[1962] K.ANSHI RAM JAGAN NATH AND OTHERS July 28. v. THE STATE (P. B. GA.TENDRAGADKAR, K. SURRA RAO, M. HIDAYATULLAH, J.C. SHAH and RAGHUBAR DAYAL, ,TJ.) Excise Dutiei-Law of erstwhi'.le Indian State providing
for royalty on bricks-Extension of Indian excise law to the State on merger with part B State-Effect on prior law-Levy of royalty, if repealed- Central Excises and Salt Act, 1944 (1of1944), ss. 2(d) 3(1)-Finance Act, 1950 (25 of 1950),
88. 11. 13 (2). The Council of Regency of the erstwhile State of Patia!a issued an order dated February 6, 1919, imposing a royalty on bricks from all kiln-owners at the rate of Rs. 50 per one lakh. After the State of Patiala became merged with the Patiala and East Punjab States Union, a Part B State under the Constitu- tion of India, the Finance Act, 1950, which can1e into force on April 1, 1950, became operative in that State. By vi.itue of s. 1 I of that Act the Central Excises and Salt Act, 1944, was extended, inter alia, to Part B States, whil~ under s. 13(2) it was provided that if immediately before April 1, 1950, there was in force in any State a law corresponding to but other than an Ac1 referred to in s. 1 I such law became repealed with effect from that date. The legality of the levy of royalty on bricks under the order dated February 19, 1949, after April 1, 1950, was challenged by the appellant on the grounds that the royalty was in the nature of an excise duty, and that the order levying it was a law corresponding to the Central
Excises and Salt Act, 194'4, and therefore became repealed by s. 13(2) of the Finance Act, 1950. Held, that' the Central Excises and Salt Act, 1944, which provided for the levy and collection of duties of excise on . goods specified in the First Schedule to the Act did not by a negative
provision expressly save other commodities, not included in the Schedule, from the operation of any existing local law. Con,.quently, the order dated February 19, 1949, passed by the erstwhile State of Patiala, was not a law corres- ponding to the Act of 1944 and was not, therefore, within the repeal created bys. 13(2) of the Finance Act, 1950.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 292 of 1958. 2 S.C.R. SUPREME COURT l{,EPORTS Appeal from the judgment and dcf:rec dated October '.?3, 1956, of the PEPSU (now l'unja.b)
High Court in l~egular Second Appeal No. 29 of 195!. C. K. Daphtary, Svlfoitor-Geneml uf India, J.B. JJadaohanji, Rav·inder Narain and 0. C. ,tfathnr, for the appellants. S. M. SiLTi, Advowlt;-General for tlte State of
Punjab, N. S. Bindra and P. D. Jlcnuu, for the respondent. 1961. J11ly 28. Judgment of the: Court W<'.S delivered by Kanshi Ram Jagan Nath v. The Sta!t HIDAYATULLAH, J.-The only question in this Jlidayatullah J. appeal, with certificate under Art. 13:J(l )( c) uf the
Constitution, against the judgment and decree of the High Court of Patiala and East :Punjab :::>tates Union, is whether the levy of royalty at l{,s. 50 per one lakh bricks under n Robkar issued by the
ljlas-i-Khas (Council of Hegency), Patiala i:ltate, on February 6, 1919, is valid. The Appeal arises out of a suit filed by the present appellants in the Court of the Hubordin~.te
Judge, l<'aridkot, for dee laration ~.nd injunction. The suit was dismissed by the trial Judge, but on appeal to the Distriet Court, the denisio.11 was rcvurs('cl. On further appeal to thf' High Court,
the decision of the Adrlitional DiHtrid .Tudgo \1·iis set aside, and that of the trial ,Judge n·otored. In this appeal, the only point argurd is whether the OYder of the lj[as .. i'.-Kha8 contim1f's to
be effective, after the ew10tm r:nt. of the :b'imrnc:o Act. il9ii0. The suit was fikd on l\fa~· l:J, l!lii2, for njunctiun agaimt notices of ckmand issued to the appellants from the Tehsil Office. Faridko1, on or
about April :W, 1951. The: kanwcl Solicitor- General conced!'s that the appc·llants' daim must. 'be confined to the 1wriod after Apr.il l, l95H, from A. anJ:Jki lt:t '1. J uyrtn …_Vath
1'he State 11 idaynt'U ll<L/i J 94i [1962] which date the Finance Act, HIGO, began to operate. He states that prior to that date the law could not be co1rnidcrcd _to be invalid because
uf Art. "277, which saved taxes, duties, cesses or fees which were being levied in any State prior to the commencement of the Constitution. He also cuncedes that tbe Finance Act, 1950, could not
operate before April l, 1!!50, antl the question, therefore, is, what is the effect of the Finance Act, l !JGO, un the order impugm d ? It may also be poiuted out that the authority of the Regency
Uouncil tu issue the "impugned order and the vali- dity of that order, unless affeeted by any Indian law, are not called in question. The Finance Act, 1950, was passed to give effect to the financial proposals for the year com-
mencing on Aprill, 1950. Se<,tion 11 of that Act extended, amongst ut,hers, the Uentral Exdse:s and Salt Act, 1944, to the whole of India induding Part B Stntes, except the State of Jammu and
Kashmir. By s. 13(2 ), it was provided, inter alia, as follows: "If immediately before the 1st day of April, 1950, there is in force in any State other than Jammu and Kashmir a law
corresponding to, but other than an Act referred to in sub-section ( 1) or ( "2) of section 11, such law is hereby repealed with effect from the o'.lid date ……… ". It i:s contended that hy
the extension of the Central }<]x<'ii<t 0 S and Salt Act, 1944, there was repeal of any law imposing exdsc du_ty on the manufacture of any dnss of goods. Attention is, therefore, drawn to the provisions of the Robkar,
where the royalty i:s dwrged as follows : "Jlc!isvl ( lloynlty) at the rnte uf Rs. 50 per lac brieks be charged from nil the kilu- owners irrespective of the fact whether they 2 s.c.R.
construct brick-kilns on the land belonging to Government or not. In case they construct brick-kilns on the land belonging to Government, cost (of the land) or damages thereof be charged (from them) in addition
to the Mehsul (Royalty) …… ". · The provisions of s. 13(2) of the Fin!Lnce Act, 1950, clearly show that only a law corresponding to the Central Excises and Salt Act, 1944, was
intended to be repealed. If the law did not correspond to the Indian statute, it would be saved by virtue of Art. 277. We have. thus to. det~rmme in this case whether the Robkar ot the IJlas-i-Khas,
imposing a royalty on bricks cun be sai~ to be a law corresponding to the Central Exel~&~ a.iiil Salt Act, 1944, which was extended on April 1, 1950. The argument of M:t·. Daphtary proceeds on
the assumption that the royalty is in the nafure of an excise duty, and the RobkM is thus a law corres- ponding to the Indian statute. That, however, does not determine the question, because the words
of sub-s. (2) of s. 13 of the Finanee Act, 1950, are that the law repealed must be a law corresponding to the Indian statute. The atgument in support of the contention that this is such a law is that the
Central Excises and Salt Act, 1944, is, as its long title and preamble show, a consolidating and amending law relating to Central duties of excise on goods ·manufactured or produced in certain parts
of India and to salt. It is urged that the Act is in the nature of a code, which not only provides for the levy of excise duty on the commodities speci- fically mentioned therein but by implication,
exonerates other articles from the levy of excise duty, and that, thercfon,, the Indian statute is uomprehensivc C'llough to include not only suo:l1 commodities as arc mentioned in it but also other
commodities on which there is no levy. It is con- ceded, however, that there is no negative provision Kanshi Ram Jagan Naty v The Stat• Hidayatullah .J. K analti Rarn JaJJan Naik v.
Tke SfJJ,/R, Bidayatullah J. [1962] under which other good~ manufactured in India are expressly saved from the uperation of any other law. Section 3( 1) of the Central Excises and i:lalt
Act, 1944, lays down the charge of excise duty, and provides: "There <lhall be levied and collected in such manner as may be prescribed duties of excise on all excisable goods other than sa It
which are produced or manufactured in India ……… at the rates, set forth ii: the First Schedule." "Excisable goods" is defined bys. 2(d). and mea11s "goods specified In the First Schedule as being sub-
ject to a duty of excise and includes salt". These two provisions read together limit the operation of the excise law to enumerated commodities and salt, and the ambit of the law is thus confined. The wor(ls
"to consolidate and amend the Jaw'' han, reference really to the Acts, which were repealed by s. 39. Prior to the enactment of this consoli- dating Act, there were no less than li Acts dealing
with different commodities, am\ in HJ44, all those laws were repealed, and a eollSolidated Act was passed to cover all those Aets and to include certain new commodities. Tht• effect uf "onsolida-
tion waH not to eorlify the law in s11L·h a way as to repeal other 1wts, which were nut specilically mentioned in the Schedule dealing with repeal~. No negative provision to save other eommoditios
from the operatio11 of any existing local law was either expressly induded or even contemplated in the Act. The result, therefore, is quite clear th~,t the Robkar, under which the roy01lty was imposed,
cannot be said to bt> a law eo1Tesponding to the Central Excise;; and Salt Avt, l!J44, and is, there- fore, not within the repeal created by s. 13(2) of the Finance Act, l !l.50. 2 s.c.R .
·.~· . . .. : -·: -· ·._. _:: SUPRE~ffi COURT REPORTS—;947– In ·our judgment, the· decision of the High Court is . correct; · and the appeal is dismissed with costs.· .Appeal dismissed.
. ROSHAN LAL 1\IEHRA ISHWAR DAS. (B. P. SINHA; C.J., S.K. DAS, A. K .. SARKAR; N_, RAJAGOPALA AYYANGAR 'lnd J.R; 1\IuDHOLKAR, JJ.) Standard rent, (fixati<m of-Neirly Constructed .and old
buildings-Cla8sification, if· .-iolatii-e of fundamental right and principksof natural.iustice-:-Constitution of India, Art •. 14-:- Delhi and Ajmer-Marwara Rent Control Act, 1947 (Act XIX of 1941), SS. 7, 7A, Sch. IV.
··. The ·appellants applied to the Rent Controller· for' ·fixa. tion of fair and standard rent of certain shops and other premises alleging that the rent charged by the landlords was exorbitant.
The questions arising for detennination were . (I) wbethei; the Delhi and Ajmer-Marwara Rent Control Act, 1947· in so far as it provided for the fixation of standard rent in respect of premises the construction of which was completed after March 24," 1947 by the Rent Controller violated the
fundamental right guaranteed under'Art. 14 of the Constitu- tion; and (2) whether the procedure to be followed by the Rent Controller violated the principles of natural justice •.
Held, thats. 7Aand the relevant provisions of Sch. IV of the Act laying down the proce<Jure for fixing standard rent by t!JJ' Rent Controller are not· unconstitutional and do not violate Art. 14 of the Constitution. The classification between premises the ·construction of which was completed before
March 24, 1947.when the Act came into force and those which \\·ere_ completed :thereafter, is reasonable,. and the cr~teria for the fixation ·-Of-standard rent for both old and new buildings· under tl:e Act were not substantially different.
.. ·.-.. The. procedure laid down Wider those provisions docs not :.violate the principles of natural juatice.~ The power given to the Rent Controller is not arbitraiy and he has to exercise it on a judicial_ consideration of all the cir.<UJDstar.~cs of th_e caoc. ·–~–
_ kanslii&.m Jagardfoth., -_.' V.•. ; •. ~ Tht Stiitt HidayatuUah J • A1Jgust 2.