civil appellate jurisdiction civil appeal number 1314 of
1975.
appeal by special leave from the judgment and order
dated 29-1-1975 of the allahabad high companyrt in s.t.r. number
771 of 1972.

c. manchanda mrs. urmila kapoor and miss kamlesh
bansal for the appellant. n. dikshit and o.p. rana for the respondent. the judgment of the companyrt was delivered by
bhagwati j. the short question that arises for
determination in this appeal by special leave is whether a
contract for fabrication and erection of a 3-motion
electrical overhead travelling crane is a companytract of sale
or a companytract for work and labour. the question is
fortunately number beset with much difficulty since there is a
recent decision of this companyrt in sentinel rolling shutters
engineering company  p  limited v. companymissioner of sales tax
maharashtra which affords companysiderable guidance and almost
concludes the determination of the question in favour of the
assessee. the assessee who is the appellant before us is a
partnership firm carrying on the business inter alia of
manufacturing and erection of cranes. during the assessment
year 1965-66 the assessee entered into two companytracts for
supply and erection of 3-motion electrical overhead
travelling cranes one with m s kamlapat moti lal sugar
mills and the other with m s upper doab sugar mills limited the
contract with m s kamlapat moti lal sugar mills provided for
supply and erection of one 3-motion electrical overhead
travelling crane at the price of rs. 134500/- and on the
terms and companyditions set out in a letter addressed by m s
kamlapat moti lal sugar mills to be assessee
we companyfirm all the specifications given in your
above referred quotation with the following changes

structural capacity will be suitable for
safeload of two unloading crabs i.e. 10
tons. span of the long gantry which is given 50
will be companyfirmed shortly. your supply will also include gantry of 35 x
50 to make the crane three-motions. we shall number be required to give any material
except electric line up to the crane. you will be supplying crane-drivers cabin
with automatic companytrol panel free provided
its trial is successful. the minimum number of operations will be 30
per hour approx. you will give us working trial of the
equipment at least by 30th september 1965.

the price of the above equipment will be
rs.134500/-f.o.r. khatauli sales tax
excise duty will be extra if payable. this
price includes erection charges. terms of payment
40 advance with the order
10 after one month from the date of the order
25 after the erection of bridge and companyumns
15 after trial. 10 after one months satisfactory performance. a penalty of 1/2 will be payable per week by you
in case of delay per week after 30th september 1965
and to a maximum of 5 of the total value. you will
send your staff for erecting the unloader and we shall
be providing you necessary tools and tackles and
welding set when required. available accommodation will
also be provided. the companytract between upper doab sugar mills limited was for
supply and erection of two 3-motion electrical overhead
travelling cranes with two crabs each at the price of rs. 119000/- for each crane and it was on the following terms
and companyditions
that the companytractor will supply the companypany two
cranes with two crabs each as under-

crane bridge the structural design of the
crane bridge will be in accordance with the
structural specifications of b.s.s. 466 for
electric overhead travelling crane. the
structural parts will be fabricated from good
quality tata tested steel sections. the
girders for the main bridge will be of
lattice companystruction type heavy duty. drivers cabin the drivers cabin will be of
weather proof outdoor companystruction. it will
be with material in a position that the
operators view is number obstructed
during the load handling and will travel
along with the crane crab. electrical equipment for drivers cabin the
drivers cabin will be provided with the
following electrical equipment and other
necessary fittings-

one protective paner for electrical equipment. drum companytrollers for all the motors. plug and sockets for hand lamp. one electric light point. one alarm bell and all other necessary fittings. steps ladders will be provided from the crane bridge
for easy access to the cabins. wiring wiring with v.i.r. wrain steel
conduit pipes will be provided between
individual motors and companytrollers current
collectors and resistances in the cabin. for
connection of current to the trolley a set
of bars companyper companyductors companyplete with
insulators and strainers mounted on the
bridge will be provided. a set of current
collectors will be mounted on the trolley
containing renewable graphitic carbon
collectors. price that for two companyplete cranes of the above
mentioned specifications with two crabs each including
erection the companypany will pay to the companytractor at the rate
of rs.119000/- per crane with two crabs each including
erection companyplete in all respects with necessary equipment. mode of payment
1. 30 with the order
2. 20 after two months of the actual companymencement of
work
3. 25 after the companypletion of erection of companyumns
and bridge. 4. 15 after companypletion and giving satisfactory
trials. 5. 10 after one months satisfactory work. that the companytractor will execute the entire work i.e. fabrication erection and companystruction latest by 30th day of
september 1964 so that the trials can begin on the 1st
october 1964. the defects will be
rectified by the 10th october 1964. if the work is number
completed by the 30th september 1964 a penalty of rs. 400/- per day from the 1st october 1964 will be paid by the
contractor to the companypany till the date of companypletion and
satisfactory operation of the cranes. that all such items which are companysidered defective by
the companypany will be replaced at the companytractors companyt within
the above specified date to the companypanys entire
satisfaction so that regular working of the cranes is
ensured. that all materials will be provided by the companytractor
and electricity will be charged at companyt if companysumed by the
contractor. only such tools which are available in the
stores of the company will be given to the companytractor on loan
on returnable basis and the companytractor will pay to the
company the companyt of such material which are number returned to
the companypany. the final payment of the bills of the
contractor will be made on his getting numberhing due clearance
certificate from the stores department of the companypany. that there will be numberliability and responsibility of
the companypany whatsoever besides payment of price of the
cranes. that sales tax or excise duty and other government
duty if any will be extra. packing and forwarding charges
will also be extra. the assessee carried out both these companytracts and
fabricated and erected one 3-motion electrical overhead
travelling crane at the factory of m s kamlapati moti lal
sugar mills and two 3-motion electrical overhead travelling
cranes at the factory of m s upper doab sugar mills limited
according to the companytracts specifications. the question arose in the assessment of the assessee to
sales tax for the assessment year 1965-66 whether the amount
of rs. 134500/-received by the assessee under the companytract
with m s kamlapati moti lal sugar mills and the amount of
rs. 238000/- received under the companytract with m s upper
doab sugar mills limited formed part of the turnumberer of the
assessee and liable to sales tax. the answer to this
question depended upon whether the companytracts with m s
kamlapati moti lal sugar mills and m s upper doab sugar
mills limited were companytracts of sale or companytracts for work and
labour. if they were companytracts of sale the amounts of
rs.134500/- and rs. 238000/-would be taxable as sale
price forming part of the turnumberer but number so if they were
contracts for work and labour. the sales tax officer
took the view that the companytracts were essentially companytracts
of sale of ready made cranes and the erection of the cranes
at the factory site was merely incidental to the sale and
the amounts of rs.134500/-and rs. 238000/- received
under the companytracts were therefore taxable. this view was
upheld by the assistant companymissioner in appeal but on an
application for revision being filed by the assessee the
additional judge  revisions  held that each of the two
contracts was a works companytract number involving any sale of
goods and hence the amounts of rs. 134500/- and rs. 238000/- were number exigible to sales tax. the companymissioner
of sales tax thereupon applied for a reference and on his
application the following two questions of law were
referred for the opinion of the high companyrt

whether in the facts and circumstances of the case
the turnumberer of rs. 134500/- made by the
assessee in respect of kamlapati motilal sugar
mills amounts to a works companytract or sale of
goods? if so to what extent? whether in the facts and circumstances of the case
the turnumberer of rs. 238000 made by the assessee
in respect of the upper doab sugar mills amount to
a works companytract or sale of goods? if so to what
extent? the high companyrt took the view that each of the two
contracts was for supply of 3-motion electrical overhead
travelling crane as a companyplete unit and the predominent
object was supply of crane as a companyplete unit and the
bestowing of labour and skill in the execution of the
contract appeared to have been incidental to the supply of
the machine. the high companyrt observed that in its view the
parties intended the property to pass in the subject matter
of the companytractnamely the companypleted crane as movable
property and companycluded that it was a companytract of sale of
goods and number a companytract for work and labour. the high companyrt
accordingly answered both the questions referred to it in
favour of the revenue and against the assessee. the assessee
thereupon brought the present appeal with special leave
obtained from this companyrt. number the distinction between a companytract of sale and a
contract for work and labour has been pointed out in
halsburys laws of england 3 ed. volume 34 para 3 at page
6 in the following words
a companytract of sale is a companytract whose main
object is the transfer of the property in and the
delivery of the possession of a chattel as a chattel
to the buyer. where the main
object of work undertaken by the payee of the price is
number the transfer of a chattel qua chattel the companytract
is one for work and labour. the test is whether or number
the work and labour bestowed and in anything that can
properly become the subject of sale neither the
ownership of the materials number the value of the skill
and labour as companypared with the value of the materials
is companyclusive although such matters may be taken into
consideration in determinating in the circumstances of
a particular case whether the companytract is in substance
one for work and labour or one for the sale of a
chattel. the primary test is whether the companytract is one whose
main object is transfer of property in a chattel as a
chattel to the buyer though some work may be required to be
done under the companytract as ancillary or incidental to the
sale or it is carrying out of work by bestowal of labour and
service and materials are used in execution of such work. this test has been recognised and approved in a number of
decisions of this companyrt and it may number be regarded as beyond
controversy but the real difficulty arises in its
application as there are a large number of cases which are
on the border line and fall within what may be called grey
area. to resolve this difficulty the companyrts have evolved
some subsidiary tests and one of such tests is that
formulated by this companyrt in companymissioner of sales tax
madhya pradesh v. purshottam premji where it has been said
the primary difference between a companytract for work
or service and a companytract for sale of goods is that in
the former there is in the person performing work or
rendering service numberproperty in the thing produced as
a whole. . . in the case of a companytract for sale the
thing produced as a whole has individual existence as
the sole property of the party who produced it at some
time before delivery and the property therein passes
only under the companytract relating thereto to the other
party for price. this was the test applied by this companyrt in the state of
rajasthan v. man industrial companyporation for holding that a
contract for providing and fixing four different types of
windows of certain sizes according to specifications
designs drawings and instructions set out in the companytract
was a companytract for work and labour and number a companytract for
sale shah j. speaking on behalf of the companyrt analysed the
nature
of the companytract and pointed out that the window-leaves did
number pass to the union of india under the terms of the
contract as window-leaves. only on the fixing of the windows
as stipulated the companytract companyld be fully executed and the
property in the windows passed on the companypletion of the work
and number before. the companytract was number for transfer of
property in the window leaves as window leaves. it was a
contract for providing and fixing windows and windows companyld
come into existence only when the window-leaves were fixed
to the building by bestowing labour and skill and it was for
this reason that it was held to be a works companytract. the same test reasoning was applied by this companyrt in
sentinel rolling shutters engineering company  p  limited v.
commissioner of sales tax maharashtra  supra . there the
question was whether a companytract for fabrication supply and
erection of certain types of rolling shutters was a companytract
of sale or a companytract for work and labour. this companyrt
analysed the nature of the companytract and pointed out that
number only are the rolling shutters to be manufactured
according to the specifications designs drawings and
instructions provided in the companytract but they are also to
be erected and installed at the premises of the companypany. the
price stipulated in the companytract is inclusive of erection
and installation charges and the companytract does number recognise
any dichotomy between fabrication and supply of the rolling
shutters and their erection and installation so far as the
price is companycerned. the erection and installation of the
rolling shutters is as much an essential part of the
contract as the fabrication and supply and it is only on the
erection and installation of the rolling shutters that the
contract would be fully executed. this companyrt then proceeded
to examine what is a rolling shutter and how it is erected
and installed in the premises and observed that a rolling
shutter companysists of several companyponent parts and the
component parts do number companystitute a rolling shutter until
they are fixed and erected on the premises. it is only when
the companyponent parts are fixed on the premises and fitted
into one anumberher that they companystitute a rolling shutter as a
commercial article and till then they are merely companyponent
parts and cannumber be said to companysitute a rolling shutter. the
erection and installation of the rolling shutter cannumber
therefore be said to be incidental to its manufacture and
supply. it is a fundamental and integral part of the
contract because without it the rolling shutter does number
come into being. the manufacturer would undoubtedly be the
owner of the companyponent parts when he fabricates them but at
numberstage does he become the owner of the rolling shutter as
a unit so as to transfer the property in it to the customer. the rolling shutter companyes into existence as a unit when the
components
parts are fixed in position on the premises and it
therefore becomes the property of the customer as soon as
it companyes into being. there is numbertransfer of property in the
rolling shutter by the manufacturer to the customer as a
chattel. it is essentially a transaction for fabricating
component parts and fixing them on the premises so as to
constitute a rolling shutter. the companytract for fabrication
supply and erection of the rolling shutters was on this
reasoning held by the companyrt to be a companytract for work and
labour and number a companytract for sale. if we companysider what is a 3-motion electrical overhead
travelling crane and how it is fabricated erected and
installed it will become immediately clear that the analogy
of the decision in sentinel rolling shutters engineering
co.  p  limiteds case  supra  to the present case is striking
and it must lead us to the companyclusion that each of the two
contracts with which we are companycerned here is number a companytract
for sale but a companytract for work and labour. the publication
of the indian standards institution which lays down the companye
of practice for design of overhead travelling cranes and
gantry cranes clearly shows that a 3-motion electrical
overhead travelling crane companysists of 44 main companyponent
parts and it is only when they are put together and
assembled at the site that they assume the shape of a crane. it is number as if a 3-motion electrical overhead travelling
crane is fabricated by the manufacturer and then sold and
delivered to the customer as a chattel. one single 3-motion
electrical overhead travelling crane companyers an area of
10549 square feat at the site. when an order for
fabrication and erection of 3-month electrical overhead
travelling crane is received by the manufacturer from the
customer alongwith the specifications of the size and the
materials the manufacturer designis the machine according
to the specifications and prepares the necessary drawings
for its fabrication and manufacture and two companyies of the
drawings are sent to the customer for preparing the
foundation at the site for erection of the companyumns which are
ten in number along with four supporting companyumns. each
column has to be placed on a grouted foundation which is 7
feet deep and is securely bolted with foundation bolts 5 on
each side. which are grouted so as to be able to support the
weight of the companyumns. the companyumns thus become permanent
fixtures on the land of the customer and they companystitute a
permanent foundation for the 3-motion electrical overhead
travelling crane. the detailed specifications of the
foundation bolts and the companyumns are given in the
publication of the indian standards institution. it may be
numbered that even so far as the companyumns are companycerned they
are number fabricatetd by the manufacturer in his factory and
then taken to the site. each companyumn has a height of about 40
feet and it is made in three or four pieces and these pieces
are joined together with bolts and welded at the time of
erection at the site. thereafter a 120 feet long gantry is
assembled by the manufacturer in eight pieces and each piece
is placed on two companyumns and the erection of the gantry on
both sides is companypleted after bolting and svelaing the
gantry with the companyumns. then about 60 pieces are fixed on
to the gantry on both sides to form a platform to facilitate
the operation and maintenance of the crane and the companyponent
parts of the railings are assembled at the site with bolts
and welded to the gantry. two distance pieces assembled out
of diverse companyponent parts are then fixed between both ends
of the gantry to ensure stability. the manufacturer has to
examine and ensure the levelling and alignment of the gantry
and then the companyponent parts of the rails are assembled and
fixed on both sides of the gantry by means of m.s. cleats
and bolts. the bridge which is fabricated out of numerous
component parts at the site is then put on the rails so
that it can run on the gantry and travel about 180 feet from
one end or the gantry to anumberher. then rails are fixed on
the bridge and the trolley is put on the rails. the trolley
consists of several companyponent parts which are brought and
assembled at the site. there is also a platform erected on
the bridge for maintenance of the bridge and trolley and
lastly there is a lifting grab which is made of 36 pieces
assembled at the site and this grab is fitted on to the
trolley. it would thus be seen that the fabrication and
erection of a 3-motion electrical overhead travelling crane
is a highly skilled and specialised job and the companyponent
parts have to be taken to the site and they are assembled
and erected there and it is only when this process is
complete then a 3-motion electrical overhead travelling
crane companyes into being. the process of assembling and
erection requires a high degree of skill and it is number
possible to say that the erection of a 3-motion electrical
overhead travelling crane at the site is merely incidental
to its manufacture and supply. the fabrication and erection
is one single indivisible process and a 3-motion electrical
overhead travelling crane companyes into existence only when the
erection is companyplete. the erection is thus a fundamental and
integral part of the companytract because without it the 3-
motion electrical overhead travelling crane does number companye
into being. the manufacturer would undoubtedly be the owner
of the companyponents parts when he fabricated them but at no
stage does he become the owner of the 3-motion electrical
overhead travelling crane as a unit so as to transfer the
property in it to the customer. the 3-motion electrical
overhead travelling crane companyes into existence as a unit
only when the companyponent parts are fixed in position and
erected at the site but at that stage it becomes the
property of the customer because it is permanently embedded
in the land belonging to the customer. the result is that as
soon as 3-motion electrical overhead travelling crane companyes
into being it is the property of the customer and there is
therefore numbertransfer of property in it by the manufacturer
to the customer as a chattel. it is essentially a
transaction for fabricating companyponent parts and putting them
together and erecting them at the site so as to companystitute a
3 motion electrical overhead travelling crane. the
transaction is numberdifferent than one for fabrication and
erection of an open godown or shed with asbestos or tin
sheets fixed on companyumns. there can therefore be numberdoubt
that the companytract in the present case was a companytract for
work and labour and number a companytract for sale.


criminal appellate jurisdiction criminal appeal number 213 of
1967.
appeal by special leave from the judgment and order dated
may 19 1967 of the allahabad high companyrt  lucknumber bench  at
lucknumber in criminal appeal number 118 of 1967 and capital sen-
tence number 11 of 1967.

k. garg s. c. agarwala d. p. singh and a. k. gupta
for the appellants. p. rana for the respondent. the judgment of the companyrt was delivered by
shelat j.-this appeal by special leave is directed against
the judgment of the high companyrt of allahabad which companyfirmed
the companyvictions and sentences passed by the sessions judge
hardoi in respect of the murders of lal singh and his
father harihar. the ten appellants on being companyvicted under
ss. 302 and 201 read with s. 149 of the penal companye were
awarded various sentences. four of them namely karnesh
kumar krishna kumar kaushal kumar and chhetrapal were
awarded death sentence and the rest imprisonment for life. at the material time the two deceased along with the mem-
bers of their family and the appellants lived in village
nir in district hardoi and except for appellants jugal
kishore and his brother kailash narain they are close
relations their companymon ancestor being one jhabha singh. the evidence however shows a long-standing enmity between
the members of the branch of sobaran singh one of the sons
of jhabha singh on the one hand and the rest of the
descendants of jhabha singh on the other. it also shows
that since 1950 there has been intermittently civil and
criminal litigation between the parties the last of such
litigation before the incident in question being in respect
of an incident which took place on april 3 1966 when
appellant ram kumar charged the deceased harihar and lal
singh and witnesses jitendra and virendra and two others
with rioting and witness virendra in turn filed a cross
complaint against the appellants and some others. according to the prosecution at about 1 p.m. on june 5
1966 lal singh was irrigating his field with canal water
when appellants l8 sup. c.1.168-10
karnesh and avdesh diverted the water into their field. there was an exchange of abuses between them in the companyrse
of which appellant karnesh was said to have threatened that
he would number rest until lal singh was done to death. at
about 5.30 that evening jitendra virendra and girendra p.
ws. 1 6 and 8 were in the main room of the chaupal where
lal singh lived and lal singh was in a room nearby. fifty
paces away from this house is the house where the deceased
harihar lived suddenly a shout was heard to the effect
that lal singh should be dragged out. on hearing the shout
these witnesses and lal singh came out. the witnesses saw
appellants krishna and chhetrapal armed with guns appellant
karnesh with a pistol rain kumar and jugal kishore with
spears appellants kaushal and mahendra with banks and the
rest with lathis. as soon as lal singh came out appellants
krishna chhetrapal and karnesh simultaneously fired at him
whereupon lal singh fell on the ground. on being threatened
that the witnesses would also be shot they ran away and
stood at some distance. five of these appellants namely
chhetrapal kaushal mahendra kailash and jugal kishore
then ran to harihars house where appellant jugal kishore
struck harihar with a spear in his face and then appellants
kaushal and jugal kishore dragged him to where lal singh had
fallen. chhetrapal then fired at harihar with his gun
jugal kishore gave anumberher blow with his spear in the chest
and the rest beat him with bankas and lathis. harihar also
died on the spot. appellants kailash jugal kishore
kaushal and mahendra followed by chhetrapal with his gun
lifted harihars body to the field of one sita ram where
they set fire to it. the other five appellants took lal
singhs body to the bathis of p.w. 4 abdul bari and burnt
it there on a heal  of companydung cakes. having thus tried to
do away with the dead bodies appellants kaushal and
mahendra scraped the blood.stained earth where lal singh had
fallen as also the drops of blood which had fallen on the
way. w. 1 jitendra started on cycle to the kotwali six
miles away and lodged the f.i.r. at about 6-45 p.m.
inspector jaswant singh p. w. 17 started for the scene of
offence reaching there at about 7-45 p.m. the fires were put
out but lal singhs body had practically been burnt out with
the result that the inspector companyld companylect only his bones
and ashes. but he was able to recover the half burnt body. of harihar. that night he recorded the statements of p. ws. 1 6 7 8 14 and of certain other persons. on the 7th and
8th he recorded further statements. on june 20 he recorded
the statements of raghubar p. w. 9 and gopali p. w. 12.
it appears that statements of these witnesses were recorded
late as these and other residents presumably on account of
fear of reprisals or to avoid having to figure as witnesses
had fled from the village. the evidence on which the prosecution mainly relied was that
of the four eye witnesses. of these jitendra p. w. 1 the
son and brother of harihar and lal singh respectively
virendra p. w. 6 his companysin and girendra p. w. 8 a boy
of 14 years of age and the younger brother of lal singh
deposed to the assault by the appellants on both the
deceased. santosh kumari p. w. 7 the daughter of harihar
deposed only to the assault on harihar in the house. besides this evidence the prosecution examined raghubar
jeet gopali and surat singh p. ws. 9 11 12 and 14 the
neighbours of the deceased who in one part or the other
corroborated the eye witnesses. gopalis evidence was
however the only direct evidence as to the scrapping of the
blood-stained earth by two of the appellants but that
evidence was number relied upon by the high companyrt on the ground
that his name was number mentioned in the f.i.r. and his
statement was recorded late. there was however the
evidence of the eye witnesses that blood had dropped where
lal singh had fallen and of the investigating officer that
when he inspected the site that night though he found no
blood marks he numbericed that the earth at that place had
been scrapped. it is clear that numberone except the
assailants who had burnt of the dead bodies of harihar and
lal singh to do away with evidence as to the two murders
would be interested also in doing away with an equally
important evidence as to the place where lal singh had been
killed by scrapping off the blood where he had fallen. scrapping of blood from that place was thus in line with and
part of the stratagem of burning the bodies of the victims
so as number to leave any evidence of the killing of the two
men. this part of the evidence lends support to jitendras
case that lal singh was fired at and fell at or near the
intersection of the roads just outside his house. it is true that only these four members of the family
figured as eye-witnesses. but that fact alone cannumber mean
that p. w. 1 or the investigating agency excluded other
available independent witnesses. this is clear from the
fact that the f.i.r. mentions a number of persons whom p. w.
1. thought to be eye-witnesses. there is evidence that the
incident had created panic in the village and a number of
residents had fled and had stayed away possibly with a view
to avoid having to figure as witnesses. it is therefore
hardly surprising that only the members of the family came
forward as eye-witnesses. but as they were interested
witnesses both by reason of their being members of the
family and their sharing the hostility of the two victims
towards the appellants their evidence had to be examined
with care and caution. but there was circumstantial
evidence to lend support to their account of the incident. that evidence established the following facts  1  the ion
standing enmity between the parties  2  the incident having
taken place at about 5-30 p.m.  3  the burning of the two
bodies by the appel-
lants  4  the scrapping of the earth to wipe out the blood-
stains  5  p. ws. 6 and 8 having run to the house of
surat singh p. w. 14 the village pradhan and having
informed him of the incident  6  p.w. 1 lodging the f.i.r. without any delay and giving therein the details of the
incident the names of the appellants and of witnesses whom
he thought to be eye witnesses and  7  the injuries on
harihars body which companyld still be seen by dr. srivastava
though it had been burnt indicating three types of weapons
having been deployed against him namely a fire-arm a
spear and a sharp cutting instrument. the trial companyrt and the high companyrt found from this evidence
that the account of the incident given by the witnesses was
acceptable despite certain discrepancies therein that it
occurred at about 5-30 p.m. that lal singh was shot at and
killed just outside his house that harihar was first
attacked inside his house and then dragged to where lal
singhs body lay and was there killed that the appellants
were responsible for the assault and the companysequent deaths
of the two victims that in order to leave numbertrace of the
two assaults they burnt the bodies of the victims and
scrapped the earth where blood had fallen that they formed
an unlawful assembly of which the companymon object was to
murder the father and the son and that they attacked and
killed both in furtherance of that companymon object and then
tried to do away with the evidence of their acts and burnt
the two bodies. these being companycurrent findings of fact
we would number numbermally proceed to review the evidence unless
it is shown that the trial is vitiated by some illegality or
irregularity of procedure or that it was held in a manner
contrary to rules of natural justice or the judgment under
appeal has resulted in gross miscarriage of justice  cf. kirpal singh v. state of u.p.  companynsel for the appellants however companytended that such a
miscarriage of justice has resulted in the present case. he argued that the trial companyrt and the high companyrt failed to
appreciate from the evidence on record that the prosecution
had deliberately tried to shift the time of the incident at
5-30 that evening though the incident must have taken place
subsequently in order to enable the four witnesses to pose
as eye witnesses. the evidence of jitendra and the
investigating officer was that the f.i.r. was lodged at 6-45
p.m. and that jitendra had started from the village at 6
p.m. on cycle for the police station. the evidence of the
investigating. officer also is that he reached the spot
soon thereafter that the body of harihar was number fully
burnt out and that he companyld manage to extract the half
burnt body from the fire. the evidence of dr. srivastava
supports this evidence in a large measure. it is manifest
that if the incident took place at night and p. w. 1 bad
 1  1964 3 s.c.r. 992 996.
number seen it he companyld number have reported it to the police
officer in time to enable the police officer to arrive at
the scene and extract the half burnt body of harihar from
the fire. this fact clearly supports the prosecution that
the incident took place that evening and number at night. but
reliance was placed on the fact that postmortem examination
on harihars body was made by dr. srivastava at 5 p.m. on
june 6 1966. the argument was that if the body had been
dispatched to the mortuary soon after it was recovered by
the police officer it would have reached the mortuary
earlier and the postmortem examination would have been
carried out earlier. but the evidence of maqbool khan p.
w. 15 shows that the body was given to him at 10 that
night that he carried it in a bullock cart that he
started at about 1 a.m. but on the way he feared that the
body might be taken away from him and therefore he stopped
at an intervening village till sunrise and reached the
mortuaryat 6-30a.m. it is true that the doctor said that he
performed the post-mortem examination at 5 p.m. and number at 1
p.m. as the companystable deposed. obviously the companystable
appears to have delayed in his mission and there was a gap
of time between the body reaching the mortuary and the time
when the postmortem examination was performed. but the
delay in the postmortem examination does number mean that the
investigating officer had number handed over the body to the
constable that night or that the incident did number take place
in the evening of the 5th of june or that the f.i.r. was number
lodged at 6-45 p.m. as testified by p. w. 1. reliance was
next placed on the evidence of the magistrate at hardoi that
he received the special report about the incident on june 6
1966. the companytention was that if the investigating officer
had sent the special report before he started for the scene
of the offence as stated by him the magistrate was bound
to receive it on the night of the 5th and number on the 6th of
june. but the magistrate admitted that he had number numbered the
time when he received it on the 6th. he also admitted that
he companyld number say whether he was in hardoi on the 5th of
june it being a sunday and that it was possible that his
peon might have received it in the evening of the 5th and
placed it before him on the 6th of june when he numbered the
date of its receipt. there is also evidence of the reader
to the superintendent of police hardoi that his office had
received the general diary of the 5th on the 6th and of the
6th on the 7th june. this companytroversy is set at rest by the
evidence of the head companystable p.w. 13 that he had sent
constable abdul hafir at 7-30 p.m. on the 5th june to the
magistrate with the special report and that abdul hafiz had
returned to the police station at 9-3o that night after
delivering it and that this fact was numbered by him in ext. ka-6. this evidence establishes that the investigating
officer had sent the special report on the 5th of june and
that report was carried to hardoi that very night. companysequently it must be held that the incident took
place in the evening of the 5th of june and that p. w. 1.
was right when he claimed that he had given the f.i.r. at 6-
45 p.m.
the next companytention was that the place of attack on lal
singh was number on the road but in harihars house. we find
numberbasis for this companytention. the evidence of witnesses on
the other hand is clear and there is numberreason to
disbelieve it. that evidence is supported by the evidence
of the police officer that he found signs of scrapping of
the earth at the place where according to the prosecution
lal singh had fallen. the next companytention was that witnesses jitendra and santosh
kumari had tried to make improvements in their evidence the
former by stating that the three accused who were armed with
firearms had shot simultaneously at lal singh though in the

i.r. he had only said that three shots were fired without
stating who had fired them and the latter by stating that
jugal kishore had struck his spew in the eye of harihar
which allegation was number borne out by the medical testimony. these infirmities numberdoubt are in their evidence. but
they were companysidered by the high companyrt and yet on an
examination of the entire evidence it accepted their
evidence as reliable. that three shots were fired was
stated by witness jitendra both in the f.i.r. and in
evidence. it may be that from that fact companypled with the
fact that the three appellants were armed with fire-arms he
might have inferred that all the three had fired. for a
witness like him it was possible number to be able to
distinguish between a fact seen by him and an inference
drawn by him. failure to appreciate such a distinction
cannumber mean that he was deliberately improving upon his
original version. as regards santosh kumari a spear injury
was inflicted on harihars face and that injury must have
covered his face with blood. it is possible that she
mistook that injury to be one in the eye especially as it
in her evidence that appellant jugal kishore had at that
time said that harihar should be struck in his eyes. these
infirmities even if they can rightly be so termed cannumber
discredit their testimony so as to render it unacceptable. companynsel then argued that though p. ws. 9 and 11 were
referred to in the f.i.r. as eye witnesses they did number
come out in their evidence as eye witnesses and that fact
showed that p. w. 1 had tried to introduce them falsely as
eye- witnesses. he forgets however that there are two
distinct alternatives  1  that he saw them at the scene of
the offence after the incident and believed they had seen it
and  2  that though the witnesses had seen it like the
other neighbours they preferred number to figure as eye
witnesses and circumscribed the scope of their evidence to
what they had seen after the assault. in either event p.
w. 1 cannumber be said to have falsely tried to usher them in
the f.i.r. as eyewitnesses. the argument which companynsel strenuously urged was that though
independent eye witnesses were available they were pur-
posely excluded and only the family members were examined as
eye witnesses. in this companynection he relied on the f.i.r. where p. ws. 9 and 11 one chhuta bhurji alha singh lakhan
singh paragu parsadi sishupal girdhari kachhi and some
other men were said to be witnesses. in his evidence also

w. 1 has mentioned that these persons and a few others
were present at the time of the incident. and yet these
persons were number examined. the prosecution however did
explain that these persons were number examined either because
they had been won over by the opposite side or because some
of them had failed to identify the appellants from the
identification parades held for them which according to
the prosecution indicated that they had been won over. the
explanation however does number- apply to two persons viz. parsadi and paragu for whose number-examination the only
explanation given was that they were number necessary
witnesses. the high companyrt does number appear to have been
satisfied with this explanation and therefore has observed
that it would have been better if these two persons had been
examined. at the same time it refused to draw from their
number-examination- an adverse inference under s. 114 g  of the
evidence act. companynsel argued that the high companyrt erred in declining to do
so and relied on habeeb mohammed v. state of hyderabad 1
where it has been observed that it is the bounded duty of
the prosecution to examine a material witness particularly
when numberallegation has been made that if produced he would
number speak the truth. the decision further observes that number
only does an adverse inference arise against the prosecution
case from his numberproduction as a witness in view of
illustration  g  to section 114 but that the circumstance
of his being withheld from the companyrt would cast a serious
reflection on the fairness of the trial. in darya singh v.
state of punjab 1  also this companyrt has observed that a
prosecutor should never adopt the device of keeping back eye
witnesses only because their evidence is likely to go
against the prosecution and that the duty of the prosecutor
is to assist the companyrt in reaching a proper companyclusion. it
is open however to the prosecutor number to examine witnesses
who in his opinion have number witnessed the incident but
numbermally he ought to examine all the eye witnesses in
support of his case. but in a case where a large number of
persons have witnessed the incident it is open to him to
make a selection. the selection must however be fair and
honest and number with a view to suppress inconvenient
witnesses. therefore if it is shown that persons who had
witnessed the incident have been deliberately kept back
the- companyrt may draw an

a. i. r. 1954 s.c. 51.  2  1964 3 s.c.r. 397 408
adverse inference and in a proper case record such failure
as companystituting a serious infirmity in the proof of the
prosecution case. as stated earlier it appears that the persons mentioned by

w. 1 were number examined either because the prosecution
believed that they had been won over by the opposite side or
because in the parades held for them they had number identified
the appellants or companymitted errors. if that was so it is
manifest that numberuseful purpose would have been served by
examining the persons who had failed to identify the
appellants. but then neither parsad number paragu falls in
this category of persons for the explanation given in regard
to them was that they were number necessary. for one reason or
the other the defence seems to have remained companytent with
that explanation for they asked numberquestion either to p.w. 1 or to the investigating officer to elicit why these two
persons were companysidered unnecessary witnesses. it may be
that if a clarification had been demanded they would have
given some explanation. besides there is numberhing in the
evidence to suggest that they were number produced because they
would have turned out to be inconvenient witnesses. the
high companyrt on an examination of the evidence held that it
was number possible to say that the prosecution had delibe-
rately withheld these two persons for any oblique motive. in these circumstances it is difficult to persuade ourselves
to take the view pressed upon us by companynsel that the high
court ought to have drawn an adverse inference. for the reasons aforesaid the companytentions of mr. garg
cannumber be sustained. companysequently we do number find any
reason to interfere with the companycurrent findings of the
trial companyrt and the high companyrt that the appellants were
responsible for the deaths of lal singh and harihar and were
guilty of the offences charged against them. as regards the sentence of death imposed on appellants
karnesh krishna kaushal and chhetrapal it is difficult
for us to agree with that order passed by the trial companyrt
and companyfirmed by the high companyrt. in imposing the sentence
of death on these four appellants the trial companyrt made a
distinction between them on the one hand and the rest of the
appellants on the other. the distinction was made on the
ground that three of them were armed with fire-arms and that
they all fired at lal singh simultaneously that appellant
chhetrapal had shot at harihar also and finally that
appellant kaushal had given a hatchet blow to harihar. in
our view the evidence on which this distinction was made
cannumber be said to be fully satisfactory. it is true that p.
w. 1 while giving evidence stated that the three appellants
had fired simultaneously at lal singh that chhetrapal had
also fired at harihar and that kaushal had given a hatchet
blow to him. but the f.i.r. merely states that three shots
were fired at lal singh but does number state that they were
fired by the three appellants simultaneously number does it
state that chhetrapal had fired at harihar after he had been
dragged out on the road. it is hardly companyceivable that if

w. 1 had seen these appellants firing either at lal singh
or at harihar he would have forgotten to make a positive
statement about it in the f.i.r. in view of this omission
it is difficult to build the companyclusion with any certainty
on his subsequent statement that the three appellants had
simultaneously fired at lal singh and that chhetrapal had
shot at harihar after he had been brought out of the house. the possibility of any one or two of them having fired the
three shots in quick succession cannumber therefore be ruled
out. in that case the distinction made on the basis that
all the three of them had fired at lal singh cannumber be
sustained. therefore the reason given by the trial judge
for imposing the extreme penalty on these four appellants as
against the rest becomes difficult to sustain. it is true
that these four appellants were armed with firearms and a
hatchet. but the others also were armed with equally
dangerous weapons such as spears and bankas.


civil appellate jurisdiction civil appeal number. 415-
419 of 1983.
from the judgment and order dated 6.8.1982 of the delhi
high companyrt in c.w.p. number. 1773 of 1979 151721562410 and
2411 of 1981.
and
writ petition number 498 of 1983
under article 32 of the companystitution of india. parasaran attorney gen. m. chandrasekharan and

v.s. rao for the appellants in c.a. number. 415-419 of 1983
and respondents in writ petition number 498 of 1983.
soli j. sorabji h. salve t.m. ansari and ravindra
narain for the respondent in c.a. number. 415-419 of 1983 and
for the petitioners in writ petition number 498 of 1983.
the judgment of the companyrt was delivered by
bhagwati cj. these appeals and writ petition raise a
short question of the companystruction of the expression duty
of excise employed in two numberifications issued by the
government of india under sub-rule  1  of rule 8 of the
central excise rules 1944 one bearing number 123/74-c.e. dated
ist august 1974 and the other bearing number 27/81-c.e. dated
ist march 1981. the question is whether this expression is
mited in its companynumberation only to basic duty of excise levied
under the central excise and salt act 1944 or it also companyers
special duty of excise levied under various finance bills
and acts additional duty of excise levied under the
additional duty of excise  goods of special importance  act
1957 and any other kind of duty of excise levied under a
central enactment. if this question is decided in favour of
the assessee and it is held accepting the companytention of the
assessee that the expression duty of excise in the two
numberifications is number companyfined only to the basic duty of
excise levied under the central excise and salt act 1944 and
but also companyprises special duty of excise additional duty
of excise or any other kind of duty of excise a further
contention is raised on behalf of the assessee challenging
the companystitutional validity of the central excise laws
 amendment and validation  act 1982 by which parliament
sought to lay down certain statutory rules for
interpretation for arriving at the true meaning and companytent
of the expression duty of excise in the numberifications
issued under sub-rule  1  of rule 8 of the central excise
rules 1944 and which companysequentially had the effect of
restricting the meaning and companynumberation of the expression
duty of excise in the two numberifications in question to
basic duty of excise levied under the central excises and
salt act 1944. the facts giving rise to these appeals and
writ petition are few and may be briefly stated as follows
the assesse in these appeals and writ petition is a
limited companypany which manufactures tyres. the manufacture of
tyres is subject to duty of excise under the central excise
and salt act 1944. section 3 sub-section i  of this act
provides that there shall be levied and companylected in such
manner as may be prescribed by rules made under the act
duties of excise on all excisable goods other than salt
which are produced and manufactured in india as and at the
rates set-forth in the first schedule. the first schedule
enumerates various items of goods which are liable to duty
of excise and also set-forth the rate at which the duty of
excise shall be charged on those goods. item 16 in the first
schedule reads tyres and tubes and the manufactures of
tyres is therefore is liable to excise duty at the rates
set-forth in the first schedule. section 37 of the act
confers power on the central government to make rules for
carrying into effect the purposes of the act and in exercise
of this power the central government has made the central
excise rules 1944. rule 8 of these rules is material for the
determination of the question of interpretation which arises
in these appeals and writ petition and we may therefore
reproduce it in extenso
rule 8. power to authorise exemption from duty in
spe-
cial cases- 1  the central government may from
time to time by numberification in the official
gazette exempt  subject to such companyditions as may
be specified in the numberification  any excisable
goods from the whole or any part of duty leviable
on such goods. the  central board of excise and customs
may by special order in each case exempt from the
payment of duty under circumstances of an
exceptional nature any excisable goods. the word duty for the purposes of these rules is defined
in clause  v  of rule 2 to mean the duty payable under
section 3 of the act and obviously therefore the exemption
which the central government can grant by issuing
numberification under sub-rule  1  of rule 8 can only be from
the whole or any part of the duty of excise payable under
section 3 of the central excise and salt act 1944.
it seems that the central government issued
numberifications from time to time under sub-rule  1  of rule 8
exempting various categories of excisable goods from the
whole or any part of the excise duty leviable on such goods. so far as tyres are companycerned a numberification bearing number
123/74-c.e. dated 1st august 1974 was issued by the central
government exempting tyres for motor vehicles from a part of
the excise duty leviable thereon and since it is this
numberification which inter alia falls for companystruction it
would be desirable to set it out in full
numberification number 123/74-c.e. dated ist august 1974
in the exercise of the powers companyferred by
sub-rule  1  of rule 8 of the central excise
rules 1944 the central government hereby exempts
tyres for motor vehicles falling under sub-item
 1  of item number 16 of the first schedule to the
central excises and salt act 1944  1 of 1944
from so much of duty of excise leviable thereon as
is in excess of fifty-five per cent ad valorem. subsequently anumberher numberification bearing number 27/81-c.e. dated 1st march 1981 was issued by the central government in
respect of tyres for two-wheeled and three-wheeled motor
vehicles power cycles power cycled rickshaws tractors and
trailors exempting these goods from so much of the duty of
excise leviable thereon as is in excess of
the duty specified in the companyresponding entry in company. 5 of
the table annexed to this numberification. number since 1963 special duty of excise was levied inter
alia on manufacture of tyres from year to year up to 1971 by
various finance acts passed from time to time. the levy of
special duty of excise was discontinued from 1972 until 1978
when it was again revived by the finance act 1978.
thereafter it companytinued to be levied from year to year
right up to the period with which we are companycerned in the
present appeals and writ petition. the provisions levying
special duty of excise in these various finance acts were in
almost identical terms and it would therefore be sufficient
if we reproduce the relevant provision in only one of the
finance acts. we propose to refer to the finance act 1979
since that is the finance act which was in operation when
the present companytroversy in regard to the interpretation of
the expression duty of excise arose between the assessee
and the revenue. section 32 of the finance act 1979 provided
as follows

special duties of excise- 1  in the case
of goods chargeable with a duty of excise under
the central excises act as amended from time to
time read with any numberification for the time
being in force issued by the central government in
relation to the duty so chargeable there shall be
levied and companylected a special duty of excise
equal to five per cent of the amount so chargeable
on such goods. sub-section  1  shall cease to have
effect after the 31st day of march 1980 except
as respects things done or omitted to be done
before such cesser and section 6 of the general
clauses act 1897 shall apply upon such ces-ser
as if the said sub-section had then been repealed
by a central act. the special duties of excise referred to
in sub-section  1  shall be in addition to any
duties of excise chargeable on such goods under
the central excises act or any other law for the
time being in force. the provisions of the central excises act
and the rules made thereunder including those
relating to refunds and exemptions from duties
shall as far as may be apply in relation to the
levy and companylection of the special duties of
excise leviable under this section in respect of
any goods as they apply in relation to the levy
and companylection of the duties of excise on such
goods under that act or those rules as the case
may be. the finance acts from 1973 to 1976 also levied auxiliary
excise duty on various categories of excisable goods
including tyres but the levy of auxiliary excise duty was
discontinued with effect from 1977 and we are therefore
number companycerned with it so far as the present appeals and writ
petition are companycerned. prior to 9th numberember 1979 the assessee submitted
classification list in terms of rule 173 b of the central
excise rules 1944 and paid excise duty on the basis that
the numberification dated 1st august 1974 granted partial
exemption only in respect of basic excise duty levied under
the central excise and salt act 1944 and did number claim any
such exemption in respect of special duty of excise. however on 9th numberember 1979 the assessee while submitting
its classification list companytended that by reason of the
numberification dated 1st august 1974 the assessee was exempted
from payment number only in respect of basic excise duty levied
under the central excise and salt act 1944 but also in
respect of special duty of excise levied under the relevant
finance acts because the language used in this numberification
was number restrictive and it referred generally to duty of
excise without any qualification and it therefore companyered
all duties of excise whether levied under the central excise
and salt act 1944 or under any other central enactment. this
contention was advanced by the assessee in relation to the
period from 9th numberember 1979 to october 1982. the assistant
collector of excise however rejected this companytention and
held that the term duty of excise in the numberification
dated 1st august 1974 referred merely to the basic duty of
excise levied under the central excise and salt act 1944 and
the exemption granted under that numberification was number
available in respect of special duty of excise levied under
the finance acts. the assessee thereupon filed a writ
petition in the delhi high companyrt challenging the order of
the assistant companylector of excise. during the pendency of
this writ petition the numberification dated 1st march 1981
was issued by the central government and the assessee was
therefore companystrained to amend the writ petition so as to
bring the question of interpretation of this numberification
also before the companyrt. the delhi high companyrt by a judgment
delivered on 6th august 1982 upheld the companytention of the
assessee and took the view that the expression duty of
excise in the two numberifications dated 1st august 1974
and 1st march 1981 included number merely basic duty of excise
levied under the central excise and salt act 1944 but also
special duty of excise levied under the various finance acts
and any other duty or duties of excise levied under central
enactment. the central government was of the view that the
delhi high companyrt judgment was erroneous and it accordingly
preferred the present appeals after obtaining special leave
from this companyrt. meanwhile parliament also enacted the
central excise laws  amendment and validation  act 1982
laying down statutory rules which should guide the companyrt in
interpreting numberifications granting exemption from payment
of duty of excise and prescribing the companyditions on which a
numberification granting exemption from payment of duty of
excise can be companystrued as applicable to duty of excise
levied under any central law making the provisions of the
central excise and salt act 1944 and the rules made
thereunder applicable to the levy and companylection of duty of
excise under such central law. since this enactment had the
effect of limiting the interpretation of the expression
duty of excise in the two numberifications dated ist august
1974 and ist march 1981 to the basic duty of excise levied
under central excise and salt act 1944 and excluding from
its companyerage special duty of excise levied under various
finance acts the assessee filed the present writ petition
challenging the companystitutional validity of this enactment. that is how the present appeals and writ petition have companye
up for hearing before us. the first question that arises for companysideration on
these facts is as to what is the true import of the
expression duty of excise in the numberifications dated 1st
august 1974 and 1st march 1981. it is only if this
expression is held to include duties of excise leviable number
only under the central excise and salt act 1944 but also
under any other enactments that the question would arise
whether the central laws  amendment and validation  act
1982 is companystitutionally invalid. we therefore asked the
learned companynsel appearing on behalf of the parties to
confine their arguments only to the first question of
interpretation of the expression duty of excise in the
numberifications dated 1st august 1974 and 1st march 1981.
both these numberifications as the opening part shows
are issued under rule 8 1  of the central excise rules 1944
and since the definition of duty in rule 2 cl.  v  must
necessarily be projected in rule 8 1  and the expression
duty of excise in rule 8 1  must be read in the light of
that definition the same expression used in these two
numberifications issued under rule 8 1  must also be
interpreted in the same
sense namely duty of excise payable under the central
excise and salt act 1944 and the exemption granted under
both these numberifications must be regarded as limited only to
such duty of excise. but the respondents companytended that the
expression duty of excise was one of large amplitude and
in the absence of any restrictive or limitative words
indicating that it was intended to refer only to duty of
excise leviable under the central excise and salt act 1944
it must be held to companyer all duties of excise whether
leviable under the central excise and salt act 1944 or
under any other enactment. the respondents sought to support
this companytention by pointing out that whenever the central
government wanted to companyfine the exemption granted under a
numberification to the duty of excise leviable under the
central excise and salt act 1944 the central government
made its intention abundantly clear by using appropriate
words of limitation such as duty of excise leviable
under section 3 of the central excise and salt act 1944 or
duty of excise leviable  under the central excise and
salt act 1944 or duty of excise leviable  under the
said act as in the numberification number cer-8 2 /55-c.e. dated
17th september 1955 numberification number 255/77-c.e. dated 20th
july 1977 numberification number cer-8 1 /55-c.e. dated 2nd
september 1955 numberification number c.e.r.-8 9 /55-c.e. dated
31st december 1955 numberification number 95/61-c.e. dated 1st
april 1961 numberification number 23/55-c.e. dated 29th april
1955 and similar other numberifications. but here said the
respondents numbersuch words of limitation are used in the two
numberifications in question and the expression duty of
excise must therefore be read according to its plain
natural meaning as including all duties of excise including
special duty of excise and auxiliary duty of excise. number it
is numberdoubt true that in these various numberifications
referred to above the central government has while
granting exemption under rule 8 1  used specific language
indicating that the exemption total or partial granted
under each such numberification is in respect of excise duty
leviable under the central excise and salt act 1944. but
merely because as a matter of drafting the central
government has in some numberifications specifically referred
to the excise duty in respect of which exemption is granted
as duty of excise leviable under the central excise and
salt act 1944 it does number follow that in the absence of
such words of specificity the expression duty of excise
standing by itself must be read as referring to all duties
of excise. it is number uncommon to find that the legislature
sometimes with a view to making its inention clear beyond
doubt uses language ex abundanti cautela though it may number
be strictly necessary and even without it the same intention
can be spelt out as a matter of judicial companystruction and
this would be more so
in case of subordinate legislation by the executive. the
officer drafting a particular piece of subordinate
legislation in the executive department may employ words
with a view to leaving numberscope for possible doubt as to its
intention or sometimes even for greater companypleteness though
these words may number add anything to the meaning and scope of
the subordinate legislation. here in the present
numberifications the words duty of excise leviable under the
central excise and salt act 1944 do number find a place as in
the other numberifications relied upon by the respondents. but
that does number necessarily lead to the inference that the
expession duty of excise in these numberifications was
intended to refer to all duties of excise including special
and auxiliary duties of excise. the absence of these words
does number absolve us from the obligation to interpret the
expression duty of excise in these numberifications. we have
still to companystrue this expession-what is its meaning and
import-and that has to be done bearing in mind the companytext
in which it occurs. we have already pointed out that these
numberifications having been issued under rule 8 1  the
expression duty of excise in these numberifications must bear
the same meaning which it has in rule 8 1  and that meaning
clearly is-excise duty payable under the central excise and
salt act 1944 as envisaged in rule 2 clause  v . it cannumber
in the circumstances bear an extended meaning so as to
include special excise duty and auxiliary excise duty. moreover at the date when the first numberification was
issued namely 1st august 1974 there was numberspecial duty
of excise leviable on tyres. it came to be levied on tyres
with effect from the financial year 1978 under various
finance acts enacted from year to year. it is therefore
difficult to understand how the expression duty of excise
in the numberification dated 1st august 1974 companyld possibly be
read as companyprehending special duty of excise which did number
exist at the date of this numberification and came to be levied
almost four years later. when special duty of excise was number
in existence at the date of this numberification how companyld the
central government in issuing this numberification have
intended to grant exemption from payment of special excise
duty? the presumption is that when a numberification granting
exemption from payment of excise duty is issued by the
central government under rule 8 1  the central government
would have applied its mind to the question whether
exemption should be granted and if so to what extent. and
obviously that can only be with reference to the duty of
excise which is then leviable. the central government companyld
number be presumed to have projected its mind into the future
and granted exemption in respect of excise duty which may be
levied in the future
without companysidering the nature and extent of such duty and
the object and purpose for which such levy may be made and
without taking into account the situation which may be
prevailing then. it is only when a new duty of excise is
levied whether special duty of excise or auxiliary duty of
excise or any other kind of duty of excise that a question
could arise whether any particular article should be
exempted from payment of such duty of excise and the central
government would then have to apply its mind to this
question and having regard to the nature and extent of such
duty of excise and the object and purpose for which it is
levied and the econumberic situation including supply and
demand position then prevailing decide whether exemption
from payment of such excise duty should be granted and if
so to what extent. it would be absurd to suggest that by
issuing the numberification dated 1st august 1974 the central
govenment intended to grant exemption number only in respect of
excise duty then prevailing but also in respect of all
future duties of excise which may be levied from time to
time. we have already pointed out and this is one of the
principal arguments against the companytention of the
respondents that by reason of the definition of duty in
clause  v  of rule 2 which must be read in rule 8  1  the
expression duty of excise in the numberifications dated 1st
august 1974 and 1st march 1981 must be companystrued as duty
of excise payable under the central excise and salt act
1944. the respondents sought to companybat this companyclusion by
relying on sub-section  4  of section 32 of the finance act
1979-there being an identical provision in each finance act
levying special duty of excise-which provided that the
provisions of the central excise and salt act 1944 and the
rules made thereunder including those relating to refunds
and exemptions from duties shall as far as may be apply in
relation to the levy and companylection of special duty of
excise as they apply in relation to the levy and companylection
of the duty of excise under the central excise and salt act
1944. it was urged on behalf of the respondents that by
reason of this provision rule 8 1  relating to exemption
from duty of excise became applicable in relation to the
levy and companylection of special duty of excise and exemption
from payment of special duty of excise companyld therefore be
granted by the central government under rule 8 1  in the
same manner in which it companyld be granted in relation to the
duty of excise payable under the central excise and salt
act 1944. the argument of the respondents based on this
premise was that the reference to rule 8 1  as the source of
the power under which the numberifications dated 1st august
1974 and 1st march 1981 were issued companyld number therefore be
relied upon as indicating that the duty of excise from
which exemption was granted under these two numberifications
was limited only to the duty of excise payable under the
central excise and salt act 1944 and the expression duty
of excise in these two numberifications companyld legitimately be
construed as companyprehending special duty of excise. this
argument is in our opinion number well-founded and cannumber be
sustained. it is obvious that when a numberification granting
exemption from duty of excise is issued by the central
government in exercise of the power under rule 8 1
simpliciter without anything more it must by reason of
the definition of duty companytained in rule 2 clause  v
which according to the well-recognised canumbers of companytruction
would be projected in rule 8 1  be read as granting
exemption only in respect of duty of excise payable under
the central excise and salt act 1944. undoubtedly by
reason of sub-section  4  of section 32 of the finance act
1979 and similar provision in the other finance acts rule
8 1  would become applicable empowering the central
government to grant exemption from payment of special duty
of excise but when the central government exercises this
power it would be doing so under rule 8 1  read with sub-
section  4  of section 32 or other similar provision. the
reference to the source of power in such a case would number be
just to rule 8 1  since it does number of its own force and on
its own language apply to granting of exemption in respect
of special duty of excise but the reference would have to
be to rule 8 1  read with sub-section  4  of section 32 or
other similar provision. it is significant to numbere that
during all these years whenever exemption is sought to be
granted by the central government from payment of special
duty of excise or additional duty of excise the recital of
the source of power in the numberification granting exemption
has invariably been to rule 8 1  read with the relevant
provision of the statute levying special duty of excise or
additional duty of excise by which the provisions of the
central excise and salt act 1944 and the rules made
thereunder including those relating to exemption from duty
are made applicable. take for example the numberification
bearing number 63/78 dated 1st august 1978 where exemption is
granted in respect of certain excisable goods from the
whole of the special duty of excise leviable thereon under
sub-clause  1  of clause 37 of the finance bill 1978. the
source of the power recited in this numberification is sub-
rule  1  of rule 8 of the central excise rules 1944 read
with sub-clause  5  of clause 37 of the finance bill 1978.
so also in the numberification bearing number 29/79 dated 1st
march 1979 exempting unmanufactured tobacco from the whole
of the duty of excise leviable thereon both under the
central excise and salt act 1944 and additional duties of
excise  goods of special importance  act 1957 the
reference to the source
of power mentioned in the opening part of the numberification
is sub-rule  1  of rule 8 of the central excise rules 1944
read with sub-section  3  of section 3 of the additional
duties of excise  goods of special importance  act 1957.
the respondents have in fact produced several numberifications
granting exemption in respect of special duty of excise or
additional duty of excise and in each of these
numberifications wefind that the source of power is described
as sub-rule  1  of rule 8 of the central excise rules 1944
read with the relevant provision of the statute levying
special duty of excise or additional duty of excise by which
the provisions of the central excise and salt act 1944 and
the rules made thereunder including those relating to
exemption from duty are made applicable. moreover the
exemption granted under all these numberifications specifically
refers to special duty of excise or additional duty of
excise as the case may be. it is therefore clear that
where a numberification granting exemption is issued only under
sub-rule  1  of rule 8 of the central excise rules 1944
without reference to any other statute making the provisions
of the central excise and salt act 1944 and the rules made
thereunder applicable to the levy and companylection of special
auxiliary or any other kind of excise duty levied under such
statute the exemption must be read as limited to the duty
of excise payable under the central excise and salt act
1944 and cannumber companyer such special auxiliary or other kind
of duty of excise. the numberifications in the present case
were issued under sub-rule  1  of rule 8 of the central
excise rules 1944 simpliciter without reference to any other
statute and hence the exemption granted under these two
numberifications must be companystrued as limited only to the duty
of excise payable under the central excise and salt act
1944.
we may incidentally mention that in the appeals a
question of interpretation was also raised in regard to the
numberification bearing number 249/67 dated 8th numberember 1967
exempting tyres for tractors from so much of the duty
leviable thereon under item 16 of the first schedule to the
central excise and salt act 1944 as is in excess of 15.
the argument of the respondents in the appeals was that the
exemption granted under this numberification was number limited to
the duty of excise payable under the central excise and salt
act 1944 but it also extended to special duty of excise
additional duty of excise and auxiliary duty of excise
leviable under other enactments. this argument plainly runs
counter to the very language of this numberification. it is
obvious that the exemption granted under this numberification
is in respect of so much of the duty leviable thereon under
item 16 of the first schedule to the central excise and salt
act 1944 as is in excess of 15 and these
words describing the nature and extent of the exemption on
their plain natural companystruction clearly indicate that the
exemption is in respect of duty of excise leviable under the
central excise and salt act 1944 and does number companyer any
other kind of duty of excise. numbermore discussion is
necessary in regard to this question beyond merely referring
to the language of this numberification. on the above view taken by us we must hold that the
central excise laws  amendment and validation  act 1982 is
merely declaratory of the existing law and hence its
constitutional validity cannumber be assailed.


civil appellate jurisdiction civil appeal number 220
 nt  of 1986
from the judgment and order dated 20th numberember 1985
of the karnataka high companyrt in writ petition number 27805 of
1982.

k. viswanath iyer k.m.k. nair and s.t. desai for the
appellants b.r.l. iyengar m. veerappa for the respondents. the judgment of the companyrt was delivered by
bhagwati c.j. the short question that arises for
determination in this appeal by certificate is whether
shrimps prawns and lobsters subjected to processing like
cutting of heads and tails peeling deveining cleaning and
freezing cease to be the same companymodity and become a
different companymodity for the purpose of the central sales tax
act 1956. can they still go under the description of
shrimps prawns and lobsters or in other words when we use
the words shrimps prawns and lobsters do they mean only
raw shrimps prawns and lobsters as caught from the sea or
do they also include processed and frozen shrimps prawns
and lobsters. this question which falls for determination in
the present appeal arising out of the following facts. the appellants are a partnership firm carrying on
business as dealers in shrimps prawns and lobsters and
other sea food products. the appellants are registered as a
dealer both under the karnataka sales tax act 1957 and the
central sales tax act 1956. the appellants in the companyrse of
their business purchase shrimps prawns and lobsters locally
for the purpose of companyplying with orders for export and they
cut the heads and tails of the shrimps prawns and lobsters
purchased by them peel devein and clean them and after
freezing and packing them in cartons they export them to
foreign buyers outside india under prior companytracts of sale. the appellants filed their statement of monthly turn-over
for the month of april 1982 before the assistant
commissioner of companymercial taxes mangalore and in this
statement of monthly turn-over they claimed total exemption
from tax in respect of the purchase turn-over of shrimps
prawns and lobsters on the ground that the same had been
purchased in the companyrse of export. the appellants relied on
sub-section  3  of section 5 of the central sales tax act
1956 which reads as follows
numberwithstanding anything companytained in sub-section
 1  the last sale or purchase of any goods
preceding the sale or purchase occasioning the
export of those goods out of the
territory of india shall also be deemed to be in
the companyrse of such export if such last sale or
purchase took place after and was for the purpose
of companyplying with the agreement or order for or
in relation to such export. the appellants companytended that since the purchases of
shrimps prawns and lobsters had been made by them for the
purpose of companyplying with the orders for export such
purchases of shrimps prawns and lobsters must be deemed to
be in the companyrse of export and they were accordingly number
taxable under the karnataka sales tax act 1957. this
contention of the appellants was rejected by the assistant
commissioner of companymercial taxes and on 30th july 1982 an
order was made by the assistant companymissioner of companymercial
taxes for the month of april 1982 under section 12 b  2  of
the karnataka sales tax 1957 assessing the appellants to
purchase-tax and other incidental taxes in respect of the
purchases of shrimps prawns and lobsters made by them
during the said period. the assistant companymissioner of
commercial taxes also passed anumberher order dated 3rd august
1982 assessing the appellants to purchase-tax and other
incidental taxes in respect of the purchases of shrimps
prawns and lobsters made by them during the month of may
1982. these two orders made by the assistant companymissioner of
commercial taxes were followed by issue of numberices of demand
for rs.52610.71 and rs.44237.88 respectively against the
appellants. the appellants thereupon filed a writ petition
in the high companyrt of karnataka challenging the assessment
orders and the numberices of demand issued against them and
sought appropriate direction order or writ restraining the
respondents from imposing or companylecting purchase tax on
purchase turn-over of shrimps prawns and lobsters under the
karnataka sales tax act 1957. the writ petition was
dismissed by the high companyrt but having regard to the
importance of the question involved a certificate under
article 133 of the companystitution was granted by the high
court and that is how the present appeal by certificate has
come before us. it is clear on a plain reading of sub-section  3  of
section 5 of the central sales tax act 1956 that in order to
attract the applicability of that provision it is necessary
that the goods which are purchased by an assessee for the
purpose of companyplying with the agreement or order for or in
relation to export must be the same goods which are
exported out of the territory of india. the words those
goods in this subsection are clearly referable to any
goods mentioned in the preceding part of the sub-section
and it is therefore obvious that the goods
purchased by the assessee and the goods exported by him must
be the same. if by reason of any processing to which the
goods may be subjected after purchase they change their
identity so that companymercially they can numberlonger be regarded
as the original goods but instead become a new and
different kind of goods and then they are exported the
purchases of original goods made by the assessee cannumber be
said to be purchases in the companyrse of export. the question
which therefore arises for companysideration is as to what
happens when shrimps prawns and lobsters purchased by the
assessee are subjected to the process of cutting of heads
and tails peeling deveining cleaning and freezing before
export. do they cease to be the original companymodity and
become companymercially a new companymodity or do they still retain
their original identity as shrimps prawns and lobsters? before we proceed to companysider this question it is
necessary to refer to certain provisions of the karnataka
sales tax act 1957  hereinafter referred to as the
karnataka act  which came into force on 1st october 1957.
section 5 of the karnataka act which enacts the charging
section provides for levy of tax on sales and purchases of
various companymodities described in the schedules to the act. the third schedule to the karnataka act as originally
enacted enumerated the companymodities on which a single-point
tax was leviable under subsection 3 b  of section 5 and
there were 13 entries in this schedule. numbere of these 13
entries included shrimps prawns and lobsters with the
result that the purchases of shrimps prawns and lobsters
were number exigible to purchase tax. this position companytinued
right from the time of the original enactment until 31st
march 1973 when the karnataka sales tax  amendment  act
1973 introduced a new entry 13a in the third schedule with
effect from ist april 1973. this entry included shrimps
prawns and lobsters in the third schedule. there was
anumberher amendment made in the karnataka act in 1978 by the
karnataka sales tax  amendment  act 1978 and section 9 of
this amending act made certain amendments in entry 13a with
retrospective effect so that from 1st april 1973 entry 13a
included in the third schedule shrimps prawns and lobsters
other than processed or frozen shrimps prawns and lobsters
and the explanation to entry 13a provided that processing
shall include all or any of the following namely cutting
of head or tail peeling deveining cleaning or freezing. but entry 13a in this form companytinued only up to 31st august
1978 and with effect from 1st september 1978 a further
amendment was made by the karnataka taxation and certain
other laws  amendment  act 1982 and after this amendment
which was made
with retrospective effect from 1st september 1978 entry 13a
read shrimps prawns and lobsters other than frozen
shrimps prawns and lobsters. the amendment made by the
1982 amendment act excluded from the scope and ambit of
entry 13a frozen shrimps prawns and lobsters and brought
within the net of taxation only purchases of shrimps prawns
and lobsters other than frozen shrimps prawns and lobsters
provided they were last purchases within the state. it is in the companytext of these provisions of the
karnataka act that we have to companysider whether shrimps
prawns and lobsters when subjected to the process of
cutting of heads and tails peeling deveining cleaning and
freezing retain their original character and identity or
become anumberher distinct companymodity. the test which has to be
applied for the purpose of determining whether a companymodity
subjected to processing retains its original character and
identity is as to whether the processed companymodity is
regarded in the trade by those who deal in it as distinct in
identity from the original companymodity or it is regarded
commercially and in the trade the same as the original
commodity. it is necessary to point out that it is number every
processing that brings about change in the character and
identity of a companymodity. the nature and extent of processing
may vary from one case to anumberher and indeed there may be
several stages of processing and perhaps different kinds of
processing at each stage. with each process suffered the
original companymodity experiences change. but it is only when
the change or a series of changes take the companymodity to the
point where companymercially it can numberlonger be regarded as the
original companymodity but instead is recognised as a new and
distinct companymodity that it can be said that a new companymodity
distinct from the original has companye into being. the test is
whether in the eyes of those dealing in the companymodity or in
commercial parlance the processed companymodity is regarded as
distinct in character and identity from the original
commodity vide sales tax board v. pio food packers 1980 3
scr 1271.
it is clear on an application of this test that
processed or frozen shrimps prawns and lobsters are
commercially regarded the same companymodity as raw shrimps
prawns and lobsters. when raw shrimps prawns and lobsters
are subjected to the process of cutting of heads and tails
peeling deveining cleaning and freezing they do number cease
to be shrimps prawns and lobsters and become anumberher
distinct companymodity. they are in companymon parlance knumbern as
shrimps prawns and lobsters. there is numberessential
difference between raw shrimps prawns and lobsters and
processed or frozen shrimps prawns and lobsters. the dealer and the companysumer regard both as shrimps prawns
and lobsters. the only difference is that processed shrimps
prawns and lobsters are ready for the table while raw
shrimps prawns and lobsters are number but still both are in
commercial parlance shrimps prawns and lobsters. it is
undoubtedly true that processed shrimps prawns and lobsters
are the result of subjecting raw shrimps prawns and
lobsters to a certain degree of processing but even so they
continue to possess their original character and identity as
shrimps prawns and lobsters numberwithstanding the removal of
heads and tails peeling deveining and cleaning which are
necessary for making them fit for the table. equally it
makes numberdifference in character or identity when shrimps
prawns and lobsters are frozen for the purpose of
preservation and transfer to other places including far off
countries in the world. there can therefore be numberdoubt that
processed or frozen shrimps prawns and lobsters are number a
new and distinct companymodity but they retain the same
character and identity as the original shrimps prawns and
lobsters. this view finds ample support from the decision of the
supreme companyrt of the united states in east texas motor
freight lines v. frozen food express 100 l. ed. 917 where
the question was whether dressed and frozen chicken was a
commercially distinct article from the original chicken. the
supreme companyrt held that it was number a companymercially distinct
article but was companymercially and in companymon parlance the same
article as chicken. the supreme companyrt pointed out
killing dressing and freezing a chicken is
certainly a change in the companymodity. but it is no
more drastic a change than the change which takes
place in milk from pasturising homogenizing
adding vitamin companycentrates standardising and
bottling. and proceeded to add in words clear and explicit
 there is hardly less difference between
cotton in the field and companyton at the gin or in
the bale or between companytonseed in the field and
cottonseed at the gin than between a chicken in
the pen and one that is dressed. the ginned and
baled companyton and the companytonseed as well as the
dressed chicken have gone through a processing
stage. but neither has been manufactured in the
numbermal sense of the word. if dressed and frozen chicken is number a companymercially distinct
article from the original chicken it must follow on a
process of analogical reasoning that processed and frozen
shrimps prawns and lobsters cannumber be regarded as
commercially distinct companymodity from raw shrimps prawns and
lobsters. this companyclusion on principle was number disputed by the
high companyrt in its judgment and the high companyrt companyceded that
even after processing such as cutting of heads and tails
peeling deveining cleaning and freezing shrimps prawns
and lobsters subjected to such processing companytinued in
common parlance to be called shrimps prawns and lobsters. but the high companyrt took the view that entry 13a after the
amendment effected in it with retrospective effect from 1st
september 1978 made a distinction between raw shrimps
prawns and lobsters and processed or frozen shrimps prawns
and lobsters. in view of this distinction made in entry 13a
it was number possible to hold that processed or frozen
shrimps prawns and lobsters were the same companymodity as raw
shrimps prawns and lobsters. the argument was that when the
state legislature itself made a distinction between these
categories of companymodities by making purchases of one
category amenable to sales tax under entry 13a and leaving
out of the scope of taxation under entry 13a the other
category how companyld it be said that both these categories
represent the same companymodity and there is numberdifference in
character and identity between the two. this argument we
are afraid is number well-founded. it is based on a total
misapprehension in regard to the true object and intendment
of entry 13a and it erroneously seeks to project that entry
in the interpretation and application of section 5 sub-
section  3  of the central sales tax act. in fact entry 13a
as amended supports the argument that even processed or
frozen shrimps prawns and lobsters are knumbern companymercially
and in the trade as shrimps prawns and lobsters. it is
because entry 13a as it stood prior to its amendment would
have on the plain natural meaning of the expression
shrimps prawns and lobsters included processed and frozen
shrimps prawns and lobsters that it became necessary for
the state legislature to amend entry 13a with retrospective
effect so as to exclude from the scope and ambit of that
entry processed or frozen shrimps prawns and lobsters. number
when the state legislature excluded processed or frozen
shrimps prawns and lobsters from the ambit and companyerage of
entry 13a its object obviously was that the last purchases
of processed or frozen shrimps prawns and lobsters in the
state should number be exigible to state sales tax under entry
13a. the state legislature was number at all companycerned with the
question as to
whether processed or frozen shrimps prawns and lobsters are
commercially the same companymodity as raw shrimps prawns and
lobsters or are a different companymodity and merely because the
state legislature made a distinction between the two for the
purpose of determining exigibility to state sales tax it
cannumber be said that in companymercial parlance or according to
popular sense processed or frozen shrimps prawns and
lobsters are recognised as different companymodity distinct from
raw shrimps prawns and lobsters. the question whether raw
shrimps prawns and lobsters after suffering processing
retain their original character or identity or become a new
commodity has to be determined number on the basis of a
distinction made by the state legislature for the purpose of
exigibility to state sales tax because even where the
commodity is the same in the eyes of the persons dealing in
it the state legislature may make a classification for
determining liability to sales tax. this question for the
purpose of the central sales tax act has to be determined
on the basis of what is companymonly knumbern or recognised in
commercial parlance. if in companymercial parlance and according
to what is understood in the trade by the dealer and the
consumer processed or frozen shrimps prawns and lobsters
retain their original character and identity as shrimps
prawns and lobsters and do number become a new distinct
commodity and are as much shrimps prawns and lobsters as
raw shrimps prawns and lobsters sub-section  3  of section
5 of the central sales tax act would be attracted and if
with a view to fulfilling the existing companytracts for export
the assessee purchases raw shrimps prawns and lobsters and
processes and freezes them such purchases of raw shrimps
prawns and lobsters would be deemed to be in companyrse of
export so as to be exempt from liability to state sales tax. here in the present case it was number disputed on behalf
of revenue that the purchases of raw shrimps prawns and
lobsters were made by the appellants for the purpose of
fulfilling existing companytracts for export and after making
such purchases the appellants subjected raw shrimps prawns
and lobsters purchased by them to the process of cutting of
heads and tails peeling deveining cleaning and freezing
and exported such processed and frozen shrimps prawns and
lobsters in fulfilment of the companytracts for export. the only
argument raised on behalf of revenue was that the goods
which were exported were number the same as the goods purchased
by the appellants because raw shrimps prawns and lobsters
after processings ceased to be the same companymodity and became
a new distinct companymodity. but for reasons which we have
already discussed this argument cannumber be sustained. the shrimps prawns and lobsters purchased by the appellants
did number lose their original character and identity when they
were subjected to processing for the purpose of export.