TaxTMI 
TaxTMI 
2018 (3) TMI 235
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....d Transport Corporation (hereinafter referred to as 'corporation'), pursuant to which the assessee supplied Buses to the corporation for being used by Bhainsali Depot, Meerut, of the corporation. Authorities under the Act issued notices to the assessee treating the rent received from corporation as constituting transfer of right to use, which was liable to be taxed @ 5%. Despite notice, the assessee did not respond. The assessing authority relied upon an order passed by this Court in Trade Tax Revision No.468 of 2001, dated 7.4.2009, to hold that rental receipts secured from the corporation is taxable and accordingly raised a demand of Rs. 5,69,720.50 paise, vide ex-parte order of assessment dated 31st March, 2014. An appeal was preferred by the assessee contending that payment of trade tax under the U.P. VAT Act continues to remain exempted in view of the notification dated 14.11.2000 by virtue of provisions contained under Section 81(2)(a) of the U.P. VAT Act and also on the ground that there was no transfer of right to use in favour of the corporation. The first appellate authority has rejected claim of assessee on both the counts, and the same is affirmed by the Tribuna....
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....tion or any other thing done or any action taken under the repealed enactment, and in force immediately before such commencement shall, so far as it is not inconsistent with the provisions of this Act, be deemed to have been issued, made granted, done or taken under the corresponding provisions of this Act. (b) any right, privilege, obligation or liability acquired, accrued or incurred under the repealed Act, shall not be affected and manufacturing units enjoying benefit of exemption from payment of tax under Section 4-A of the repealed Act or the units enjoying facility of moratorium for payment of tax under Section 8(2-A) of the said Act shall be entitled to claim moratorium for payment of tax in accordance with provisions of Section 42. (3) ...... (4) ....... (5) ........ (6) The mention of particular matters in this section shall not be held to prejudice or affect general application of Section 6 of the Uttar Pradesh General Clauses Act, 1904, with regard to the effect of repeals." 8. By virtue of Section 81(2)(a), a notification issued under the Act of 1948 would be deemed to have been issued under the Act of 2008, insofar as it ....
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....3-A or Section 3AAA or section 3-D but subject to the provisions of section 14 and 15 of the Central Sales Tax Act, 1956, every dealer shall, for each assessment year, pay a tax on the net turnover of-- (a) Transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; or (b) transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract. at such rate not exceeding twenty per centum, as the State Government may, by notification declare and different rates may be declared for different goods or different classes of dealers." 11. Sale is otherwise defined in the Act of 1948 under Section 2(h). Clause (iv) thereof is also reproduced:- "2(h) 'Sale', with its grammatical variations and cognate expressions, means any transfer of property in goods (otherwise than by way of a mortgage, hypothecation, charge or pledge) for cash or deferred payment or other valuable consideration, and includes-- (iv) a transfer of the right to use any goods for any purpose (whether or not for a specified perio....
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....ate of four percent;" 15. Item 3 in Part-A of Schedule-II provides that 4% tax would be leviable upon the transfer of right to use of goods. The relevant taxing entry reads as under:- "S.No. 3 of Schedule-II Part-A: Originally as per The Uttar Pradesh Value Added Tax Ordinance (U.P. Ordinance No.37 of 2007) S.No.3 of Schedule-II Part-A stood as under: "3. All intangible goods like copyright, patent, rep. license etc." W.r.e.f. 1.1.2008. Entry substituted by the following entry w.r.e.f. 1.1.2008 by Noti. No. KA.NI.-2-67/XI-....., dt. 10.1.2008 (S.No.5): "3. All intangible goods like copyright, patent, R.E.P., license etc.; transfer of right to use goods." Entry has been incorporated in The U.P. Value Added Tax Act, 2008 published in the U.P. Gazette, dt. 27.2.2008." 16. Right to transfer of use therefore is taxable both under the Act of 1948 and the Act of 2008, and the only difference is that while tax under the Act of 1948 is payable @ 5%, where the turnover is above Rs. 1 lac, it is 4% under the Act of 2008. The point of taxation remains the point of sale both under the Act of 1948 and the Act of 2008. 17. Si....
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....ayable, is not a relevant factor when the Government decides to exempt a transaction itself from payment of tax. In the present case, the transfer by a Bus owner to the UPSRTC of the right to use a Bus under any contract, is the goods specified in the schedule, and thus to be exempted from the applicability of tax. Such a notification would not become inconsistent only because the right of tax payable for the transaction in the Act of 2008 is different from the rates specified in the Act of 1948. 21. Unless the notification dated 14.11.2000 is found to be inconsistent with the Act of 2008, the transaction would continue to be exempted under the Act of 2008, and the notification dated 14.11.2000 would be deemed to have been issued under the Act of 2008. 22. In Central Indian Machinery Manufacturing Co. Ltd. Vs. State of M.P. and another, reported in (1997) 9 SCC 475, a question arose regarding continuance of notification under a repealed Act on the ground that a deduction of 10% towards statutory allowance was contemplated in lieu of cost of repair etc. from the gross annual letting value. The High Court had observed that for such reasons, the notification issued under the rep....
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.... and buildings are situate. The said contention was rejected by the High Court on the view that the appellant's factory and buildings are situate in an area known as additional industrial area which was included within the Gwalior Municipal limits in October 1954. The High Court has referred to the provisions of Section 7(4)(a) of the 1954 Act wherein it is prescribed that "when any area is added to the municipality by a notification, the Act, rules, bye-laws, orders, notices and notifications of the Municipality concerned shall be applicable to that area". The High Court has held that in view of the said provision the 1945 notification passed under the Gwalior Act imposing house tax which was applicable after the 1954 Act, became applicable to the area wherein the properties of the appellant are situate. On that view the High Court has dismissed the writ petition filed by the appellant. Hence this appeal. 4. The learned counsel for the appellant has urged the contentions aforementioned which have been rejected by the High Court. We do not find any reason to take a view different from that taken by the High Court. In our view, the said contentions were rightly rejected....
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....ct. It is, therefore, not possible to accept the contention of the learned Standing Counsel that the provisions of the 2003 Act are incompatible with the banking and wheeling Agreements entered into by the erstwhile dispensation with the petitioners. That the Commission has been continuing with the policy of banking, even under the changed legal environment, is evident from Clause 12 of Regulation 2 of 2006, albeit with certain changes. The contention of the learned Standing Counsel is mainly based on the fact that the functions of tariff fixation and regulation are entrusted to the Commission. In my considered view, this change by itself cannot be treated as inconsistent between the provisions of the repealed Act and the present Act. More so, when the issue regarding Banking is not concerned with tariff fixation or tariff regulation. 17 . According to Black's Law Dictionary, the expression "inconsistent" means "lacking consistency" and "not compatible with". As noticed earlier, the present enactment far from being incompatible with Banking, the Commission continued the policy of Banking even under this Act. Hence, the contention of the learned Standing Counsel that th....
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....he new Act expressly keeps alive old rights and liabilities but whether it manifests an intention to destroy them. We cannot therefore subscribe to the broad proposition that Section 6 of the General Clauses Act is ruled out when there is report of an enactment followed by a fresh legislation. Section 6 would be applicable in such cases also unless the new legislation manifests an intention incompatible with or contrary to the provisions of the section. Such incompatibility would have to be ascertained from a consideration of all the relevant provisions of the new law and the mere absence of a saving clause is by itself not material. It is in the light of these principles that we now proceed to examine the facts of the present case. 20. In Bansidhar v. State of Rajasthan MANU/SC/0057/1989: [1989]2SCR152 M.N. Venkatachalaiah, J, as he then was, speaking for the Constitution Bench, while expressing a similar view as in Mohar Singh AIR 1955 SC 84 held as under: When there is a repeal of a statute accompanied by re-enactment of a law on the same subject, the provisions of the new enactment would have to be looked into not for the purpose of ascertaining whether the co....
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....de after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made, then, unless a different intention appears, the repeal shall not- (a) revive anything not in force or existing at the time at which the repeal takes effect; or (b) affect the previous operation of any enactment so repealed or any thing duly done or suffered thereunder; or (c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or (d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any enactment so repealed; or (e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid; and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or Regulation had not been passed. Banking and right to utilize the power so banked is a valuable right accrued to the petitioners. Such a right conferred on....
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.... of Rent and Eviction) Act, 1973. 2. It shall extend to all urban areas in Haryana but nothing herein contained shall apply to any cantonment area. 3. Nothing in this Act shall apply to-- (i) any residential building the construction of which is completed on or after the commencement of this Act for a period of ten years from the date of its completion. (ii) any non-residential building construction of which is completed after the 31st March, 1962; (iii) any rented land let out on or after 31st March, 1962. Section 3--Exemptions: The State Government may direct that all or any of the provisions of this Act shall not apply to any particular building or rented land or to any class of buildings or rented lands. Section 24--Repeal and Savings: 1. The East Punjab Urban Rent Restriction Act, 1949 (East Punjab Act No. 3 of 1949), is hereby repealed: Provided that such repeal shall not affect any proceedings pending or order passed immediately before the commencement of this Act, which shall be continued and disposed of or enforced as if the said Act had! not been repealed. 2. Notwithstanding....
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....nstruction of which is completed on or after the commencement of this Act for a period of ten years from the date of its completion. 10 . The words "shall be substituted and shall always be deemed to have been substituted" imply that the new provision would have to be read as if it had been enacted at the time when the new Act, i.e., Act No. 11 of 1973, was brought on the statute book. This matter admits of no doubt and has been finally set at rest by their Lordships of the Supreme Court in State of Bombay v. Pandurang Vinayak and Ors. MANU/SC/0025/1953 : A.I.R. 1953 S.C. 244, wherein it was held-- When a statute enacts that something shall be deemed to have been done, which in fact and truth was not done, the Court is entitled and bound to ascertain for what purposes and between what persons the statutory fiction is to be resorted to and full effect must be given to the statutory fiction and it should be carried to its logical conclusion. (Vide Lord Justice James in ex parte Walton) In re Levy 17 Ch. D. 748. If the purpose of the statutory fiction mentioned in Section 15 is kept in view, then it follows that the purpose of that fiction would be completely defeate....
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.... notification would have to be deemed as a valid place of law. 13. Faced with this situation, the learned Counsel for the Appellant submitted that the notification was inconsistent with the provisions of the new Act inasmuch as the latter exempted only the buildings constructed after it came into force and purposely did not make any mention about the buildings constructed earlier. We are not impressed with this argument either. A reading of Section 1 of the new Act shows that primarily the Act was made applicable to all urban areas excluding the cantonment areas, but special type of buildings were expressly excluded by the Legislature from the field of operation of the Act. At the same time, the Legislature authorised the Government by enacting Section 3 to exclude from the operation of the Act, any class of rented lands or buildings. Thus, the scheme of this section and that of Section 3 shows that the Legislature itself kept some buildings out of the control of the Act and also authorised the State Government to achieve the same result by issuing a notification. It cannot possibly be contended that there is some inconsistency in these two provisions. The Legislature thou....
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....the District Judge, Poona to hear the application under s. 153-C of the Act of 1913 as that notification is inconsistent with s. 10 of the Act of 1956 and the District Judge cannot, therefore, continue to deal with the applica- tion. Section 24 does not however purport to put an end to any notification. It is not intended to terminate any notification; all it does is to continue a notification in force in the stated circumstances after the Act under which it was issued, is repealed. Section 24 therefore does not cancel the notification empowering the District Judge of Poona to exercise jurisdiction under the Act of l9l3. It seems to us that since under s. 6 of the General Clauses Act the proceeding in respect of the application under s. 153-C (1) [1955] I S.C.R. 893 of the Act of 1913 may be continued after the repeal of that Act, it follows that the District Judge of Poona continues to have jurisdiction to entertain it. If it were not so, then s. 6 would become infructuous." 27. In Neel alias Niranjan Majumdar Vs. The State of West Bengal, reported in (1972) 2 SCC 668, a Division Bench of the Apex Court speaking through Hon'ble J.M. Shelat, J. expressed similar views in Par....
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....ued to operate but has to be deemed to have been enacted under the new Act." 28. In a recent decision of the Apex Court in Harkesh Chand Vs. Krishan Gopal Mehta and others, reported in (2017) 4 SCC 547, the law has been extensively traced and the true import of Section 24 of the U.P. General Clauses Act has been examined in continuing a Government Notification under an enactment repealed and re-enacted. Paras 20 to 26 of the judgment are reproduced:- "20. The question whether the notification dated 31st March, 1949 continued to exist even after the Act was repealed upon the reenactment of the Act of 1972 may be considered. 21. Section 24 of the U.P. General Clauses Act, 1904:- "24. Continuation of appointments, notifications, orders, etc., issued under enactments repealed and re-enacted. - Where any enactment is repealed and re-enacted by an [Uttar Pradesh] Act, with or without modification, then, unless it is otherwise expressly provided, any appointment, [or statutory instrument or form], made or issued under the repealed enactment, shall, so far as it is not inconsistent with the provisions re-enacted, continue in force, and be deemed to have been m....
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....le to the Doiwala area. Apparently the purpose of the re- enacted provision is, inter alia, to protect the tenants from eviction, except on special grounds. Nothing in the Act shows that such a protection was intended to be removed from any area or for that matter, the Doiwala area. In fact, the contrary is clear from the fact that a notification expressly applying the re-enacted provisions to the Doiwala area was issued on the 21st of March, 1973. Thus, there can be no inconsistency between the notification applying the Act to the Doiwala area, and the re-enacted provisions of the Act unless the Act of 1972 clearly expresses an intention to remove the protection accorded to the tenants from an area. 25. Section 24 of the General Clauses Act, 1904 clearly provides that a statutory instrument issued under a repealed enactment shall continue in force and be deemed to have been made or issued under the re-enacted provisions unless: (a) the re-enacted provision expressly provides otherwise or (b) it is superseded by a statutory instrument made under the re-enacted provision. The section further provides that the extent to which the statutory instrume....