Validity of Tax Exemption for Jaggery Sales Confirmed

The court held that the exemption for inter-State sales of jaggery and gur under the Central Sales Tax Act remained valid until 21st March 1969. The court allowed the writ petitions, prohibiting the respondents from taxing the inter-State sales turnover of jaggery and gur for the period from 1st January 1968 to 20th March 1969. The petitions were allowed without any order as to costs.

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Issues Involved:
1. Jurisdiction to assess inter-State sales turnover under the Central Sales Tax Act, 1956.
2. Validity of exemption notifications under Section 8(5) of the Central Sales Tax Act.
3. Impact of Madras Act 2 of 1968 on exemptions granted under the Central Sales Tax Act.
4. Doctrine of implied repeal concerning legislative powers.

Detailed Analysis:

1. Jurisdiction to Assess Inter-State Sales Turnover:
The petitioner challenged the respondent's proposal to assess inter-State sales of jaggery and gur under the Central Sales Tax Act, 1956, arguing that such sales were exempt from tax. The petitioner sought a writ of prohibition to restrain the respondent from including the turnover in the assessable turnover, claiming the respondent lacked jurisdiction.

2. Validity of Exemption Notifications:
The court examined Section 8(5) of the Central Sales Tax Act, which allows the State Government, as a delegate of Parliament, to exempt certain goods from tax if it serves public interest. The State Government had issued a notification on 12th December 1957, exempting inter-State sales of sugar, including jaggery and gur. This exemption continued until 20th March 1969, when it was canceled by a subsequent notification.

3. Impact of Madras Act 2 of 1968:
The Madras General Sales Tax Act, 1959, initially exempted sugar, including jaggery and gur, from intra-State tax. However, Madras Act 2 of 1968 amended this to exclude jaggery and gur from the exemption, effective 1st January 1968. The court clarified that the legislative fields of the Central Sales Tax Act and the Madras General Sales Tax Act are distinct. The exemption under the Central Sales Tax Act remained valid until explicitly withdrawn by the appropriate authority on 21st March 1969. The peripheral actions of the State Legislature under the Madras General Sales Tax Act did not affect the Central Sales Tax Act exemptions.

4. Doctrine of Implied Repeal:
The court rejected the argument that the Madras Act 2 of 1968 impliedly repealed the exemption notification under the Central Sales Tax Act. The court emphasized that only the authority which granted the exemption could withdraw it. The court stated, "It is only the authority which can grant an exemption that can withdraw the exemption by exercising the power under the specific provision of the statute which enables them to grant or cancel the exemption." The court further noted that there was no repugnancy between the two legislative actions, and the principle of implied repeal did not apply.

Conclusion:
The court concluded that the exemption for inter-State sales of jaggery and gur under the Central Sales Tax Act remained valid until 21st March 1969. The court allowed the writ petitions, prohibiting the respondents from taxing the inter-State sales turnover of jaggery and gur for the period from 1st January 1968 to 20th March 1969. The petitions were allowed without any order as to costs.

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