Anil Kumar Sen, J. - (1.) This rule was obtained by the two petitioners on a writ petition. The first petitioner is an association of holders of excise licences in the Calcutta Excise District, while the second petitioner is a country spirit licensee carrying on the business of retail vend of country spirit at 26, Barrackpur Trunk Road, Calcutta. They are disputing the constitutional validity of the West Bengal Taxation Laws (Amendment) Act, 1972, in so far as and to the extent to which such Act seeks to impose sales tax on the sale of country spirit by the licensees.
(2.) It may be recalled that when the sales tax was first introduced in the then Bengal by the Bengal Finance (Sales Tax) Act, 1941 (hereinafter referred to as the Sales Tax Act), sale of country spirit was exempted from the incidence of such taxation by virtue of Section 6(1) read with entry 25, column 1, Schedule I, of the Act. But the West Bengal Legislature passed the West Bengal Taxation Laws (Amendment) Act, 1972 (West Bengal Act 20 of 1972) (hereinafter referred to as the Taxation Laws Amendment Act), and by Section 3(5) thereof, entry 25, column 1, of the Schedule to the Sales Tax Act, 1941, was omitted in order to bring the sale of country spirit amongst other articles under the incidence of sales tax. The said Taxation Laws (Amendment) Act had no previous sanction of the President nor did it obtain any subsequent assent of the President. It, however, obtained the assent of the Governor on 21st July, 1972, and came into effect from 7th August, 1972. Circulars were issued both by the Excise Directorate and the Directorate of Commercial Taxes intimating the licensees that the sale of country spirit would henceforth be liable to sales tax at the rate of 6 per cent.
(3.) On such imposition of sales tax on the sale of country spirit by licensees, the petitioners have moved this Court disputing the validity of such an imposition. According to the petitioners, Section 3(5) of the Taxation Laws (Amendment) Act is ultra vires the Constitution. It is claimed to be ultra vires, firstly, because the sale made by them as licensees is not a sale within the meaning of the Indian Sale of Goods Act, 1930, so that the State Legislature had no authority to impose the tax as proposed. Secondly, it is claimed that the imposition in the present case imposes a restriction on the freedom of trade, commerce or intercourse and yet no previous sanction of the President under Article 304(b) of the Constitution nor any subsequent assent of the President under Article 265 thereof having been taken, the enactment of the State Legislature is unconstitutional.;