DWIVEDI, J. - (1.) THE petitioner seeks to challenge the assessment orders for the years 1958-59, 1959-60 and 1960-61 made under the U.P. Sales Tax Act on 30th March, 1970. The orders were passed by the Sales Tax Officer, Agra.
(2.) THE petitioner is a dealer in dressed hides and skins. Tax has been assessed in accordance with the Notification No. ST 2934/X-902(7)-56 dated 1st August, 1958. This notification was issued by the State Government under section 3-AA of the U.P. Sales Tax Act (hereinafter called "the Act"). The argument of learned counsel for the petitioner is that as the notification was made operative from a back date it is invalid in toto. Before we examine the argument on merits we shall give a short history of the genesis of the notification. Section 3 of the Act, at the relevant time, provided that every dealer shall, for each assessment year, pay a tax at the specified rate on his turnover of such year. The U.P. Sales Tax (Amendment) Act, 1956, inserted section 3-AA into the Act. Section 3-AA provided that notwithstanding anything contained in section 3, the turnover in respect of coal, iron and steel, raw jute, cotton, oil-seeds, or raw hides and skins shall not be liable to tax except at the point of sale by a dealer to the consumer, and the rate of tax shall not exceed three pies per rupee. The U.P. Sales Tax (Amendment) Act, 1957, amended section 3-AA. It may be noted that in the original section only raw hides and skins were mentioned. The amendment now included in section 3-AA dressed hides and skins. The amendment came into force with effect from 30th November, 1957. The U.P. Sales Tax (Amendment) Act, 1958, amended section 3-AA. It substituted for the words "two per cent." the words "two paise per rupee". Some other amendments were also made but we are not concerned with them. The State Government issued the impugned notification. It reads : "In pursuance of the provisions of section 3-AA of the U.P. Sales Tax Act, 1948 (U.P. Act No. 15 of 1948), as amended up to date, and in modification of all previous notifications on the subject to the extent they are repugnant to this notification, the following is hereby notified for the information of all concerned : (a) the turnover in respect of raw hides and skins which under the said section 3-AA are liable to tax only at the point of sale by a dealer to the consumer shall with effect from the date of issue of this notification be subject to tax at the rate of one naya paisa per rupee; (b) the turnover in respect of dressed hides and skins which under the said section 3-AA are liable to tax only at the point of sale by a dealer to the consumer shall with effect from 30th November, 1957, be subject to tax at the rate of two naye paise per rupee; and (c) the turnover in respect of cotton yarn as defined in the said section 3-AA and which under the said section is liable to tax only at the point of sale by a dealer to the consumer shall with effect from 1st August, 1958, be subject to tax at the rate of two naye paise per rupee."
(3.) IT may now be noted that there is no reference to the issue of a notification by any authority in section 3-AA. However, the Government issued the impugned notification in 1958. It had also issued several other notifications of a like nature. In 1964 the State Legislature made an attempt to repair the lacuna. It passed the U.P. Sales Tax (Amendment) Act (No. 14 of 1964) on 27th June, 1964. Section 3-AA(1) was amended. It was provided that in sub-section (1) for the words "shall not exceed two paise per rupee" the words "shall be such not exceeding 2 paise per rupee as may be declared by the State Government by notification in the Official Gazette." It was further provided that these words shall be substituted and shall be deemed always to have been substituted. Section 3 of the Amending Act reads : "Any notification declaring the rate of tax issued before the commencement of this Act purporting to be under section 3-AA of the principal Act shall be deemed to have been issued under that section as amended by this Act ..............." ;