Declared goods taxation and statutory remedy rules upheld against constitutional challenge to sales tax schedule.

Schedule D of the Punjab General Sales Tax Act, 1948, as applied in Haryana, was challenged as enabling double taxation of declared goods under section 15 of the Central Sales Tax Act, 1956 and article 286(3). The Court held that the validity of a charging provision is judged on its terms, and a mistaken assessment producing double taxation in a particular case does not by itself render the schedule unconstitutional. The schedule was therefore upheld. The writ petition was also found not maintainable because an appeal lay against the assessment order, leaving an efficacious statutory remedy available.

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Issues: (i) Whether Schedule D of the Punjab General Sales Tax Act, 1948, as made applicable in Haryana, was unconstitutional on the ground that it enabled double taxation of declared goods in violation of section 15 of the Central Sales Tax Act, 1956 and article 286(3) of the Constitution of India. (ii) Whether the writ petition was maintainable when the assessment order was appealable under the statutory scheme.

Issue (i): Whether Schedule D of the Punjab General Sales Tax Act, 1948, as made applicable in Haryana, was unconstitutional on the ground that it enabled double taxation of declared goods in violation of section 15 of the Central Sales Tax Act, 1956 and article 286(3) of the Constitution of India.

Analysis: Article 286(3) of the Constitution of India permits State taxation on declared goods only within the restrictions imposed by Parliament. Section 14 of the Central Sales Tax Act, 1956 identifies cotton as declared goods, and the challenge centered on Schedule D, which prescribed different points of levy depending on the mode of acquisition. The Court held that a statute does not become unconstitutional merely because an assessing authority may apply the wrong entry in an individual case. The validity of the provision must be tested on its terms, and a mistaken assessment causing double taxation in a particular instance would not by itself invalidate the charging schedule. The earlier Division Bench view sustaining the same schedule was followed.

Conclusion: Schedule D was held to be constitutionally valid and the challenge based on double taxation failed.

Issue (ii): Whether the writ petition was maintainable when the assessment order was appealable under the statutory scheme.

Analysis: The impugned assessment order was appealable, and therefore the petitioners had an efficacious statutory remedy. In the presence of such alternative remedy, the writ jurisdiction was not available in view of the applicable constitutional bar.

Conclusion: The writ petition was held to be not maintainable on account of the available statutory appellate remedy.

Final Conclusion: The challenge to the sales tax schedule failed on merits, and the writ petition was declined in favour of the taxing authority.

Ratio Decidendi: A fiscal provision is not unconstitutional merely because it may be wrongly applied so as to cause double taxation in a particular case, and writ relief is ordinarily unavailable where an effective statutory appeal lies against the assessment.

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