UJAGAR PRINTS ETC. v. UNION OF INDIA & ORS. ETC.

dealt with the other question, namely, what is the value of the proces- A sed fabrics liable to be assessed. Referring to the aforesaid decision of the Empire industries, (supra), he illustrated the problem by reference to the example set out in the judgment (Page 654_of the report at para 2). In that example illustrated by him the value of the grey cloth in the hands of the processor was Rs.20. The value of the job-work was Rs.5. B Trader's selling price inclusive of his selling profits etc. was put at Rs.30. Bhagwati C.J. at page 655 of the report observed that the assessable value of the processed fabric must obviously be taken to be the wholesale cash price of the processed fabric at the factory gate that is when the processed fabric leaves the factory of the processor and it cannot possibly include the selling profit of the trader who sub- sequently sells the processed fabrics. The learned Chief Justice c reiterated that it is ~t the point when the processed fabric leaves the factory of the processor that its assessable value has to be determined and that assessable value cannot include the selling profit of the trader. Empire Industries, (supra) did not say that the postcmanufacturing profits or post-manufacturing costs could be included in the assessable- D value of the processed fabric. If the trader, who entrusted cotton or man-made fabrics to the processor for processing on job-work basis, would give a declaration to the processor as to what would be the price at which he would be selling the processed goods in tlie market that would be taken by the Excise authorities as the assessable-value of the processed fabrics and excise duty would be charged to the processor on that basis. Where a manufacturer sells the goods manufactured by him in wholesale to a wholesale dealer at the arms length and in the usual course of business, the wholesale cash price charged by him to the wholesale dealer less trade discount would represent the value of the goods for the purpose of assessment of excise. But the price received by the wholesale dealer who purchases the goods from the manufacturer and in his turn sells the same in wholesale to other dealer, would be irrelevant for determination of the value of the goods and .the goods would not be charged on that basis. This has been explained in Atic Industries Ltd. v. H.H. Dave, Asstt. Collector of Central Excise and Ors., [1975] 3 S.C.R. 563. This has also been explained in Union of India & Ors. etc. etc. v. Bombay Tyre /nterna- G tional Ltd. etc. etc., [1984] 1 S.C.R. 347 at 375. It has to be reiterated that the valuation must be on the basis of wholesale cash price at the time when the manufactured goods enter into the open market. See in this connection the ratio of this Court in Union of India & Ors. v. Cibatul Ltd., [1985] Suppl 3 SCR 95 and the Joint Secy. to the Govt. of India & Ors. v. Food Specialities Ltd., [1985] Suppl 3 SCR 165. It was emphasised in Union of India & Ors. v. Cibatul, (supra) that the value

UJAGAR PRINTS v. U.0.1. [MUKHARJI, J.l 813

of the trade-marks was not be taken into account in computing the assessable value as the affixation of the trade-marks of a particular brand was extraneous to manufacture. The values of such extraneous or additional factors do not enter into the computation. of assessable value and as such the wholesale cash price at which the goods enter into the wholesale market would be independent of the value of the trade-marks. So that cannot be taken into the computation of the assessable value. Similarly, in the case of Joint Secretary to the Govt. of Jndia and others v. Food Specialities Ltd., (supra), it was held that the value of Nestle's trade marks could not be to the wholesale price charged by the dealer to Nestle's for the purpose of computing the value of the goods manufactured. The goods in both these cases were manufactured independently of the addition of the trade-marks. The price thereof at the factory gate was not after taking into account the c value of the trade-marks. If that was the position the value of the trade-marks cannot be added to the wholesale cash price charged by the dealer. Affixation of trade-marks for enhancement of the value thereof is extraneous to and independent of the process of manufac- ture. The charges for the same are not part of the assessable value and cannot enter into computation of the whole-sail cash price on the basis of which excise duties are to be levied.

In the aforesaid view of the law and for the reasons mentioned by my learned brother, I agree with his answer to this contention. The assessable value would, therefore, include the value of the grey cloth in the hands of the processors plus the value of the job-work done plus manufacturing profits and manufacturing expenses whatever would be included in the price at the factory gate. The correct assessable value must be the value of the fabric at the factory gate, that is to say, the value at which the manufactured goods leave the factory and enter the rnain stream. F

One more aspect will have to be reiterated. Computation of the assessable-value is one question and as to who should be liable for the same is another. Duties of excise are imposed on production or on manufacture of goods and are levied upon the manufacturer or the producer in accordance with the relevant rule>. This is quite indepen- G dent of the ownership of goods. It is, therefore, necessary to reiterate that the value for the assessment under Section 4 of the Act will not be the processing charge alone but the intrinsic value of the processed fabrics which is the price at which the fabrics are sold for the first time in the wholesale market. The rules are clear on the computation of that value. If the valuation is made according to the rules as adumbrated in H

p. 814

A Empire Industries (supra) and as clarified by my learned brother in this judgment no difficulty should arise.

RANGANATHAN, J. I agree but I should like to add a few words on two of the points argued befote us.

B First, I should like to clarify the nat.ure of the decision in Hindustan Milkfood Manufacturers Ltd. v. Union, {the HMM case) 1980 E.L.T. 480 (to which I was a party), since learned counsel for the petitioners sought to rely on my judgment in that case as supporting his .contention that_the UniQn cannot seek to uphold the amendment presently in question by reference to Entry 97 of List I in the Seventh-· c Schedule to the Constitution. In that case, the Delhi High Court was concerned with the interpretation of the amendment to S. 4 of the Central Excises and Salt Act, 1944 by Act 22 of 1975. The pre- amendment section postulated the determination of excise duty on the basis of the wholesale cash price of the excisable goods at "the factory gate"; and, an explanation provided that, in determining this price, no abatement or deduction shall be allowed in respect of trade discount and the amount of duty payable at the time of the removal of the goods from the factory. The post-amendment section made certain changes in the concept of sale at the factory gate by excluding therefrom sales effected in favour of a category of persons defined as "related persons" with which we are not concerned here. The amendment also defined the assessable "value" so as to include packing charges but to exclude the amount of excise duty, sales tax and other taxes as well as trade discount. The question was whether this amendment precluded the deduction, from the wholesale factory gate price, of post- manufacturing expenses and profits. The question had been answered by several High Courts in the negative principally on the ground that the duty sought to be levied under the Act was an excise duty, the very nature of which required a proximate connection with production or manufacture and that what had passed beyond this region and entered the domain of sale could not pass as excise duty. Counsel for the Union of India, with a view to overcome these decisions, had contended that since Entry 97 of List I in the Seventh Schedule to the Constitution G enabled Parliament to enact a legislation even beyond the purview of an excise duty covered by Entry 84of that list, the Court should not read into the amended section the limitations that had been considered inherent in the section before its amendment. It was in repelling this contention that certain observations were made by me in paras 30 to 32 of the judgment to which Sri Soli Sorabjee drew our attention. It will, however, be clear from the discussion in the paragraphs referred to

UJAGAR PRINTS v. U.0.I. [RANGANATHAN, J.] 815

that the contention was repelled not on the ground that the legislature could not make a-wider levy by reference to Entry 97 but only on the ground that the history, context and language of the amendment did not warrant the wider interpretation. This will be clear from the following two sentences in para~ 1 where I said:

"Mr. Chandrasekharan's contention .......... that the language of the new section should be given an enlarged scope and.interpretation by relating it to Entry 97 of List I of Seventh Schedule cannot, in our opinion, be accepted. We do not think, in considering this amendment, that it is necessary for us to discuss whether, if Parliament were to enact a law imposing on goods manufactured or produced a duty based not only on the manufacturing cost/profits, but also .including in the dutiable value the whole or some part, of post manufacturing cost/profits, such a law would be intra vires or not: because it appears to us that no such law has been enacted in this case. We shall assume with Mr. Chandrasekharan, tl!_at in view of Entry 97 in the Union D List under the Constitution, it is open to and competent for the legislature to expand or even modify the nature of the levy. The question, however, will be whether it has done so."

It was concluded, after referring to the previous position as well as the E statement of objects and reasons for the amendment, that there was nothing to show that the legislature had intended to make any change and that the rule against a presumption of implicit alteration of the law should be invoked in the context. In other words, the HMM decision was based not on the scope of legislative Entry 9] in List l but on the language and scope of the amendment actually effected. It was con- p sidered not necessary or possible to stretch the language of the defini- tion in s. 4 beyond the ambit of the provision as delineated in the earlier decisions. The question decided was not that the legislatur£ could not, but that it did not, make any radical.change in the nature of the levy. - G • The position considered in the HMM case may be illustrated by an analogy. Entry 82 in List I of the Seventh Schedule to the Constitu- tion permits the enactment, by the Union Legislature, of a law relating to taxation of 'income'. The entry does not restrict such laws only to the income of a 'previous year', though this was the pattern of the prevelent Income Tax Acts activated by annual Finance Acts. Bet- if

p. 816

A ween 1948 and 1955, however, the Finance Acts purported to impost a tax on "excess dividends" which, in brief, was a tax on dividends declared out of profits of past years. The effect of these enactments was considered by the Bombay High Court as well as this Court. In C.J. T. v. Elphinstone Spinning & Weaving Mills Co. Ltd., [1960] 3 SCR 953, this Court held that the language of the relevant provision in B the Finance Acts was so framed that it could not be read as an indepen- dent charging section. It will be appreciated that the Finance Acts were also enactments of the Union Legislature and a taxation of pro- fits,. even of past years, by an independent and specific enactment ·could certainly have been brought within the scope of Entry 97, if not Entry 82 itself. Nevertheless, the enactments were held ineffective not c because ·they could not but because they did not contain the words necessary to effectuate the result. The position in the HMM case was somewhat similar. The legislature retained the levy on the basis of the wholesale cash price at the factory gate as before and only introduced a definition of the expression 'value' in terms a little more elaborate but basically not very different from what had been contained in the D earlier section. The Court saw no reason to read into the language of the amended provision a meaning much wider than had been attributed to the provision before its amendment. The amendment gave no indication that, contrary to what had been decided earlier, it was the intention of the legislature to bring into the assessable value even an element of post manufacturing cost/profits. E But. here the position is entirely different. The amendment has specifically enlarged the meaning and concept of the word "manufacture". If such extended concept is within the range of duties of excise as envisaged under Entry 84-and I agree with my learned brothers that it is-, there is no difficulty. But, if, as contended for by F Sri Soli Sorabjee, that legislative entry permits a duty being levied only on the process of '·'manufacture", stricto sensu, and the processing in this case cannot be brought within that definition then this expanded definition cannot be fitted into that entry. Nevertheless the specific statutory definition cannot be ignored and if it cannot be held valid by reference to Entry 84, its validity has to be considered with reference to the residuary Entry 97. The definition being what it is it cannot be read down or restricted only to the process of manufacture in a limited sense. It explicitly enlarges the scope of the levy of excise duty and, if it is not permissiole to bring it within the scope of Entry 84, a resort to Bntry 97 cannot be ruled out. In my view, therefore, there is nothing in the decision in the HMM case that supports the contention of the petitioners here that the amendment of the definition of "manufac-

UJAGAR PRINTS v. U.0.1. [RANGANATHAN, J.] 817

ture" cannot be sustained by reference to Entry 97 of List I in the Seventh Schedule to the Constitution of India, if it cannot be upheld as falling under the purview of Entry 84.

The second point, on which I feel inclined to add a few words is in regard to the contention on behalf of the petitioners that the defini- tion of the term "manufacture" enacted in the Central Excises & Salt B Act, 1944 as enlarged by Amendment Act 6/80, cannot be read into the provisions of the Additional Duties of Excise Act (No. 58), 1957. The argument is in three phases and runs thus:

(i) S. 3 of the 1957 Act, which is the charging section, fastens the charge of duty at the state of 'manufacture' but this expression is deliberately left undefined, though the c statute takes special care in s. 2 to adopt, for its purposes, the definition of the specified goods as con.tained in the 1944 Act. This excludes the definition of 'manufacture' enacted in s. 2(f) of the 1944 and enlarged from time to time. D

(ii) S. 3(3) cannot help the Revenue in this regard, as its only purpose and effect is to avoid a repetition, in this Act, of the procedural provisions of the 1944 Act. The charge or imposition of the tax having been laid under S. 3(1), the purpose of S. 3(3) is only to say that this charge shall be E quantified, demanded and recovered by resort to the machinery provisions of the 1944 Act. This sub-section can- not be read as having the effect of incorporating the sub- stantive definition of "manufacture" in the 1944 Act particularly when s. 2 chose to incorporate only the defini- tion of the specified goods as contained in the 1944 Act. F

(iii) Even if the language of S. 3(3) is construed more liberaly, it will be effective only to incorporate the defini- tions contained in the 1944 Act as on the date of com- mencement of the 1957 Act but not its subsequent legisla- tive expansions. G

In my opinion, there is no warrant or justification for giving such a narrow interpretation to the wide language of s. 3(3) of the 1957 Act. Learned counsel for the petitioner, in advancing this argument, appa- rently has in mind the famous dictum of Lord Dunedin in Whitney v. Inland Revenue Commissioners, [ 1927] A.C. 37 echoed in several deci- H

p. 818

A sions of this Court and of the various High Courts in India:

"Now, there are three stages in the imposition of a tax: there is the declaration of liability, that is the part of the statute which determines what persons in respect of what property are liable. Next, there is the assessment. Liability B does not depend on assessment. That, ex hypothesi, has already been fixed. But assessment particularizes the exact sum which a person liable has to pay. Lastly come the methods of recovery, if the person taxed does not volunta- rily pay." ·

The argument, founded on the above figurative analysis, seeks to c equate the expressions "levy and collection" used in s. 3(3) with the stages of assessment and collection concerned with the procedure for quantification and recovery of a duty that has already been imposed. The first stage of "charge", according to counsel, has already been dealt with in the first sub-section of s. 3, which has fastened a charge D on the production of manufacture of specified goods. The third sub- section, it is said, only relates to the quantification or recovery of the charge imposed under s. 3(1). I do not see any force in this argument.

In the first place, evens. 3(1) which, according to the counsel, is the charging section, uses the same words "levied and collected". E These are the same as the words used in Article 265 of the Constitution, which have been interpreted as comprehending the entire process of taxation commencing from the imposition of the tax by enacting a statute to the actual taking away of money from the pocket of a citizen. They take in every stage in the entire process of taxation. The words "levied" is a wide and generic expression. One can say with as much F appropriateness that the Income tax Act levies a tax on income as that the Income Tax_ Officer levies the tax in accordance with the provisions of the Act. It is an expression of wide import and takes in all the stages of charge, quantification and recovery of duty, though in certain con- texts it may have a restricted meaning. In the context of sub-section (1) the word "levied" admittedly means "charged "as well as "assessed". G The words "levy and collection" in sub-section (3) cannot be con- strued differently from the words 'levied and collected' used in sub- section (1). S. 3(3), therefore, also covers the entire gamut of s. 3(1) and cannot be construed as becoming operative at a somewhat later stage. Its operation cannot be excluded in determining the scope of the charge. H

UJA.GAR PRINTS v. U.0.1. [RANGANA1HAN. J.] 819

In this context, reference has to be made to a decision of this A Court which had to consider a provision, almost identical with S. 3(3) of the 1957 Act, appearing in the Finance Act 1965, in a somewhat indirect manner, as the decision contains some observations, which, at first sight, appear to support the line of argument of the petitioner herein. -Such a provision has .been annually repeated in all Finance Acts-vide, the Finance Act from 1963 to 1983-and imposes what has B been described as "special", "regular" or "auxiliary" duties of excise and customs. The decision I am referring to is that of this Court in Associated Cement Co. Ltd. v. Director of Inspection, [1985] 2 SCC

719. This decision was really concerned withs. 280 ZD of the Income Tax Act, 1961, which in turn called for a reference to s. 80 of the Finance Act, 1965 which is in the following terms: c "( 1) When goods of the description mentioned in this sec- tion chargeable with a duty of excise under the Central Excises Act ..... are assessed to duty, there shall be levied and collected- D (a) as respects (certain) goods .... ., a special duty of ex- cise equal to 10 per cent of the total amount so chargeable on such goods;

(b} as respects (certain other) goods .... ., a special duty of excise equal to 20 per cent ... : and E

(c) as respects (certain other) goods .... ., a special duty of excise equal to 33-1/3 per cent ...

(2) xxxxxx F (3) The duties of excise referred to in sub-section (1) . . . . . . . . . . shall be in addition of the duties of excise chargeable on such goods under the Central Excise Act or any other law for the time being in force ...

(4) The provisions of the Central Excises Act and the rules G thereunder, including those relating to refunds and exemp- tions from duty, shall, so far as may be, apply in relation to the levy and collection of the duty of excise leviable under this section in respect of any goods as they apply in relation to the levy and collection of the duties of excise on such goods under that Act or rules." H

p. 820

A Section 280 ZD of the Income Tax Act, ·196Lenabled an assessee, in certain circumstances, to obtain a "tax credit" certificate in respect of a percentage of the amount of "duty of excise payable by him." "Duty of excise" was defined by the section to mean "the duty of excise leviable under the Central Excises & Salt Act". The question was whether the tax credit could also be given in respect of the amount of B the special duty of excise levied and collected under the Finance Act. This Court held that, obviously, the special duty levied under s. 80 could not be regarded as having been levied under the Central Excise Act. It said:

"It is true that the expression 'leviable' is an expression.of wide import and includes stages of quantificalion and re- c covery of the duty but in the context in which that expres- sion has been used in clause (b) of sub-section (6) of s. 280 ZD, it is clear that it has been used In the sense of chargea- . l bility to duty. In other words, the duty of excise in respeci whereof tax credit is available would be in respect of s.uch D duty of ex(tse. as is chargeable under the Excise· Act and clearly the Special excise duty in respect whereof additional tax credit is sought by the appellant company is not charge- able under the Excise Act but chargeable under the Excise Act."

E Having said this, the Court added:

"Sub-clauses (3) and (4) of s. 80 of the Finance Act on which reliance has been placed by counsel for the appellant company in terms refers to the procedural aspect such as the qualification and collection of the special duty and sim- F ply because the qualification and collection of the special duty under the Finance Act is to be done in accordance with the provisions of the Excise Act such duty does not become Ieviable, that is to say chargeable, under the Excise Act.''

G The above observations no doubt lend some support to the contention of the petitioner, as the wording of s. 80(4) of the 1965 Finance Act is identical with that of s. 3(3) and has been interpreted as attracting only the procedural aspect of the Central Exicse Act. But, in my opinion, while that may have been true of s. 80(4) of the Finance Act, 1965, it will not be correct to draw the same conclusion ·about the 1957 Act. H For, s. 80(1) of the Finance Act, 1965 fully exhausted the aspect of

UJAGAR PRINTS v. U.0.1. [RANGANATHAN, !.] 821

charge of the special duty. It specified the goods to be taxed and also laid down that the special duty was to be a percentage of the normal excise duty chargeable on those goods. Nothing else remained except the quantification and the collection. But here the position is different. There are three ingredients of the charging provision viz. s. 3(1). The additional duties are charged (a) on manufacture, storage of produc- tion (b) of certain named goods (c) at the rates specified in the first schedule. Of these, only aspect (b) finds mention in the 1957 Act but in relation to the definitions contained in the 1944 Act. Aspect (c), clearly is not complete without a reference to the main Act. For, turning to the First Schedule of the Act, originally it specified rates on the basis of length, weight or number on all items except "cigarettes" where the duty was to be ad valorem. The Amendment Act, No. 6 of 1980, substituted the rate per metre specified under the original c schedule in respect of the items with which we are concerned to ad valorem rates. Now the assessable value is to be determined on the basis of which the special duty will have to be worked out cannot be found out from the 1957 Act which contains no definition or indication in this regard. The statute cannot be worked atleast in respect of goods where an ad valorem rate is prescribed unless s. 3(1) is read withs. 3(3) and the definition of "assessable value" ins. 4 of the 1944 Act is read with the Finance Act. In like manner, I think, the content of aspect (a) cannot be understood differently from, or independently of, the definition in the main enanctment. Having regard to the nature and content of the levy indicated ins. 3(1), it is obvious thats. 3(3) has to have the effect of at!racting not only the purely procedural and machinery provisions of the 1944 Act but also some of its charging provisions. It is, therefore, difficult to consider section 3(1) of the 1957 Act-in contrast to the. Finance Act of 1965-As covering the entire ambit of the charge imposed. In short, the language of s. 3(3) has to be given a wider meaning than under the Finance Act, 1985. I have refer- F red to the fact that a provision similar to that in s. 80 of the Finance Act, 1965 is also found in other Finance Acts. On perusal of these provisions, it will be found that a like position exists there also. These provisions are all self-contained and completely specify the scope of the charge either as a percentage of the excise duty normally charge- able under the Central Excises & Salt Act, 1944 or as a percentage of G the 'assessable value determined under s. 4 of the 1944 Act.' This, in my view, is a very important reason why the observations in the .Associated Cement Co. 's case (supra) cannot be of application in the context of the 1957 Act. ·

A question has been raised as to why, if it were the intention of H

p. 822

A the Legislature to lake in all the provisions including definitions from the 1944 Act, it was considered necessary to make a specific reference to the definitions of the various goods on which additional duty was being imposed as contained in the schedule to the 1944 Act. Counsel says that this enactment of specific definitions drawn from the 1944 Act should lead to an inference that no other definitions from that Act B were intended to be incorporated in the 1957 Act. A careful examina- tion will, however, show that this is not the effect. Actually, s. 2 is not much of a 'definition' section. Cl. (a) is not strictly necessary and cl. (b) is only intended to clarify that the proceeds of the duties are not be distributed to Union Territories. So far as clause (c) is concerned, it is necessary to make a reference to s. 7 of the Act, which reads thus: c "7. It is hereby declared that the following goods, namely, subject, tobacco, cotton fabrics, rayon or artificial fabrics and woolen fabrics, are of special importance in inter-state trade of commerce and every sales tax law of a State shall, in so far as it imposes or authorises the imposition of a tax D on the sale or purchase of the declared goods, he subject, as from the Isl day of April, 1958, to the restrictions and. conditions specified in s. 15 of the Central Sales Tax Act, 1956."

The effect of this provision, as held in Mis Mahendra Pratap Rama E Chandra v; Commercial Tax Officer & Others, AIR 1965 Cal. 203 is that "the contents of s. 15 became a part of section 7 from the moment when s. 7 was enacted." S. 15 of the Central Sales Act applies to "declared" goo~s as defined ins. 2(c) and enumerated ins. 14 of that Act as being of special importance in i11ter-state trade and commerce. S. 14 of the Central Sales Tax Act, 1956, enumerates various items of F goods among which are the six items specified ins. 3(1) of the 1957 Act and this list further specifies that they shall have the same meaning as is attached to the respective items in the First Schedule to the Central Excises & Salt Act, 1944 vide items (ii-a), (vii), (viii), (ix), (x) and (xi). Thus, it was always clear that the specified goods have to be understood in the way they were defined in the Central Excises & Salt G Act, 1944. The idea in 1956 was to restrict the powers of the States to levy sales tax in respect of such goods and other goods. In 1958, the idea was conceived of the Centre levying an additional excise duty on these. goods and distributing the same to the States subject to the . condition specified in Schedule II that such States did not impose any sale or purchase tax on these commodities. Subsequently, perhaps, it H was realised that s. 7 served no specific purpose under the Act except

UJAGAR PRINTS v. U.0.1. !RANGANATHAN, J.] 823

that of the definitions which was an aspect already covered bys. 2(c). A In these circumstances, not much significance need be attached to s. 2(c) much less can it be construed as negativing the import of other definitions from the 1944 Act.

The next question that arises for considerion is, whether, even assuming that the terms of s. 3(3) are applicable, its terms are wide B enough to take in not merely the provisions of the Central Excises and & Salt Act, 1944 and, in particular its definition clauses, as they stood in 1957 on the date when the 1957 Act came into force but also the amendments effected therein from time to time. The answer to this question depends upon the general principles applicable to what is described as 'referential legislation' of which this is an instance. Legis- latures sometimes take a short cut and try to reduce the length of c statutes by omitting elaborate provisions where such provisions have already been enacted earlier and can be adopted for the purpose on hand. While, on the one hand, the prolixity of modem statutes and the necessity to have more legislation then one on the same or allied topics render such a course useful and desirable, the attempt to legislate by D reference is sometimes everdone and p;evity is achieved at the expense of lucidity. However, this legislative device is quite well known and the principles applicable to it fairly well settled.

Referential legislation is of two types. One is where an earlier Act or some of its provisions are incorporated by reference into a later E Act. In this event, the provisions of the earlier Act or those so incorporated, as they stand in the earlier Act at the time of incorpora- tion, will be read into the later Act. Subsequent changes in the earlier Act or the incorporated provisions will have to be ignored because, for all practical purposes, the existing provisions of the earlier Act have been re-enacted by such reference into the later one, rendering irrele- F vant what happens to the earlier statute thereafter. Examples of this can be seen in Secretary of State v. Hindustan Cooperative Insurance Society, AIR 1931 P.C. 149; Soltini Ores Ltd. v. State, AIR 1975 S.C. 17 and Mahindra and Mahindra Ltd. v. Union, AIR 1979 S.C. 798. On the other hand, the later statute may not incorporate the earlier provi- sions. It may only make a re.ference of a broad nature as to the law on a G subject generally, as in Bhajiya v. Gopikabai, [1978] 3 SCR 561; or contain a general reference to the terms of an earlier statute which are to be made applicable. In this case any modification, repeal or re- enactment of the earlier statute will also be carried into in the late.r, for here, the idea is that certain provisions of an earlier statute which become applicable in certain circumstances are to be made use of for H

p. 824

A the purpose of the latter Act also. Examples of this type of legislation are to be seen in Collector of Customs v. Nathella Sampathu Chetty, [1962] 3 SCR 786; New Central Jute Mills Co. Ltd. v. Assistant Col- lector, [ 1971] 2 SCR 92 and Special Land Acquisition Officer v. City Improvement Trust, [1977] 1 SCR 569. Whether a particular statute falls into the first or second category is always a question of construc- B tion.' In the present case, in my view, the legislation falls into the second category. S. 3(3) of the 1957 Act does not incorporate into the 1957 Act any specific provisions of the 1944 Act. It only declares generally that the provisions of the 1944 Act shall apply "so far as may be", that is, to the extent necessary and practical, for the purposes of the 1957 Act as well. c That apart, it has been held, even when a specific provision is incorporated and the case apparently falls in the first of the above categories, that the rule that repeals, modifications or amendments of the earlier Act will have to be ignored is not adhered to incertain situations. These have been set out in State of Madhya Pradesh v. D Narasimhan, [1976] 1 SCR 6. In that case, the Supreme Court was considering the question whether the amendment of s. 21 of the Penal Code by the Criminal Law.Amendment Act, 1958, was also applicable for purposes of the Prevention of Corruption Act, 1947, which by section 2 incorporates, for the purposes of that Act, the definition of 'public servant' in s. 21 of the Penal Code. Answering the question in E the affirmative, the Court outlined the following proposition:

"Where a subsequent Act incorporates provisions of a pre- vious Act, then the borrowed provisions become an integ- ral and independent part of the subsequent Act and are totally uneffected by any repeal or amendment in the pre- F vious Act. This principle, however, will .not apply in the following cases:

(a) where the subsequent Act and the previous Act are supplemental to each other;

·G (b) where the two Acts are in pari materia:

(c) where the amendment in the previous Act, if not imported into the subsequent Act also, would render the subsequent Act wholly unworkable and uneffectual; and

H (d) where the amendment of the previous Act, either

• "'f ·~ . ,- •~

UJAGAR PRINTS v. U.0.1. [RANGANATHAN, J.] 825

expressly or by necessary intendment, applies the said pro- A visions to the subsequent Act."

The present case falls within the scope of these exceptions, even ifs. 3(3) is construed as incorporating certain specific provisions of the 1944 into itself. The legislation presently in question is clearly in pari materia with the 1944 Act. It is also merely supplemental. While the B 1944 Act imposes a general levy of excise duty on all goods manufactured and produced, and aim of the present Act is to supple- ment \he levy by an additional duty of the same nature on certain goods: The duration of the applicability is undefined but the statute is clearly.enforceable as long as it is in the statute book side by side with the normal excise duties. The clear intention is that the same provi- c sions shall govern both the levies except that the duty under the later Act is confined to certain ·goods only anci its distributability among the State's inay perhaps follow a different pattern from the principal duty . .There is no reason or logic why all the incidents attaching under the earlier legislation, in so far as they are not clearly inconsistent with the ·1ater one sh1:mld not be extended to the later legislation as well. As has been pointed out earlier, the Finance Acts which levied special or _regular or additional excise duties contained in themselves all the elements of charge of duty. The goods were mentioned and the duty as to be levied either at a percentage of the normal excise duty payable under the 1944 Act or at a percentage· of the value of the assessable goods as determined under the 1944 Act. All thatwas further needed was the applicability of the procedural provisions of the 1944 Act. Here, however, the 1957 Act is incomplete as to the basis of the charge and its provisions would become totally unworkable unless the con- cepts of "manufacture" and "assessable value" as determined under the 1944 Act are carried into it. · · .F In the circumstances, f agree that we should give full and literal effect to the language of s:3(3} and hold that it has the effect not only of attracting the procedural provisions of the .1944 Act but also all its other provisions, including those containing the definition.

M.L.A .. .G