D. Raju, J.
1. The above three writ petitions involve common and identical issues and, therefore, are dealt with together since submissions were also made by the counsel appearing on either side in common.
2. (I). (i) W.P. No. 9376 of 1989 has been filed for a writ of mandamus seeking for a direction to the respondents to issue to the petitioners "C" forms prescribed under rule 12(1) of the Central Sales Tax (Registration and Turnover) Rules, 1957, to enable them to procure and purchase materials and goods for effecting sale and transfer of property in goods involved in the execution of works contract and to forbear from penalising the petitioners under section 10-A of the Central Sales Tax Act, 1956, for the procurement of goods and materials against "C" forms in the course of inter-State trade for use in the execution of works contract.
(ii) The sum and substance of the claim of the petitioners is that they are having orders for the receipt of "C" declaration in the State of Madhya Pradesh, Uttar Pradesh and Maharashtra, but the second respondent and its officers are refusing to permit the petitioners to issue "C" declaration in relation to goods and materials purchased for their use in their execution of works contract. According to the petitioners, this resulted in the escalation of the cost of material and place the petitioners in an uncompetitive position as against dealers in the other States as well as those buying and selling the goods within the State. The petitioners claim that they are engaged in the construction, building and handing over on turnkey basis several mechanical, civil and electrical works under contract entered into with various Governments, quasi-Governmental undertakings and public sector institutions for the construction of dams, buildings, installation of power stations, cooling towers, etc., besides contracts with various Electricity Boards and Railways. For the said purpose, it is stated that the petitioners have to purchase cement, steel, electrical goods, mechanical equipment, machineries, accessories etc.
(iii) Reference is made to the amendment introduced to the Constitution by the Constitution (Forty-sixth Amendment) Act, 1982, inserting the definition of "tax on sale or purchase of goods" and it is claimed that in view of the said Amendments as well as the Tamil Nadu General Sales Tax (Fourth Amendment) Act, 1984 (Act 28 of 1984), the petitioners have been approaching the first respondent for securing "C" declaration under the Central Sales Tax Act in order to secure the concessional rate of purchase under section 8(1) of the Central Sales Tax Act, 1956, and the petitioners have also approached the second respondent, who, by his communication dated January 23, 1988, refused to permit the issuance of form "C" declaration. It is stated that in the States of Madhya Pradesh, Uttar Pradesh and Maharashtra, the sales tax authorities in those States, have permitted the issue of "C" forms in relation to the execution of works contract. The petitioners, on that basis contend that the respondents have a non-discretionary duty to issue "C" forms to the petitioners under rule 10-A of the Central Sales Tax (Tamil Nadu) Rules, 1957 and the respondents cannot refuse to issue the declaration once the application and the fee is submitted. It is also contended that after the Constitution (Forty-sixth Amendment) Act referred to supra, the difference between dealers effecting sale of materials and contractors effecting sale by transfer of property of goods used in the course of execution of works contract ceased to exist and the denial of the "C" forms is arbitrary and violative of article 14 of the Constitution of India. It is further contended that section 8 of the Central Sales Tax Act, 1956, deals with the issue of "C" forms and having regard to section 7 and 8(3), a person is entitled to be registered, under the Central Sales Tax Act even for carrying on exclusive local business to enable procurement of materials in the course of inter-State sale for local use or sale and that the respondents have misdirected themselves in taking the stand that the Central Sales Tax Act, 1956, was not amended for entitling the petitioners to have the "C" forms issued to them in their capacity as contractors. It is also stated that the denial of "C" forms to the petitioners engaged in works contracts while permitting the same to the traditional traders is violative of article 14 of the Constitution of India. It is also said to be in violation of article 301 of the Constitution of India.
II. W.P. No. 9377 of 1989 : The petitioners in this writ petition engaged in the manufacture and contracting and handing over on turnkey basis several mechanical, also electrical and civil contracts with various Government departments, quasi-Government undertakings and other public sector institutions, besides Electricity Boards and Railways, have filed the writ petition for a writ of mandamus seeking relief on the same terms as the petitioner in W.P. No. 9376 of 1989. It is claimed that the petitioners are already registered dealers under the Central Sales Tax Act, 1956 and the Tamil Nadu General Sales Tax Act, 1959. In all other respects, the grounds urged for the petitioners in the affidavit are almost similar to the one in the other writ petition.
III. W.P. No. 2023 of 1990 has been filed for a writ of certiorarified mandamus to call for the records and quash the proceedings of the first respondent in Asst. No. 678075/89-90 dated November 3, 1989 and consequently direct the first respondent to issue "C" forms against the application dated November 2, 1989.
(i) Under the impugned order, the first respondent informed the petitioner that unless the provisions of the Central Sales Tax Act are amended so as to bring within its purview the works contract, "C" forms could not be used for purchase of goods to be used in the execution of works contract and consequently the request for supply of "C" forms for the purpose in question could not be complied with, since the issue and use of such forms have a specific purpose as visualised under section 8(3) of the Act. The petitioners are a company carrying out contracts in Tamil Nadu and in particular contracts for railway electrification. The petitioners in the present writ petition also urged the very same grounds as urged in the other two writ petitions in support of their claim for the issue of the forms in question. In addition, it is contended that the impugned communication came to be passed without giving an opportunity and in violation of the principles of natural justice.
3. The respondents have filed three counter-affidavits in all the above three writ petitions. So far as W.P. No. 9376 of 1989 is concerned, it is contended that the petitioners are registered dealers both under the Tamil Nadu General Sales Tax Act, 1959 and the Central Sales Tax Act, 1956, that they are assessees on the file of the first respondent, that they purchase several items of goods from outside the State, that a registered dealer under the Central Sales Tax Act, 1956, is entitled to concessional rates of tax on their sales in the course of inter-State trade or commerce provided the necessary "C" or "D" forms are issued and the goods purchased by them by using the "C" forms from other States are to be used only for the purposes specified in the declarations, viz., for resale or use in manufacture/processing of goods for sale or use in mining, or use in generation/distribution of power/packing of goods for sale or resale and inasmuch as the definition of sale in section 2(g) of the Central Sales Tax Act, 1956, did not undergo any change or amendment in terms of the Constitution (Forty-sixth Amendment) Act, any person who purchases goods from other States cannot use such goods purchased by the issue of "C" forms in the execution of works contract and consequently the petitioners are not entitled to and it is not permissible for them to use the "C" forms for purchase of goods from other States for use in the execution of works contract. It is contended that the fact that in the other States referred to above, such permission is granted has no justification for the petitioners to have the same treatment in this State from the authorities of the Sales Tax Department in the State of Tamil Nadu. It is also claimed that inasmuch as the petitioners have sought for the issue of "C" forms admittedly for the purchase of goods for use in the execution of works contract, the denial of issue of "C" forms in quite in accordance with laws and the Constitution amendment by itself does not permit and does not also come to the rescue of the petitioners in the situation under consideration. It is also contended for the respondents that there has been no discrimination between two types of dealers and the denial of issue of "C" forms does not violate article 14 of the Constitution of India. It is also contended that the amendment of definition of sale [in] the Tamil Nadu Act equally does not enure to the benefit of the petitioners to obtain "C" forms or the use of the same for purchase of goods at concessional rates for being used in the execution of works contract.
4. In W.P. No. 9377 of 1989 also, a counter-affidavit has been filed taking the same line of defence.
5. So far as W.P. No. 2023 of 1990 is concerned, it is contended for the respondents that for the assessment year 1988-89, the petitioners were assessed on a total and taxable turnover of Rs. 81,79,349 and Rs. 57,25,684 respectively under section 3-B of the Tamil Nadu Act and they were paying tax for the assessment year 1989-90 on the basis of monthly returns. It is also stated for the respondents that the petitioners were dealers under the Central Sales Tax Act and they approached the assessing authority for the issue of the "C" form declarations for the purpose of buying goods from other States for being used in the execution of works contract in Tamil Nadu and that their claim for the issue of "C" forms was rightly rejected by the impugned communication and that the reasons assigned therefor are quite in accordance with law.
6. Mr. C. Natarajan, learned counsel appearing for the petitioners, contended that registration under the Central Sales Tax Act carries with it certain consequential benefits and having regard to the provisions contained in section 8(3), 7(2) read with sections 2(i), 4 and 5 of the Central Sales Tax Act, the petitioners are entitled to the supply and use of "C" forms to purchase goods in the course of inter-State sale for use or for sale in the course of execution of the works contract. It is also contended that the Central Sales Tax Act is not only aimed at levy of sales tax on inter-State sales, but also for carrying out the mandate of articles 286(1) and (2) and article 269 of the Constitution of India. The next aspect of the submission for the petitioners is that having regard to the combined effect of sections 2(g), 6(2) and 9(1) of the Central Sales Tax Act, a transaction shall be deemed to be sale even though not actually liable to tax. It is also submitted that even if two views are possible, the one in furtherance of the constitutional rights and which would avoid discrimination should be adopted. Inspiration is also sought to be derived from a reference to form No. A. [Application for registration under section 7(1)/7(2) of the Central Sales Tax Act, 1956] to contend that it is not only a dealer liable to pay tax under the Central Sales Tax Act, but also a dealer liable to pay tax under the sales tax law of the appropriate State, but not liable to tax under the Central Sales Tax Act who may apply for registration and that it entitles the dealer concerned to purchase goods for purposes noticed in the registration certificate by the use and issue of "C" forms.
7. In support of his submissions and the relief sought for, the learned counsel also relied upon the following judicial pronouncements, In Unitech Ltd. v. Commercial Tax Officer  83 STC 207, a Division Bench of the Andhra Pradesh High Court held that a dealer engaged in the execution of works contract is entitled to the supply of "C" forms and the question as to whether a particular "C" form has been correctly used or not does arise for consideration only at a later stage. The learned Judges were also of the view that after the 46th Amendment to the Constitution of India, the goods used in executing works contract are deemed to be sold and, therefore, there would be a sale of the material used in execution of the works contracts. In Commissioner of Sales Tax v. Imphalbs Manufacturing Co.  29 STC 450, a Division Bench of the Madhya Pradesh High Court while construing section 7(1) and 7(2) held that while section 7(1) casts an obligation on a dealer liable to tax under the Central Sales Tax Act to get himself registered, section 7(2) enables the dealer liable to pay tax under the sales tax law of the State and not liable to tax under the Central Sales Tax Act, to get himself registered and that the two sub-sections are designed for two different purposes and to cater to the needs of two different classes of dealers. In Deputy Commissioner of Sales Tax (Law) v. Lakshmichand Vasanji & Co.  79 STC 209, a Division Bench of the Kerala High Court held that the dealer who purchased goods in the State of Tamil Nadu by issue of "C" forms prescribed, for purposes of resale, brought the goods to Kerala and subsequently transported them to Bombay for sale therein did not commit any violation of law since there is no requirement obliging the dealer to sell the goods purchased only in the State of Kerala.
8. In order to get over the decision of the Kerala High Court in Deputy Commissioner of Agricultural Income-tax and Sales Tax (Law) v. P. K. Biriyumma  83 STC 276, the learned counsel referred to the decisions in Mithan Lal v. State of Delhi  9 STC 417 and Builders Association of India v. Union of India  73 STC 370, both of the Supreme Court of India. In the first of the above decisions, it was held by the Apex Court even within a week of its pronouncement of the decision in State of Madras v. Gannon Dunkerley & Co. (Madras) Ltd.  9 STC 353 that the decision in Gannon Dunkerley's case rendered in the context of a law enacted by the State Legislature in exercise of its powers under entry 54 in List II of the Seventh Schedule to the Constitution of India, would have no application to the law enacted by the Parliament by virtue of its authority under article 246(4) of the Constitution and that it was within the competence of Parliament acting under that article to impose a tax even on the supply of materials in building contracts even though there was no sale of those materials within entry 54 of List II of the Seventh Schedule to the Constitution of India. In the second of the decisions relied upon, the Apex Court held that the Constitution Forty-sixth Amendment introducing clause (29A) to article 366, came to be enacted to overcome the effect of the decision of the Supreme Court in State of Madras v. Gannon Dunkerley & Co. (Madras) Ltd.  9 STC 353, among other things. It was also held therein that all transfers, deliveries and supplies of goods referred to in clauses (a) to (f) of clause (29A) of article 366 of the Constitution of India are subject to the restrictions and conditions mentioned in clause (1), clause (2) and sub-clause (a) of clause (3) of article 286 of the Constitution of India and the transfers and deliveries that take place under sub-clauses (b), (c) and (d) of clause (29A) of article 366 of the Constitution of India are subject to an additional restriction mentioned in sub-clause (b) of article 286(3) of the Constitution of India.
9. Mr. D. Srinivasan, learned Additional Government Pleader (Taxes) while reiterating the stand taken in the counter-affidavit, contended that fixation of rates of tax and determination of liability involves substantial rights and that section 7(1) and 7(2) is meant for registration purposes only and not for any other purpose and the fact that a person was registered as a dealer does not ipso facto entitle him to get the supply of "C" forms. It was also contended that what is not sale within section 2(g) of the Central Sales Tax Act, 1956, cannot be plugged into it and the factum of registration cannot be pressed into use beyond its object so as to deal with substantial rights too in the matter of claim for concessional rates of tax. It was also contended that in the absence of any specific legislation by the Parliament, on par with the legislations enacted by the States pursuant of the Constitution Forty-sixth Amendment, liability cannot be automatically presumed for purposes of the Central Sales Tax Act, 1956 and that the position of law governing as per the Central Sales Tax (Amendment) Act, 1958, alone will apply to the case. The learned counsel also relied upon certain judicial pronouncements in support of his submissions to which a reference will be made herein after. In Deputy Commissioner of Agricultural Income-tax and Sales Tax (Law) v. P. K. Biriyumma  83 STC 276, a Division Bench of the Kerala High Court held that till section 2(g) and the definition of "Sale" contained therein is amended to take within the relevant statutory provision the content of clause 29-A of article 366 of the Constitution of India, it is not permissible to read into the definition of sale in the Central Sales Tax Act, 1956, the ingredients of the Forty-sixth Amendment to the Constitution of India and that the sales tax authorities were right in cancelling the amendments effected in the dealer's certificate of registration under Central Sales Tax Act by which goods used in tyre retreading were included prior to such cancellation. While taking the view that transaction covered by the registration certificate in that case were works contract, per se the Kerala High Court disapproved the view of the Tribunal that the word "sale" as contained in the Central Sales Tax Act is wide enough to take in the transfer of property involved in goods used in the execution of works contract also.
10. The decision in Consolidated Coffee Ltd. v. Coffee Board  64 STC 164 was that of the Supreme Court, wherein it was held that "sale" as defined under the Central Sales Tax Act, cannot mean "agreement to sell" in the context of section 5(3) and particularly in order to decide the question as to when a penultimate sale shall also be deemed to be in the course of export. Even in the said decision, the Apex Court reaffirmed the position of law that in the context of a question as to when a sale could be said to take place in the course of inter-State trade or commerce a wide and extended meaning to the word "sale" as defined in section 2(g) of the Central Sales Tax Act, and as used in section 3(a) and 4(2)(a) and (b) had to be given and the word, in the context of those provisions was wide enough to include not only a concluded contract of sale, but also an agreement of sale provided that the latter (contract) stipulated that there was a transfer of property or movement of goods. The Apex Court also reiterated in this decision the fundamental principle that the definition of "sale" and "agreement to sell" in the Sale of Goods Act, 1930, would not apply to the expression "sale" occurring in the Central Sales Tax Act, 1956. In my view, this approach was on account of the basic principle that the Parliament was never considered to lack the required constitutional authority or legislative competency from the lack of which the State Legislatures were uniformly held to suffer necessitating the constitutional 46th Amendment. The definition of sale in section 2(g) of the Central Sales Tax Act, 1956, is so wide to take within it and encompass all those transactions which the State Legislatures had to specifically provide for after the Forty-sixth amendment to the Constitution of India entitled them to do and there was absolutely no need for any amendment or incorporation of a specific provision to be made to the Central Sales tax Act, 1956. To view the matter otherwise would amount to overlooking the constitutional history as well as the scheme of distribution of legislative powers among the Parliament and the Legislature of the State, and the circumstances as well as the reasons or objects with which the Constitution (Forty-sixth Amendment) Act, 1982, came to be enacted. With great respect to the learned Judges of the Kerala High Court, who decided the case reported in  83 STC 276 [Deputy Commissioner of Agricultural Income-tax and Sales Tax (Law) v. P. K. Biriyumma] I am unable to persuade myself to subscribe to such a view taken by them.
11. In the decision in Khemka & Co. (Agencies) Pvt. Ltd. v. State of Maharashtra  35 STC 571, the Apex Court held that the Central Act is a self-contained code creating liability for tax as well as for imposition of penalty and it is not permissible for the authorities to invoke the sales tax law of the State for imposing a penalty not provided for in the Central Act. In State of Tamil Nadu v. Gemini Studios  36 STC 357, a Division Bench of this Court expressed the view that in view of the deletion of the class of goods covered by section 8(3)(c) by the Central Sales Tax (Amendment) Act, No. 31 of 1985 with effect from October 1, 1958, the certificate issued earlier under the unamended provision continued to have validity (?) and that when the provision is repealed automatically, the forms and the other certificates issued shall be deemed to have been pro tanto modified. This was on the basis that the words, "for use in the execution of works contracts" came to be deleted in 1958. The above decisions and the ratio laid down therein have no relevance to the case on hand in the context and purpose under consideration before me. The above decisions are sought to be quoted out of context and without due regard to the actual ratio decidendi of those cases. That apart, the question in the form it is posed now before me never arose for consideration in those cases, and the issue actually decided therein was as to the efficacy of a certificate issued under a provision of law which underwent a change, after the amended provision came into force. There can be no serious dispute over the fact that the goods purchased in the course of inter-State sale or trade or commerce could be resold locally and the resale need not necessarily be by means of another inter-State sale. If therefore under the local sales tax law of the appropriate State, as has been held by the Apex Court in Builders Association of India's case  73 STC 370, the States are entitled to levy sales tax on the price of goods and materials used in works contracts as if there was a sale of such goods and materials, the dealers like the petitioners become entitled to purchase materials for their use in the execution of the works contracts by the issue of the "C" forms, notwithstanding the Central Amendment Act No. 31 of 1958. In the light of my above conclusion, it is unnecessary for me to deal with the plea of alleged violation of article 14 of the Constitution of India.
12. That apart, in my view, the petitioners are entitled to have themselves registered as dealers under section 7(2) and consequently are entitled to the supply of "C" forms for use in their purchase of goods in the course of inter-State sale or trade or commerce at the concessional rate. The further question whether the goods have been rightly purchased for any one of the approved and permitted purposes and whether there was sufficient compliance or non-compliance or violation of the terms of the registration certificate or as to whether the "C" forms issued have been misused by the registered dealer shall be considered only at the subsequent and appropriate stage and in accordance with section 10-A of the Central Sales Tax Act and it would be not only premature but inappropriate to enter into an enquiry postulated under section 10-A even at the stage of issue or the supply of "C" forms. For all the reasons stated above, the impugned order dated November 3, 1989 in W.P. No. 2023 of 1990 shall stand quashed. The other relief in the terms prayed for by the respective petitioners in the other cases cannot be granted. Instead, in my view, it would be appropriate to issue a writ of mandamus in all these cases, directing the respondents to supply the "C" forms, as prayed for by them in terms of the respective registration certificates held by them or to be granted to them in future. It is made clear that the mere supply of "C" forms as per this directions shall not exonerate the petitioners of any liabilities under section 10-A of the Central Act and the right of the respondents or the concerned and competent authorities to take appropriate action against the dealers concerned under section 10-A of the Central Sales Tax Act, 1956, without reference to any of the observations made in this order which are confined to a consideration of the stage of supply of "C" forms and have nothing to do with any liability or otherwise that may be incurred by the dealers concerned or the rights acquired by the department or its officers to proceed against the petitioners for any violation or misuse of the "C" forms in accordance with law. The writ petitions are, therefore, allowed to the extent indicated supra reserving the right of the respondents, as noticed above. There shall be no order as to costs.
13. Writ petitions allowed.