'Can The View Of Five Judges Bench Be Overruled By Four Judges Speaking For A Seven Judge Bench? Supreme Court Reserves Judgement

The Supreme Court on Tuesday reserved its judgment on whether the view of five Judges can be overruled by a view of four Judges speaking for a Bench of 7 Judges; and also whether without amending the exemption provision/notification issued under a specific power, a general notification prescribing the rate of tax under different provisions relating to determination of tax liability under the Act can be deemed to have withdrawn the exemption merely because the exemption provision and charging provision are under the same Act and the same authority.The five-judge constitution bench of Justices Indira Banerjee, Hemant Gupta, Surya Kant, M. M. Sundresh and Sudhanshu Dhulia was hearing a 2017 reference by the bench of Justices Rohinton Nariman and S. K. Kaul where the 2-judge bench had opined that "there is a dichotomy between two lines of Supreme Court judgments. The first line is contained in Kothari Products Ltd. v. government of AP, and state of Orissa v. Radheshyam Gudakhu Factory; the second line of decisions being Commissioner, Sales Tax UP v. M/s Agra Belting Works, Agra as followed in Sales Tax Officer, Section IX, Kanpur v. Dealing Dairy Products and Another, and state of Bihar and Others v. Krishna Kumar Kabra and Another". The 2-judge bench had noted that "Whereas the Kothari Products line of judgments had held that an entry under a sales tax statute which only specifies rate cannot be used to eat into an exemption entry, the Agra Belting Works line of judgments states the exact opposite, which is that the charging section, the rate of tax section, and the exemption section all form part of one scheme, and when a notification is issued under a rate of tax section, which is subsequent to a notification exempting certain goods, the intention of the legislature is that such exemption then gets withdrawn and makes the sale of such goods liable to tax". The 2-judge had further observed, "It may be pointed out that in the present case, if numbers are toted up, the Kothari Products line, as followed in Radheshyam Gudakhu Factory and Reliance Trading Company, Kerala v. state of Kerala, will go to a Bench strength, numerically speaking, of eight learned Judges, as against the Agra Belting Works line, which goes up to a numerical strength of six learned Judges. If the dissenting judgment of B.C. Ray, J. (in Agra Belting) is to be added to the Kothari Products line, then we have a numerical strength of 9:6. The question of numerical strength gains poignancy when one judgment is overruled by another, as has been pointed by Beaumont C.J. in Ningappa Ramappa Kurbar, and by Lokur, J. in Supreme Court Advocates-on-Record". Continuing, the 2-judge bench of Justices Nariman and Kaul had canvassed, "Let us consider a hypothetical example, where a 2 Judge Bench has laid down the law in a particular way. If nine other 2 Judge Benches have followed the first 2 Judge Bench decision, is it open for three learned Judges to overrule all of the 2 Judge Benches i.e. twenty learned Judges? The obvious answer would be yes, because the 3 Judge Bench is really overruling the first 2 Judge Bench decision, which was merely followed by nine other 2 Judge Benches. As against this, however, if a unanimous 5 Judge Bench decision is overruled by a 7 Judge Bench, with four learned Judges speaking for the majority, and three learned Judges speaking for the minority, can it be said that the 5 Judge Bench has been overruled? Under the present practice, it is clear that the view of four learned Judges speaking for the majority in a 7 Judge Bench will prevail over a unanimous 5 Judge Bench decision, because they happen to speak for a 7 Judge Bench. Has the time come to tear the judicial veil and hold that in reality a view of five learned Judges cannot be overruled by a view of four learned Judges speaking for a Bench of 7 learned Judges? This is a question which also needs to be addressed and answered". "Given the head on conflict between the Kothari Products line of judgments and the Agra Belting Works line of judgments, together with the aforesaid conundrum insofar as the doctrine of precedent qua this Court is concerned, we request the Hon'ble Chief Justice of India to constitute an appropriate Bench", the 2-judge bench had said.On Tuesday, ASG N. Venkataraman told the 5-judge bench, "The issue for consideration which arose in the three High Courts- Delhi, Allahabad and Andhra Pradesh- which came before this court in the referral order was how do you construe the expression gutka or pan masala; whether pan masala and gutka would be tobacco per se or it would not be tobacco in its common sense parlance. What we are now contesting is gutka which is pan masala which contains tobacco- Pan Masala containing tobacco. So when it is a tobacco product, it is governed by Central excise and it is also governed by Additional Excise Duties Act which is a Central act. Whatever is governed by the AED, you cannot impose sales tax on it then. That is a...

'Can The View Of Five Judges Bench Be Overruled By Four Judges Speaking For A Seven Judge Bench? Supreme Court Reserves Judgement

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