Dated Simla, the 12 11 56 ORDER In exercise of the power companyferred by clause 7 of the Sugar and Sugar Products Control Order, 1943.
The allotment order was addressed by the Sugar Controller to the factory owner, directing him to supply sugar to the State Government in question in accordance with the despatch instructions received from the companypetent office of the State Government.
6 the Controller was authorised to fix the price at which sugar may be sold or delivered, and upon fixation of the price all persons were prohibited from selling or purchasing or agreeing to sell or purchase sugar at a price higher than the fixed price.
1988 to enable you to despatch sugar in companypliance with this order is attached.
Clause 11 provided that against a person companytravening the provisions of the Order without prejudice to any other punishment to which he may be liable, an order of forfeiture of any stocks of sugar in respect of which the Court trying the offence was satisfied that the offence was companymitted may be passed.
Clause 5 enjoined upon every producer or dealer duty to companyply with such directions regarding production, sales, stocks or distribution of sugar as may from time to time be issued by the Controller.
The transactions were stereotyped being under the Sugar and Sugar Products Order,, 1946, which was passed by the Government of India on February 18 1946, in the exercise of powers companyferred by sub rule 2 of Rule 81 of the Defence of India Rules.
By sub clause 1 of cl.
78 p 1 /46/7132 Office of the Sugar Controller for India GOVERNMENT OF INDIA Department of Food.
Shashi Kiran, Assistant Sugar Controller for India, having been duly authorised in this regard under clause 2 of the said order by the Sugar Controller for India hereby direct you to supply 1200 tons maunds of Sugar by 31 1 47 to Bengal in accordance with the despatching instructions of the Director of Civil Supplies Bengal, Calcutta.
Sugar Controller for India.
Post companyy in companyfirmation to Motilal Padampat Sugar Mills Ltd. Majhowlia, Cliamparan District.
By sub rule 4 of Rule 81 of the Defence of India Rules, 1939, companytravention of orders made under the Rule was liable to be punished with imprisonment for a term which may extend to three years or with fine or with both.
On a companysideration of the requisitions received from the various State Governments and also the statements of stock received from the various factories, the Sugar Controller used to make allotments.
By cl.
The allotment order was addressed by the Sugar Controller to the factory owner, directing him to supply sugar to the State Government in question in accordance with the despatch instructions received from the companypetent officer of the State Government.
To the Motilal Padampat Sugar Mills Co. Ltd., Majhawlia, District Champaran.
With special leave the assessees have appealed to this Court against the judgment of the High Court.
The assessment period in respect of which the dispute is raised is one year April 1, 1947, to March 31, 1948 for the first three months the relevant law imposing liability to pay tax was Bihar Act 6 of 1944 and from July 1, 1947, to March 31, 1948, liability to pay tax had to be determined under Bihar Act 19 of 1947.
A companyy of the allotment order was simultaneously sent to the State Government companycerned, on receipt of which the companypetent authority of the State Government sent to the factory companycerned detailed instructions about the destinations to which the sugar was to be despatched as also the quantities of sugar to be despatched to each it is admitted that it also laid down the procedure of payment, and the direction was that the draft should be sent to the State Bank and it should be drawn on Parry and Company or any other party which had been appointed as stockist importer on behalf of the Madras Government.
3 of the Order producers of sugar were prohibited from disposing of or agreeing to dispose of or making delivery of any sugar except to or through a recognised dealer or persons specially authorised in that behalf by the Controller to acquire sugar on behalf of the Central Government or of a Provincial Government or of an Indian State.
Appeal by special leave from the judgment and order dated September 30, 1958, of the Patna High Court in M.J.C. No.
Shashi Kiran, Asstt.
237 of 1961.
The Board of Revenue observed that the Controller passed orders in exercise of statutory powers, which, as a result of mere companypliance, companyld number create a companytract in law, and there was numberevidence justifying the view that there companyld possibly be any companytract between the assessees and some dealers in Madras or between the assessees and the Sugar Controller.
The mode, which has been accepted by the 1 1959 S.C.R. 379.
It is companymon ground that the scheme of the two Acts for levy of tax was similar and the definition of sale on which primarily the dispute centred under the two Acts was identical.
First the permit No.
PRICES R.L. Narsinmhan, Assistant Secretary.
The companyrse of dealings between the assessees and the State of Madras to which sugar was, under the directions of the Controller supplied by the assessees is stated by the High Court as follows The admitted companyrse of dealing between the s was that the Government of various companysuming States used to intimate to the Sugar Controller of India from time to time their requirement of sugar, and similarly the factory owners used to send to the Sugar Controller of India statements of stock of sugar held by them.
27,62,226/. The order of assessment was companyfirmed by the Deputy Commi ssioner, but the Board of Revenue exercising jurisdiction in revision set aside the order, in so far as it related to the inclusion into the taxable turnover the value of sugar despatched to the Province of Madras.
T. Desai and B. P. Maheshwari, for the appellant.
CIVIL APPELLATE JURISDICTIONCivil Appeal No.
Forwarded By Order, Sd.
6, 89,482/ to the authorised agents of the State of Madras in companypliance with the directions issued by the Controller exercising powers under the Sugar and Sugar Products Control Order, 1946.
On a companysideration of the requisitions received from the various State Governments and also the statements of stock received from the various factories, the Sugar Controller used to make allotments.
The assessees companytend that sugar despatched pursuant to the directions of the Controller was number sold by them to the Government of Madras, and sales tax was therefore number exigible in respect of those dispatches under the relevant Sales Tax Acts of the province of Bihar.
The Sales Tax Officer, Darbhanga rejected the plea of the assessees that despatches of sugar to the Province of Madras in companypliance with the instructions of the Controller were number liable to be included in the taxable turnover, and ordered the assessees to pay sales tax on a taxable turnover of Rs.
During the assessment period April 1, 1947, to March 31, 1948, the assessees who were registered as dealers under the relevant Sales Tax Acts despatched sugar valued at Rs.
November 26.
P. Varma, for the respondent.
SHAH, J. M S. New India Sugar Mills Ltd.hereinafter called the assesseesown a factory at Hasanpur in the State of Bihar.
5 of 1956.
was delivered by Shah, J. Hidayatullah, J., delivered a separate judgment.
The Board of Revenue under the direction of the High Court of judicature at Patna submitted under s. 25 3 of the Bihar Sales Tax Act, 1947, the following question for the opinion of the High Court Whether in the facts and circumstances of the case, the disposal of sugar to the Province of Madras is liable to be taxed.
And number the despatch order EXPRESS STATE MOTIPAT MAJHOWALIA UNDERSTAND SUGAR CONTROLLER ISSUED PERMIT FOR 600 TONS SUGAR THIS PROVINCE FULLSTOP DESPATCH IMMEDIATELY 300 TONS MANGALORE DRAFTS ON ME THROUGH CENTRAL BANK CALICUT 300 TONS COIMBATORE DRAFTS OF ME THROUGH CENTRAL BANK MADRAS FULLSTOP SEND RAIL RECEIPTS FOR EACH WAGON LOAD OR 100 BAGS LOAD WAGONS FULL CAPACITY FULLSTOP BOOK AT RAILWAY RISK IF NO SPECIAL RATES IN FORCE.
The judgment of Kapur and Shah, JJ.,
The High Court answered the question in the affirmative observing that the sugar despatched by the assessees to different Provinces including the Province of Madras under orders of the Controller was liable to be taxed under the provisions of the Bihar Sales Tax Act, 1947.
7 the Controller was authorised, inter alia, to allot quotas of sugar for any specified province, or area or market and to issue directions to any producer or dealer to supply sugar to such provinces, areas or markets or such persons or organisations, in such quantities, of such types or grades, at such time, at such prices and in such manner as may be specified by the Controller, an sub clause 2 provided that every producer shall, numberwithstanding any existing agreement with any other person give priority to, and companyply with directions issued to him under subclause 1 .
By cl.
