Tax classification upheld where differential treatment of goods for revenue purposes was found neither arbitrary nor an unreasonable trade restraint.

A taxing amendment that withdrew exemption for sales of goods used in manufacturing was upheld because the Legislature may classify goods differently for revenue purposes, and the distinction between goods used in manufacture for sale and goods supplied under contracts was not shown to be arbitrary or discriminatory under Article 14. The increased cost of production caused by loss of the exemption was also held insufficient to establish an unreasonable restriction on trade, so the challenge under Article 19 failed. Once the constitutional attack failed, refusal to restore deleted items in the registration certificate did not give rise to any separate enforceable relief.

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Issues: (i) Whether the amendment to section 15 of the Assam Sales Tax Act, 1947 by the Assam Sales Tax (Amendment) Act, 1960 violated Article 14 by making an unreasonable and discriminatory classification. (ii) Whether the amendment imposed an excessive and unreasonable restriction on the petitioner's right to carry on trade under Article 19(1)(f). (iii) Whether the refusal to amend the registration certificate, by not restoring the deleted items, infringed the petitioner's rights under Article 19(1)(f).

Issue (i): Whether the amendment to section 15 of the Assam Sales Tax Act, 1947 by the Assam Sales Tax (Amendment) Act, 1960 violated Article 14 by making an unreasonable and discriminatory classification.

Analysis: The amendment removed the exemption for sales of goods intended for use in manufacture or production of goods for sale. The challenge under Article 14 failed because the Legislature, in a taxing statute, is entitled to determine the class of goods to be taxed as part of its revenue policy. The distinction between goods used in manufacture for sale and goods supplied under contracts was held not to amount to an unconstitutional discrimination, since the provision operates on classes of goods and the two situations are not similarly situated for the purpose of the tax.

Conclusion: The amendment did not offend Article 14 and the challenge failed.

Issue (ii): Whether the amendment imposed an excessive and unreasonable restriction on the petitioner's right to carry on trade under Article 19(1)(f).

Analysis: The increase in production cost resulting from the withdrawal of exemption was not shown to be an unreasonable restriction. The Court treated the levy as a matter of legislative taxation policy and held that the possibility of competitive disadvantage did not by itself establish unconstitutionality.

Conclusion: The amendment did not violate Article 19(1)(f) and the challenge failed.

Issue (iii): Whether the refusal to amend the registration certificate, by not restoring the deleted items, infringed the petitioner's rights under Article 19(1)(f).

Analysis: This contention was dependent on the success of the constitutional challenges to the amendment. Once those challenges failed, the refusal to restore the omitted items in the registration certificate could not independently sustain the petition.

Conclusion: The refusal to amend the registration certificate did not give rise to any separate enforceable relief.

Final Conclusion: The constitutional challenge to the sales tax amendment failed in its entirety, and the ancillary objection regarding the registration certificate also failed.

Ratio Decidendi: In a taxing statute, a legislative classification based on different uses of goods will not offend equality or trade rights unless the classification is shown to be unreasonable, arbitrary, or lacking a rational basis.

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