STATE OF MAHARASHTRA & ANR. versus CHAMPALAL KISHANLAL MORTA

Citation: [1971] 1 S.C.R. 46 · Decided: 17-03-1970 · Supreme Court of India · Bench: J.C. SHAH · Disposal: Appeal(s) allowed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

,~-· 
46 
STATE OF MAHARASHTRA & ANR. 
v. 
CHAMPALAL KISHANLAL MORTA 
March 17, 1970 
(J. C. SHAH AND K. S. HEGDE, JJ.J 
Bombay Sales Tax Act (51 of 1959) as amended by the Maharashtra 
Act (15 of 1967), s. 2(7)-"Goods",, including standing timber agreed 
Ito be severed-Sale of standing trees agreed to be severed under contract 
-If 'sale of goods' liable to sales tax. 
The contract of sale entered into by the respondent expressly pro-
vi,ded that the timber agreed to be sold shall be severed. 
The High 
Court held th:.it the sale of 
standing trees was not a sale of goods 
chargeable to sales tax under the Bombay Sales Tax Act, 1959, and 
the decision \Vas confirmed by this Court on appeal. 
But after the 
judgment of th·o High Court and before the appeal was heard in this 
Court. the expression "goods" in the Act was amended by Maharashtra 
Act 15 of 1967 with retrospective operation, so that, it included at all 
relevant times, standing timber agreed to be severed before sale or under 
the contract of sale. 
In a petition for review to this Court, 
HELD : Since the judgment of this Court suffers from an error 
apparent on the face of the record, the judgment should be reviewed 
and the appeal allowed. (47 CJ 
A 
B 
c 
D 
A State Legislature may not extend tbe import cif the expression 
E 
"sale of ,goods" so as to impose liability for tax on transactions which 
are not sales of goods within the meaning of the Sale of Goods Act. 
But, by the inclusive definition in s. 2(7) of the Sale of Goods Act, 
things which are attached to the land may be the subject matter of 
contract of sale provided that under the terms of the contract they are 
to be severed before sale at under the cortract of 1ale. The timber in 
the present case was therefore "goods" within the meaning of s. 2(7) of 
the Sale oi Goods Act. Since the expression "sale of goods" in Entry 54, 
F 
List JI, of the Constitution has the same meaning as that expression has 
~n the Sale of Goods Act, the amendment is valid. (47 H; 48 A-El 
, 
The State of Madras v. Gannon Dunkerley. [1959] S.C.R. 379 and 
Pandit Banarsi Das Bhanot v. The State of Madhya Pradesh, [1959] S.C.R. 
427, referred to. 
CIVIL APPELLATE JURISDICTION: Review Petition No. 29 of 
G 
1969. 
Application for review of this Court's Judgment dated July 17, 
1969 in Civil Appeal No. 1878 of 1967 arising out of the judg-
ment and order dated July 18, 1966 of the Bombay High Court, 
Nagpur Bench in Special Civil Application No. 722 of 1965. 
N. S. Bindra and S. P. Nayar, for the petitioner/appellants. 
H 
A. G. Ratnaparkhi, for the respO)lident. 
MAHARASHTRA v. CHAMPALAL (Shah, J.) 
47 
A 
Th~. Judgment of the Court was delivered by 
s 
c 
D 
E 
F 
G 
H 
Shah, J. 
Appeal No. 1878 of 1967 was ordered to be dis-
missed by this Court on July 17, 1969. The Court held that the 
~ale of standing trees is not sale of goods chargeable to sales tax 
under the Bombay Sales Tax Act, 1959. 
. 
A petition for review of Judgment has been filed by the State 
contending that after the judgment of the High Court and before 
the appeal was heard, the Bombay Sales Tax Act, 1959 was amend-
ed by the Maharashtra Act 15 of 1967 with retrospective opera-
tion, and by the amendment standing timber was included in the 
definition of timber, but counsel for the State failed to invite the 
attention of the Court to that Act. 
Since the judgment of this 
Court it is claimed suffers from a:n error apparent on the face of the 
record, we have granted review of judgi:p.ent. 
The expression "goods" was defined ins. 2( 13) of the Bombay 
Sales Tax Act, 1959. By Maharashtra Act 15 of 1967 by s. 2 
the definition of "goods" was altered by providing that : 
"Ia section 2 of the Bombay Sales Tax Act, 1959 
. . . in clause (13), after the words 'and commodi-
ties' the following shall be, and shall be deemed always 
to have been, added, namely :-
'and all standing timber which is agreed to be sever-
ed before sale or under the contract of sale'." 
Tb.e definition was retrospective in operation and the expression 
"goods" included at all relevant times standing timber agreed to 
be severed before sale or under the contract of sale. 
The expression "sale of goods" in Entry 54 List II of Sch. VII 
of the Constitution has the same connotation as it has in the Sale 
of Goods Act, 1930· This Court in The State of Madras v. Gan-
non Dunkerley & Co. (Madras) Ltd.(1) observed that the expres-
sion "sale of goods" was, at the time when the Govern

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