P.B.Mukharji, J. - (1.) This application under Article 226 of the Constitution raises the vexed constitutional and legal problem of Inter State trade and commerce. The disputed tax is levied by the State of West Bengal under the Bengal Finance (Sales Tax) Act 1941 upon the goods of the petitioner which were being sent from Calcutta to Jamshedpur under certain contracts or more accurately called Purchase Orders to the Kaiser Engineers Overseas Corporation who are agents of the Tata Iron and Steel Co. Ltd. for the express purpose and object of the expansion of the Tata's existing Steel Plant facilities at Jamshedpur, India. The tax is said to be illegal and unconstitutional being violative of the constitutional freedom of inter State commerce.
(2.) The petitioner is one Dhiraj Lal Mehta said to be carrying on business under the name and Style of 'Bengal Hardware Mart' at 69/A, Netaji Kubhas Road, Calcutta. He is a registered dealer both under the Central Sales Tax Act as well as under the Bengal Sales Tax Act as re-seller of pipes etc. but not as a manufacturer. In fact the petitioner himself states that he carries on business in pipe, pipe fittings hardware merchant and as general order suppliers. He does not state that he is a manufacturer or fabricator of goods. The first Purchase Order which the petitioner received from Kaiser Engineering Overseas Corporation is dated the 27th June, 1956 being Order No. 5566-5521 for Rs. 1,18,650/- which was enhanced to Rs. 1,22,262-8-0 due to increase in prices. The other Purchase Order is No. 5577,26-12618 and dated the 16th September, 1957.
(3.) So far as the sales to the Tatas are concerned and which are the subject-matter of controversy in this application the amounts involved may be divided into' five items, namely: (1) Rs. 37,305. 28 nP ... sales to Tata before1-11-56 (2) Rs. 218,042 . 09 nP ... sales to Tata during 1-11-56 to 1-7-57 (3) Rs. 48,932 . 18 nP ... sales to Tata carried over from the Sambat year 2012 (4) Rs. 32,728. 59 nP ... sales to Tata after 1-7-57 (5) Rs. 6,524 . 18 nP ... cost of rejected goods. The total of these amounts comes up to Rs. 3,41,532.38 nP. as the value of sales to Tatas by the petitioner in the accounting period. The reason for classifying these amounts and periods of time are not very material except to say that many of the taxes are in connection with sales before the Central Sales Tax Act came into operation. That Central Sales Tax Act was passed on the 2lst December, 1956 and came into effect on the 15th January, 1957. It is. necessary to add that Section 6 of the Central Sales Tax Act came into force on 1-7-1957. It is with reference to this last date that the above divisions of the periods of time have been made.;