COLLECTOR OF CENTRAL EXCISE Vs. STATE OF KERALA

JUDGEMENT

(1.) Writ Petition was preferred by the Collector of Customs and Central Excise seeking a declaration that the Central Excise and Customs Department of the Government of India administering the Customs Act, 1962 and is not liable to pay sales tax under the Kerala General Sales Tax Act on disposal of goods during the course of administering the Customs Act, 1962 and also for a declaration that the Kerala General Sales Tax Act, 1962 as amended by Act 3 of 1968 and Act 21 of 1978 particularly Section 2 thereof is ultra vires in so far as the said Act pertains to Central Excise and Customs Department of Government of India administering the Customs Act, 1962 and disposal of the goods by the said Department.

(2.) Learned Single Judge repelled the contention placing reliance on the decision of a learned Single Judge of this Court in Collector of Customs v. State of Kerala, 1993 (1) KLT 850. Collector of Customs and Central Excise aggrieved by the judgment of the learned Single Judge has preferred this appeal.

(3.) Contention was raised that the Kerala General Sales Tax Act, 1962 as amended by Act 3 of 1968 and Act 21 of 1978 particularly Section 2 thereof is ultra vires and offends Article 285 of the Constitution of India and is liable to be quashed. It is also pointed out that the expression "carrying on business" used in Section 22(1) and 22(2) of the said Act and other connected provisions are judicially interpreted by the Apex Court and by this Court to mean activity for profit or gain which intention is conspicuously absent in the matter of disposal of confiscated goods by Central Excise and Customs Department.