- (1.) We agree that this appeal must be allowed in part but we prefer to rest our judgment on one of the material points on a ground which is different from that adopted by our learned Brother S. K. Das, J., in the judgment which has just been delivered by him and which we have had the advantage of perusing.
(2.) The Orissa Sales Tax Act, (Orissa XIV of 1947), hereinafter referred to as the said Act received the assent of the Governor-General on 26th April 1947, when S. 1 of the Act came into force. On 1st August 1947, a Notification was issued by the Government of Orissa bringing the rest of the said Act into force in the Province of Orissa, as it was then constituted. Section 4, as it stood at all times material to this appeal, ran as follows : "4(1) Subject to the provisions of sections 5, 6, 7 and 8 and with effect from such date as the Provincial Government may, by notification in the Gazette, appoint, being not earlier than thirty days after the date of the said notification, every dealer whose gross turnover during the year immediately preceding the commencement of this Act exceeded Rs. 5,000 shall be liable to pay tax under the Act on sales effected after the date so notified. Provided that the tax shall not be payable on sale involved in the execution of a contract which is shown to the satisfaction of the Collector to have been entered into by the dealer concerned on or before the date so notified. (2) Every dealer to whom sub-section (1) does not apply shall be liable to pay tax under this Act with effect from the commencement of the year immediately following that during which his gross turnover first exceeded Rs. 5,000. (3) Every dealer who has become liable to pay tax under this Act shall continue to be so liable until the expiry of three consecutive years, during each of which his gross turnover has failed to exceed Rs. 5,000 and such further period after the date of such expiry as may be prescribed and on the expiry of this latter period his liability to pay tax shall ceases. (4) Every dealer whose liability to pay tax has ceased under the provisions of sub-section (3) shall again be liable to pay tax under this Act with effect from the commencement of the year immediately following that during which the gross turnover again exceeds Rs. 5,000." On 14th August 1947, a notification was issued by the Government of Orissa appointing 30th September 1947, as the date with effect from which that sub-section was to come into force in the then province of Orissa.
(3.) On 1st January 1948, by a covenant of merger executed by its ruler, the feudatory State of Pallahara merged into the province of Orissa. In exercise of the powers delegated to it by the Government of India under what was then known as the Extra Provincial Jurisdiction Act, 1947, the Government of Orissa on 14th December 1948, issued a notification under S. 4 of that Extra Provincial Jurisdiction Act, extending the Orissa Sales Tax Act to the territories of the erstwhile feudatory States, including Pallahara which had merged into the province of Orissa, on 1st March 1949, a notification under S. 1(3) was issued by the Government of Orissa, bringing Ss. 2 to 29 of the said Act into force in the added territories. On the same day another notification was issued under S. 4 (1) of the Act, which was in the following terms : "In exercise of the powers conferred by Sub-section (1) of Section 4 of the Orissa Sales Tax Act, 1947 (Orissa Act XIV of 1947) as applied to Orissa State, the Government of Orissa are pleased to appoint the 31st March, 1949, as the date with effect from which every dealer whose gross turnover during the year ending the 31st March 1949, exceeded Rs. 5,000 shall be liable to pay tax under the said Act on sales effected after the said date." It was after this notification had been issued that the respondents were sought to be made liable to tax.;