JULLUNDUR RUBBER GOODS MANUFACTURERS' ASSOCIATION versus UNION OF INDIA & ANR.

Citation: [1970] 2 S.C.R. 68 · Decided: 25-08-1969 · Supreme Court of India · Bench: J.C. SHAH · Disposal: Dismissed

Cited by 3 judgment(s) · cites 3 · see the full citation network in Lexace

Judgment (excerpt)

JULLUNDUR RUBBER GOODS MANUFACTURERS' 
A 
ASSOCIATION 
v. 
UNION OF INDIA & ANR. 
August ZS, 1969 
[J. C. SHAH, V. RAMASWAMI AND A. N. GROVER, JJ.] 
Rubber Act (24 of 1947), s. 12 and Rules 33, 33A and 33D-Duty 
Jeviable from users of rubber-If violative of Art. 14 and. Entry "84 of List 
I of VII Schedule of the Constitution. 
The, appellants, an association of rubber chappal manufacturers who 
B 
were using rubber in their manufacturing process, filed a petition in the 
C 
High Court challenging the levy and collection from the manufacturers of 
chappals, of a duty under s. 12 of the Rubber Act, 1947 as amended by 
Rubber Amendment Act, 1960. The grounds of challenge were : ( 1) that 
the imposition on the appellants was outside the ambit of Entry 84 of List 
I of VII Schedule of the Constitution, which deals with the duties which 
can be levied on goods manufactured or produced in India; (2) Section 
12(2) which provides the machinery for levy and collection has given un-
controlled and unbridled discretion to the Rubber Board and no guiding 
D 
principle or policy was laid down in the Act to enable the Board to choose 
between the owners of estates of rubber or the users of the rubber; and 
(3) the rules framed under the section do not indicate with sufficient 
clarity and precision on whom the levy was to be made. The High Court 
dismissed the petition. 
In appeal to this Court, 
HELD : (1) (a) The excise duty could be imposed at the stage which 
Was found to be most convenient and lucrative as that is a matter relating 
to the machinery of collection and did not affect the essential nature of 
the tax. Therefore, merely because the incidence of tax is shifted to the 
users of rubber under s. 12(2) which provides for the method of collec-
tion, the tax would not cease to be one falling within Entry 84. [73 B-C; 
F-GJ 
R, C. Jail v. Union of India, [1962] Supp. 3 S.C.R. 436, followed. 
Re: the Central Provinces and Berar Act, 14 of 1938, [1939] F.C.R. 
18, applied. 
(b) If the duty is not excise duty because it is imposed .on the user 
Parliament would even then have legislative competence to provide for ih 
collection from users, whatever be its nature, under Entry 97 of List I 
E 
F 
read with Art. 248 of the Constitution. [73 H; 74 A-BJ 
G 
(2) The task of subordinate legislativil necessary for im_plementing the 
purpose and objects of an enactmer.: can be delegated, so long as the law 
has provided the method by which the delegate can be controlled, there 
is a g-Jidance fer fixirig rates of tax and there is a provision to see th'at 
reasonable rates are fixed. [74 J>-.F] 
Municipal Corporation oj Delhi v. Birla Cf:!tlon, Spinning and Weaving 
Mills, [1%8] 3 S.C.R. 251, followed. 
In the present case, the Act was enacted for the purpose of develop-
1J1ent of rubber industry under the control of the. Union. Parliament has 
H 
A 
B 
c 
RUBBER MANUFACTURERS v. UNION (Grover, J.) 
69. 
onacted that the Rubber Board san levy and collect the duty either from 
the owner of the rubber estate or the user of the rubber. But the Board 
is enjoined to do so in accordance with the Rules made by Central Govern. 
meiit under s. 25 ( 1) (a) of the Act and which are placed before each 
House of Parliament for approval. 
The Board itself is a high powered 
body and all interests are represented among its members and all its acts 
are subject to the control of the Central Government under s. 22. [74 H; 
75 H; 78 CJ 
Further. the Board is vitally interested in the collection of the duty 
and it has to see that such duty is collected without undlle delay and proper 
expedition. The objects and reasons of the Amending Act (which can be 
taken into consideration for the purpose of seeing if there is any a11eged 
infringement of Art. 14) show that the Board was finding it difficult to 
levy and collect the duty from the owners and it was considered that it 
would be much more easy to collect it from the users, in accordance with 
the rules. Thus it is necessary that it should be left to the rule making 
authority to indicate the cases and the circumstances in which the duty 
was to be collected from the owner or user. [15 C; 77 H; 78 A-Bl 
Since the polic · of the Act has b~n enunciated with sufficient clarity, 
and 1Uidance has been furnished as to how the Board should exercise its 
powe•s in the matter of levy, there is no discrimination and Art. 
14 is 
GO! Vk>lated. 
D 
Jpoh v. C.J.T. Madras, [19681 1 S.C.R. 65 ~nd Raghubar Daya

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