H. N. SETH, J. - (1.) THE assessee Satya Narain Singh carried on the business of manufacturing and selling bricks. For the assessment year 1964-65, the Sales Tax Officer determined the turnover of bricks sold by the assessee as Rs. 20,500, and in view of Notification No. ST-6438/X - 1012-1962 dated 1st December, 1962, issued under section 3-A of the U.P. Sales Tax Act, calculated the tax payable on that turnover at the rate of 7 per cent. Ultimately, by an order dated 3rd July, 1971, the Additional Judge (Revisions), Sales Tax, Varanasi, reduced the turnover determined by the Sales Tax Officer to Rs. 9,000. While determining the rate applicable for calculating sales tax on sale of bricks, the Additional Judge (Revisions), Sales Tax, relied upon certain decisions of the High Court wherein it has been decided that the notification dated 1st December, 1962, issued under section 3-A, levying sales tax on the sale of bricks at the rate of 7 per cent was invalid, and held that such turnover was liable to be taxed at the rate of 2 per cent.
(2.) IT appears that it was attempted to validate the notification dated 1st December, 1962, by enacting the U.P. Sales Tax (Amendment and Validation) Ordinance, 1970 (U.P. Ordinance No. 2 of 1970). Section 2 of that Ordinance sought to make certain changes in the phraseology of section 3-A of the Sales Tax Act and section 7 provided that notwithstanding any judgment, decree or order of any court or tribunal to the contrary, every notification issued or purporting to have been issued under section 3-A of the principle Act, before the commencement of the Ordinance, shall be deemed to have been issued under that section as amended by the Ordinance and shall be so interpreted and be deemed to be and always to have been as valid as if the provisions of the Ordinance had been in force at all material times. Accordingly, anything done or any action taken (including any order made, proceedings taken, jurisdiction exercised, assessment made, or tax levied, collected or paid, purporting to have been done or taken in pursuance of such notification) shall be deemed to be, and always to have been, validly and lawfully done or taken. However, in the case of Gurna Mal v. State of U.P. and Another ([1970] 26 S.T.C. 270), a Division Bench of this Court took the view that notwithstanding the provisions in Ordinance No. 2 of 1970, the notification dated 1st December, 1962, issued under section 3-A had not been validated and that the turnover of sale of bricks continued to be taxable under section 3 of the U.P. Sales Tax Act at 2 per cent. Thereafter, the State Legislature passed an Act known as the Uttar Pradesh Sales Tax (Amendment and Validation) Act, 1971, which was published in the U.P. Gazette dated 22nd August, 1971. By section 3 of this Act, sections 3 and 3-A of the U.P. Sales Tax Act were substituted by new sections 3, 3-A and 3-AB. New section 3-A provided that the turnover in respect of the goods specified in the second column of the First Schedule shall be liable to tax at the point specified in the third column thereof at such rate, not exceeding ten per cent, as the State Government may, by notification in the Gazette, declare. It also provided that in respect of goods the rates prevailing by virtue of section 3-AB immediately before the commencement of the Validation Act, 1971, shall continue to be in force until altered by a notification. Section 3-AB then provided that notwithstanding any judgment, decree or order of any court, any tax imposed, assessed, levied or collected, or purporting to have been imposed, assessed, levied or collected before the commencement of the U.P. Sales Tax (Amendment and Validation) Act under any of the notifications specified in the Second Schedule shall be deemed to have been validity imposed, assessed, levied or collected. The First Schedule to section 3-A, as introduced by the 1971 Amendment Act, provides that bricks if manufactured in Uttar Pradesh are to be taxed at the point of sale by the manufacturer, and if imported from outside Uttar Pradesh, at the point of sale by the importer. The Second Schedule referred to in the newly added section 3-AB purports to validate Notification No. ST-6438/X - 1012-1962 dated 1st December, 1962, under which it was provided that the turnover of sale of bricks was to be taxed at the rate of 7 per cent. Accordingly, some time after 28th August, 1971, the Commissioner of Sales Tax moved an application before the Judge (Revisions), Sales Tax, praying that under section 11(3) of the U.P. Sales Tax Act, he should state the case and refer the question, the English translation of which would read as follows, for the opinion of the High Court : "Whether, in view of the aforesaid facts and the Government Amendment Bill, 1971, the turnover of bricks for the year 1964-65 should be taxed at the rate of 7 per cent or 2 per cent ?" The Judge (Revisions), Sales Tax, has accordingly stated the case and referred the aforementioned question for the opinion of this court.
(3.) IT appears to us that reference to the U.P. Sales Tax (Amendment and Validation) Bill, 1971, made in the application for reference as also in the question referred to this court has been made under some misapprehension. By the time the application for reference came to be made, the U.P. Sales Tax (Amendment and Validation) Act, 1971 (U.P. Act 20 of 1971), had already come into force with effect from 22nd August, 1971, and the real question, therefore, that arose for consideration was whether in view of Act 20 of 1971, the assessee's turnover of sale of bricks during the year 1964-65, was liable to be taxed at the rate of 7 per cent or 2 per cent. Accordingly, we have reframed the question referred to us as follows : "Whether, in view of the aforesaid facts and the provisions of the U.P. Sales Tax (Amendment and Validation) Act, 1971, the turnover of the sale of bricks, for the year 1964-65, should have been taxed at the rate of 7 per cent or 2 per cent ?" ;