Case Summary - Misrilal Jain and Another Vs State of Orissa and Another (1977)
(1977) 03 SC CK 0015
In The Supreme Court of India
Case No: Civil Appeal Nos. 1810 of 1971, 1170, 1603, 1604, 1981 and 1982 of 1972
Misrilal Jain and Another (Appellant)
Vs
State of Orissa and Another (Respondent)
Date of Decision: 02-03-1977
Bench: Full Bench
Hon'ble Judges: Y. V. Chandrachud, J; V. R. Krishna Iyer, J; S. Murtaza Fazal Ali, J; P. S. Kailasam, J; P. N. Bhagwati, J; N. L. Untwalia, J; M. Hameedullah Beg, J
Final Decision: Dismissed
[Judgment Source]
https://www.courtkutchehry.com/Judgement/Search/AdvancedV2?docid=288950
All Citations
AIR 1977 SC 1686
Facts of the Case
The Orissa Legislature enacted the Orissa Taxation (on Goods Carried by Roads or Inland Waterways) Act, 1959 without prior Presidential sanction as required under Article 304(b) proviso. This was later validated by the Orissa Validation Act, 1962, which the Supreme Court held invalid. Subsequently, in 1968, after obtaining Presidential sanction, the Orissa Legislature enacted the Orissa Taxation Act, 1968, with retrospective effect from 1959, re-imposing the same levy and validating actions taken under the earlier Act. The appellants challenged the 1968 Act as unconstitutional.
Law Points Raised
1. Whether retrospective validation of taxes under the 1968 Act was constitutional.
2. Whether the 1968 Act constituted colourable legislation.
3. Whether the Act encroached upon judicial powers.
4. Whether legislation can operate entirely on the past without future application.
Acts / Provisions / Articles Referred
• Constitution of India, 1950 — Article 13(3), Article 144A, Article 226, Article 304(b)
• Orissa Taxation (on Goods carried by Roads or Inland Waterways) (Amendment) Act, 1964 — Section 4
Judgements Referred
• Khyerbari Tea Co. Ltd. v. State of Assam — upheld retrospective taxation.
• Precedent on legislative competence and retrospective validation.
Obiter Dicta
The Court reiterated that legislative competence includes retrospective operation and that retrospective validating statutes do not inherently become colourable legislation. Legislative power includes validating past acts if the subject matter is within legislative competence.
Ratio Decidendi
The Orissa Legislature, after fulfilling the constitutional requirement of Presidential sanction, was competent to enact the 1968 Act retrospectively. Such retrospective application did not render the legislation invalid or colourable.
Final Ruling
The Supreme Court upheld the 1968 Act, confirming the legislative competence to enact retrospective taxation laws in compliance with Article 304(b) proviso. Appeals were dismissed.
Summary
This judgment affirmed the State's power to enact retrospective taxation statutes, provided constitutional procedures are followed. The decision reinforced that retrospective operation alone does not invalidate legislation, and validating past acts is permissible if the legislature has competence over the subject matter.