T. G. VENKATARAMAN ETC. versus STATE OF MADRAS & ANR.

Citation: [1970] 1 S.C.R. 615 · Decided: 17-07-1969 · Supreme Court of India · Bench: J.C. SHAH · Disposal: Dismissed

Cited by 1 judgment(s) · cites 2 · see the full citation network in Lexace

Judgment (excerpt)

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T. G. VENKATARAMAN ETC. 
v. 
STATE OF MADRAS & ANR. 
July 17, 1969 
[J. C. SHAH AND G. K. MITTER, JJ.] 
Madras General Sales Ta;x: Act, 1959 as amended by Madras Act 2 
of 1968-'Cane iaggery' liable to ta;x: but 'palm ;agger;' 
exempted-
Discrimlnation whether violative of Art. 14 of Constitution-Tax on 'cane 
jaggery' whether restrictive of trade and commerce within meaning of Art. 
301-Whether colourable exercise of power. 
As a result of a notification dated December 30, 1967 under s. 59(1) 
of the Madras General Sales Tax Act and later by Act 2 of 1968 sales 
of jaggery became liable to tax. But while by notification under s. 17 'palm 
jaggery was exempted from tax 'cane jaggery' was not. The appellants 
who were dealers in 'cane jaggery' challenged the levy by· writ petitions in 
the High Court which were, however, dismissed. 
Jn appeal before this 
Court it was contended (i) that the tax on 'cane jaggery' while exempting 
'palm jaggery' was discriminatory and violative of Art. 14 of the Consti-
tution; (ii) that taxation of 'cane jaggery' was restrictive of trade and 
r-0mmerce and therefore violative of Art. 301; (iii) that the impugned 
legislation constituted a colourable exercise of power. 
HELD: (i} The evidence on record clearly showed that 'cane jaggery' 
and 'palm jaggery~ were. commercially.diffdrcnt commodities. The methods 
of production of 
1pahri jagge1y' and 'cane jaggeryt were different; they 
reached the consumers through different channels of distribution; the prices 
at which they were sold differed and they wefe consumed by different 
sections of the community. 'Cane jaggery' and 'palm jaggery' did not thus 
belong to the same class and in differently treating them for the purpose 
of taxation there was no unlawful disc!rimination. [620 B-E; 621 C-Dl 
It was incorrect to .say that the State Legislature had always treated 
the two products on the same footing. 
For !learly three years before 
April I, 1958 sales of ,'palm jaggery' were exempt from tax hut sales of 
'cane faggery' were not. [620 BJ 
Further, it is for the legislature to determine the objects on which 
tax shall be levied. 
The courts will not strike down an Act a• denying 
equal protection merely because other objects could have been but are not 
taxed by the legislature. [621 B-C] 
N. Venugopal,\Ravi Varma Raiah v. Union of India, [1969] 3 S.C.R. 
827, applied. 
. 
(ii) Freedom of trade, commerce and intercourse guaranteed by Art. 
301 of the Constitution is protected against taxing statutes as weII as 
other statute·s, but by iin.position of tax on transactions of sale of 'cane 
jaggery' no restriction on the freedom of trade or commerce or in the 
courso of trade with or Within the State was imposed. [621 D-F] 
State of Madras v. N. K. Nataraia Mudaliar. 
[1968] 3 S.C.R. 829, 
referred to. 
(iii) The plea' of colourable exercise of power had 
no 
substance 
because the legislature l;lad power in the present case to levy the tax. 
[621 G] 
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L14 Sup. GL/69 
616 
SUPREME COURT REPORTS 
[1970] l S.C.R. 
K. C. Gajapali Ncraya11 Deo & Ors. v. State of Orlssa, [1954] S.C.R. 
1, applied. 
CIVIL APPELLATE JuRJsmcT10N : Civil Appeals Nos. 281, 
284, 363, 383 to 393 and 513 to 567 oi 1969. 
Appeals from the judgment and order dated December 6, 
1968 of the Madras High Court in Writ Petitions Nos. 1659 of 
1968. 
M. S. Sethu and A. V. V. Nair, for the appellant (in C.As. 
Nos. 281 and 363 of 1969). 
M. S. Sethu and P. Parameshwara Rao, for the appellant (in 
C.A. No. 284 oi 1969). 
H. R. Gokhale and K. Jayaram, for the appellant (in C.A. 
No. 383 of 1969). 
K. Jayaram and T. S. Vishwanatha Rao, for the appellants (in 
C.As. Nos. 38ll to 393 and 513 to 567 of 1969). 
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S. V. Gupte, S. Mohan and A. V. Rangam, for the respon-
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dent (in C.A. No. 281 of 1969). 
S. Mohan and A. V. Rangam, for the respondents (i.n C.As. 
Nos. 284, 363, 383 to 393 and 513 to 567 of 1969). 
The Judgment of the Court was delivered by 
Shah, J. At the conclusion of the hearing of these appeals on 
April 23, 1969, we announced that "the appeals are dismiss.A 
with costs; reasons in support of the order will be delivered •here-
after". We proceed to record the reasons in support of the order. 
The appellants carry on business as 'k~lers in "cane jaggery" 
in the State of Tamil Nadu. As a result of certain legislative and 
executive measures, transactions of sale in "cane jaggery" were 
made liable as from January l, 1968 to tax 

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