Declared goods taxation upheld as valid where the statute fixes one taxable stage and permits reassessment within the legislative scheme.

The amended Punjab and Haryana sales tax scheme was upheld because it fixed the taxable stage for declared goods at the last sale or last purchase by the dealer liable to tax, thereby avoiding multiple-stage levy and conforming to Section 15 of the Central Sales Tax Act, 1956. The constitutional challenge also failed: the classification and reassessment/refund options were available equally to all concerned, and any tax burden differences arose from the ad valorem levy or cost variations rather than unequal statutory rates. The retrospective validation and reassessment machinery were held to be within legislative competence, and the ceiling on tax rate under the Central Act did not amount to unlawful delegation.

---

---

Issues: (i) whether the amended Punjab and Haryana sales tax provisions, especially the fixation of the taxable stage for declared goods and the validation provisions, were inconsistent with Section 15 of the Central Sales Tax Act, 1956; (ii) whether the amendments offended Articles 14, 19 and 304 of the Constitution of India; and (iii) whether the retrospective validation and reassessment machinery were beyond legislative competence or involved unlawful delegation.

Issue (i): whether the amended Punjab and Haryana sales tax provisions, especially the fixation of the taxable stage for declared goods and the validation provisions, were inconsistent with Section 15 of the Central Sales Tax Act, 1956.

Analysis: The amended scheme expressly identified the taxable stage for declared goods as the last sale or last purchase by the dealer liable to tax. That removed the uncertainty that had existed under the unamended law, where the statute did not clearly indicate the stage of levy and could expose the same goods to more than one levy. By linking liability to the dealer's own position in the chain of transactions and excluding other stages from the taxable turnover, the amended provisions brought the State law into conformity with the Central Act's requirement of a single levy at one stage.

Conclusion: The amendments were not repugnant to Section 15 of the Central Sales Tax Act, 1956.

Issue (ii): whether the amendments offended Articles 14, 19 and 304 of the Constitution of India.

Analysis: The classification between different dealers, including the option regarding reassessment and refund, was held to be open equally to all concerned and did not create hostile discrimination. The rate of tax remained the same for imported and local goods, and any difference in the actual tax burden resulted from the ad valorem character of the levy or from variations in cost, not from unequal rates imposed by the statute. The challenge under the constitutional equality and trade provisions therefore failed.

Conclusion: The amendments did not violate Articles 14, 19 or 304 of the Constitution of India.

Issue (iii): whether the retrospective validation and reassessment machinery were beyond legislative competence or involved unlawful delegation.

Analysis: The State Legislature was competent to amend the existing law after reorganisation in relation to its own territory. The retrospective operation did not by itself invalidate the enactment because the defect in the earlier law had been cured by fixing the taxable stage. The reassessment and refund mechanism was treated as an implementation choice within the statutory scheme, and the fixation of a maximum rate within the limit allowed by the Central Act did not amount to unguided delegation.

Conclusion: The retrospective and validating provisions were within legislative competence and did not amount to invalid delegation.

Final Conclusion: The amended sales tax laws were upheld as valid, and the constitutional and statutory challenges failed.

Ratio Decidendi: Where a State sales tax law, in relation to declared goods, clearly fixes tax liability to a single ascertainable stage and excludes other stages from the taxable turnover, it satisfies the Central Act's restriction against multiple-stage levy and does not offend the equality or trade clauses merely because ancillary refund or reassessment machinery is provided.

---