- (1.)THE petitioner is a Limited Company carrying on the business of manufacture and sale of electrical goods. By a notice dated 1 -7 -1968, the Commercial Tax Officer, V Circle, Bangalore (Respondent No. 1) proposed to provisionally assess the petitioner on a net turnover of Rs. 21,45,037 -68 and levy a tax of Rs. 6,82,566 -75 for the period 1 -4 -1968 to 31 -3 -1969 finder Section 9(3) of the Central Sales Tax Act, 1956, hereinafter called the 'Act' read with Section 12 -B of the Mysore Sales Tax Act, 1957. On 15 -7 -1968, the petitioner filed the above writ petition challenging the levy on the ground that the provisions of Sections 8 and 9 of the Act are unconstitutional. The main ground of attack was that the Act has adopted the Sales Tax Laws of various States not only as they stood at the time when the Act was passed but also the Sales Tax Laws as in force from time to time after the passing of the Act in the matter of fixation of rate "of taxation, grant of exemptions, assessment and collection of tax and imposition of penalty and thereby the Parliament has abdicated its essential legislative function. In the alternative, it was urged that the Act must be deemed to have adopted the Sales Tax Laws as in force when the Act came into force on 21 -12 -1956 and that the Sales Tax law in force at that time was the Mysore Sales Tax Act, 1948, which did not provide for making provisional assessment and hence Respondent No. 1 had no Jurisdiction to issue the impugned notice proposing to make provisional assessment to tax. Luring the pendency of the writ petition, Section 9, among others, of the Act was amended by the Central Sales Tax (Amendment) Act, 1969, and it is the validity of Section 9 as amended that has to be considered.
(2.)THE argument of the learned counsel for the petitioner was that the Act has adopted not only the Sales Tax Laws of the States as they stood when the Act was pass -ed but also the future Sales Tax laws as amended from time to time in the matter of fixation of rate of taxation, grant of exemptions, assessment and collection; that an Act of the Parliament adopting the future laws passed by another legislature is a clear abdication of essential legislative function and therefore Sections 8 and 9 are void. In support of that contention, the learned counsel relied on the decision in B. Shama Rao Vs. The Union Territory of Pondicherry, AIR 1967 SC 1480 . The Legislative Assembly competent to legislate for the Union Territory of Pondicherry passed the Pondicherry General Sales Tax Act, 1965, which was published on 3rd June, 1965 after receiving me President's assent on 25th May, 1965. Section 1 (2) of that Act provided that it would come into force oft such date as the Government by Notification appoint. Section 2 (1) provided that the" Madras General Sales Tax Act," 1959, as in force in the State of Madras immediately before the commencement of the Pondicherry Act shall extend to and come into force in the Union Territory of Pondicherry subject to certain modifications and adaptations. As provided by Section 1 (2), the Pondicherry Government issued a notification dated 1st March, 1966 bringing into force the Madras Act as extended by the Pondicherry Act to the Union Territory of Pondicherry as from 1st April, 1966. In the meantime, the Madras Legislature had amended the Madras Act and consequently it was the Madras Act as amended upto 1st April, 1966 that was brought into force under the said Notification. The petitioner before the Supreme Court contended that while it was competent for the Pondicherry Legislature to extend the Madras Act as it stood when the Pondicherry Act was passed, the Pondicherry Legislature could not have adopted the Madras law as amended by the Madras Legislature. In other words, the Pondicherry Legislature could not have adopted the future laws enacted by the Madras Legislature. The Supreme Court upheld that contention and declared that the Pondicherry Act was unconstitutional. In the course of that judgment, the Supreme Court observed as follows: "The question then is whether in extending the Madras Act in the manner and to the extent it did under Section 2(1) of the Principal Act the Pondicherry Legislature abdicated its Legislative power in favour of the Madras Legislature. It is manifest that the Assembly refused to perform its legislative functions entrusted under the Act con - stetting it. It may be that a mere refusal may not amount to abdication if the Legislature instead of going through the full formality of legislation applies its mind to an existing statute enacted by another Legislature for another jurisdiction, adopts such an Act and enacts to extend it to the territory under its jurisdiction. In' doing so, it may perhaps be said that it has laid down a policy to extend such an Act and directs the executive to apply and implement such an Act. But when it not only adopts such an Act but also provides that the Act applicable to its territory shall be the Act amended in future by the other Legislature, there is nothing for it to predicate what the amended Act would be. Such a case would be clearly one of non -application of mind and one of refusal to discharge the function entrusted to it by the instrument constituting it. It is difficult to see how such a case is not one of abdication or effacement in favour of another Legislature at least in regard to that particular matter."
Belying on the above statement of the law, it was argued by the learned counsel for the petitioner that the Central Sales Tax Act having adopted not only the Sales Tax Laws of the appropriate States as they existed when the Act came into force but also the future laws to be enacted from time to time, it is a clear case of non -application of the mind and one of refusal to discharge the functions entrusted to the Parliament by the Constitution:

(3.)THE learned counsel for the petitioner next relied on the decision in Shah and Co. v. State of Madras (1967) 20 (Mad) 146 . Therein the question was whether the' penalty levied under Section 9(3) of the Act read with Section 12 (3) of the Madras General Sales Tax Act, 1959 was valid. When the Act was passed, the Sales Tax Law in force in the Madras State was the Madras General Sales Tax Act, 1939 which did not contain any provision for levying penalty. It was held by the Madras High Court that while it is competent for the Parliament to adopt the existing provisions of a local law as part of the Central Legislation without repeating those provisions in the Central Act, it cannot make a law adopting the provisions of a local law which does not exist at that time.
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