LexUNION OF INDIA & ORS. versus M/S MARTIN LOTTERY AGENCIES LTD.
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(2009] 7 S.C.R. 946 A UNION OF INDIA & ORS. V. M/S MARTIN LOTTERY AGENCIES LTD. Civil Appeal No. 3239 of 2009 B MAY 5, 2009 - (S.B. SINHA AND CYRIAC JOSEPH, JJ.) Finance Act, 1994: Section 65( 105) - Service Tax - Whether sale, promotion c and marketing of lottery tickets would be exigible to Service Tax - On a writ petition, High Court held in the negative - On appeal, Held: By reason of explanation a substantive law may be introduced - But it will have no retrospective effect - Thus, Service Tax, if any, would be payable with effect from May, D 2008 and not with retrospective effect. Interpretation of Statutes: Speech of Finance Minister in Parliament - Could be taken to be a valid tool for interpretation of a statute. E Words and Phrases: 'Service' - Meaning of. In this appeal against the judgment of the Sikkim High Court, the question involved was as to whether sale, F promotion and marketing of lottery tickets would be exigible to Service Tax within the meaning of the provisions of Section 65(105) of the Finance Act, 1994. ... Dismissing the appeal, the Court G HELD: 1.1 Organizing lottery by the State is tolerated being an economic activity on its part so as to enable it to raise revenue. Raising of revenue by the State, by itself . ' cannot amount to rendition of any service. It may be true that for the purpose of invoking the provisions of taxing • H 946 ... UNION OF INDIA & ORS. V. 947 M/S MARTIN LOTTERY AGENCIES LTD. statute, the morality aspect may not be of much A consequence but such a question assumes significance for the purpose of ascertaining as to whether the same .··amounts to rendition of service within the meaning of clause (19) of Section 65 of the Finance Act, 1994. [Pata 16] [962-C-E] B 1.2 Service provided in respect of the matters envisaged under clause (19) of Section 65 of the Act must be construed strictly. Before a tax is found to be leviable, it must come within the domain of legitimate business and/ or trade. The doctrine of res extra Cominercium was c invoked in the United States of America where keeping in view the nature of right conferred on its citizens and the concept of imposition of reasonable restrictions thereon being absent, it was held that gambling should be frowned , upon being opposed to constitutional jurisprudence. 0 While borrowing the said principle in the Indian context, however, it must be borne in mind that Constitution of India envisages reasonable restrictions in respect of almost all the fundamental rights of the citizens. No citizen has an absolute fundamental right. Whereas the same principle may apply in Australia but it may not apply to the European E Countries where gambling and even sale of narcotic drugs subject to licensing provisions, if any, is permissible. [Para 18] [963-B-E] 1.3 Conceptually business may be carried out in respect of a property which is capable of being owned as F contrasted to those which cannot be. Having regard to the changing concept of the right of property, which includes all types of properties capable of being owned including intellectual property, it is possible to hold that the restrictions which can be imposed in carrying on G business in relation thereto must only be reasonable on~ ~ __ within the meaning of Clause (6) of Article 19 of the Constitution of India. Right of property although no longer a fundamental right, but, indisputably is a human right. (Para 18] (963-F-G] H 948 SUPREME COURT REPORTS [2009] 7 S.C.R. A Gujarat Ambuja Cements Ltd. v. Union of India (2005) 4 SCC 241; H. Anraj v. Government of Tamil Nadu (1986) 1 SCC 414; Yasha Oversees v. Commr. of Sales Tax & Ors. (2008) 8 SCC 681; The State of Bombay v. R.M.D. Chamarbaugwala 1957 SCR 874; B.R. Enterprises v. State of B U.P & Ors. (1999) 9 sec 700; Vimlaben Ajitbhai Patel v. Vatslaben Ashokbhai Patel and Others (2008) 4 SCC 649; Karnataka State Financial Corporation v. N. Narasimahaiah (2008) 5 sec 176; e.S.S Motor Service Tenkari and Ors v The State of Madras represented by the Secretary to the c Government of Madras, Home Department and Anr. Al R 1953 Mad 279 - relied on. Sunrise Associates vs. Govt. of NCT of Delhi & Ors. (2006) 5 SCC 603 and Federation and Association of Hotels and Restaurants Association of India v. Union of India (1989) 3 D SCC 634 - referred to. California v. Central Pacific R. Co. (1888) 32 Law Ed 150 ti - referred to. 2.,The s
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