed	 and the receipt of income by the assessees in British India furnished sufficient nexus to give validity to the legislation imposing tax on their foreign income. If this doctrine of nexus is applicable to laws imposing tax on sales and it was applied by this Court to those laws in the United Motors case (2) at p. 1079 and in Poppatlal Shah 's case (3) at pp. 682 683 then it would be competent to the State to enact a law imposing a tax on sales not merely when the property in the goods passed within the State but even when it (lid not	 if there was sufficient connection between the State and the transaction of sale	 such as the presence of the goods in the State at the date of the agreement	 as was held recently by this Court in Tata Iron & Steel Co. Ltd. vs State of Bihar (4). In fact	 acting on the nexus theory the Legislatures of the States enacted Sales Tax Laws adopting one or more of the nexi as the basis of taxation. This resulted in multiple taxation	 as a consequence of which the free flow of commerce between the States became obstructed and the larger economic interests of the country suffered. It was to repair this mischief that the Constitution	 while (1) (1948) L.R. 75 I.A. 86. (2) ; (3) ; (4) ; 1446 retaining the power in the States to tax sales under Entry 54 in List II sought to impose certain restrictions on that power in article 286. One of those restrictions is contained in article 286(1)(a) which prohibits a State from taxing outside sales. The Explanation now under consideration is attached to this provision	 and it is in this context	 viz.	 in its setting in an Article	 the object of which was to impose fetters on the legislative powers of the States	 that this Court observed that though positive in form	 it was in substance negative in character	 and that its true purpose was not to confer any fresh power of taxation on the State but to restrict the power which it previously had under Entry 54. These considerations will clearly be in apposite in construing a taxing statute like the Madras Act	 the object of which is primarily to confer power on the State to levy and collect tax. When we find in such a statute a provision containing a prohibition followed by an Explanation which is positive in its terms	 the true interpretation to be put on it is that while the prohibition is intended to prevent taxation of outside sales on the basis of the nexus doctrine	 the Explanation is intended to authorise taxation of sales falling within its purview	 subject of course to the other provisions of the Constitution	 such as article 286 (2). It should be remembered that unlike the Constitution	 the law of a State can speak only within its own territories. It cannot operate either to invest another State with a power which it does not possess	 or divest it of a power which it does possess under the Constitution. Its mandates can run only within its own borders. That being the position	 what purpose would the Explanation serve in section 22 of the Madras Act	 if it merely meant that when goods are delivered under a contract of sale for consumption in the State of Madras	 the outside State in which property in the goods passes has no power to tax the sale ? That is not the concern of the State of Madras	 and indeed	 the Legislature of Madras would be incompetent to enact such a law. In its context and setting	 therefore	 the Explanation to section 22 must mean that it 1447 authorises the State of Madras to impose a tax on sales falling within its purview. Thus	 while in the context of article 286 (1) (a) the Explanation thereto could be construed as purely negative in character though positive in form	 it cannot be so construed in its setting in section 22 of the Madras Act	 where it must have a positive content. Nor is there much force in the contention that the non obstante clause in section 22 has only the effect of substracting something from the power to tax conferred on the State by the charging section	 section 3	 read with section 2 (h) and not of adding to it. In Aswini Kumar Ghosh and another vs Arabinda Bose and another (1)	 It was observed by this Court that " the enacting part of a statute must	 where it is clear	 be taken to control the non obstante clause where both cannot be read harmoniously ". Now	 as the Explanation lays down in clear and unambiguous terms that the sales of the character mentioned therein are to be deemed to have taken place inside the State in which goods are delivered for consumption	 full effect must be given to it	 and its operation cannot be cut down by reference to the non obstante clause. It cannot be put against this construction that it renders the non obstante clause ineffective and useless. According to the definition in section 2 (h)	 a sale in which property passes inside the State of Madras will be liable to be taxed	 even though the goods are delivered for consumption outside that State	 but under the Explanation such a sale will be deemed to have taken place in the out side State in which goods are delivered for consumption	 and therefore the State of Madras will have nO power to tax it: The purpose which the non obstante clause serves is to render the Explanation effective against the definition in section 2 (h) and not to render it ineffective in its own sphere	 as determined on its terms. But it is contended that in order to reach this result it was necessary that the Explanation to section 22 should have been made a part of the definition of " sale " under section 2 (h)	 because under section 3	 which is the charging (1) ; 	 24. 1448 section	 it is the turnover of sales that is subject to tax	 that sale for the purpose of that section is only what is defined as " sale " under section 2 (h)	 and that the Explanation sales not having been brought within that definition	 no charge could be imposed thereon. The Explanation in section 22	 it is argued	 cannot override section 2 (h)	 and if its object was to confer on the State a power to tax sales falling within its ambit	 that has not	 in fact	 been achieved. It is pointed out by way of contrast that in the Sales Tax Laws of some other States	 such as Bihar and Uttar Pradesh	 the Explanation has been added to the definition of sale. Now	 a contention that what the Legislature intended to bring about it has failed to do by reason of defective draftsmanship is one which can only be accepted in the last resort	 when there is no avenue left for escape from that conclusion. But that clearly is not the position here. Section 22 opens with the words " Nothing contained in this Act "	 and that means that that section is to be read as controlling	 inter alia	 the definition of sale in section 2 (h). Otherwise	 sales in which property passes in Madras but delivery is outside that State would be taxable under section 2 (h) and under section 3	 even though they are within the prohibition enacted in section 22. If the provisions of section 22 are effective for the purpose of limiting the operation of section 2 (h)	 we do not see any difficulty in construing the Explanation therein as equally effective for the purpose of enlarging it. Again	 it is a rule of construction well establisbed that the several sections forming part of a statute should be read	 unless there are compelling reasons contra	 as constituting a single scheme and construed in such manner as would give effect to all of them. On this principle	 section 2 (h) and section 22 must be read together as defining what are sales	 which are taxable under the Act and what are not	 and so read	 the Explanation really means that in sales in which goods are delivered for consumption in the State of Madras	 the property therein shall be deemed to have passed inside that State	 notwithstanding that it has	 under the Sale of Goods Act	 passed outside that State. On this construction	 those 1449 sales will fall within the definition in section 2 (h) and will be taxable. The contention of the petitioners highly technical and based oil the non insertion of the Explanation in section 2 (h) must	 in our opinion	 be rejected as unsound. It is next contended that the power of the President under Art	. 372 (2) is merely to bring the provisions of the State laws into conformity with article 286	 and that having regard to the interpretation put on that Article in The Bengal Immunity Company case (1)	 the Explanation in section 22 would be valid in so far as it prohibits the State of Madras from imposing a tax on sales in which goods are delivered outside Madras	 though property therein passed inside that State	 but that in so far as it makes taxable sales in which property passes outside the State of Madras but the goods themselves are delivered for consumption in Madras	 it is much more than bringing the. 	State law into conformity with article 286	 and is	 in consequence	 unauthorised and bad. It is argued that such a provision could be enacted by the Legislature of Madras	 as was in fact	 done by the legis latures of many of the States	 but the President could not do it in exercise of the special and limited power conferred on him by article 372(2). That power is merely	 it is contended	 to take the definition of " sale " in section 2(h) of the Madras Act	 strike out therefrom whatever is repugnant to article 286	 such as sales in which goods are delivered for consumption outside Madras	 and leave it there and not to add to it. We are not satisfied that that is a correct view to take of the powers of the President under article 372(2). It is to be observed that article 286(1)(a) and the Explanation thereto form	 in their setting in a taxing statute	 integral parts of and different facets of the same concept. Sales in which property passes outside the State of Madras but delivery for consumption is inside Madras are at once inside sales for Madras and outside sales for the other States. Now	 if in exercise of the power to adapt	 the enactment of the Explanation is requisite to give effect to one aspect of that (1) 1450 concept	 that is	 for prohibiting the State of Madras from taxing sales when goods are delivered outside	 we fail to see why it should not operate to give effect to the other aspect of the concept which is so integrally connected with it	 viz.	 taxing of sales in which goods are delivered for consumption in the State of Madras	 if its language is comprehensive and wide enough to include such sales. We find it difficult to hold that the self same Explanation is intra vires the powers of the President in so far as it prohibits the State from taxing gales	 in which goods are delivered Outside the State but is ultra vires in so far as it authorises that State to tax sales in which goods are delivered inside it. It should be remembered in this connection that the power which the President has under article 372(2) to adapt is the legislative power of the State whose law is adapted	 and that includes the power to repeal and amend any provision. Provided that the law as adapted is within the legislative competence of the State and its enactment is in the process of bringing the State law into conformity with article 286	 it seems to us that it is within the ambit of the power con ferred by article 372(2). The question	 however	 is of academic interest	 because of the concluding words of article 372(2)	 which enact that no adaptation order made under that provision shall be liable to be questioned. It was suggested for the petitioners that these words would have no application when the adaptation order went beyond the terms of article 372(2)	 and that it was open to them to challenge its validity on the ground that it amounted to more than bringing the existing law into conformity with article 286. We are unable to agree. If the adaptation order is within the scope of article 372(2)	 then it is valid of its own force	 and does not require the aid of a clause such as is contained in the concluding portions thereof. It is only when the adaptation amounts to something more than merely bringing the State law into conformity with the Constitutional provisions that there can arise a need for such a clause. In our opinion	 the effect of the concluding words of article 372(2) is to 1451 render the question of the validity of the adaptation non justiciable. The Adaptation Order in question must	 accordingly	 be held to be not open to attack on the ground that it goes beyond the limits contemplated by article 372(2). It is then argued that even though the Adaptation Order of the President might not be open to question even if it had imposed for the first time a tax on sales which had not been previously imposed by the Act	 nevertheless in deciding whether it does	 in fact	 impose such a tax	 it would be relevant to take into account that the object of article 372(2) was only to bring the State laws into conformity with the Constitution	 and that	 in consequence	 the Explanation in section 22 must be construed as having the same meaning as the Explanation in article 286(1)(a). This would	 no doubt	 be a legitimate consideration in interpreting the language of the Explanation	 but then	 it must be remembered that at the time when the Adaptation Order was made	 the true interpretation of the Explanation to article 286(1)(a) had not been the subjectmatter of any decision	 and it is therefore difficult to impute to the framers of section 22 the construction put by this Court on the Explanation to article 286(1)(a) in The Bengal Immunity Company case (1) any more than the one put on it in The United Motors case (2). We are therefore thrown back on the language of the Explanation itself to discover its true scope. If	 in enacting the Explanation	 the Adaptation Order merely intended to prohibit the State of Madras from imposing tax on sales under which goods are delivered for consumption outside that State even though property therein passed inside that State	 it would clearly have expressed that intention in words to the following effect: " For the purposes of clause (a)(i)	 a sale under which goods are delivered for consumption outside the State of Madras shall be deemed to have taken place outside that State	 notwithstanding that property in those goods passed inside that State ". But the language of the Explanation is general	 and fixes the situs of sales of (1) (2) ; 184 1452 an inter State character in the State in which goods are actually delivered for consumption. Under this Explanation	 a sale under which goods are delivered outside the State of Madras will be an outside sale for that State even though property in the goods passed inside that State	 and likewise	 a sale under which goods are delivered inside the State of Madras will be an inside sale for that State	 even though property in the goods passed outside that State. As the language of the Explanation is general and of sufficient amplitude not merely to restrict but also to add to the power of the State to tax Explanation sales	 and as the reasons for construing it as purely restrictive in article 286(1)(a) are	 as already stated	 without force in their application to a taxing statute	 we must give full effect to the words of the enactment	 and bold that they operate to confer on the State a power to tax Explanation sales. There is one other contention relating to this aspect of the matter	 which remains to be considered	 and that is that even if the Explanation could be construed as authorising the imposition of a tax on the sales mentioned therein	 a reading of the section as a whole makes it clear that	 in fact	 no such tax was imposed	 as it expressly enacts that "Nothing contained in this Act shall be deemed to impose a tax on inter State sales ". The argument is that the Explanation sales being inter State sales and the section having exempted them from taxation	 they go out of the statute book altogether	 and do not exist for the purpose of the impugned Act. We are unable to agree with this contention. Article 286(2) consists of two parts	 one imposing a restriction on the power possessed by the States to tax sales under Entry 54 in so far as such sales are in the course of inter State trade and commerce and another	 vesting in Parliament a power to enact a law removing that restriction. If section 22 had merely enacted that portion of article 286(2) which prohibited imposition of taxes on interstate sales	 that might have furnished some plausible ground for the contention now urged by the petitioners.:but it enacts both the parts of article 286(2)	 1453 the restriction imposed therein and also the condition on which that restriction is to cease	 viz.	 Parliament providing otherwise by law. Taken along with the admitted power of the States to impose tax on sales under Entry 54	 the true scope of section 22 is that it does impose a tax on the Explanation sales	 but the imposition is to take effect only when Parliament lifts the ban. In other words	 it is a piece of legislation imposing tax in praesenti but with a condition annexed that it is to come into force in futuro as and when Parliament so provides. It is not contended that there is in the Constitution any inhibition against conditional legislation. In The Queen vs Burah (1)	 it was held by the Privy Council that a legislature acting within the ambit of authority conferred on it by the Constitution has the power to enact a law either absolutely or conditionally	 and that position has been repeatedly affirmed in this Court. Vide In The 	 etc. (2) and Sardar Inder Singh vs State of Rajasthan(3). It would clearly be within the competence of the Madras Legislature to enact a law imposing a tax on sales conditional on the ban enacted in article 286(2) being lifted by Parliamentary legislation	 and that	 in our opinion	 is all that has been done in section 22. The Madras Act defines the event on which the tax becomes payable and the person from whom and the rate at which it has to be levied	 and forms a complete code on the topic under consideration. It could have no immediate operation by reason of the bar imposed by article 286(2)	 but when once that is removed by a law of Parliament	 there is no impediment to its being enforced. That satisfies all the requirements of a conditional legislation. But it was argued that section 22 of the Madras Act could not be so construed	 because it was not open to the President acting in exercise of the power conferred on him under article 372 (2) to impose a conditional levy ; nor would it be competent to the Legislature of Madras to make a levy conditional or otherwise	 unless Parliament had authorised it. We see no force in this argument. As (1) (1878) L.R. 5 I.A. 178. (2) ; (3) ; 1454 article 286(2) is itself in two parts	 one a restriction on the power of the State and the other	 a condition on which such restriction will cease to operate	 an adaptation made pursuant thereto must also be similar in its contents. Nor is there in article 286 (2) any prohibition of any legislation by tile State Legislature against enacting laws imposing tax on interstate sales. It merely enacts that such law can have no effect. The words "No law of a State shall impose " mean only that no such law shall be effective to impose a tax. It is also contended that under the Sales Tax Acts	 the levy of tax is annual and the rules contemplate submission of quarterly returns and payment of taxes every quarter on the admitted turnover	 and that a conditional legislation under which payment of tax will become enforceable in futuro would be inconsistent with the scheme of the Act and the rules. But this argument	 when examined	 comes to no more than this that the existing rules do not provide a machinery for the levy and the collection of taxes which might become payable in future	 when Parliament lifts the ban. Assuming that that is the true position	 that does not affect the factum of the imposition	 which is the only point with which we are now concerned. That the States will have to frame rules for realizing the tax which becomes now payable is not a ground for holding that there is	 in fact	 no imposition of tax. It should also be mentioned in this connection that the Madras Act makes a clear distinction between sales which are outside the operation of the Act	 and sales which are within its operation but are exempt from taxation. Section 4 provides that the provisions of the Act shall not apply to the sale of electrical energy	 motor spirit	 manufactured tobacco and certain other articles. In contrast to this is the language of section 22	 which expressly enacts that the Act shall not be deemed to impose a tax on inter State sales	 except in so far as Parliament may by law otherwise provide. We are of opinion that	 on the true construction of section 22 of the Act	 there is an imposition of tax on Explanation sales but that it could be enforced only when Parliament so provides. 1455 We have so far considered the question on principle and on the language of the statute. We may now.	. refer to the decisions of the High Courts	 wherein this question has been considered. In Mettur Industries Ltd. vs State of Madras (1)	 the point directly arose for decision as to whether section 22 of the Madras Act did. in fact	 levy a tax on the Explanation sales so as to fall within the protection of the Sales Tax Laws Validation Act. It was held that the Explanation to section 22 had ' the effect of rendering the sale one inside the State so as to fall within the definition of that word in section 2 (h)	 and that it was taxable. Next in point of time is the decision of the Bombay High Court in Dial Das vs P. section Talwalkar (2) in which the question arose with reference to section 46 of the Bombay Sales Tax Act (Bom. III of 1953)	 corresponding to section 22 of the Madras Act. It was held that it did impose a tax	 though it was to operate only if Parliament so provided. Then	 there are two decisions of the Travancore Cochin High Court	 Mathew vs Travancore Cochin Board of Revenue(3) and Cochin Coal Co.	 Ltd. vs State Of Travancore Cochin(4)	 in which it was held that section 26 of the Travancore Cochin General Sales Tax Act corresponding to section 22 of the Madras Act	 had not the effect of imposing	 of its own force	 a tax on the Explanation sales	 and the decision in Mettur Industries Ltd. vs Madras State (supra) was not followed. In The Mysore Spinning and Manufacturing Co.	 Ltd. vs Deputy Commercial Tax Officer	 Madras (5) the Madras High Court re affirmed the view which it had taken in Mettur Industries Ltd. vs State of Madras (supra)	 and held that section 22 had the effect of imposing a tax on the Explanation sales. In The Government of Andhra vs Nooney Govindarajulu (supra)	 the true effect of section 22 of the Madras Act came up for consideration before the Andhra High Court	 and it was held therein	 dffering from Mettur Industries Ltd. vs State of Madras (1) and Dial Das vs P. section Talwalkar (2) that in view of the observations of this Court as to the scope of the (1) A.I.R. 1957 Mad. 362. (2) A.I.R. 1957 Bom. (3) A.I.R. 1957 T.C. 300. (4) (1956) 7 Sales Tax Cases 731. (5) A.I.R. 1957 Mad. 1456 Explanation in article 286 (1) (a)	 the Explanation in section 22 could not be construed as imposing a tax on the sales mentioned therein	 and that that conclusion also followed on the opening words of the section that " Nothing contained in this Act shall be deemed to impose	 or authorise the impo sition of a tax. . . For the reasons already given	 we are unable to agree with the decisions in Mathew vs Travancore Cochin Board of Revenue(1)	 Cochin Coal Co. Ltd. vs State of Travancore Cochin(2) and The Government of Andhra vs Nooney Govindarajulu (3). We are of opinion that the law has been correctly laid down in Mettur Industries Ltd. vs State of Madras (4) and Dial Das vs P. section Talwalkar (5). We accordingly hold that section 22 operated to impose a tax falling within the Explanation	 subject to authorisation by Parliament as provided in article 286 (2). In this view	 the contention urged on behalf of the States that the Explanation to article 286 (1) (a)	 being a provision of the Constitution	 operated by its own force to impose a tax on the sales covered by it	 and did not require to be supplemented by any State legislation to become effective	 does not call for any detailed consideration. Suffice it to say that it cannot be maintained if the true scope of article 286 is to define and limit the powers of State Legislatures with reference to imposition of sales tax and not to itself impose it. (11) That brings us on to the next question which is whether the impugned Act	 Sales Tax Laws Validation Act	 is ultra vires on the ground that it is not authorised by the terms of article 286 (2). Now	 it is a well known rule of interpretation that in order to understand the true nature and scope of an Act it is necessary to ascertain what the evils were which were intended to be redressed by it. The starting point of the trouble which ultimately led to the enactment of the impugned Act is the Explanation to article 286(1)(a)	 which came into force on January 26	 1950. The terms in which it is worded undoubtedly suggest that sales (1) A.I. R. (2) (1956) 7 Sales Tax Cases 731. (3) (1957) 8 Sales Tax Cases 297. (4) A.I.R. 1957 Mad. (5) A.I.R. 1957 Bom. 1457 of the description mentioned therein are to be treated as sales inside the delivery State for purposes of taxation. That is how it would seem to have been understood in the Adaptation Order under which section 22 was inserted in the Madras Sales Tax Act and in the Adaptation Orders relating to the Sales Tax Laws of other States; for	 as already stated	 in a taxing statute the language of the Explanation can only mean that a sale failing within its purview is an inside sale enabling the State to tax it. In The United Motors case (1)	 the construction put by this Court on the Explanation was that though but for it the sales mentioned therein would be in the course of interState trade and commerce	 its effect was to convert them into intrastate sales	 so as to bring them within the taxing power of the delivery State. It was only later that this Court held finally in The Bengal Immunity Company case (2) that the Explanation sales were not divested of their character as inter State sales as the Explanation to article 286 (1) (a) did not govern article 286 (2)	 and that in the absence of Parliamentary legislation as contemplated by article 286 (2)	 taxation of sales falling within its purview would be unconstitutional. This judgment was delivered on September 6	 1955. But acting on the apparent tenor and import of the Explanation and the construction put upon it in The United Motors case (1)	 the States in India had been levying taxes oil the sales falling within its purview. The position on September 6	 1955	 was that the States had imposed and collected large amounts by way of tax on Explanation sales; that there were proceedings pending for assessment of tax on such sales; and that apart from this	 the States would have been entitled to take	 but for the decision in The Bengal Immunity Company case (2)	 proceedings for the assessment of tax in respect of those sales. Now	 the result of the decision in The Bengal Immunity Company case (2) was that the levy of the tax on the Explanation sales became unauthorised and the States were faced with large claims for restitution of the (1) ; (2) 1458 amounts realised	 involving threat to their economic stability. It should also be mentioned that quite a large number of dealers had	 acting under provisions of the Sales Tax Acts which empowered them to pass the tax on	 collected it from their purchasers for the purpose of payment to the State	 and as after the decision in The Bengal Immunity Company case (1) they could no longer be called upon to pay it	 they stood to make an unjust gain of it. These were the evils which called for redress	 and it was to remedy them that Parliament enacted the Sales Tax Validation Ordinance No. III of 1956	 and eventually replaced it by the impugned Act. Section 2 of the Act provides that no law of a State imposing a tax on sales which took place in the course of interState trade or commerce between April 1	 1951	 and September 6	 1955	 shall be deemed to be invalid or ever to have been invalid merely by reason of the fact that such sales were in the course of inter State trade. The section further provides that all taxes levied or collected under such a law during the specified period shall be deemed to have been validly levied or collected. The policy behind the Act is obviously to declare the law as interpreted in The United Motors case (2) as the law governing sales filling within the Explanation up to the date of the judgment in The Bengal Immunity Company case(1) and to give effect to the law as laid down in that decision for the sales effected subsequent thereto. The question is whether this Act is unconstitutional as being ultra vires the powers of Parliament tinder Art ' 286 (2). The petitioners maintain that it is	 and put forward several grounds in support of that position. It is firstly contended by them that under Entry 54 in List II	 the power to make laws in respect of tax on sales is vested exclusively in the States	 that the power which is conferred on Parliament under article 286(2) is only to enact a law directing or permitting the States to impose a tax on inter States sales and not to itself enact a law with reference thereto that the impugned Act being one to validate Sales (1) (2) ; 1459 Tax Laws is substantive in character and is not authorised by the terms of article 286 (2) and is	 in consequence	 unconstitutional. It is argued that to validate is to confirm or ratify	 and that can be only in respect of acts which one could have himself performed	 and that if Parliament cannot enact a law relating to sales tax	 it cannot validate such a law either	 and that such a law is accordingly unauthorised and void. The only basis for this contention in the Act is its description in the Short Title as the " Sales Tax Laws Validation Act " and the marginal note to section 2	 which is similarly worded. But the true nature of a law has to be determined not on the label given to it in the statute but on its substance. Section 2 of the impugned Act which is the only substantive enactment therein makes no mention of any validation. It only provides that no law of a State imposing tax on sales shall be deemed to be invalid merely because such sales are in the course of inter State trade or commerce. The effect of this provision is merely to liberate the State laws from the fetter placed on them by article 286 (2) and to enable such laws to operate on their own terms. The true scope of the impugned Act is	 to adopt the language of this Court in the decisions in The United Motors case (1) and The Bengal Immunity Company case (2)	 that it lifts the ban imposed on the States against taxing inter State sales and not that it validates or ratifies any such law. Considering the legislation on its substance	 we have .no doubt that it is within the scope of the authority conferred on Parliament by article 286 (2) and is not ultra vires. It is next contended that the impugned Act is wholly retrospective in character in that it operates on sales which took place during the specified period	 and that such a legislation is	 having regard to the intendment of article 286 (2)	 outside its terms. It is argued that this Article	 to start with	 enacts a restriction on the power of the State to impose taxes on inter State sales and then vests in Parliament a power (1) (2) 185 1460 to remove that restriction	 and that in logical sequence therefore	 there should first be a legislation by Parliament authorising the States to impose a tax on interState sales and then a law of the State made in accordance therewith	 and that that order having been reversed in the present case	 the impugned Act is unconstitutional. We do not agree with this contention. Article 286 (2) merely provides that no law of a State shall impose tax on inter State sales " except in so far as Parliament may by law otherwise provide ". It places no restrictions on the nature of the law to be passed by Parliament. On the other hand	 the words " in so far as " clearly leave it to Parliament to decide oil the form and nature of the law to be enacted by it. What is material to observe is that the power conferred on Parliament under article 286 (2) is a legislative power	 and such a power conferred on a Sovereign Legislature carries with it authority to enact a law either prospectively or retrospectively	 unless there can be found in the Constitution itself a limitation on that power. Now	 there is nothing express in article 286 (2) imposing a restriction on the power of Parliament to enact a law with retrospective operation. But it is argued for the petitioners that such a restriction is to be implied from the scheme of it	 which is that there is a prohibition on the power of the State to enact a law imposing tax on inter State sales	 unless Parliament lifts the ban	 and it is said that a prohibition operates only in futuro and therefore a law removing that prohibition must also operate in futuro. The decision of the Privy Council in Punjab Province vs Daulat Singh (1) is relied on in support of this proposition. There	 the question arose with reference to the validity of a mortgage of agricultural lands in the Punjab executed in the year 1933. Section 13 A of the Punjab Alienation of Land Act which came into force in 1939 enacted that transfer of a land by a member of an agricultural tribe in favour of another member of the tribe was void if the transferee was a benamidar for a person who was not a member of that tribe	 whether such transfer was (1) (1946) L.R. 73 I.A. 59. 1461 made before or after the Act. The mortgagee instituted a suit	 challenging the vires of this section on the ground that it contravened section 298(1) of the Government of India Act	 1935	 which provided that no subject of His Majesty domiciled in India shall be prohibited from acquiring	 holding or disposing of property on grounds only of religion	 place of birth or descent. The mortgagor in reply relied on section 298 (2) which enacted that nothing in that section shall affect the operation of any law which prohibits the sale or mortgage of agricultural land situate in any particular area and owned by a person belonging to the agriculturist class. In rejecting this contention	 the Privy Council observed that what was saved by section 298 (2) was a law prohibiting certain kinds of transfers	 that the word " prohibition " could properly apply only to acts to be done in futuro	 and that the impugned provision	 section 13 A	 was intra vires the Constitutional provision in so far as it prohibited transfers after the date of its enactment	 but to the extent that it avoided transfers which had taken place prior to that date	 it was ultra vires. This decision proceeded solely on the connotation of the word " prohibits " in section 298 (2) of the Government of India Act	 and can be of no assistance in the construction of article 286 (2)	 wherein that word does not occur. And even on the substance of it	 we see no real analogy between the case in Punjab Province vs Daulat Singh (1) and the present. There	 the law which was authorised by section 298 (2) was one prohibiting certain transfers; here the law which Parliament is authorised to make is one not prohibiting the States from imposing tax on inter State sales	 but permitting them to do so. While a law prohibiting transfers must be prospective	 a law authorising imposition of tax need not be. It can be both prospective and retrospective. A decision more directly in point is the one in The United Provinces vs Atiqa Begum(2). There	 the question arose on the construction of section 292 of the Government of India Act	 1935	 which enacted that	 " Notwithstanding the repeal by this Act of the (1) I. A. 59. (2) 1462 Government of India Act	 but subject to the other provisions of this Act	 all the law in force in British India immediately before the commencement of Part III of this Act shall continue in force in British India until altered or repealed or amended by a competent Legislature or other competent authority. " The Legislature of the United Provinces had enacted a law modifying the pre existing law relating to the payment of rents by tenants to landlords and giving it retrospective operation. The question was whether the enactment was repugnant to section 292 which had provided that the preexisting law was to continue in force until it was altered. It was held that the power of a legislature to pass a law included a power to pass it retrospectively	 and that the words of section 292 did not operate to impose any restriction on that power	 and that the legislation was intra vires. In our opinion	 the principle of this decision is applicable to the present case	 and the impugned Act cannot be held to be bad on the ground that it is retrospective in operation. It is next contended that the impugned Act is ultra vires	 inasmuch as it is much more than a mere retrospective law	 and that it is really a piece of ex post facto legislation	 which is not authorised by article 286(2). The argument in support of this contention may thus be stated : A ' State legislature is competent under Entry 54 in List II to enact a law taxing sale of goods	 and when such a law is made to operate retrospectively it may not be open to challenge on constitutional grounds	 though its propriety may be open to question on grounds of policy. Parliament has no competence to enact laws in respect of tax on sales filling within Entry 54 in List 11	 but article 286(2) confers on it a power to authorise the States to impose a tax on inter State sales. The impugned Act does not do that	 but validates ex post facto laws of States imposing such a tax retrospectively for the specified period. Such a general law may be intra vires the States but not Parliament	 nor is it one which can be justified by the power granted to it to " provide otherwise. " It is therefore unconstitutional and void	 In 1463 our opinion	 this argument is only an amalgam of the two contentions already dealt with	 and does not require further detailed consideration. The impugned Act	 though it is in name a validating Act	 is in essence a law lifting the ban under article 286 (2)	 and if no limitation on the character of that law could be spelt out of the language of that Article	 then it must be upheld as within the authority conferred by it. It is also argued that even if the power to make a law conferred on Parliament under article 286 (2) comprehends a power to enact a law with retrospective operation	 that power cannot extend to authorising what is unconstitutional	 and that as section 22 of the	 Madras Act and the corresponding provisions in the statutes of other States were unconstitutional and illegal when made as contravening the prohibition enacted in article 286 (2)	 the impugned Act must be held to be unauthorised and bad in that it seeks to give effect to those provisions. But this is to beg the very question which we have to decide. If it is competent to the legislatures of the States to enact a law imposing a tax on inter State sales to take effect when Parliament so provides	 there is nothing unconstitutional or illegal either in section 22 of the Madras Act or in the corresponding provisions in the Acts of other States. If conditional legislation is valid	 as we have held it is	 then section 22 is clearly intra vires	 and the foundation on which this contention of the petitioners rests	 disappears and it must fall to the ground. In the result	 we are of opinion that the impugned Act is intra vires	 and is not open to challenge on any of the grounds put forward by the petitioners. (111) (a). We have now to consider the contention that even if the impugned Act is valid	 that would not give efficacy to section 22 of the Madras Act or the corresponding provisions in the laws of other States which came in by adaptation under article 372 (2). The ground urged in support of this contention is that the expression " law of a State " in article 286 (2) has a technical import	 and means a law which is enacted by the legislature of a State in the manner prescribed by the Constitution and open to challenge in courts if 1464 it is unconstitutional	 that that expression occurring 	 in section 2 of the impugned Act must bear the same meaning which it has in article 286 (2) as it was enacted	 pursuant to the authority contained therein	 and that section 22 of the Madras Act is not a law of that description	 as it was made by the President in exercise	 of the special power conferred on him by article 372 (2)	 and is	 as provided therein	 not open to attack in a court of law. We do not see why we should restrict the connotation of the words " law of a State " in the manner contended above. The law of a State signifies	 in its ordinary acceptation	 whatever is an expression of the legislative	 as distinguished from the executive or judicial power of a State. Its normal mode under the Constitution is no doubt that it is enacted by the legislature of the State constituted in accordance with the procedure prescribed therein. But that is not the only mode in which the legislative power of the State could be exercised. Under article 213	 the Governor is authorised	 subject to the conditions laid down therein	 to issue Ordinances which have the force of law	 and these Ordinances are clearly laws of the State and not the less so by reason of their not having been passed by the State legislature. Under article 252	 it is open to Parliament acting on resolutions of the legislatures of two or more States	 to enact laws on subjects which are within the exclusive competence of the States	 a recent instance of such legislation being Act 42 of 1955	 the validity of which was the subject of consideration in R. M. D. Charnarbaugwalla vs Union of India(1). Can it	 be contended that these are not laws of the States for which they were enacted	 because they were not passed by the legislatures of those States ? We entertain no doubt that by the expression " law of a State " in article 286 (2) and section 2 of the impugned Act is meant whatever operates as law in the state	 and that section 22 of the Madras Act is a law within those enactments. Nor does it affect this conclusion that that law may not be open to challenge in a court of law. A right to challenge a (1) ; 1465 law must depend on the provisions of the Constitution governing the matter	 and if those provisions enact that it is not open to question in a court of law or ' that it is liable to be questioned only on certain specified grounds	 that will not have the effect of depriving a statute duly enacted of its character as law. We are also not satisfied that a law as adapted under article 372 (2) is not open to attack on the ground that it contravenes some constitutional provision. We are disposed to think that the concluding words of article 372 (2) preclude an attack on the Adaptation Order only on the ground that it does more than merely bringing the State law into conformity with the Constitution and is	 in consequence	 ultra vires the powers conferred by that article. In the result	 we must hold that section 22 of the Madras Act is within the protection afforded by section 2 of the impugned Act. (111) (b) : The next contention of the petitioners that falls to be considered is whether even on the footing that the impugned Act is intra vires the powers of Parliament under article 286 (2)	 the proceedings which are proposed to be taken by the State of Andhra against them for assessment of tax are incompetent	 because the Act validates only levies or collections made during the specified period but does not authorise the initiation of fresh proceedings for levy or collection of tax. It is contended that though section 2 of the impugned Act consists of two clauses	 one giving effect to laws of States imposing tax on inter State sales in so far as they took place during the specified period and the other validating levy or collection of tax made during that period	 the first clause has no independent operation	 the only purpose which it serves being to lead up to the second which is the only effective clause in the section. It is argued that if the intention of the legislature was not merely to validate the levies or collections already made but also to maintain the laws in force so as to enable the States to take fresh proceedings for assessment and levy of tax	 then there was no need whatsoever for the second clause	 as effectuation of the Act would automatically validate the levies and collections made thereunder. It is said 1466 that the object of the legislation was only to see that the States had not to refund amounts collected by them	 and that for achieving that object it was necessary only to give effect to the second clause. The decision in Dialdas vs P. section Talwalkar (1) already cited	 was relied on as supporting the petitioners on this point. In our judgment	 the language of the enactment is too clear and unambiguous to admit of this contention. If the purpose of the enactment is what the petitioners contend it to be	 then nothing would have been easier for the legislature than to have so framed the section as to confine its operation to levies or collections already made	 without giving effect to the law itself. On the contention of the petitioners	 the first clause has to be discarded as wholly inoperative	 and we should be 10th to adopt a construction which leads to that result. It is true that on the contention of the State that the first clause has independent operation the second clause would be unnecessary	 as even without it	 the result sought to be achieved by it must follow on the first clause itself. But it is to be noted that the first clause has reference to the exercise of legislative power while the second is concerned with administrative action	 and it is possible that the second clause might have been enacted by way of abundant caution. It is nothing strange or unusual for a legislature to insert a provision ex abundanti cautela	 so as to disarm possible objection; but it is in conceivable that it should enact a provision which is wholly inoperative. Of two alternative constructions of which one leads to the former and the other involves the latter result	 there cannot be any question that it is the former that is to be preferred. Nor is it permissible to cut down the plain meaning of the terms of the statute on considera tions of policy behind the legislation. But even from that point of view	 there was the fact that there were dealers who had collected taxes from their purchasers for payment to the State	 but were relieved of (1) A.I.R. 1957 Bom. 1467 that obligation by the judgment in The Bengal Immunity Company case (1) and that	 further	 to validate only levies and collections made would give an advantage to those who evaded the law as then understood	 over those who loyally obeyed it. It follows that we are unable to agree with the decision in Dialdas vs P. section Talwalkar (2)	 in so far as it held that it was not competent to the State to start fresh proceedings for assessment of tax on the strength of the impugned Act. In our opinion	 the true construction of section 2 is that the two clauses therein are	 as indicated by the conjunction	 distinct and independent in their opera. tion	 and that the laws of the States are kept in force in respect of sales which had taken place during the specified period	 and that proceedings in respect thereof for assessment are within the protection of the Act. It was next argued that the impugned Act is a temporary statute	 as its operation is limited to sales which took place during the specified period	 and that period having expired	 no proceedings could now be taken on the strength of the provisions of that Act	 and reliance was placed on the observations of this Court in Keshavan Madhava Menon vs The State of Bombay (3)	 in support of this position. But the impugned Act is in no sense a temporary Act. Its life is not limited to any specified period. It is a permanent statute operating on all sales which took place during the specified period. The fallacy in this contention of the petitioners lies in mixing up the period	 the sales during which are brought within the operation of the Act	 with the period of the operation of the Act itself. The former may be said to be temporary	 but the latter clearly is not. (IV) It is next contended that even if the impugned Act authorised starting of fresh proceedings for assessment of tax on the Explanation sales which had taken place during the specified period	 no action in that behalf could be taken under section 22 of the (1) (2) A.I.R. 1957 Bom. (3) ; 	 235. 186 1468 Andhra (Madras) Act	 because it was	 when it was enacted	 repugnant to article 286(2) of the Constitution	 and was therefore void. It is argued that a statute which is unconstitutional is a nullity and must be treated as non est and that the impugned Act could not infuse life into it. It may be open	 it is said	 to the Legislature of the State of Andhra to enact a fresh law giving it even retrospective operation as provided in the impugned Act	 but in the absence of such a legislation	 the provisions of the Act as they stood prior to the impugned Act are incapable of enforcement. It would be sufficient answer to this contention that section 22 of the Madras Act is only a piece of conditional legislation	 imposing tax on interState sales when Parliament should enact a law lifting the ban	 and if such legislation is competent as we have held it is	 then no question of unconstitutionality of the section when it was enacted could arise. But it would be more satisfactory to decide the point on its own merits	 as the question raised has been	 of late	 the subject of considerable discussion in this Court. Now	 in considering the question as to the effect of unconstitutionality of a statute	 it is necessary to re member that unconstitutionality might arise either because the law is in respect of a matter not within the competence of the legislature	 or because the matter itself being within its competence	 its provisions offend some constitutional restrictions. In a Federal Constitution where legislative powers are distributed between different bodies	 the competence of the legislature to enact a particular law must depend upon whether the topic of that legislation has been assigned by the Constitution Act to that legislature. Thus	 a law of the State on an Entry in List 1	 Sch. VII of the Constitution would be wholly incompetent and void. But the law may be on a topic within its competence	 as for example	 an Entry in List II	 but it might infringe restrictions imposed by the Constitution on the character of the law to be passed	 as for example	 limitations enacted in Part III of the Constitution. Here also	 the law to the extent of the repugnancy will be 1469 void. Thus	 a legislation on a topic not within the competence of the legislature and a legislation within its competence but violative of constitutional limitations have both the same reckoning in a court of law; they are both of them unenforceable. But does it follow from this that both the laws are of the same quality and character	 and stand on the same footing for all purposes ? This question has been the subject of consideration in numerous decisions in the American Courts	 and the preponderance of authority is in favour of the view that while a law on a matter not within the competence of the legislature is a nullity	 a law on a topic within its competence but repugnant to the constitutional prohibitions is only unenforceable. This distinction has a material bearing on the present discussion. If a law is on a field not within the domain of the legislature	 it is absolutely null and void	 and a subsequent cession of that field to the legislature will not have the effect of breathing life into what was a still born piece of legislation and a fresh legislation on the subject would be requisite. But if the law is in respect of a matter assigned to the legislature but its provisions disregard constitutional prohibitions	 though the law would be unen. forceable by reason of those prohibitions	 when once they are removed	 the law will become effective without re enactment. Willoughby on the Constitution of the United States	 Vol. 1	 at p. 11 says : " The validity of a statute is to be tested by the constitutional power of a legislature at the time of its enactment by that legislature	 and	 if thus tested it is beyond the legislative power	 it is not rendered valid	 without re enactment	 if later	 by constitutional amendment	 the necessary legislative power is granted. However	 it has been held that where an act is within the general legislative power of the enacting body	 but is rendered unconstitutional by reason of some adventitious circumstance	 as for example	 when a State legislature is prevented from regulating a matter by reason of the fact that the Federal 1470 Congress has already legislated upon that matter	 or by reason of its silence is to be construed as indicating that there should be no regulation	 tile act does not need to be re enacted in order to be enforced	 if this cause of its unconstitutionality is removed. " In Cooley on Constitutional Law at p. 201	 it is stated that " a finding of unconstitutionality does not destroy the statute but merely involves a refusal to enforce it". In Wilkerson vs Rahrer (1)	 the State of Kansas had enacted a law in 1889 forbidding the sale of intoxicating liquor. This was bad in so far as it related to sales in the course of interstate trade	 as it was in contravention of the Commerce Clause. But in 1890	 the Congress passed a law conferring authority on the States to enact prohibition laws. The question was whether a prosecution under the law of 1889 in respect of a breach of that law subsequent to the Congress legislation in 1890 was maintainable. Repelling the contention that the statute of 1889 was a nullity when it was passed and could not be enforced without reenactment	 the Court observed: " This is not the case of a law enacted in the unauthorized exercise of a power exclusively confided to Congress	 but of a law which it was competent for the State to pass	 but which could not operate upon articles occupying a certain situation until the passage of the Act of Congress. That Act in terms removed the obstacle	 and we perceive no adequate ground for adjudging that a re enactment of the state law was required before it could have the effect upon imported which it had always had upon domestic property. " It should be noted that in this case the law of 1889 applied to intrastate sales also	 and it was admittedly valid to that extent. The impugned legislation was therefore unconstitutional only in part. Rottschafer after referring to the conflict of authorities on 'this question in the States	 refers to the decision in Wilkerson vs Rahrer (1) as embodying the better view. Vide American Constitutional Law	 1939 Edn. p. 39. A similar view was taken in Ulster Transport (1) (1891) I40 U.S. 545; ; 1471 Authority vs James Brown & Sons Ltd. (1). There	 construing section 5(1) of the Act of 1920 which enacts that " any law made in contravention of the restrictions imposed by this sub section shall so far as it contravenes these restrictions	 be void "	 Lord MacDermott L. C. J. observed: " I am not aware of any authority for the view that language such as this necessarily means that contravention must produce an actual gap in the statute book in the sense that the measure concerned	 or some specific part thereof	 simply drops out of the authorized text. As well as this vertical severability	 if I may so describe it	 I see no reason why	 if the circumstances warrant such a course	 the terms of section 5(1) should not be sufficiently met by what I may call a horizontal severance	 a severance that is which	 without excising any of the text	 removes from its ambit some particular subject matter	 activity or application. This	 I think	 would give effect to the words ' so far as it contravenes ' without impinging on the meaning or weight to be attached to the word ' void '. " It will be noted that this decision also deals with a statute which was in part unconstitutional. Coming to the authorities of this Court where this question has been considered: In Behram Khurshed Pesikaka vs The State of Bombay (2) the question arose with reference to the Bombay Prohibition Act of 1949 which	 subject to certain exceptions provided therein	 prohibited the consumption of liquor. In The State of Bombay and another vs F. N. Balsara (3) this Court had held that this provision was obnoxious to article 19(1)(g) of the Constitution in so far as it related to medicinal and toilet preparations containing alcohol. The appellant was prosecuted for the offence of consuming liquor	 and his defence was that he had taken medicine containing alcohol. The point in dispute was whether the burden was upon the appellant to prove that he had taken such a medicine or for the prosecution to show that he had not. This (1) (1953) Northern Ireland Reports 79. (2) 	 654. (3) ; 1472 Court held that the onus was on the prosecution	 and the same not having been discharged	 the appellant was entitled to be acquitted. In the course of the judgment	 Mahajan C. J. made the following observations	 which are relied on by the petitioners: " The constitutional invalidity of a part of section 13(b) of the Bombay Prohibition Act having been declared by this Court	 that part of the section ceased to have any legal effect in judging cases of citizens arid had to be regarded as null and void in determining whether a citizen was guilty of an offence. " It must be observed that the question of the constitu tionality of the Act did not arise directly for deter mination and was incidentally discussed as bearing on the incidence of burden of proof. And further	 these observations have reference to the enforceability of the provisions of the Bombay Prohibition Act	 while the bar under article 19 continued to operate. There was no question of the lifting of ban imposed by article 19	 'and the question as to the effect of lifting of a ban did not arise for decision. In the context in which they occur	 the words " null and void " cannot be construed as implying that the impugned law must be regarded as non est so as to be incapable of taking effect	 when the bar is removed. They mean nothing more than that the Act is unenforceable by reason of the bar. In A. V. Fernandez vs State of Kerala (1) the question arose with reference to the Travancore Cochin General Sales Tax Act and the Rules made thereunder. Prior to the Constitution	 the assessees were liable to pay tax on the total turnover of sales including those inside the State and those outside the State. Where the sales were of cocoanut oil	 there was a provision for deduction of the price paid for the purchase of copra from the total turnover. After the coming into force of the Constitution	 a new section	 section 26	 corresponding to section 22 of the Madras Act	 was introduced incorporating therein the provisions of article 286	 and consequent thereon	 the sales which took place outside the State were excluded from the turnover. On this	 (1) ; 1473 a question arose as to the quantum of deduction to which the assessee was entitled in respect of his purchase of copra. He claimed that he was entitled to deduct the price paid for copra not only in respect of oil which was sold inside the State but also oil sold outside the State. This contention was rejected by the High Court	 which limited the deduction to purchase of copra relating to the sales inside ' the State	 and in affirming that decision	 this Court observed : " In our opinion	 section 26 of the Act	 in cases falling within the categories specified under Article 286 of the Constitution has the effect of setting at nought and of obliterating in regard thereto the provisions contained in the Act relating to the imposition of tax on the sale or purchase of such goods and in particular the provisions contained in the charging section and the provisions contained in rule 20(2) and other provisions which are incidental to the process of levying such tax. So far as sales falling within the categories specified in Article 286 of the Constitution and the corresponding section 26 of the Act are concerned	 they are	 as it were	 taken out of the purview of the Act and no effect is to be given to those provisions which would otherwise have been applicable if section 26 had not been added to the Act. " On the strength of the above observations	 the petitioners contend that the provisions relating to inter State sales must be treated as non existent	 and that	 therefore	 a fresh enactment of the statute would be necessary to bring them into operation. Here again	 the point for decision was only as to the effect of the ban under article 286 on the transactions which came within its purview. That ban had not then been lifted and the effect of the lifting of such a ban on the existing law did not fall to be considered. We are unable to read the observations relied on by the petitioners as implying that section 22 of the Madras Act must be taken to have been blotted out of the statute book. A case directly in point is Bhikaji Narayan Dhakras and others vs The State of Madhya Pradesh and another (1). There	 the question arose with reference (1) ; 1474 to the C. P. & Berar Motor Vehicles (Amendment) Act	 1947 (Act 3 of 1948). That Act had amended section 43 of the 	 by introducing provisions which authorised the Provincial Government " to take up the entire motor transport business in the Province and run it in competition with and even to the exclusion of motor transport operators ". These provisions	 though valid at the time when they were enacted	 became void on the coming into force of the Constitution as infringing the rights of citizens to carry on business	 protected by article 19(1)(g). The Constitution	 however	 was amended on June 18	1951	 and article 19(6) was amended so as to authorise the State to carry on business " to the exclusion	 complete or partial	 of citizens or otherwise ". Subsequent to this amendment	 the Government issued a notification under section 43 of the Amendment Act of 1948	 and it was the validity of that notification that was in issue. The contention was that as section 43 of the Act of 1948 had become void at the date of the Constitution	 a notification issued by the Government under that section after the date of the amendment of the Consti tution was not valid	 as it must be taken to have become non est. It was held by this Court that section 43 of the Act of 1948 could not be held to have been effaced out of the statute book	 because it continued to operate on transactions prior to the coming into force of the Constitution	 and that even after the Constitution	 it would be operative as against non citizens	 that the consequence of section 43 being repugnant to article 19(1)(g) was that it could not be enforced so long as the prohibition contained therein was in force	 but that when once that prohibition had been removed as it was by the First Amendment	 the provisions of that Act which had been dormant all the time became active and enforceable. The result of the authorities may thus be summed up: Where an enactment is unconstitutional in part but valid as to the rest	 assuming of course that the two portions are severable	 it cannot be held to have been wiped out of the statute book as it admittedly must remain there for the purpose of enforcement of 1475 the valid portion thereof	 and being on the statute book	 even that portion which is unenforceable on the ground that it is unconstitutional will operate proprio vigore when the Constitutional bar is removed	 and there is no need for a fresh legislation to give effect thereto. On this view	 the contention of the petitioners with reference to the Explanation in section 22 of the Madras Act must fail. That Explanation operates	 as already stated	 on two classes of transactions. It renders taxation of sales in which the property in the goods passes in Madras but delivery takes place outside Madras illegal on the ground that they are outside sales falling within article 286(1) (a). It also authorises the imposition of tax on the sales in which the property in the goods passes outside Madras but goods are delivered for consumption within Madras. It is valid in so far as it prohibits tax on outside sales	 but invalid in so far as sales in which goods are delivered inside the State are concerned	 because such sales are bit by article 286(2). The fact that it is invalid as to a part has not the effect of obliterating it out of the statute book	 because it is valid as to a part and has to remain in the statute book for being enforced as to that part. The result of the enactment of the impugned Act is to lift the ban under article 286(2)	 and the consequence of it is that that portion of the Explanation which relates to sales in which property paws outside Madras but the goods are delivered inside Madras and which was unenforceable before	 became valid and enforceable. In this view	 we do not feel called upon to express any opinion as to whether it would make any difference in the result if the impugned provision was unconstitutional in its entirety. There is one other aspect of the question to which reference must be made. The decisions in Behram Khurshed Pesikaka vs The State of Bombay (1) and Bhikaji Narain Dhakras and others vs The State of Madhya Pradesh and another (2) both turn on the construction of article 13 of the Constitution	 which enacts that laws shall be void to the extent they are (1) 187 (2) ; 	 187 1476 repugnant to the provisions of Part III. We are concerned in these petitions not with infringement of any of the provisions of Part III but of article 286(2)	 and the point for our decision is as to the effect of the infringement of that provision. article 286(2) does not provide that a law which contravenes it is void	 and when regard is had to the context of that provision	 it is difficult to draw the inference that that is the consequence of contravention of that provision. article 372(1) provides for the continuance in force of all laws existing at the date of the Constitution. The proviso to article 286(2) enacts that the President may by an order continue the operation of the Sales Tax Laws up to March 31	 1951	 and article 286(2) itself enacts that no law of a State shall impose a tax. In the context in which they occur	 the true meaning to be given to these words is	 as already observed	 that no law of a State shall be effective to impose a tax; that is to say	 the law cannot be enforced in so far as it imposes such a tax. Whether we consider the question on broad principles as to the effect of un constitutionality of a statute or on the language of article 286(2)	 the conclusion is inescapable that section 22 of the Madras Act and the corresponding provisions in the other statutes cannot be held to be null and void and non est by reason of their being	 repugnant to article 286(2) and the bar under that Article having been now removed	 there is no legal impediment to effect being given to them. (V) We shall now deal with the contention of the learned counsel for the Madura Mills Ltd.	 who struck a new path cutting across the lines on which the petitioners and the other interveners proceeded. He contended that the decisive factor in the determination of the question was Entry 42 in List I of the Seventh Schedule	 "Inter State trade and commerce"	 that under that Entry	 Parliament had the exclusive power to enact laws in respect of inter State trade and commerce and that included power to impose a tax on inter State sales	 that the States had therefore no competence under the Constitution to enact a law imposing tax on such sales	 that the laws passed 1477 by the States after the Constitution imposing such a tax were ultra vires and void	 that the impugned Act purporting to give effect to such laws was likewise ultra vires and inoperative	 and that	 in consequence	 the proceedings sought to be taken under section 22 of the Madras Act and the corresponding provisions in the sister Acts of other States were unauthorised and illegal. The argument in support of this contention was as follows: Entry 42 in List I is based on the Commerce Clause of the American Constitution	 article 1	 section 8 that " The Congress shall have power to regulate commerce among the several States "	 and that has been interpreted by the Supreme Court of the United States as meaning that the States have no power to enact a law imposing a tax on the carrying on of inter State trade (Vide Robins vs Taxing District of Shelby County (1)	 or imposing tax on inter State sales (Vide McLeod vs Dilworth Co. (2)). The contents of Entry 42 are the same as those of the Commerce Clause	 and it must therefore be construed as of the same effect. It is also a well established rule of construction that the Entries in the Legislative Lists must be interpreted liberally and in a wide sense. The true interpretation therefore to be put upon Entry 42 is that Parliament has	 and therefore	 in view of the non obstante clause in article 246(1) and of the words "subject to" in article 246(3)	 the States have not	 the power to impose tax on inter State sales. Article 301 which provides that trade and commerce in the territory of India shall be free is also intended to achieve the same result. It reproduces section 92 of the Commonwealth of Australia Constitution Act	 and the authorities on that section have held that imposition of a tax on inter State trade would be obnoxious to that provision. That the freedom in article 301 includes freedom from taxation is also implicit in article 304 (a) in which an exception to article 301 is made in respect of the imposition of tax on goods imported from other States. The result is	 it is argued	 that after the Constitution no law of a State can impose a tax on (1) ; ; (2) (1044) ; ; 1478 inter State sales	 and in consequence	 section 22 of the Madras Act	 which came into force after the Constitution	 would	 if it is construed as imposing a tax	 be bad	 and the impugned Act which proceeds on the view that the States have the power to enact laws imposing a tax on inter State sales and seeks to give effect to them would also be unconstitutional and void. This contention suffers	 in our opinion	 from serious infirmities. It overlooks that our Constitution was not written on a tabula rasa	 that a Federal Constitution had been established under the Government of India Act	 1935	 and though that has undergone considerable change by way of repeal	 modification and addition	 it still remains the framework on which the present Constitution is built	 and that the provisions of the Constitution must accordingly be read in the light of the provisions of the Government of India Act. It fails to give due weight to the setting of the relevant provisions of the Constitution and the interpretation which is to be put upon them in their context. In the Government of India Act	 1935	 there was no Entry corresponding to Entry 42 in List I of the Constitu tion. But there was in List II	 Entry 48 which corresponds to Entry 54 in the Constitution. It is not in dispute that under Entry 48 the States had power to pass a law imposing a tax on inter State sales	 because the terms of the Entry are wide and would include inter State as well as intrastate sales. It was on this view that the Provinces had enacted laws imposing tax on inter State sales. Then the Constitu tion came into force	 and it included for the first time a new Entry 42 in List 1. It also reproduced Entry 48 in Entry 54 in List II in terms	 for our purposes	 identical. Having regard to the connotation of that Entry in the Government of India Act	 1935	 one would have expected that if it was intended by the Constitution makers that the States should be deprived of the power to tax interstate sales which they had under Entry 48 in the Government of India Act	 that would have been made clear in the Entry itself. It is material to note that while Entry 48 in the Government 1479 of India Act was "Taxes on the sale of goods and on advertisement "	 Entry 54 in List II of the Constitution as originally enacted was " Taxes on the ' sale or purchase of goods other than newspapers". Thus	 the Constitution did limit the scope of Entry 48 by excluding from it newspapers	 and if it was its intention to exclude inter State sales from its purview	 nothing would have been easier for it than to have said so	 instead of leaving that result to be inferred on a construction of Entry 42 in List I in the light of the American authorities on the Commerce Clause. This Is strong indication that Entry 42 is not to be read as including tax on inter State sales. This conclusion is further strengthened	 when regard is had to the scheme of the Lists in the Seventh Schedule and the principle underlying the enumeration of heads of legislation therein. In List 1	 Entries I to 81 mention the several matters over which Parliament has authority to legislate. Entries 82 to 92 enumerate the taxes which could be imposed by a law of Parliament. An examination of these two groups of Entries shows that while the main subject of legislation figures in the first group	 a tax in relation thereto is separately mentioned in the second. Thus	 Entry 22 in List I is " Railways "	 and Entry 89 is " Terminal taxes on goods or passengers	 carried by railway	 sea or air; taxes on railway fares and freights ". If Entry 22 is to be construed as involving taxes to be imposed	 then Entry 89 would be superfluous. Entry 41 mentions "Trade and commerce with foreign countries; import and export across customs frontiers ". If these expressions are to be interpreted as including duties to be levied in respect of that trade and commerce	 then Entry 83 which is " Duties of customs including export duties " would be wholly redundant. Entries 43 and 44 relate to incorporation	 regulation and winding up of corporations. Entry 85 provides separately for Corporation tax. Turning to List II	 Entries I to 44 form one group mentioning the subjects on which the States could legislate. Entries 45 to 63 in that List form another group	 and they deal with 1480 taxes. Entry 18	 for example	 is " Land " and Entry 45 is " Land revenue ". Entry 23 is " Regulation of mines " and Entry 50 is " Taxes on mineral rights ". The above analysis and it is not exhaustive of the Entries in the Lists leads to the inference that taxation is not intended to be comprised in the main subject in which it might on an extended construction be regarded as included	 but is treated as a distinct matter for purposes of legislative competence. And this distinction is also manifest in the language of article 248	 Cls. (1) and (2)	 and of Entry 97 in List I of the Constitution. Construing Entry 42 in the light of the above scheme	 it is difficult to resist the conclusion that the power of Parliament to legislate on inter State trade and commerce under Entry 42 does not include a power to impose a tax on sales in the course of such trade and commerce. Article 286 has a direct bearing on the point now under discussion. It imposes various restrictions on the power of the State to enact laws imposing taxes on sale of goods and one of those restrictions has reference to taxes on inter State sales	 vide article 286(2). It is implicit in this provision that it is the States that have got the power to impose a tax on such sales	 as there can be no question of a restriction on what does not exist. That is how article 286(2) has been construed by this Court both in The United Motors case (1) and in The Bengal Immunity Company case (2). It was observed therein that under Entry 54	 as under Entry 48 of the Government of India Act	 the power to tax sales rested with the States	 and that article 286(2) was enacted with the object of avoiding multiple taxation of inter State sales in exercise of the power conferred by that Entry. This again strongly supports the conclusion that Entry 54 must be interpreted as including the power to tax inter State sales and Entry 42 as excluding it. In order to get over this hurdle	 learned counsel put forward the contention that article 286(2) had reference only to laws which were in existence at the time when the Constitution came into force	 and that the (1) ; (2) 1481 power given to Parliament was one to continue those laws. Reference was made to the proviso to article 286(2) which authorised the President to direct that the taxes which were being levied by the State before the commencement of the Constitution might be continued to be levied until March 31	 1951	 and it was said that the power conferred under article 286(2) was of the same character	 and that it merely enabled Parliament to continue pre Constitution laws. Now	 it cannot be disputed that the language of article 286(2) would	 in terms	 comprehend future legislation. Language similar to the one used in article 286 (2) is also to be found in article 287	 and there	 it clearly has reference to laws to be enacted after the Constitution. Indeed	 it was conceded that on the wording of article 286(2) both existing and future legislation would be included. But it was contended that its operation should be limited to existing laws	 because as Entry 42 in List I includes tax on inter State sales	 any law of the State subsequent to the Constitution imposing such a tax would be incompetent. This	 however	 is petitio principii. The point for decision is whether tax on inter State sales is included within Entry 42. The inference to be drawn from the plain language of article 286(2) is that it is not. It is no answer to this to say that Entry 42 includes it	 and that	 therefore	 the meaning of article 286(2) should be cut down. We cannot accede to such a contention. To sum up: (1) Entry 54 is successor to Entry 48 in the Government of India Act	 and it would be legitimate to construe it as including tax on interState sales	 unless there is anything repugnant to it in the Constitution	 and there is none such. (2) Under the scheme of the Entries in the Lists	 taxation is regarded as a distinct matter and is separately set out. (3) Article 286(2) proceeds on the basis that it is the States that have the power to enact laws imposing tax on inter State Sales. it is a fair inference to draw from these considerations that under Entry 54 in List 11 the States are competent to enact laws imposing tax on inter State sales. We must now consider the arguments that have 1482 been put forward as supporting the opposite conclusion. It is firstly contended that the Entries in the Legislative Lists must be construed broadly and not narrowly or in a pedantic manner	 and that	 in accordance with this principle	 Entry 42 should be construed	 there being no limitation contained therein	 as inclusive of the power to tax sales in inter State trade and commerce. The rule of construction relied on is no doubt well established; but the question is as to the application of that rule in the present case. The question here is not simpliciter whether a particular piece of legislation falls within an Entry or not. The point in dispute before us is whether between two Entries assigned to two different Legislatures the particular subject of legislation falls within the ambit of the one or the other. If Entry 42 in List I is to be construed liberally	 so must Entry 54 in List II be	 and the point is not settled by reference to article 246	 Cls. (1) and (3) and to the principle laid down in Union Colliery Company of British Columbia vs Bryden (1) that where there is a conflict of jurisdiction between a Central and a Provincial Legislature	 it is the law of the Centre that must prevail. article 246	 Cls. (1) and (3) have to be invoked only if there is a conflict as to the scope of two Entries in the two Lists and not otherwise. What has therefore first to be decided is whether there is any conflict between Entry 42 in List I and Entry 54 in List 11. If there is not	 the application of the non obstante clause in article 246(1) or of the words " subject to " in article 246(3) does not arise. There is another rule of construction also wellsettled that the Entries in two Legislative Lists must be construed if possible so as to avoid a conflict. In Province of Madras vs Boddu Paidanna and Sons (2) the question was as to whether the first sales by a manufacturer of goods were liable to be taxed by the Province under Entry 48 in List II	 or whether it was really a tax on excise which was within the exclusive competence of the Centre under Entry 45 in List 1. It was held by the Federal Court that the (1) (2) 1483 correct approach to the question was to see whether it was possible to effect a reconciliation between the two Entries so as to avoid a conflict and overlapping	 ' and that	 in that view	 though excise duty might in a extended sense cover the first sales by the manufacturer	 in the context of entry 48 in List II it should be held not to include it	 and that therefore the Province had the right to tax the first sales. This view was approved by the Privy Council in GovernorGeneral in Council vs Province of Madras (1). If it is possible therefore to construe Entry 42 as not including tax on interstate sales	 then on the principle enunciated in Province of Madras vs Boddu Paidanna and Sons (2) and Governor General in Council vs Province of Madras (1) we should so construe it	 as that will avoid a conflict between the two Entries. It was also argued in support of the contention that Entry 42 in List I must be held to include the power to tax	 that that was the interpretation put by the American authorities on the Commerce Clause	 and that there was no reason why a different construction 	should be put on Entry 42 in list I of our Constitution. It is true that our Constitution makers bad before them the Commerce Clause and the authorities thereon	 but it is a mistake to suppose that they intended to bodily transplant that clause in Entry 42. We had in the Government of India Act	 1935	 a fullfledged Federal Constitution in force in this Country	 and what the Constitution makers did was to draw from other Federal Constitutions of the world	 adapt and modify the provisions so as to sent our conditions and fit them in our Constitution. In this new context	 those provisions do not necessarily mean what they meant in their old setting. The threads were no doubt taken from other Constitutions	 but when they were woven into the fabric of our Constitution	 their reach and their complexion underwent changes. Therefore	 valuable as the American decisions are as showing how the question is dealt with in a sister (1) (1945) L.R. 72 I.A. 91. (2) 188 1484 Federal Constitution	 great care should be taken in applying them in the interpretation of our Constitution. We should not forget that it is our Constitution that we are to interpret	 and that interpretation must depend on the context and setting of the particular provision which has to be interpreted. Applying these principles and having regard to the features already set out	 we must hold that Entry 42 in List I is not to be interpreted as including taxation. The same remarks apply to the argument based upon section 92 of the Commonwealth of Australia Constitution Act and article 301 of 'our Constitution. We should also add that article 304 (a) of the Constitution cannot be interpreted as throwing any light on. the scope of article 301 with reference to the question of taxation	 as it merely reproduces section 297 (1) (b) of the Government of India Act	 and as there was no provision therein corresponding to article 301	 section 297 (1)(b) could not have implied what is now sought to be inferred from article 304 (a). In the result	 we are of opinion that if the States had the power under Entry 54 to impose a tax on inter State sales subject only to the restriction enacted in article 286 (2)	 then by virtue of the impugned Act such law is rendered operative and proceedings taken thereunder are valid. We have reached this conclusion on a construction of the statutory provisions bearing on the question without reference to the Sixth Amendment of the Constitution which	 proceeding on the view that the States had the power to tax interState sales under Entry 54	 has amended the Constitu tion	 and has vested the power to tax interstate sales in the Centre. (VI) Another contention urged by the petitioners is that the levy of tax proposed to be made by the Andhra State on the sale of yarn by them to dealers in the State of Andhra is illegal	 because under the Madras Act and the Rules made thereunder	 where there are successive sales of yarn the tax can be imposed at only one point	 and as the Government of Madras had already imposed a tax on the sale within that State	 a second levy on the self same goods by the State of Andhra is unauthorised. and that therefore 1485 the threatened proceedings for assessment are incompetent. This contention is clearly untenable. When the Madras Act provides for a single levy on successive sales of yarn	 it can have only application to sales in the State of Madras	 as it would be incompetent to the Legislature of Madras to enact a law to operate in another State. But it is argued that section 53 of the Andhra State Act	 1953	 on its true interpretation enacts that though for political purposes Andhra is to be regarded as a separate State	 for the enforcement of laws as they stood on that date it should be deemed to be a part of the State of Madras. We do not agree with this interpretation. In our opinion	 section 53 merely provides that the laws in existence in the territories which were constituted into the State of Andhra should continue to	 operate as before. In fact	 by an Adaptation Order issued on November 12	 1953	 even the name of Andhra was substituted for Madrts in the Madras General Sales Tax Act. There is no substance in this contention. (VII) Lastly	 it is argued that the Essential Commodities Act enacted by Parliament in exercise of the power conferred by article 286 (3) has declared that yarn is an essential commodity	 and that if the Madras Act is to be construed as a fresh enactment for the Andhra State by reason of sections 53 and 54 of the Andhra State Act and the Adaptation Order dated November 12	 1953	 then it would be bad inasmuch as the procedure prescribed in that provision had not been followed. The basis of this contention is that the Madras Act as applied to the Andhra State is a now Act for purposes of article 286 (3)	 but that is not so. The Madras Act was in force in the territories which now form part of the Andhra State until October 1	 1953	 and thereafter that Act continues to be in operation by force of section 53 of the Andhra State Act. Moreover	 the Madras Act become operative in the new State of Andhra not under any law passed by the Legislature of the State of Andhra but under section 53 of a law enacted by Parliament and therefore article 286 (3) has no application. We should add that the Essential Commodities Act (LII of 1952) has itself 1486 been repealed and is no longer in operation. This contention of the petitioners also should be rejected. The petitioners sought to raise certain other contentions such as that they are not "dealers" in the Andhra State	 and that the Explanation to section 22 had no application to the sales sought to be taxed	 as the goods were delivered not in the State of Andhra but in Madras. But these are questions which ought properly to be raised before the assessing authorities	 and cannot be gone into in these proceedings. In the result	 the petitions fail and are rejected. The petitions have had a chequered career	 their fortures fluctuating with changes in the interpretation of the law and in the law itself. In the circumstances	 we direct the parties to bear their own costs. SARKAR J. The petitioners who are dealers in cotton yarn carrying on business in the city of Madras had sold goods to various persons in the State of Andhra. This State	 the respondent in these petitions	 demanded taxes on these sales under the provisions of the Sales Tax Act applying to its territories. The petitioners challenged the respondents right to tax the	 sales	 and filed these petitions for writs of prohibition or other suitable writs restraining the respondent from levying and collecting the tax. The Act mentioned various kinds of sales which could be taxed under it. The procedures followed by the petitioners in effecting the sales were diverse and have not yet been ascertained	 and it is not possible without such ascertainment to decide whether they are or are not taxable under the provisions of the Act read with other relevant laws. To avoid this difficulty it has been agreed between the parties that the only question that will be decided on these petitions is whether the respondent can tax a sale under which the pro perty in the goods sold passed outside the State of Andhra but the goods were delivered in that State for consumption there. Before proceeding to discuss this question it is necessary to refer to certain antecedent events. On January 26	 1950	 the Constitution of India was 1487 promulgated. It continued the laws previously in force in the territories of India subject to its provisions. Article 372(2) of the Constitution provides that	 "For the purpose of bringing the provisions of any law in force in the territory of India into accord with the provisions of this Constitution	 the President may by order make such adaptations and modifications of such law	 whether by way of repeal or amendment	 as may be necessary or expedient. " Article 286 of the Constitution as it stood prior to its amendment in 1956	 that being what this case is concerned with	 contained the following provisions : " article 286. (1) No law of a State shall impose	 or authorise the imposition of	 a tax on the sale or purchase of goods where such sale or purchase takes place (a) outside the State ; or (b) in the course of the import of the goods into	 or export of the goods out of	 the territory of India	. Explanation. For the purposes of sub clause (a)	 a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consump tion in that State	 notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State. (2) Except in so far as Parliament my by law otherwise provide	 no law of a State shall impose	 or authorise the imposition of	 a tax on the sale or purchase of any goods where such sale or purchase talks place in the course of inter State trade or commerce : " In the year 1939 the legislature of Madras had enacted the Madras General Sales Tax Act and this was continued in force by the Constitution after its promulgation. In order to bring its provisions into accord with the Constitution	 the President under his power mentioned earlier	 passed on July 2	 1952	 the Adaptation of Laws(Fourth Amendment) Order which 1488 added a new section to the Madras Act	 being section 22. The terms of this section are important in this case and will be set out later. The effect of the Explanation in article 286(1)(a) came up for consideration by this Court in the case of The State of Bombay vs The United Motors (India) Ltd. (1). This Court held by its judgment pronounced by a majority	 on March 30	 1953	 that a State 'could tax a sale under which goods were delivered within its territories for consumption there though the property in the goods passed beyond its territories and a provision in a State statute purporting to levy such a tax did not contravene article 286. Andhra is a new State which came into existence on October 1	 1953. It was created by the Andhra State Act	 1953	 largely out of territories previously belonging to the State of Madras. Later	 the new State came to be designated as the State of Andhra Pradesh but I will refer to it as the State of Andhra or simply Andhra. Section 53 of the Andhra State Act provided that the laws in force prior to the Con stitution of the State of Andhra in the territories included in it	 were thereafter to continue in force there. The Madras General Sales Tax Act therefor(	 became applicable to the State of Andhra and it became go applicable with the new section 22 previously added to it. Subsequently	 the Madras Act as applying in the State of Andhra was	 to suit the latter State	 adapted by substituting for the name Madras the name Andhra wherever it occurred in that Act. I will hereafter call this Act the Sales Tax Act. Sometime in the year 1954 the respondent	 the State of Andhra	 issued notices to the petitioners demanding taxes under its Sales Tax Act. As I have earlier stated the petitioners challenged the right of the respondent to levy the tax and certain correspondence followed. As the respondent insisted on collecting the tax	 the petitioners instituted the present proceeding	 	 in July and August	 1955. While these proceedings were pending	 the question of the effect of article 286 again came up for consideration (1) ; 1489 by this Court in the case of the Bengal Immunity Company Ltd. vs The State of Bihar(1). This Court by its judgment pronounced	 again by a majority	 on September 6	 1955	 held that until Parliament by law made in the exercise of powers vested in it under article 286(2) otherwise provided	 no State could impose any tax on a sale or purchase of goods when such sale or purchase took place in the course of inter State trade or commerce and the majority decision in the State of Bombay vs The United Motors (India) Ltd. (2) in so far as it decided to the contrary could not be accepted andfurther that the explanation in article 286(1)(a)did not confer any right on the State in which the goods were delivered under a sale	 to tax it notwithstanding that the property in the goods passed in another State. In view of this decision the respondent was advised that it could not oppose the petitions and on October 21	 1955	 it actually filed statements in these proceedings submitting that the petitions might be allowed. Before however the petitions could be heard and disposed of	 an Ordinance called the Sales Tax Laws Validation Ordinance	 1956	 was promulgated by the President on January 30	 1956. This Ordinance was later	 on March 21	 1956	 replaced by the Sales Tax Laws Validation Act	 1956. Both these enactments were in identical terms. The operative provision of the Validation Act is set out below. " Notwithstanding any judgment	 decree or order of any court no law of a State imposing	 or authorising the imposition of	 a tax on the sale or purchase of any goods where such sale or purchase took place in the course of inter State trade or commerce during the period between the 1st day of April	 1951	 and the 6th day of September	 1955	 shall be deemed to be invalid or ever to have been invalid merely by reason of the fact that such sale or purchase took place in the course of interstate trade or commerce ; and all such taxes levied or collected or purporting to have been levied or collected during the (1) (2) ; 1490 aforesaid period shall be deemed always to have been validly levied or collected in accordance with law. " The respondent was advised that the Validation Act had changed the situation and in view of it the petitions could no longer succeed. Thereupon	 the respondent on February 19	 1957	 filed fresh statements submitting that the petitions should be dismissed. The petitions have now come up for hearing in these circumstances. The validity of the Validation Act itself has been challenged. But I do not think it necessary to decide that question. I will assume that that Act is perfectly valid. It does not however itself levy any tax. Its only effect	 so far as these cases are concerned	 is to permit the Sales Tax Act to operate to tax sales which took place in the course of trade between Andhra and any other State between certain dates. I will not refer to these dates hereafter for what Ihave to say applies to sales between them only. As has been agreed between the parties	 as mentioned at the commencement of this judgment	 the only question that we have to decide is whether a sale under which the goods were delivered in Andhra for consumption there though property in them passed in Madras	 can be taxed by the respondent. Such a sale would no doubt be a sale in the course of trade between Andhra and Madras. It is said that such a sale cannot be taxed by the respondent notwithstanding the Validation Act	 because the Sales Tax Act does not purport to tax it. Does the Sales Tax Act then contain any provision taxing such a sale ? Now the Act authorises the levy of a tax on sales as defined in it. A sale is defined in section 2(h) of the Act. It is not disputed however that that definition does not include a sale under which goods are delivered in Andhra for consumption there but property in them passes in Madras and no further reference to that section is therefore necessary. It is however said that the effect of the Explanation in section 22 is to make such a sale	 a sale within the meaning of the Act and therefore liable to be taxed under it. So I proceed to examine that section. Section 22 as it stood at the relevant time reads thus: 1491 S.22. "Nothing contained in this Act shall be deemed to impose	 or authorise the imposition of	 a tax on the sale or purchase of any goods	 where such ' sale or purchase takes place (a) (i) outside the State of Andhra	 or (ii) in the course of the import of the goods into the territory of India or of the export of the goods out of such territory	 or (b) except in so far as Parliament may by law otherwise provide	 after the 31st day of March 1951 in the course of inter State trade or commerce	 and the provisions of this Act shall be read and construed accordingly. Explanation. For the purposes of clause (a)(i)	 a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State	 notwithstanding the fact that under the general law relating to sale of goods	 the property in the goods has by reason of such sale or purchase passed in another State. " Does the Explanation in this section then say that when under a sale goods are delivered in Andhra	 the sale shall be deemed to have taken place there though the property in the goods may have passed in another State	 for example	 Madras ? It no doubt says	 without specifying any particular State	 that a sale shall be deemed to have taken place in the State in which the goods were delivered under it though the property in them has passed in another State. But it seems to me impossible from the language used to say that it contemplated a case in which the goods were delivered in Andhra though property in them passed in another State. For the sake of clarity I have left out in what I have just said the term as to consumption in the State in which the goods were delivered and no question as to such consumption is in dispute in these cases. The Explanation opens with the words " For the purposes of clause (a) (i) ". What then is that clause ? 189 1492 It only contains the words "outside the State of Andhra". It completes the sentence part of which has preceded it. The complete sentence says	 Nothing in this Act shall be deemed to impose	 or authorise the imposition of	 a tax on the sale or purchase of any good		;	 where such sale or purchase takes place (a) (i) outside the State of Andhra. It then savs that no tax shall be levied under the Act on a sale which takes place outside Andhra. It is after this that the Explanation comes and starts with the words " for the purposes of clause (a) (i)". These words must therefore mean	 for the purpose of explaining which sale is to be regarded as having taken place outside Andhra. The Explanation then is for this purpose. I will now turn to the remaining and the substantive portion of the Explanation. That must explain when a sale is to be regarded as having taken place outside Andhra. The substantive portion of the Explanation however mentions a sale which is to be deemed to have taken place inside a State. Keeping its purpose in mind	 it must be taken by saying that a certain sale is to be deemed inside a State	 to say that it is outside the State of Andhra. It follows that the Explanation does not contemplate that the State inside which a sale is to be deemed to have taken place	 can be the State of Andhra. That State cannot be the State of Andhra	 for then the Explanation would not show when a sale is to be deemed to be outside Andhra and that by its language is the only purpose for which it is enacted. Therefore the Explanation can only be read as contemplating a State other than Andhra as the State inside which a sale shall be deemed to have taken place. This is the inevitable result produced by the opening words of the Explanation understood according to their plain meaning. So the Explanation	 omitting portions of it for the sake of clarity	 can only be read in the manner shown below: For the purposes of clause (a)(i) a sale or purchase shall be deemed to have taken place in the State being a State other than Andhra	 in which the goods have 1493 been actually delivered notwithstanding that the property in the goods has passed in the State of Andhra. I therefore find it impossible to say that the Explanation states that a sale shall be deemed to have taken place inside Andhra if under it the goods have been delivered there though the property in them passed in another State. The Explanation does not hence	 in my view	 authorise the taxation of a sale under which goods are delivered in Andhra though property in them passed in Madras. The view that I have taken of the purpose of the Explanation in section 22 was taken of the purpose of the Explanation in article 286(1)(a) in the Bengal Immunity Company case (1). It was said at p. 646 of the report	 " Here the avowed purpose of the Explanation is to explain what an outside sale referred to in sub clause (a) is ". The language of the Explanations and the setting of each in its respective provision are identical. That language must therefore have the same meaning. It is said that the consideration that prevailed with the Court in the Bengal Immunity Company case (1) in dealing with article 286 cannot apply in dealing with section 22 for the latter is a provision in a taxing statute which the former is not. But I do not see that this comment	 even if justified	 would lead to a different meaning being put on words used when they occur in a taxing statute from that when they occur in a statute which does not purport to levy a tax. As a matter of language only	 words must have the same meaning. The words "for the purpose of clause (a)(i)" must therefore have tile same meaning in the Explanation in article 286(1)(a) as in the Explanation in section 22. 1 am unable to distinguish the present case from the Bengal Immunity Company case (1) for the purpose of determining the meaning of the words used. It is then said that the Explanation in i. 22 has two facets; that when it talks of a sale inside one State	 it at the same time necessarily talks of a sale outside all other States. Therefore it is said that when under a (1) 1494 sale goods are delivered in Andhra but property in .them passes outside Andhra	 the Explanation at the same time makes such a sale inside Andhra and outside all other States. I do not follow this. Why should the Explanation in this Andhra Act be concerned with saying when a sale shall be deemed to have taken place outside all other States ? Andhra cannot of course legislate for any other State. Nor is there anything in this Act which makes it necessary for the purposes of it to say when a sale shall be deemed to be outside all other States. It follows therefore that a construction cannot be put on the language used in tile Explanation which produces the result of showing a sale to be inside Andhra and so outside all other States. Further	 as I have earlier pointed out	 the words " For the purposes of clause (a)(i)" with which the Explanation starts	 show conclusively that it is necessarily confined to a sale under which goods are delivered in a State other than Andhra and the property in the goods passes in Andhra. It is no objection to this reading of the Explanation to say that the Andhra Act would then be saying when a sale is to be deemed to have taken place inside another State and it has no power to do so as it can legislate only for itself and for no other State. Such an objection would be pointless because Andhra by saying that a sale shall be deemed to have taken place inside another State is only legislating for itself and only saying that such a sale is therefore an outside sale so far as it is concerned and cannot be taxed in view of section 22(a) of its Act. It may be that it is possible in construing the Explanation in article 286(1)(a) to conceive of two facets because that dealt with all States or any two States at a time and for all these the Constitution was fully competent to lay down the law. That however is not possible when construing a law passed by a State legislature. Such law cannot regulate the laws of other States. And in this case the conception is further impossible because the language shows that the Explanation is for explaining when a sale is to be deemed to have taken place outside the State of Andhra. It is not meant to 1495 explain when it is deemed to have taken place outside any State whatsoever that State may be. I am therefore unable to see that the Explanation has any facet showing what would be a sale inside Andhra. The conclusion that I reach is that the Sales Tax Act with which these cases are concerned does not authorise '.he taxing of a sale under which goods are delivered in Andhra but the property in them passes in Madras. In this view of the matter I do not think it necessary to discuss the various other grounds on which the respondent 's right to tax these sales was also challenged. In the result I would allow these petitions. BY COURT: In view of the opinion of the majority	 the petitions an dismissed. The parties are to bear their own costs. Petitions dismissed.

Summary:
The petitioners were dealers carrying on business in the City of Madras in the sale and purchase of yarn. The dealers in the State of Andhra used to place orders for the purchase of yarn with the petitioners in Madras	 where the contracts were concluded and the goods were delivered ex godown at Madras and thereafter despatched to the purchasers who would take delivery of them within their State. The present dispute related to sales in which property in the goods sold passed outside the State of 1423 Andhra	 but the goods themselves were actually delivered as a result of the sale for consumption within that State. After the coming into force of the Constitution of India the President in the exercise of the powers conferred by article 372(2) made Adaptation Orders with reference to the Sales Tax Laws of all the States	 and as regards the Madras General Sales Tax Act	 1939	 he issued an Amendment inserting a new section	 section 22 in that Act	 which was a verbatim reproduction of the Explanation to article 286 (i)(a) of the Constitution. Oil July 13	 1954	 the Board of Revenue (Commercial Taxes) in the State of Andhra	 acting on the decision in The State of Bombay and another vs The United Motors (India) Ltd.	 and others; 	 	 called upon dealers in the State of Madras to submit returns of their turnover of sales in which goods were delivered in the State of Andhra for consumption. Thereupon they filed the present petitions under article 32 Of the Constitution challenging the demand on the grounds	 inter alia	 that the sales proposed to be taxed were inter State sales and that they were immune from taxation under article 286(2) Of the Constitution. While the petitions were pending the Supreme Court pronounced on September 6	 1955	 its judgment in The Be gal Immunity Company Limited vs The State of Bihar and others	 [1055] 2 S.C.R. 603	 according to which the petitioners were not liable to be taxed. But before final orders were passed on the petitions Parliament passed Sales Tax Laws Validation Act	 1956	 section 2 whereof provided that no law of a State imposing or authorising the imposition of tax on inter State sales during the period between April 1	 1951	 and September 6	 1955	 shall be deeme to be invalid or ever to have been invalid merely by reason of the fact that the sales took place in the course of the inter State trade. That section further provided that taxes levied or collected on such sales during the aforesaid period shall be deemed to have been validly levied or collected. It was the con tention of the State of Andhra that by reason of the aforesaid provision it had the right to impose tax on inter State sales during the aforesaid period. On the other hand the petitioners contended	 inter alia	 that (I) section 22 Of the Madras General Sales Tax Laws Validation Act	 1956	 which gave validity to laws which imposed a tax	 did not authorise the imposition	 (2) the Sales Tax Laws Validation Act was ultra vires article 286(2)	 (3) section 22 of the Madras Act was not a "law of a State" within article 286(2) and section 2 of the impugned Act	 (4) the impugned Act only validated levies already made and did not authorise the initiation of fresh proceedings for imposing tax	 (5) section 22 having been unconstitutional when it was enacted and therefore void	 no proceedings could be taken thereunder on the basis of the Validation Act	 as the effect of unconstitutionality of the law was to efface it out of the statute book	 and (6) the proposed levy was bad as infringing the Rule which provided that the sale of yarn could be taxed only at one point. It was also contended that under the Constitution it was only the Parliament that has the competence to impose tax on inter State sales and that the Sales Tax Laws Validation Act 1424 was bad in that it gave validity	 to the laws of the State to impose the tax : Held (Sarkar J. dissenting)	 that section 22 of the Madras General Sales Tax Act	 1939	 did in fact impose a tax on the class of sales covered by the Explanation to article 286(1)(a) but that it was conditional on the ban enacted on article 286(2) being lifted by law of Parliament as provided therein	 and that it was therefore validated by section 2 of the Sales Tax Laws Validation Act	 1956. The construction put upon the Explanation to article 286(1)(a) of the Constitution in The Bengal Immunity Company case that it merely prohibited the outside States from imposing a tax on the class of sales falling within the Explanation and did not confer on the delivery State any power to impose a tax on such sales has no application to a taxing statute of a State the object of which was primarily to confer power on the State to levy and collect tax. Section 22 and section 2(h) of the Madras General Sales Tax Act must be read together as ' defining the sales which are taxable under the Act. Mettur Industries Ltd. vs State of Madras	 A.I.R. 1957 Mad. 362	 The Mysore Spinning and Manufacturing Co. Ltd. vs Deputy Commercial Tax Officer	 Madras	 A.I.R. 1957 Mad. 368 and Dial Das vs P. section Talwalkay	 A.I.R. 1957 Bom. 71	 approved. Mathew vs Travancore Cochin Board of Revenue	 A.I.R. 1957 T. C. 300	 Cochin Coal Co. Ltd. vs The State of Travancore Cochin	 (1956) 7 Sales Tax Cases 731 and The Government of Andhra vs Nooney Govin arajulu	 (1957) 8 Sales Tax Cases 297	 disapproved. Queen vs Burah	 (1878) 5 I.A. 178 and In Ye The 	 etc. ; 	 relied on : Held (Per section R. Das	 C. J.	 Venkatarama Aiyar	 section K. Das and Vivian Bose	 JJ.) that (i) the Sales Tax Laws Validation Act	 1956	 is in substance one lifting the ban on taxation of interState sales and is within the authority conferred on Parliament tinder article 2 6(2) and further that under that provision it was competent to Parliament to enact a law with retrospective operation. Punjab Province vs Daulat Singh	 (1946) L.R. 73 I.A. 59	 distinguished. The United Province vs Atiqa Bcgum	 	 (2) the Adaptation Order made by the President under article 372(2) is valid and is not open to attack on the ground that it goes beyond the limits contemplated by that Article. (3)the expression " law of a State " in article 286(2) and section 2 of the Sales Tax Laws Validation Act means whatever operates as law in the State	 and that section 22 of the Madras General Sales Tax Act is a law within those enactments. 1425 (4) section 2 of the Sales Tax Laws Validation Act validates not only the levies already collected but also authorises the imposition of tax on sales falling within the Explanation which had taken place during the period specified in section 2. The Act is not a temporary Act though its operation is limited to sales taking place within a specified period. Dial Das vs P. section Talwalkay	 A.I.R. 1937 Bom. 71	 in so far as it held that it was not competent to the State to start fresh proceedings for assessment	 disapproved. (5) though section 22 of the Madras General Sales Tax Act was unconstitutional when enacted the effect of the unconstitu tionality was not to efface it out of the statute book. Unconstitutionality might arise either because the law is in respect of a matter not within the competence of the legislature or because the matter itself being within the competence	 its provisions offend some constitutional restrictions. Which a law which is not within the competence of the legislature is a nullity a law on a topic within its competence but repugnant to any constitutional prohibition is only unenforceable. In the latter class of legislation when once the constitutional prohibition is removed the law becomes enforceable without re enactment. Where an enactment is unconstitutional in part but valid as to the rest	 assuming that the two portions are severable	 it cannot be held to have been wiped out of the statute book	 as admittedly it must remain there for the purpose of enforcement of the valid portion. Moreover in the view that the impugned law is conditional legislation it cannot be held to have become non est. Behram Khurshed Pesikaka vs The State of Bombay	 [1955] I S.C.R. 6I3 and A. V. Fernandez vs State of Kerala	 ; 	 distinguished. Bhikaji Narayan Dhakras and others vs The State of Madhya Pradesh and a other; 	 	 relied on. (6) under Entry 42 in List 1	 Sch. VII of the Constitution	 legislation with respect to inter State trade and commerce is exclusively within the competence of Parliament. Under Entry 54	 List 11	 taxes on sale of goods is within the exclusive competence of the State Legislature	 and reading the two Entries together Entry 42 must be construed as excluding the power to tax sale of goods. The scheme of the Entries in the Lists is that taxation is regarded as a distinct matter and is separately set out. Entry 42	 List 1	 must therefore be construed as not including the power to impose tax on inter State sales. (7) the proposed imposition does not infringe the rule that the sales of yarns should be subject to taxation at a single point because the proposed levy is by the State of Andhra and the rule in question prohibits only multiple taxation in the same State. Per Sarkar J. The Sales Tax Act does not authorise the taxation of a sale under which goods are delivered in the State of 1426 Andhra but the property in them passes outside that State. The Explanation in section 22 of the Act only contemplates a State other than Andhra as the State inside which a sale shall be deemed to have taken place. The words " for the purposes of clause (a)(i) " have the same meaning in the Explanation in article 286(1) as in the Explanation in section 22 of the Act	 and the present case is not distinguishable from the decision in The Bengal Immunity Company Limited vs The State of Bihar and others