Venkatarama Aiyar, J.— The petitioner is a partner in a firm called Messrs Mohan La1 Hargovind Das, which carries on business in the manufacture and sale of biris in a number of States, and is a dealer registered under the U.P Sales Tax Act 15 of 1948, with its head office at Allahabad. In the present petition filed under Article 32 of the Constitution, the petitioner impugns the validity of a levy of sales tax made by the Sales Tax Officer, Allahabad, by his order dated December 20, 1958.
2. On December 14, 1957, the Government of Uttar Pradesh issued a notification under Section 4(l)(b) of the Act exempting from tax, sales of certain goods including biris: provided that the additional Central Excise duties leviable thereon had been paid. In partial modification of this notification, the Government issued another notification on November 25, 1958, exempting from tax unconditionally sales of biris, both machine-made and hand-made, with effect from July 1, 1958. The effect of the two notifications aforesaid taken together is that while for the period, December 14, 1957 to June 30, 1958, the exemption of biris from tax was subject to the proviso contained in the notification dated December 14, 1957, for the period commencing from July 1, 1958, it was unconditional and absolute.
3. The petitioner's firm filed its return for the quarter ending June 1958, disclosing a gross turnover of Rs 75,44,633 and a net turnover of Rs 111 representing the sale proceeds of empty packages, and deposited a sum of Rs 3.51 n.p as sales tax on the latter. On November 28, 1958, the Sales Tax Officer, Allahabad, sent a notice to the petitioner's firm for assessment of tax on the sale of biris during the period, April 1, 1958 to June 30, 1958, and on the date of enquiry which was held on December 10, 1958, the petitioner filed a petition stating that by reason of the exemption granted under the Notification No. ST-4485.X dated December 14, 1957, no tax was payable on the sale of biris. By his order dated December 20, 1958, the Sales Tax Officer rejected this contention. He observed:
“The exemption envisaged in this notification applies to dealers in respect of Sales of Biris, provided that the additional Central Excise duties leviable thereon from the closing of business on December 13, 1957, have been paid on such goods. The assessee paid no such excise duties. Sales of Biris by the assessee are, therefore, liable to sales tax.”
Against this order, there was an appeal (Appeal No. 441 of 1959) to the Court of the Judge (Appeals), Sales Tax, Allahabad, who, by his order dated May 1, 1959, dismissed the same on the ground that the exemption from sales tax under the notification related “to such classes of goods only on which the Additional Central Excise Duty was leviable”, Under Section 10 of the Act, a person aggrieved by an order appeal might take it up on revision before the revising authority, and under Section 11, the assessee has a right to require that any question of law arising out of the order of assessment be referred to the opinion of the High Court. The Petitioner did not take any proceedings under the Act against the order in appeal dated May 1, 1959, and that has become final.
4. While Appeal No. 441 of 1959 was pending, the petitioner also filed under Article 226 of the Constitution a petition in the High Court of Allahabad, for a writ of certiorari to quash the assessment order dated December 20, 1958. That was dismissed on January 27, 1959, by the learned Judges on the ground that as the assesses could contest the validity of the order in appropriate proceeding under the Act, and as, in fact, an appeal had been filed, there was no ground for exercising the extraordinary jurisdiction under Article 226. In this view, the learned Judges did not decide the case on the merits, but observed that the “language of the notification might well be read as meaning that the notification is to apply only to those goods on which an additional Central Excise Duty had been levied and paid”. The petitioner then filed an application under Article 133 of the Constitution for a certificate for appeal to this Court, against the above order, and that was granted. But instead of pursuing that remedy, the petitioner has chosen to file the present application under Article 32 challenging the validity of the order of assessment dated December 20, 1958. It is alleged in the petition that the imposition and levy of tax aforesaid “amounts to the infringement of the fundamental rights of the petitioner to carry on trade a business guaranteed by Article 19(1)(g) of the Constitution,” and that it is further “an illegal confiscation of property without compensation and contravenes the provisions of Article 31 of the Constitution”. The prayer in the petition is that this Court might be “pleased to issue”:
“(a) a writ of certiorari or other order in the nature of certiorari quashing the order of the Sales Tax Officer, Allahabad, dated 20th December 1958;
(b) a writ of mandamus directing the opposite parties not to realise any sales tax from the petitioner on the basis of the said order dated 20th December 1958.”
5. No argument has been addressed to us that the impugned order of assessment is in contravention of Article 31. Such a contention would be wholly untenable in view of the decision of this Court in Ramji lal v. Income Tax Officer (1951) SCR 127 and Laxmanappa Hanumantappa v. Union of India (1955) 1 SCR 769 where it has been held that when a tax is authorised by law as required by Article 265, the levy is not open to attach under Article 31 of the Constitution. The whole of the argument on behalf of the petitioner is that the assessment order is unconstitutional as infringing Article 19(l)(g). It is contended in support of this position that the Sales Tax Officer has misconstrued the notification dated December 14, 1957, in holding that exemption of tax thereunder is limited to biris on which additional excise duty had been levied, that as a result of such misconstruction a tax has been imposed which is unauthorised, and that that constitutes an interference with the right of the petitioner to carry on business guaranteed by Article 19(1)(g). That is how the jurisdiction of this Court under Article 32 is invoked,
6. To this, the answer of the respondents is that the Sales Tax Officer had correctly construed the notification in limiting the exemption to goods on which additional excise duty had been paid. The respondents further raise a preliminary objection to the maintainability of this petition on the ground that laws of taxation which are protected by Article 265 fall outside the purview of Part III of the Constitution, and are not open to attack as infringing fundamental rights guaranteed therein, and that even if they are subject to the restrictions in Part III, on order of assessment made by a tribunal acting judicially under a statute which is intra vires such as the impugned order dated December 20, 1958, does not infringe Article 19(l)(g), and that, further, a petition under Article 32 is not maintainable for challenging it, even if it is erroneous on the merits.
7. On these contentions, the points that arise for decision are whether taxation laws are subject to the limitations imposed by Part III; whether the order of assessment dated December 20, 1958, is in contravention of Article 19(1)(g); and whether it can be impugned in a petition under Article 32 of the Constitution. The first question that falls to be considered is whether the restrictions imposed in Part III of the Constitution have application to taxation laws. The contention of the respondents is that taxation is a topic which is dealt with separately in Part XII of the Constitution, that the governing provision is Article 265 which enacts that no tax shall be levied or collected except by authority of law, that when there is a law authorising the imposition of tax and that does not contravene any of the inhibitions in Part XII, then the levy thereunder cannot be attacked as infringing any of the fundamental rights declared in Part III. In support of this contention, the following observations in Ramjilal case (1951) SCR 127 were relied on:
“Reference has next to be made to Article 265 which is in Part XII, Chapter I, dealing with ‘Finance'. That article provides that no tax shall be levied or collected except by authority of law. There was no similar provision in the corresponding chapter of the Government of India Act, 1935. If collection of taxes amounts to deprivation of property within the meaning of Article 31(1), then there was no point in making a separate provision again as has been made in Article 265. It, therefore, follows that clause (1) of Article 31 must the regarded as concerned with deprivation of property otherwise than by the imposition or collection of tax, for otherwise Article 265 becomes wholly redundant. In the United States of America the power of taxation is regarded as distinct from the exercise of police power or eminent domain. Our Constitution evidently has also treated taxation as distinct from compulsory acquisition of property and has made independent provision giving protection against taxation save by authority of law. In our opinion, the protection against imposition and collection of taxes save by authority of law directly comes from Article 265, and is not secured by clause (1) of Article 31. Article 265 not being in Chapter III of the Constitution, its protection is not a fundamental right which can be enforced by an application to this court under Article 32. It is not our purpose to say that the right secured by Article 265 may not be enforced. It may certainly be enforced by adopting proper proceedings. All that we wish to state is that this application insofar as it purports to be founded on Article 32 read with Ariticle 31(1) to this court is misconceived and must fail.” (pp.136-137).
A similar decision was given in Laxmanappa Hanumantappa v. Union of India (1955) 1 SCR 769. Where an order of assessment made in November 1953, was attacked in a petition under Article 32 on the ground that the Act under which it was made viz. the Taxation on Income (Investigation Commission) Act (30 of 1947) was void under Article 14 of the Constitution. Rejecting this contention, Mahajan, C.J, delivering the Judgment of the Court, observed:
“The assessment orders under the Income Tax Act itself were made against the petitioner in November 1953. In these circumstances we are of the opinion that he is entitled to no relief under the provisions of Article 32 of the Constitution. It was held by this Court in Ramjilal v. Income Tax Officer, Mohindergarh (1951) SCR 127 that as there is a special provision in Article 265 of the Constitution that no tax shall be levied or collected except by authority of law, clause (1) of Article 31 must therefore be regarded as concerned with deprivation of property otherwise than by the imposition or collection of tax, and inasmuch as the right conferred by Article 265 is not a right conferred by Part III of the Constitution, it could not be enforced under Article 32.” (p.772).
The argument of the respondents based on the above decisions is that a law imposing a tax enacted by a competent legislature is not open to attack under the provisions of Part III.
8. The contention of the petitioner, on the other hand, is that a law of taxation is also subject to the limitations prescribed in Part III of the Constitution, and the recent decision of this Court in Kunnathat Thathunni Moopil Nair v. State of Kerala AIR 1961 SC 552 is relied on in support of it. There, the question was whether the provisions of the Travancore-Cochin Land Tax Act 15 of 1955, as amended by the Travancore-Cochin Land Tax (Amendment) Act 10 of 1957, contravened Article 14 of the Constitution. The Court was of the opinion that they did. Then the contention wrs raised that in view of Article 265 the legislation was not open to attack under the provisions of Part III. In revelling this contention the Court observed:
“Article 265 imposes a limitation on the taxing power of the State insofar as it provides that the State shall not levy or collect a tax, except by authority of law, that is to say, a tax cannot be levied or collected by a mere executive fiat. It has to be done by authority of law, which must mean valid law. In order that the law may be valid, the tax proposed to be levied must be within the legislative competence of the legislature imposing a tax and authorising the collection thereof and secondly, the tax must be subject to the conditions laid down in Article 13 of the Constitution. One of such conditions envisaged by Article 13(2) is that the legislature shall not make any law which takes away or abridges the equality clause in Article 14, which enjoins the State not to deny to any person equality before the law or the equal protection of the laws of the country. It cannot be disputed that if the Act infringes the provisions of Article 14 of the Constitution, it must be struck down as unconstitutional.”
In the result, the impugned legislation was struck down as unconstitutional.
9. It might appear at first sight that this decision is in conflict with the decisions in Ramjilal case (1951) SCR 127 and Laxmanappa case (1955) 1 SCR 769. But when the matter is closely examined, it will be seen that it is not so. In Ramjilal case (1951) SCR 127 and in Laxmanappa case (1955) 1 SCR 769, the contention urged was that the tax which is duly authorised by valid legislation as required by Article 265 will still be bad under Article 31(1) as amounting to deprivation of property. This was negatived, and it was held that Article 31(l) had no application to a law, which was within the protection afforded by Article 265. There are observations in the above decisions which might be read as meaning that taxation laws are altogether outside the operation of Part III. But, in the context, they have reference to the application of Article 31(1). In Moopil Nair case AIR 1961 SC 552, the contention urged was that even though a taxing law might be discriminatory, it was not open to attack under Article 14 by reason of Article 265. In negativing this contention, this Court held that a law which authorised the imposition of a tax under Article 265 was also a law within Article 13; and that, therefore, if it contravened Article 14 it was liable to be struck down. This decision is clearly an authority for the position that laws of taxation must also pass the test of the limitations prescribed in Part III of the Constitution. But it is not an authority for the position that all the provisions contained in Part III are necessarily applicable to those laws. It did not decide contrary to Ramjilal case (1951) SCR 127 and Laxmanappa (1955) 1 SCR 769case that Article 31(1) would apply to a taxation law, which is otherwise valid. In our judgment, the correct position in law is that a contention that a taxation law infringes a fundamental right cannot be shut out on the ground that Article 265 grants immunity to it from attack under the provisions of Part III, but that whether there has been infringement must be decided on a consideration of the terms of the particular article, which is alleged to have been infringed, it is on this reasoning that taxation laws were held in Ramjilal case (1951) SCR 127 and in Laxmanappa case (1955) 1 SCR 769 to be unaffected by Article 31(1), whereas in Moopil Nair case AIR 1961 SC 552 they were held to be within the purview of Article 14.
10. In this view, the question that arises for decision is whether Article 19(1)(g), which is alleged to have been infringed, is applicable to a sales tax law which has been enacted by a competent legislature and which is not otherwise ultra vires. Article 19(l)(g) enacts that all citizens have the right to practice any profession or to carry on any occupation, trade or business. Is a law imposing a tax on sales by a dealer an infringement of his right to carry on trade? We must assume for the purpose of the present discussion that the sales tax statute in question is within the competence of the legislature and is not ultra vires. Where a law is passed by a legislature which has no competence to enact it as when a State Legislature imposes what is in substance, a tax on income, a subject which is within the exclusive competence of the Centre under Entry 82, that legislation has no existence in the eye of law and any levy of tax under the provisions of that law will not be within the protection afforded by Article 265, and will, in consequence, be hit by Article 19(1)(g). The same result would follow when a law though disguised as a taxation law, is, in substance a law which is intended to destroy or even burden trade and not to raise revenue. That is colourable legislation which cannot claim the benefit of Article 265, and it must be held to contravene Article 19(1)(g) unless saved by Article 19(6). But where the law is within the competence of the legislature and is otherwise valid and is not colourable can it be said that it is liable to be attacked as infringing Article 19(1)(g)? The object of the legislation is not to prevent the dealer from carrying on his business. Far from it it envisages that the trader will carry on his business and carry it on a large scale so that the State might earn the tax. It is, therefore, difficult to conceive how a sales tax law can fall within the vision of Article 19(1)(g). Articles 19(1)(f) and 19(1)(g) are in the same position as Article 31(1). They all of them enact that the citizen shall have the right to hold property or to carry on business without interference by the State. If Article 31(1) is as held in Ramjilal case (1951) SCR 127 and Laxamanappa case (1955) 1 SCR 769 inapplicable to taxation laws. Articles 19(1)(f) and (g) must on the same reasoning also be held to be inapplicable to such laws.
11. The question can also be considered from another standpoint, Article 19(1)(g) and Article 19(6) form parts of one law which has for its object the definition of the fundamental right of a citizen to carry on business. Article 19(1)(g) declares that right and Article 19(6) prescribes its limits. The two provisions together make up the whole of the fundamental right to carry on business. If a taxation law is within Article 19(1)(g) it must also be capable of being upheld as a reasonable restriction under Article 19(6). But can imposition of a tax be properly said to be a restriction on the carrying on of trade within Article 19(6)? It is only if that it so that the question of reasonableness can arise. If the imposition of sales tax is a restriction on the carrying on of business then the imposition of income tax must be that even to a greater degree. Likewise land tax must be held to be a restriction on the right of a citizen to hold property guaranteed by Article 19(1)(f). Indeed it will be impossible to conceive of any taxation law which will not be a restriction under Article 19(1)(f) or Article 19(1)(g). It is difficult to imagine that that is the meaning which the word “restriction” was intended to bear in Articles 19(5) and (6). That this is not the correct interpretation to be put on the word “restriction” will be clear when Article 19(6) is further examined. Under that provision, the question whether a restriction is reasonable or not is one for the determination of the Court and that determination has to be made on an appreciation of the facts established. If it is to be held that taxation laws are within Article 19(1)(g) then the question whether they are reasonable or not becomes justiciable and how is the Court to judge whether they are so or not? Can the Court say that the taxation is excessive and is unreasonable? What are the materials on which the matter could be decided, and what are the criteria on which the decision thereon could be reached? It would, therefore seem that the reasonableness of taxation laws is not a matter which is justiciable and therefore they could not fall within the purview of Article 19(5) and (6). If it is to be held that taxation laws are within the inhibition enacted in Article 19(1)(g), then all those laws must be struck down as unconstitutional, because they could never be saved under Article 19(5) and Article 19(6). It should be noted that Article 19 (1)(g) and Article 19(6) form parts of one scheme and for a proper understanding of the one regard must be had to the other; Article 19(1)(g), cannot operate where Article 19(6) cannot step in and the considerations arising-under Article 19(6) being foreign to taxation laws Article 19(1)(g) can have no application to them.
12. We may now refer to the decisions of this Court, where the question of applicability of Article 19(1)(g) to taxation laws has been considered. In Himmatlal Harilal Mehta v. State of Madhya Pradesh (1954) SCR 1122 the question arose with reference to a sales tax which was sought to be imposed under Explanation II to Section 2(g) of the Central Provinces and Berar Sales Tax Act 21 of 1947, under which a sale was defined as at transaction by which property in goods which were actually within the State was transferred wherever the sale might have been made. That provision was held to be ultra vires the State Legislature. A dealer then filed an application under Article 226 in the High Court of Nagpur questioning the vires of that provision and asking for appropriate writ. The State resisted the application on the ground that as there was a special machinery provided in the Act for questioning the assessment a petition under Article 226 was not maintainable. In rejecting this contention this Court held that:
“Explanation II to Section 2(g) of the Act having been declared ultra vires any imposition of sales tax on the appellant in Madhya Pradesh is without the authority of law and that being so a threat by the State by using the coercive machinery of the impugned Act to realise it from the appellant is a sufficient infringement of his fundamental right under Article 19(l)(g) and it was clearly entitled to relief under Article 226 of the Constitution.”
This decision is a direct authority for the proposition that when a provision in a taxing statute is ultra vires and void any action taken thereunder is without the authority of law, as required under Article 265 and that in that situation Article 19(1)(g) would be attracted.
13. This decision was approved in Bengal Immunity Company Limited v State of Bihar (1955) 2 SCR 603. The facts of that case are that the appellant Company filed a petition under Article 226 in the High Court of Patna for a writ of prohibition restraining the Sales Tax Officer from making an assessment of sales tax pursuant to a notice issued by him. The appellant claimed that the sales sought to be assessed were made in the course of inter-State trade that the provisions of the Bihar Sales Act 19 of 1947 which authorised the imposition of tax on such sales were repugnant to Article 286(2) and void and that, therefore the proceedings taken by the Sales Tax Officer should be quashed. That application was dismissed by the High Court on the ground that if the Sales Tax Officer made an assessment which was erroneous the assessee could challenge it by way of appeal or revision under Sections 24 & 25 of the Act and that as the matter was within the jurisdiction of the Sales Tax Officer, no writ of prohibition or certiorari could be issued. There was an appeal against this order to this Court and there in a preliminary objection was taken that a writ under Article 226 was not the appropriate remedy open to an assessee for challenging the legality of the proceedings before a Sales Tax Officer. In rejecting this contention this Court observed:
“It is however clear from Article 265 that no tax can be levied or collected except by authority of law which must mean a good & valid law. The contention of the appellant company is that the Act which authorises the assessment, levying and collection of Sales Tax on inter state trade contravences & constitutes an infringement of Article 286 and is therefore, ultra vires, void and unenforceable. If however this contention be well founded the remedy by way of a writ must on principle and authority be available to the party aggrieved”. (p. 1619).
And dealing with the contention that the petitioner should proceed by way of appeal or revision under the Act, this Court observed:
“The answer to this plea is short and simple. The remedy under the Act cannot be said to be adequate and is, indeed, nugatory or useless if the Act which provides for such remedy is itself ultra vires and void and the principle relied upon can, therefore, have no application where a party comes to Court with an allegation that his right has been or is being threatened to be infringed by a law which is ultra vires, the powers of the legislature which enacted it and as such void and prays for appropriate relief under Article 226.” (p. 620).
14. It will be seen that in this case the question arose with reference to a provision in the taxing statute, which was ultra vires and the decision was only that any action taken under such a provision was without the authority of law and was, therefore, an unconstitutional interference with the right to carry on business under Article 19(l)(g). There is nothing in these two decisions which lends any support to the contention that, where the provision of law under which assessment is made is intra vires, the order is liable to be impugned as contravening Article 19(l)(g), if the order is, on the merits, erroneous. That, however, was held in the decision in Kailas Nath v. State of U.P. AIR 1957 SC 790
15. In that case, a petition under Article 32 of the Constitution was filed in this Court challenging an order of assessment on the ground that the Sales Tax Officer had disallowed an exemption on a misconstruction of a notification issued under Section 4 of the U.P Sales Tax Act, and that thereby the right of the petitioner to carry on business under Article 19(l)(g) had been infringed. An objection was taken that, even if the Sales Tax Officer had misconstrued the notification, no fundamental right of the petitioner had been infringed, and that the petition was not maintainable. Overruling this contention, Govinda Menon, J. observed:
“If a tax is levied without due legal authority on any trade or business, then it is open to the citizen aggrieved to approach this Court for a writ under Article 32, since his right to carry on a trade is violated, or infringed by the imposition and such being the case, Article 19(l)(g) comes into play.” (pp. 792-93).
In support of this view, the observations in Bengal Immunity Company case (1955) 2 SCR 603 were relied on. The Petitioner contends that, on this reasoning, Article l9(l)(g) must be held to be violated not merely when an assessment is made under a statute which is ultra vires, but also when it is made on a misconstruction of a statute, which is intra vires. It is incontrovertible that that is the effect of the decision in Kailash Nath case AIR 1957 SC 790. But it is equally incontrovertible that the decision in Bengal Immunity Company case (1955) 2 SCR 603, which it purports to follow, does not support it. There is a fundamental distinction between an order of assessment made on a provision, which is ultra vires, and one made on a valid provision, which is misconstrued. Where the provision is void, the protection under Article 265 fails, and what remains is only unauthorised interference with property or trade by a State Officer, and Articles 19(1)(f) and (g) are attracted. But where the provision itself is valid, Article 265 operates, and any action taken thereunder is protected by it. An authority having jurisdiction to decide a matter has jurisdiction to decide wrong as well as right, and the protection afforded by Article 265 is not destroyed, if its decision turns out to be erroneous. To such cases, Article 19(1)(g) has no application. Both in Himmatlal case (1954) SCR 1122 and in Bengal Immunity Company case (1955) 2 SCR 603 the decision of the Court that the proceedings constituted an infringement of the rights of the citizen under Article 19(l)(g) was based expressly on the ground that Article 265 did not apply to those proceedings. But this ground did not exist in Kailash Nath case AIR 1957 SC 790, and that makes all the difference in the legal position. The decision in Kailash Nath case AIR 1957 SC 790 which merely purported to follow the Bengal Immunity Company case (1955) 2 SCR 603, is open to the criticism that it has overlooked this distinction.
16. We may now refer to two decisions subsequent to the one in Kailash Nath case AIR 1957 SC 790, which have been relied on by the petitioner. In Tata Iron and Steel Co., Ltd. v. S.R Sarkar AIR 1961 SC 65 the question arose under the Central Sales Tax Act. Under that Act, sales in the course of inter-state trade are liable to be taxed at a single point. The petitioner was assessed to tax on certain sales falling within the Act by the Central Sales Tax Officer, Bihar, and the tax was also duly paid. Thereafter, the Central Sales Tax Officer in West Bengal made an order assessing to tax the very sales in respect of which tax had been paid. The petitioner then moved this Court under Article 32 for an order quashing the order of assessment. A preliminary objection to the maintainability of the petition was taken on behalf of the respondent State on the ground that, under the Act the petitioner could file an appeal against the order of assessment, and that proceedings under Article 32 were, therefore, incompetent. In overruling this contention, Shah, J. referred to the decisions of this Court in Himmatlal case (1954) SCR 1122, Bengal Immunity Company case (1955) 2 SCR 603 and State of Bombay v. United Motors (India) Ltd. (1953) SCR 1069 and observed:
“In these cases, in appeals from orders passed by the High Courts in petitions under Article 226, this Court held that an attempt to levy tax under a statute which was ultra vires, infringed the fundamental right of the citizens, and recourse to the High Court for protection of the fundamental right was not prohibited because of the provisions contained in Article 265. In the case before us, the vires of the Central Sales Tax Act, 1956, are not challenged; but in Kailash Nath v. State of U.P, a petition challenging the levy of a tax was entertained by this Court even though the Act under the authority of which the tax was sought to be recovered was not challenged as ultra vires. It is not necessary for purposes of this case to decide whether the principle of Kailash Nath case AIR 1957 SC 790 is inconsistent with the view expressed by this Court in Ramjilal case (1951) SCR 127.” (pp. 68-69).
The learned Judges then proceeded to hold that, as there was under the Act a single liability and that had been discharged, proceedings for the assessment of the same sales a second time to tax infringed the fundamental right of the petitioner to hold property. Dealing with this point, Sarkar, J. observed the same case:
“In AIR 1957 SC 790 this Court held that an illegal levy of sales tax on a trader under an Act the legality of which was not challenged violates his fundamental rights under Article 19(l)(g) and a petition under Article 32 with respect to such violation lies. The earlier case of 1951 SCR 127 does not appear to have been considered. It is contended that the decision in Kailash Nath case6 requires reconsideration. We do not think, however, that the present is a fit case to go into the question whether the two cases are not reconcilable and to decide the preliminary question raised. The point was taken at a late stage of the proceedings after much costs had been incurred.” (p. 76).
It is clear from the above observations that the learned Judges were of the opinion that the decision in Kailash Nath case AIR 1957 SC 790 required reconsideration. The ratio of the decision in Tata Iron and Steel Co. Ltd. v. S.R Sarkar AIR 1961 SC 65 would appear to be that as the law did not authorise the imposition of tax a second time on sales, on which tax has been levied and collected, proceedings for assessment a second time are without jurisdiction, and, therefore, Article 19(l)(f) is attracted. In the present case, there is no contention that the proceedings of the Sales Tax Officer are without jurisdiction.
17. The petitioner also relied on a recent dicision of this Court in Shri Madan Lal Arora v. Excise and Taxation Officer, Amritsar WP No. 120 of 1959. In that case, a notice for assessment was issued after the expiry of the period prescribed therefor by the Statute. The assessee thereupon applied to this Court under Article 32 for quashing the proceedings on the ground that they were without jurisdiction, and it was held that, as the taxing authority had no power under the statute to issue the notice in question, the proceedings must be quashed. This again is a case, in which the authority had no jurisdiction under the Act to take proceedings for assessment of tax, and it makes no difference that such assumption of jurisdiction was based on a misconstruction of statutory provisions. In the present case, we are concerned with an alleged misconstruction, which bears on the merits of the assessment, and does not affect the jurisdiction of the Sales Tax Officer to make the assessment, and the two are essentially different. And we should add that the present question was not raised or decided in that case.
18. It remains to refer to the decision in Moopil Nair case AIR 1961 SC 552 which has been already discussed in connection with Article 14. In that case, the provisions of the Travancore-Cochin Land Tax Act 15 of 1955 as amended by the Travancore-Cochin Land Tax (Amendment) Act 10 of 1957, were held to be bad as violative also of Article 19(l)(f). As the considerations applicable to Articles 19(1)(f) and 19(l)(g) are the same, we should have to examine the ground on which this decision rests. They were thus stated:
“Ordinarily, a taxing statute lays down a regular machinery for making assessment of the tax proposed to be imposed by the statute. It lays down detailed procedure as to notice to the proposed assessee to make a return in respect of property proposed to be taxed, prescribes the authority and the procedure for hearing any objections to the liability for taxation or as to the extent of the tax proposed to be levied, and finally, as to the right to challenge the regularity of assessment made, by recourse to proceeding in a higher civil court.... The Act being silent as to the machinery and procedure to be followed in making the assessment leaves it to the Executive to evolve the requisite machinery and procedure. The whole thing, from beginning to end, is treated as of a purely administrative character, completely ignoring the legal position that the assessment of a tax on person or property is at least of a quasi-Judicial character.... It is clear, therefore, that apart from being discriminatory and imposing unreasonable restrictions on holding property, the Act is clearly confiscatory in character and effect.... For these reasons, as also for the reasons for which the provisions of Sections 4 and 7 have been declared to be unconstitutional, in view of the provisions of Article 14 of the Constitution, all these operative sections of the Act, namely, 4, 5-A and 7, must be held to offend Article 19(1)(f) of the Constitution also.”
From the above observations, it will be seen that the ground on which the law was held to be in contravention of Article 19(1)(f) was not one which had any reference to the merits of the assessment but to the procedure laid down for imposing tax. This decision is an authority only for the position that, where the procedure laid down in a taxing statute is opposed to rules of natural justice, then any imposition of tax under such a procedure must be held to violate Article 19(l)(f).
19. Reference may be made to the following passage in Willoughby's Constitution of the United States, Second Edn. Vol. 3, p. 1718 relied on for the respondents:
“It is established that the guaranty to suitors of due process of law does not furnish to them a right to have decisions of courts reviewed upon the mere ground that such decisions have been based upon erroneous findings of fact or upon erroneous determinations of law. Such errors, if committed by trial courts, can be corrected only by ordinary appellate proceedings as provided for by law, especially has this doctrine been declared in cases in which the Federal Courts have been asked to review the decisions of State courts.”
Our attention was also invited to the decisions in McGovern v. New York and American Railway Express Co. v. Kentucky. It was observed in the latter case:
“It is firmly established that a merely erroneous decision given by a State court in the regular course of judicial proceedings does not deprive the unsuccessful party of property without due process of law.”
The above remarks support the contention of the respondent that an order of a court or tribunal is not hit by Article 19(1)(g).
20. The result of the authorities may thus be summed up:
(1) A tax will be valid only if it is authorised by a law enacted by a competent legislature. That is Article 265.
(2) A law which is authorised as aforesaid must further be not repugnant to any of the provisions of the Constitution. Thus, a law which contravenes Article 14 will be bad, Moopil Nair case AIR 1961 SC 552.
(3) A law which is made by a competent legislature and which is not otherwise invalid, is not open to attack under Article 31(1). Ramjilal case (1951) SCR 127 and Laxmanappa case (1955) 1 SCR 769.
(4) A law which is ultra vires either because the legislature has no competence over it or it contravenes, some constitutional inhibition, ha-; no legal existence, and any action taken thereunder will be an infringement of Article 19(1)(g) Himmatlal case (1954) SCR 1122 and Laxmanappa case (1955) 1 SCR 769. The result will be the same when the law is a colourable piece of legislation.
(5) Where assessment proceedings are taken without the authority of law, or where the proceedings are repugnant to rules of natural justice, there is an infringement of the right guaranteed under Article 19(l)(f) and Article 19(l)(g): Tata Iron & Steel Co. Ltd. AIR 1961 SC 65; Moopil Nair case AIR 1961 SC 552 and Shri Madan Lal Arora case WP No. 120 of 1959.
21. Now, the question is, when a law is enacted by a competent legislature and it is not unconstitutional as contravening any prohibition in the Constitution such as Article 14, and when proceedings for assessment of tax are taken thereunder in the manner provided therein, and there is no voilation of rules of natural justice, does Article 19(1)(g) apply, even though the taxing authority might have, in the exercise of its jurisdiction, misconstrued the legal provisions? The decision in Kailash Nath case (1955) 1 SCR 769 would appear to support the contention that it does; but for the reasons already given, we think that its correctness is open to question and the point needs reconsideration.
22. There is another objection taken to the maintainability of this petition. Article 32, under which it is presented, confers on a person, whose fundamental right guaranteed in Part III is infringed, a right to move this Court for appropriate writs for obtaining redress. The contention of the petitioner is that the order of assessment dated December 20, 1958, amounts to interference with the right of the firm to carry on business and is, therefore, in contravention of Article 19(1)(g), and that relief should be granted under Article 32. Now, the objection that is taken on behalf of the respondents is that the guarantee given under Article l9(l)(g) is against an action of the executive or legislature of the State, that the order of assessment now in question is one passed in judicial proceedings and is, therefore, outside the purview of Article 19(l)(g). If this contention is well-founded, then Article 32 will have no application and the present petition must fail on this ground.
23. The constitutional provisions bearing on this question are Articles 12, 13, 19 and 32. Article 12 enacts that:
“In this Part, unless the context otherwise requires, ‘the State' includes the Government and Parliament of India and the Government and the legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.”
Article 13(3)(a) defines “law” as follows:
“‘law' includes any ordinance, order, bye-law, rule, regulation, notification, custom or usage having in the territory of India the force of law;”
Article 19(1) enacts that the citizen shall have the seven rights mentioned therein, and Articles 19(2) to 19(6) save laws, whether existing or to be made, which impose reasonable restrictions on the exercise of those rights, subject to the conditions laid down therein. Article 32(1) guarantees “the right to move the Supreme Court by appropriate proceedings for the enforcement of the rights conferred by this Part”. Then we have Article 32(2), which is as follows:
“The Supreme Court shall have power to issue directions or orders or writs, including writs in the nature of habeas corpus, mandamus, prohibition, quo waranto, and certiorari, whichever may be appropriate, for the enforcement of any of the rights conferred by this Part.”
It will be convenient now to set out the contention of the parties urged in support of their respective positions. The contention of the respondents based upon Article 12 is that the word “State” in Part III means only the Executive and the Legislature, that the Judiciary is excluded therefrom, and, that therefore, no question of a fundamental right can arise with reference to an order passed by an authority discharging judicial functions. The answer of the petitioner to this is that the word “State” comprehends all the three organs, the Executive, the legislature and the Judiciary, that the express mention of the Government and the legislature in Article 12 cannot be construed as excluding the Judiciary, that the use of the word “includes” shows that the enumeration which follows is not exhaustive, and that, therefore, the ordinary and the wider connotation of the word “State” is not cut down by Article 12.
24. It is true that the word “includes” normally signifies that what is enumerated as included is not exhaustive. But the question ultimately is, what is the intention of the legislature, and that has to be gathered on a reading of the enactment as a whole. It is possible that in some context the word “includes” might import that the enumeration is exhaustive. The following observations of Lord Watson in Dilworth v. Commissioner of Stamps 1899) AC 99 were relied upon:
“The word “include” is very generally used in interpretation clauses in order to enlarge the meaning of words or phrases occurring in the body of the statute; and when it is so used these words or phrases must be construed as comprehending, not only such things as they signify accordding to their natural import, but also those things which the interpretation clause declares that they shall include. But the word ‘include' is susceptible of another construction, which may become imperative, if the context of the Act is sufficient to show that it was not merely employed for the purpose of adding to the natural significance of the words or expressions defined. It may be equivalent to ‘mean and include', and in that case it may afford an exhaustive explanation of the meaning which for the purposes of the Act, must invariably be attached to these words or expressions.”
25. Now, when the legislature wants to enlarge the sense in which an expression is generally used so as to take in certain other things, it does so by using the word “includes”. Therefore, it may be argued that the word “includes” would be appropriate only when the expression, the connotation of which is sought to be extended by the word “includes”, does not, in its ordinary sense, include what is sought to be “included”, and that as the executive and the legislature of a State are, according to all accepted notions, understood as included in the word “State”, the use of the word “includes” with reference to them would make no sense. The article also provides that the word “State” is to include “all local or other authories”. With reference to them, the use of the word “includes” will be quite appropriate because they would not in the ordinary sense of the word “the State”, be understood as included therein. A reading of the article, as a whole, would seem to show that the intention of the legislature was on the one hand, to restrict the accepted connotation of the word “State”, and, on the other hand, to extend it by including “local or other authorities”. There is much to be said in favour of the contention of the respondents that in the context the word “includes” must be read as “means and includes”.
26. In further support of the contention that orders of courts and tribunals are not, in general, within the purview of Part III, the respondents rely on the definition of “law” in Article 13(3). Judgments and orders made in the course of judicial proceedings do not fall within that definition. It is contended that the scheme of the Constitution is that, whenever there is an infringment of a fundamental right by the executive or the legislature, the person aggrieved has a right of resort to this Court under Article 32, that being the consequence of the definition of “State” under Article 12 and of “law” under Article 13(3); that courts and tribunals are not law-making bodies in the sense in which law is defined in Article 13(3), their function being to interpret law; and that it will, therefore be inappropriate to bring them within Part III, which enacts limitations on power to make laws.
27. It is urged that the scheme of the Constitution does not contemplate judicial orders being brought up before this Court in a petition under Article 32. Whenever a fundamental right is infringed, it is said, the party aggrieved has a right to resort to the civil courts either in their ordinary jurisdiction or under Article 226, and the decisions of the courts will ultimately come up to this Court on appeal under Articles 132 to 136. Thus, when executive and legislative action infringes fundamental rights, the Supreme Court can deal with it under Article 32, whereas orders of courts and tribunals, in which questions of infringement of fundamental rights are decided, will come for review before the Supreme Court under Articles 132 to 136.
28. We may now refer to the decisions where this question has been considered by this Court. In Basheshar Nath v. CIT 1959) Supp. (1) SCR 528 occur the following observations, relied on for the respondents:
“In the third place it is to be observed that, by virtue of Article12 ‘the State' which is, by Article 14, forbidden to discriminate between persons includes the Government and Parliament of India and the Government and the legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India. Article 14, therefore, is an injuction to both the legislative as well as the executive organs of the State and the other subordinate authorities. As regards the legislative organ of the State, the fundamental right is further consolidated and protected by the provisions of Article l3 .... That apart, the very language of Article 14 of the Constitution expressly directs that ‘the State', by which Article 12 includes the executive organ, shall not deny to any person equality before the law or the equal protection of the law. Thus Article 14 protects us from both legislative, and executive tyranny by way of discrimination.” (pp. 551-552).
29. The above remarks are based on the view that the words “the State” in Article 12 comprehend only the executive and the legislature.
30. A more direct decision on this point is the one in S.S.Md Amirabbas Abbasi v. State of Madhya Bharat 1960) 3 SCR 138. There, the facts were that one Amirabbas Abbasi applied to the Court of the District Judge at Ratlam for an order that he should be appointed guardian of the person and properties of his two children. This application was rejected by the District Judge, who appointed another person, Sultan Hamid Khan, as the guardian. An appeal against this order to the High Court was also dismissed. Amirabbas Abbasi then field a petition in this Court under Article 32 of the Constitution, challenging the validity of the order of the District Court on the ground that it was discriminative and violative of Article 14 of the Constitution. In dismissing this petition, this Court observed:
“The second respondent was appointed guardian of the minors by order of a competent court, and denial of equality before the law or the equal protection of the laws can be claimed against executive action or legislative process but not against the decision of a competent tribunal. The remedy of a person aggrieved by the decision of a competent judicial tribunal is to approach for redress a superior tribunal, if there be one.” (p.142)
31. The following observations in Ratilal v. State of Bombay AIR 1959 Bom. 242 are also relied on for the respondents:
“The second observation which must be made is that the protection afforded by the Constitution of fundamental rights is against executive, or legislative interference. A decision of a regularly constituted court cannot however be challenged as an interference with fundamental rights in the abstract. The Court in the very nature of things adjudicates upon conflicting claims and declares rights and does not by the operation of its own order seek to infringe any fundamental rights.”
32. These observations would appear to apply with equal force to judicial proceedings before tribunals, as they cannot be regarded as representing the executive or the legislative function of the State.
33. It is next contended for the petitioner that the Sales Tax Officer will at least fall within the category of “other authorities” in Article 12. The meaning of the expression “other authorities” was considered in University of Madras v Shantha Bai AIR 1954 Mad. 67. There, the question was as to whether the University of Madras was “other authority” within that article and deciding that it was not, it was observed that the words “other authorities” must be construed ejusdem generis with what had been enumerated in the Article namely, the Government or the legislature. This clearly supports the respondents.
34. It is contended for the petitioner that even if courts could not be held to be “other authorities” quasi-judicial tribunals must be regarded as falling within that expression, and that Sales Tax Officers are at best only quasi-judicial officers, and they cannot be put on the same footing as regular Courts. It is argued that Sales Tax Authorities are Officers of Government to whom is entrusted the work of levy and collection of taxes, that that is primarily an executive function, that the officers have, no doubt, to act judicially in determining the tax payable but that that is only incidential to the discharge of what is essentially and administrative Act, that, at best, the assessment proceedings are quasi-judicial in character, and that accordingly an officer imposing a tax must be held to be “other authority” within Article 12. In this view, it is urged, the assessment order dated December 20, 1958, falls within the purview of part III.
35. The respondent dispute the correctness of this contention. They concede that a Sales Tax Officer has certain functions of an administrative character, but urge that the proceedings with which we are concerned, are entirely judicial. In this connection, it will have to be borne in mind that it is a feature well-known in the Government of this country that both executive and judicial functions are vested in the same Officer, and because of the undesirable results which followed from this combination, Article 50 of the Constitution has enacted as one of the Directive Principles that,
“The State shall take steps to separate the judiciary from the executive in the public services of the State.”
When an authority is clothed with two functions, one administrative and the other judicial, proceedings before it which fall under the latter category do not cease to be judicial by reason of the fact that it has got other non-judicial functions. What has to be seen is the capacity in which the authority acts with reference to the impugned matter. It will, therefore, be necessary to examine the character in which the Sales Tax Officer functions when he takes proceedings for assessment of tax. Under the provisions of the Act, the Sales Tax Officer has to issue notice to the assessee, take evidence in the matter, hear him and then decide, in accordance with the provisions of the statute, whether tax is payable, and if so, how much. Against his order, there is an appeal in which again the parties have to be heard and a decision given in accordance with law. The legality or propriety of an order passed in an appeal is again open to consideration on revision by a revising authority who must be a “person qualified under clause (2) of Article 217 of the Constitution for appointment as Judge of a High Court.” Section 11, which is on the same lines as Section 66 of the Indian Income Tax Act, provides that the revising authority might refer for the opinion of the High Court any question of law arising out of its order, and under Section 11(4) the assessee has a right to move the High Court for an order that the revising authority do refer the question of law arising out of the order, if there has been an erroneous refusal to refer. Now the respondents contend that the proceedings commencing with a notice issued by the Sales Tax Officer and ending with a reference to the High Court are entirely judicial that it is in that view that petitions for certiorari and prohibition are entertained against orders of assessment under Article 226 of the Constitution, and appeals against such orders are entertained by this Court under Article 136. It will be inconsistent, it is urged to hold, on the one hand, that the orders possed in these assessment proceedings are open to appeal under Article 136 on the footing that they are made by Tribunals, and, on the other, that they are open to attack under Article 32 of the footing that they are made by executive authorities.
36. It is also contended for the petitioner that the definition of “State” in Article 12 is to govern Part III “unless the context otherwise required”, and that in the context of Article 32, “The State” would include courts and tribunals exercising judicial functions. Article 32, it will be noticed, confers on the court jurisdiction to issue among others, writs of certiorari and prohibition. The argument is that as these writs are issued only with reference to judicial proceedings, the restricted definition of “the State” in Article 12 as excluding them must give way to the express language of Article 32. it is accordingly contended that even on the footing that the order of assessment is judicial in Character, the present petition for issue of certiorari is within Article 32. It is true, argue the respondents, that certiorari and prohibition lie only in respect of judicial and not administrative acts, and it must, therefore, be taken that Article 32 does envisage that there could be a petition under that Article with respect to judicial proceedings. It is also true, as held by this Court, that the right of an aggrieved party to resort to this court under that Article is itself a fundamental right under Article 32. But the right of resort to this court under Article 32(1) is only when there is an infringement of a fundamental right which had been guaranteed in Part III, that it is Articles 14 to 31 that declare what those fundamental rights are, for the breach of which remedy can be had under Article 32(2), and that what has to be seen, therefore, is whether there is anything in the article which is said to have been infringed, which is repugnant to the definition of “the State” in Article 12. Examining, it, is said, Article 19(1)(g) which is alleged to have been violated, there is nothing in it which is repugnant to the restricted connotation of the expression “the State” in Article 12, and judicial proceedings therefore cannot be brought within it. It is further argued that Articles 19(2) to 19(6) clearly show that it is only laws existing and to be made that are within their purview, and judicial pronouncements not being law cannot fall within the ambit of those provisions. In the result, it is contended that the definition of “State” in Article 12 stands and an order made by a court or tribunal cannot be held to infringe Article 19(l)(g) read along with Article 12.
37. If that is the true position, replies the petitioner, then what purpose is served by the provision in Article 32 that this Court might issue writs of certiorari or prohibition? The answer of the respondents is that among the substantive enactments forming Articles 14 to 31, there are some which are specially directed against judicial proceedings, and the writ of certiorari or prohibition will lie in respect of them. One such, for example, is Article 20, which is as follows:
“20. (1) No person shall be convicted of any offence except for violation of a law in force at the time of the commission of the Act charged as an offence, nor be subjected to a penalty greater than that which might have been inflicted under the law in force at the time of the commission of the offence.
(2) No person shall be prosecuted and punished for the same offence shall than once.
(3) No person accused of any offence shall be compelled to be a witness against himself.”
38. This article clearly applies to prosecutions and convictions for offences. It has reference, therefore, to judicial proceedings, and the restricted definition of “State” in Article 12 is, in the context, excluded. And proceedings contemplated by Article 20 being judicial, writs of certiorari and prohibition can issue. In this connection, the respondents rely upon the expression “whichever may be appropriate” occurring in Article 32(2). It means, it is said, that when once an infringement of a fundamental right is established, the writ which the court can issue must depend upon the nature of the right involved. It is accordingly contended that Article l9(l)(g) is, on its terms, inapplicable to judicial proceedings, and no writ of certiorari can issue for the infringement of a right under that Article.
39. It was also argued the petitioner that under the American law, certiorari lies against decisions of the State courts when they are repugnant to the provisions of the constitution, and the decision in National Association for the Advancement of Colored People v. State of Alabama 2 L. Ed. 1488 357 US 449 was relied in support of this position. There the question related to the validity of a provision in a statute of Alabama requiring foreign corporations to disclose, among other things, the names and adresses of their local members and agents. The appellant-Corporation having made default in complying with this provision, the State instituted an action for appropriate relief, and the Court granted the same. Then the Corporation moved the Supreme Court for a writ of certiorari on the ground that the provision in the statute was an invasion of the right to freely assemble, guaranteed by the constitution. One of the grounds on which the State resisted the application was that no certiorari will lie for quashing an order of court. In rejecting this contention, the Court observed:
“It is not of moment that the State has here acted solely through its judicial branch, for whether legislative or judicial, it is still the application of state power which we asked to scrutinize.” 2(L.Ed.2d 1500).
40. It is unnecessary to refer to other decisions in which similar views have been taken. The principle on which all these decisions are based was thus stated in Virginia v. Rives:
“It is doubtless true that a State may act through different agencies, either by its legislative, its executive or its judicial authorities; and the prohibitions of the amendment extend to all action of the State denying equal protection of the laws, whether it be action by one of these agencies or by another.”
41. These decisions have no bearing on the point now under consideration, which is not whether a writ of certiorari will lie under the general law against decisions of courts — on that, there could be and had been no controversy — but whether, on the terms of Article 12, that will lie against an order of a court or tribunal.
42. The above is a resume of the arguments addressed by both sides in support of their respective contentions. The question thus debated is of considerable importance on which there has been no direct pronouncement by this Court. It seems to desirable that it should be authoritatively settled. We accordingly direct that the papers be placed before the Chief Justice for constituting a larger Bench for deciding the two following questions:
1. Is an order of assessment made by an authority under taxing statute which is intra vires, open to challenge as repugnant to Article 19(l)(g); on the sole ground that it is based on a misconstruction of a provision of the Act or of a notification issued thereunder?
2. Can the validity of such an order be questioned in a petition under Article 32 of the Constitution?