AGRICULTURAL INCOME TAX OFFICER &ANR.versusGOODRICKE GROUP LTD. &ANR.

                          [2015] 3 S.C.R. 612


A         AGRICULTURAL INCOME TAX OFFICER &ANR.

                                    v.
                   GOODRICKE GROUP LTD. &ANR.
B                   (Civil Appeal No. 9043 of 2003)

                           MARCH 25, 2015

        [A.K. SIKRI AND ROHINTON FALi NARIMAN, JJ.)
c
             Gess - Refund - Entitlement to refund of cess paid
     with interest 12 % pa - Rural employment cess and education
     cess - Levy of- High Court on basis of interim orders passed
     in Buxa Dooars's case and Goodricke's case held that for
o    the period pn"or to the Amendment Act of 1989, respondent
     entitled to refund of cess paid by it with interest 12 % pa, and
     interest would only be payable after assessment orders are
     passed - However, interim order in Buxa's case was
     substituted by the final order which held that the charging
E    Sections under the 1976 Act and the 1973 Act were inva/id-
     Subsequently, two West Bengal Acts were amended in 1989
     with retrospective effect, and the levy of the rural employment
     cess and education cess which was levied under the principal
     Acts on the basis of dispatch of manufactured tea was now
F    levied on the basis of production of tea leaves - Said 1989
     Amendment Act was upheld in Goodricke's case and
     direction was issued to pay cesses stayed by the orders of
     the court along with interest 12 % pa - On appeal, held: ss.
G    48 and 78C have changed the basis of the law as it existed
     when Buxa's case was decided and consequentially, the
    judgment and interim order passed in Buxa's case will cease
    to have any effect- What was payable under the unamended
    Act, is now payable only under the 1989 Amendment Act
H   which has come into force with retrospective effect- The 1989
                                  612
AGRICULTURALINCOMETAXOFFICERv. GOODRICKE 613
               GROUP LTD.

Amendment Act expressly seeks to remove the basis of A
Buxa'sjudgment by retrospectively changing the basis of the
levy of the cesses - Impugned judgment rightly held that
with regard to the payment ofinterest by the petitioner on the
amount of cess payable by virtue of the Goodricke's case,
interest would only be payable from the respective dates of B
assessment for the various relevant periods till recovery -
West Bengal Taxation Laws (Second Amendment) Act, 1989
- ss. 4B, 78C - West Bengal Rural Employment and
Production Act, 1976- West Bengal Primary Education Act, C
1973.

      Disposing of the appeal, the Court

       HELD: 1.1 It is clear from a reading of Section 4B
and Section 78C of the West Bengal Taxation Laws D
(Second Amendment) Act, 1989 that where any sum is
paid by or collected from an owner of a tea estate during
a period commencing from 01.04.1981or14.04.1984, as
the case may be, up to the date ofthe Amendment Act as
rural employment cess or as education cess, such E
portion of the said sum as may become payable under
the provisions of the Amendment Act shall,
notwithstanding any judgment, decree or order of any
court, be deemed to have been validly levied, paid. or F
collected under the Amendment Act. [Para 12] [624-E-F]

       1.2 The purport of ss. 4B and 78C is clear.
Whatever may have been the subject matter of Buxa
Dooars's case, that is the subject matter of the two Acts- G
West Bengal Rural Employment and Production Act,
1976 and West Bengal Primary Education Act, 1973 as
originally enacted, will now, notwithstanding the interim
order or the final judgment in Buxa Dooars's case, be
deemed to have been validly levied, collected and paid H
614        SUPREME COURT REPORTS             [2015] 3 S.C.R.


A as rural employment cess and education cess under the
  Amendment Act. This being the case, it is clear that
  Section 48 and Section 78C have changed the basis of
  the law as it existed when Buxa Dooars's case was
  decided and consequentially, the judgment and interim
B order passed in Buxa Dooars's case will cease to have
  any effect. Also, what would have been payable under
  the Act as unamended, is now payable only under the
  1989 Amendment Act which has come into force with
C retrospective effect. [Paras 13 and 14) [624-G-H; 625-A-
      C]
          1.3 Rural employment cess and education cess
  continue to be the same cess whether before or after
  the Amendment Act. What has been changed is the basis.
0
  for the said levy so as to undo the defects that were found
  in the Buxa Dooars's case. It is obvious that when the
  basis ·of Buxa Dooars's case has gone, on a retrospective
  amendment of these two Acts, the interim order and the
E judgment and order in Buxa Dooars's case can no longer
  survive. In the instant case, the 1989 amendment Act
  expressly seeks to remove the basis of Buxa Dooars's
  judgment by retrospectively changing the basis of the
  levy of the cesses mentioned above. What is done away
F with by the Amending Act of 1989 is a declaratory
  judgment holding the cesses to be invalid. [Paras 15 and
  17] [625-F-H; 628-C] ·

         1.4 Goodricke's case made it clear that the
G petitioners shall pay cesses stayed by an order of this
  Court along with interest at 12 % pa. The expression
  "cesses stayed" has reference to the interim order which
  had stated that there would be no enforcement of
  demand under the Act or Rules and in the meanwhile,
H
AGRICULTURAL INCOME TAX OFFICER v. GOODRICKE 615
                GROUP LTD.

assessment may be made. Assessments were made with A
effect from July, 1993 onwards and consequential
demands have been made with effect from 1995
onwards. Therefore, the impugned judgment is right in
holding that with regard to the payment of interest by
the petitioner on the amount of cess payable by virtue · B
of the Goodricke's case, interest would only be payable
from the respective dates of assessment for the various
relevant periods till recovery. [Para 18) [628-H-G; 629-A]

  Buxa Dooars Tea Company Ltd. and others v. State          c
  of West Bengal and others 1989 (3) SCR 293: (1989)
  3 SCC 211; Goodricke Group Ltd. and others v. State
  of WB. and others 1994 (6) Suppl. SCR 120: 1995
  Supp. (1) SCC 707; Indian Aluminium Company v.
                                                            D
  State of Kera/a 1996 (2) SCR 23: (1996) 7 SCC 637;
  Kera/a v. Peoples Union for Civil Liberties, Kera/a
  State Unit & Ors. 2009 (11) SCR 142: (2009) 8 SCC
  46 - referred to.

  Madan Mohan Pathak v. Union of India and other'
                                                            E
  1978 (3) SCR 334 - distinguished.

                   Case Law Reference
1989 (3) SCR 293            referred to.      Paras 1, 14   F
1994 (6) Suppl. SCR 120     referred to.       Paras 1, 2

1996 (2) SCR 23             referred to.       Para 15

2009 (11) SCR 142          · referred to.      Para 16
                                                            G
1978 (3) SCR 334            distinguished.    Para 18

      CIVILAPPELLATE JURISDICTION: Civil Appeal No.
9043 of2003
                                                            H
616         SUPREME COURT REPORTS                   (2015) 3 S.C.R.


A           From the Judgment and Order dated 08.05.2003 of the
      High Court of Calcutta in WPTT NO. 3 of 2003

             Anip Sachthey and Shagun Malta, for the appellant.

B             C. U. Singh, R. K. Tiwary, Priya Puri and R. K. Dubey,
      for the respondents.

             The Judgment of the Court was delivered by

          R. F. NARIMAN, J. 1. An interesting question is raised
C in this appeal which arisesoutoftwojudgmentsofthisCourt,
  namely, 'Buxa Dooars Tea Company Ltd. and others v. State
  of West Bengal and others' ((1989) 3 SCC 211) and
  'Goodricke Group Ltd. and others v. State of W.B. and
  others' (1995 Supp.(1) sec 707).
0
          2. In the present appeal, we are concerned with The
  West Bengal Rural Employment and Production Act, 1976
  and The West Bengal Primary Education Act, 1973. The
  High Court has found, based on a reading of the interim
E orders passed in both Buxa Dooars Tea Company Ltd.'s
  case and Goodricke Group Ltd.'s case, that for the period
  prior to the Amendment Act of 1989, the respondent herein is
  entitled to a refund of the cess paid by it together with interest
F at 12 per cent per annum, and has further found that insofar
  as interest is payable after the Amendment Act is concerned,
  such interest would only be payable after assessment orders
  are passed (which on facts here, we are informed, were
  passed on 27.07.1993 andthereafter).
G
          3. By an interim order dated 16.06.1983 in the Buxa
  Dooars Tea Company Ltd.'s case, this court held as
  hereunder: -

        "Rule NISI. There will be no order on stay application
H
AGRICULTURAL INCOME TAX OFFICER v. GOODRICKE 617
        GROUP LTD. [R. F. NARIMAN, J.]

   but if the petitioner succeeds in the writ petition, the      A
   State of West Bengal will refund the amount of cess
   collected with interest thereon @ 12% per annum
   from the date of collection."

        4. By the judgment delivered in Buxa Dooars Tea B
Company Ltd .'s case in 1989, this Court held that the charging
sections under both the aforesaid Acts were invalid both on
the ground of legislative competence as well as violation of
Article 301 inasmuch as the impugned legislative measures
were outside Entry 49 in List II of the Seventh Schedule of C
the Constitution, which speaks of''taxes of lands and buildings";
and it was further held that the levy being on movement of
goods, Article 301 of the Constitution would be attracted
and these levies are not saved under Article 304(b) as no
                                                                  0
Presidential assent has been taken on either of these
legislative measures.

       5. The West Bengal legislature was swift to act after
the judgment of this court. By the West Bengal Taxation Laws
(SecondAmendment) Act of1989amendingtheprovisions E
 of both the aforesaid Acts, the charging sections were
substituted with retrospective effect, and the levy of the rural
employment cess and education cess (which was levied
under the earlier principal Acts on the basis of despatch of F
manufactured tea) was now levied on the basis of production
oftealeaves. A challenge to thisAmendmentActwasmade
before this Court which challenge failed in the second
judgment referred to hereinabove (in Goodricke Group Ltd.'s
case).                                                           G

         6. The 1989 AmendmentAct was upheld in the following
terms:

  "Lastly, the learned counsel for the petitioners questioned
                                                                 H
618         SUPREME COURT REPORTS                   [2015] 3 S.C.R.


A        the validity . of the retrospective effect given to the
         impugned enactment. We fail to see any substance in
         this submission. If the Act is good, it is good both
         prospectively and retrospectively. Retrospective effect
         is given for the period covered by the anterior
B        provisions which were struck down in Buxa Dooars.
         Once we hold that the defect pointed out in Buxa
         Dooars is rectified and remedied in the impugned
         enactment, it can certainly be given retrospective effect
         to cover the period covered by the earlier enactment
c        which is not only a well-known but a frequently adopted
         measure by all the legislatures.

         For the above reasons, the writ petitions fail and
         are accordingly dismissed. The interim orders made
D
         in these writ petitions shall also come to an end. The
         petitioners shall pay the cesses stayed by the orders
         of this Court along with interest@ 12% p.a. There
         shall no order as to costs."
E           7. It is a little important to note that before the final
      judgment in Goodricke Group Ltd.'s case , an interim order
      was passed dated 25.01.1990 in the following terms:

           "Issue notice. In the meantime the assessment may
F          be made as usual but there will be no enforcement
           of demand under the Act or Rules. Status quo to
           be maintained as far as refund of Cess is
           concerned."

G         8. Learned counsel forthe appellant ShriAnip Sachthey
  has argued before us that the impugned judgment should be
  set aside on the ground thatthe interim order dated 16,06.1983
  in the Buxa Dooars Tea Company Ltd.'s case did not survive
H as it was substituted by the final order in the Buxa Dooars
 AGRICULTURAL INCOME TAX OFFICER v. GOODRICKE 619
         GROUP LTD. [R. F. NARIMAN, J.]

Tea Company Ltd.'s case, which is to be found in Para 16 A
thereof, which stated that the two West Bengal Acts were
declared void and consequential refund ordered. There was
no separate order as to payment of interest in the final
judgment and therefore the interim order which merges with
the final judgment had no independent existence. He has B
also urged that since the two West Bengal Acts were
amended in 1989 with retrospective effect from 1981 and
1984 respectively, the basis of the judgment in Buxa Dooars
Tea Company Ltd.'s case was removed and as a result, it is C
clear that no refund at all is payable.

        9. Mr. C. U. Singh, learned senior counsel appearing
on behalf of the respondent, on the other hand, supported the
judgment on both counts and submitted that the levy under
                                                                  0
the original Act no longer remained the same, so thatthe levy
under the 1989 amendment was a separate and new levy of
rural employment cess and education cess, and this being
the position, the interim order as well as the final judgment in
Buxa Dooars Tea Company Ltd.'s case still remain intact. E
He further submitted that the interim order was self operative
inasmuch as interest became payable at the rate of 12 per
cent the moment the writ petitions were finally decided in
the petitioner's favour. He also supported the second portion
of the impugned judgment saying that the final order in F
Goodricke Group Ltd.'s case is to be read with the interim
order thereof and if so read, the result is that interest is only
payable under the new Act with effect from the date of
assessment and not before.
                                                                 G
       10. We have heard learned counselforthe parties. In
our opinion, Mr. C. U. Singh, learned counsel appearing on
behalf of the respondents, is right in saying that the interim
order dated 16.06.1983 is self operative. In any case, the
                                                                 H
620     ·   SUPREME COURT REPORTS                   [2015] 3 S.C.R.


A     final order in Buxa Dooars Tea Company Ltd.'s case did not
      say anything to the contrary, and when both the judgment and
      the interim order are read together, it is clear that the refund
      will have to be made together with 12 per cent interest.

B            11. But the matter does not end here. The Amendment
      Act contains two very important provisions, namely, Section
      4B of the West Bengal Rural Employment and Production
      Act and Section 78C of the West Bengal Primary Education
      Act. Both the sections are set out hereinbelow: -
c
         "4B. (1) Where any sum has been paid by, or collected
         from, any owner of a tea estate during the period
         commencing on the 1st day of April, 1981 and ending
       . on the day immediately preceding the date of coming
D        into force of the West Bengal Taxation Laws (Second
         Amendment) Act, 1989 as rural employment cess in
         respect of any period prior to the coming into force of
         the said Act, such portion of the said sum as may
         become payable in accordance with the provisions of
E        thisActafterthecoming into force ofthesaidActshall,
         notwithstanding any judgment, decree or order of any
         court, be deemed to have been validly levied, paid or
         collected under this Act, and where after assessment
F        or fresh assessment any portion of such sum is found to
         have been levied, paid or collected in excess of the
         rural employment cess payable for the said period shall
         be refunded .to such owner in accordance with the
         provisions of this Act and the rules made thereunder.
G
        (2) Where any assessmentis purported to have been
        made, or any order is purported to have been passed
        on appeal, revision or review, by any authority, or any
        appeal or application for revision or review has been
H       made before such authority under this Act, or any order
AGRICULTURAL INCOME TAX OFFICER v. GOODRICKE 621
        GROUP LTD. [R. F. NARIMAN, J.)

 has been passed by a court or where any sum has been        A
 paid or collected as rural employment cess, before
 the coming into force of the West Bengal Taxation Laws
 (Second Amendment)Act, 1989, in respect of any period
 prior to the coming into force of the said Act,
 assessment or fresh assessment shall, notwithstanding       B
 such order on appeal, revision or review, or the
 pendency of such appeal or application for revision or
 review, or any order passed by a court, be made in
 accordance with the provisions of this Act within four
                                                             c
 years from the date of coming into force of the said Act.

 (3) Notwithstanding anything contained in this Act, any
 default by an owner of a tea estate to make payment of
 the rural employment C€SS or to apply for registration
                                                             D
 or to file return in accordance with the provisions of
 thisActafterthe coming into force of the West Bengal
 Taxation Laws (Second Amendment) Act, 1989 in
 respect of any period prior to the coming into force of
 the said Act shall not be deemed to be a contravention      E
 ofsuch provisions if such owner makes payment of such
 rural employment cess within one month or files return
 within six months, as the case may be, from the date of
 coming into force of the said Act.
                                                             F
 (4) The amount of the rural employment cess payable
 by any owner of a tea estate under sub-section (2A) of
 section 4 of this Act in respect of any period prior to
 the coming into force of the West Bengal Taxation
 Laws (Second Amendment) Act, 1989, shall,                   G
 notwithstanding anything contained in this Act, be
 reduced by such amount of rural employment cess
 payable in respect of such tea estate on such quantity
 of green tea leaves produced therein during the said
                                                             H
622      SUPREME COURT REPORTS                   [2015] 3 S.C.R.



A     period as may be equivalent to the quantity of any tea
      despatched for which such owner has purported to have
      enjoyed or would have enjoyed exemption from payment
      of the rural employment cess during such period, and
      it is hereby declared that for determining the amount of
B     the rur1:1I employment cess to be reduced, each kiiogram
      of tea dispatched during such period shall be equivalent
      to four and a half kilograms of green tea leaves
      produced in such tea estate."
c     "78C. "Validation and exemption. (1) Where any sum
      has been paid by, or collected from, any owner of a
      tea estate during the period commencing on the 14th
      day of April, 1984 and ending on the day immediately
      preceding the date of coming into force of the West
D
      Bengal Taxation Laws (SecondAmendment)Act, 1989
      as education cess in respect of any period prior to the
      coming into force of the said Act, such portion of the
      said sum as may become payable in accordance with
E     the provisions of this Act after the coming into force
      of the said Act shall be deemed to have been validly
      levied, paid or collected under this Act, and where after
      assessment any portion of such sum is found to have
      been levied, paid or collected in excess of the amount
F     payable as education cess for the said period shall be
      refunded to such owner in accordance with the provisions
      of this Act and the rules made thereunder.

      (2) Where any assessment is purported to have been
G     made, or any order is purported to have been passed
      on appeal, revision ·or review, by any authority, or any
      appeal or application for revision or review has been
      made before such authority under this Act, or any order
      has been passed by a court, or where any sum has
H
AGRICULTURAL INCOME TAX OFFICER v. GOODRICKE 623
     ,  GROUP LTD. [R. F. NARIMAN, J.]

  been paid or collected as education cess, before the         A
  corning into force' of the West Bengal Taxation Laws
  (SeeondArnendrnent)Act, 1989, in respect of any period
  pri_or. to_ the corning into force of the said Act,
  assessment         or fresh . • assessment . shall,
  notwithstanding such' order on appeal, revision or review    8
  or )he pendency of such appeal or application for
,;revision orreview or any order passed by any court,.
  be ma_de in accordance with the_ provisions of. this Act
· within four years from the date of coming into force of
·.the said Act.     ·                                ··    ·   c
      '· '·        '                  '· ,.
 (3) Notwithstanding anythir:ig contain~d.in this Act, any
 default by an owner of a tea estate to make payment of
 the education cess or to apply for registration or to file
                                                               D
 return in accordance with the provisions of this Act
·after the coming into force of the West Bengal Taxation
 Laws (Second Amendment) Act, 1989 in respect of any.•
 period prior to the· coming into force of the said Act
 shall not be deemed to. be a contravention of such            E   !
 provisions if. such owner makes payment of such
 education cess within three months or applies for
 registration within one month or files return within six •
 months, as the case may be, from the date of coming ·
                                                                   I
 into force of the said Act.                                   F   f
                                              .   ~   :

  (4) The amount of the education cess payable by any
· ownerof a tea estate under sub-section (2A) of Section
  78 of this Act in respect I of any . period prior to the
  coming into force of the West Bengal Taxation· Laws          G
  (Second Amendment) Act, 1989, shall notwithstanding.
  anything contained in this Act; be reduced by such .. '
  amount of education cess payable in respect of such
  tea estate on such quantity of green tea leaves produced
                                                               H
     · 624 ': ·       · SUPREME COURT REPORTS           (2015] 3 S.C.R
                                         u.
     .A       .therein during. the said period as may be equiva lentto
               the quantity of any tea despatched for which such owner
               has purported to'have enjoyed or.would have enjoyea
                                               of
               exemption from payment the education cess during
               such period, and it· is hereby declared that for
      8        determining the 'amount of the education cess to be           \
               reduced, each kilogram of tea despatched during
               such period shall be equivalent to four and a half
               kilogr()ms of green tea leaves~produced in such tea
               estate?' "x            '"       ·
      c
               (5) The provisions of this section shall have
             . effect, notwithstanding any judgment, decree or order
               of any court, tribunal or other authority to the
               eontrary." ·
      D               /-
                       -, '~ ' ''
                                 '   ;




           , :;','.12; It is clear from a reading of Section 48 and 78C
        that where .any sum is paid by or collected from an owner of a
        tea estate during a period commencing from 01.04 ..1981 or
        14.04.1984, as the case may be, up to .the date of the
      E Amendment Act as rural employment cess or as education
        cess;such portion of the said sum as may become payable
        under the provisions of the Amendment.Act shall,·
        notwithstanding any judgment, decree or order of any court,
      F be deen;ied to have been validly levied, paid or collected
        under the AmendmentAct.                -     ·
                  '< r; .· . .           ~·'                 , --   '..; .
             , ,13:1n our.view, the purport of these two sections is
        clear. Whatever may have been the subject matter of Buxa
      G Dooars Tea Company Ltd.'s case;th~t is the subject matter
        of the two Acts as originally enacted; will now, notwithstanding
        the interim order or the final judgment in Buxa Dooars Tea
        Company Ltd.'s. case, be .deemed to have been validly
        levied, collected: and paid as rural employment cess and
      H education cess under theAmendmentAct.
i'
 AGRICULTURAL INCOME TAX OFFICER v. GOODRICKE 625
         GROUP LTD. [R. F. NARIMAN, J.]

       14. This being the case, it is clear that ·Section 48 A
and Section 78C have changed the basis of the law as it
existed when 8uxa Dooars Tea Company Ltd.'s case was
decided and consequentially, the judgment and interim order
passed in 8uxa Dooars Tea Company Ltd.'s case will cease
to have any effect. Also, what would have been payable 8
under the Act as unamended, is now payable only under the
1989 Amendment Act which has come into force with
retrospective effect.

        15. Mr. C. U. Singh, however, referred us to 'Madan      C
Mohan Pathak v. Union of India and others' (1978 (3) SCR
334] and in particular to Justice P. N. 8hagwati's judgment
thereof, in which it has been decided by this Court that a
Legislative Act cannot directly undo a writ of mandamus that
                                                                 0
is granted by an order of a superior court. We are of the view
that Madan Mohan Pathak's case would not apply to the facts
in the present case for the simple reason that what has been
undone by Section 48 and Section 78C is not a mandamus
issued by a superior court. What is undone is the very basis     E
of the judgment in 8uxa Dooars Tea Company Ltd.'s
case by retrospectively changing the levy of rural employment
cess and education cess. It must be understood that rural
employment cess and education cess continue to be the
same cess whether before or after the Amendment Act.             F
What has been changed is the basis for the said levy so as
to undo the defects that were found in the 8uxa Dooars
Tea Company Ltd. 's case judgment. It is obvious that when
the basis of 8uxa Dooars Tea Company Ltd.'s case has
gone, on a retrospective amendment of these two acts, the        G
interim order and the judgment and order in 8uxa Dooars Tea
Company Ltd.'s case can no longer survive. Forth is reason,
we are of the view that the impugned judgment needs to be
set aside on this score. In fact, Madan Mohan Pathak has         H
626        SUPREME COURT REPORTS                   [2015] 3 S.C.R.


A     been explained in Indian Aluminium Company v. State of
      Kerala, [(1996) 7 SCC 637] as follows:

        "49. In Madan Mohan Pathak v. Union of India [(1978) 2
        SCC 50 : 1978 SCC (L&S) 103] , on the basis of a
B       settlement, bonus became payable by UC to its Class
        Ill and Class IV employees. In a writ, a Single Judge of
        the Calcutta High Court issued mandamus directing
        payment of bonus as provided in the settlement. During
        the pendency of letters patent appeal, LIC (Modification
c       ofSettlements)Act, 1976wasenacted denying bonus
        payable to the employees. The appeal was withdrawn.
        The validity of 1976 Act was challenged-in this Court
        under Article 32 of the Constitution. A Bench of seven
        Judges had held that Parliament was not aware of the
D
        mandamus issued by the court and it was declared that
        the 1976 Act was void and writ of mandamus was
        issued to obey the mandamus by implementing or
        enforcing the provisions of that Act and directed
E       payment of bonus in terms of the settlement. It was
        pointed out that there was no reference to the judgment
        of the High Court in the Statement of Objects and
        Reasons, nor any non obstante clause referring to the
        judgment of the Court was made in Section 3 of the Act.
F       Attention of Parliament was not drawn to the mandamus
        issued by the High Court. When the mandamus issued
        by the High Court became final, the 1976 Act was held
        invalid. Shri RF. Nariman laid special emphasis on the
        observations of learned Chief Justice Beg who in a
G       separate judgment had pointed out that the basis of the
        mandamus issued by the court could not be taken
        away by indirect fashion as observed at p. 743c to f. From
        the observations made by Bhagwati, J. per majority, it is
        clear that this Court did not intend to lay down that
H
 AGRICULTURAL INCOME TAX OFFICER v. GOODRICKE 627
         GROUP LTD. [R. F. NARIMAN, J.]

   Parliament, under no circumstance,· has power to               A
   amend the law removing the vice pointed out by the court.
   Equally, the observation of Chief Justice Beg is to be
   understood in the context that as long as the effect of
   mandamus issued by the court is not legally and
   constitutionally made ineffective, the State is bound to       B
   obey the directions. Thus understood, it is
   unexceptionable. But it does not mean that the learned
   Chief Justice intended to lay down the law that
   mandamus issued by court cannot at all be made
   ineffective by a valid law made by the legislature;
                                                                  c
   removing the defect pointed out by the court."

   This statement of law has been accepted in yet another
   judgment of this Court. (See: State of Kerala v. Peoples
                                                                  D
   Union for Civil Liberties, Kera la State Unit &Ors., ((2009)
   8 sec 46 at paragraph 65).

           16. Bhagwati, J.'s judgment in Madan Mohan Pathak
  also makes it clear that Section 3 of the impugned Act in that E
  case sought to modify a settlement dated 24th January,
  1974 arrived at between the UC and its employees. There
  was no reference to a Mandamus issued by the Calcutta High
  Court in the Statement of Objects and Reasons as a result of
  which Section 3 of the impugned Act did not contain a non- F
  obstante clause referring to any judgment of any court. The
  right given under the said judgment was therefore not sought
  to be taken away by the impugned Act. Further, inexplicably,
. the Letters Patent Appeal filed by the UC was not pressed as
  otherwise e Section 3 of the impugned Act would only have to G
  be applied to the facts in that case to upset the Single Judge
 judgment that had issued the Writ of Mandamus. Bhagwati,
 J. also went on to state that the judgment given by the Calcutta
  High Court was not a mere declaratory judgment holding
                                                                  H
628         SUPREME COURT REPORTS                   [2015] 3 S.C.R.


A     an impost or tax to be invalid, so that a validation statute can
      remove the defect pointed out by the judgment and amend
      the law with retrospective effect to validate such impost or
      tax - See: Madan Mohan Pathak v. Union of India, [(1978) 3
      SCR 334 at 352 to 355].
B.
           17. In the present case, the 1989 amendment Act
  expressly seeks to remove the basis of Buxa dooars's
  judgment by retrospectively changing the basis of the levy of
  the cesses mentioned above. In the present case, what is
C done away with by the Amending Act of 1989 is a declaratory
  judgment holding the above cesses to be invalid. On all these
  grounds also the judgment in Madan Mohan Pathak's case
  is distinguishable.

D          18. However, insofar as interest is concerned, post
  .Goodricke Group Ltd.'s case, we are of the view that Mr. C.
   U. Singh is correct in supporting the impugned judgment.
   Goodricke Group Ltd.'s case made it clear that the
   petitioners shall pay cesses stayed by an order of this
E Court along with interest at 12 per cent per annum. The
   expression "cesses stayed" has reference to the interim order
   dated 25.01.1990 which had stated that there would be no
   enforcement of demand under the Act or Rules and in the
F meanwhile, assessment may be made. We have been
   informed that assessments were made with effect from July,
   1993 onwards and consequential demands have been made
   with effect from 1995 onwards. It is clear, therefore, that
   the impugned judgment is right in holding that with regard to
G the payment of interest by the petitioner on the amount of cess
   payable by virtue of the Goodricke Group Ltd.'s case,
   interest would only be payable from the respective dates of
   assessment for the various relevant periods till recovery. On
   facts here, no question arises as to whether interest would
H
AGRICULTURAL INCOME TAX OFFICER v. GOODRICKE 629
        GROUP LTD. [R. F. NARI MAN, J.]

become payable from the date of demand or from the date A
of the assessments inasmuch as counsel for the
respondents supports the impugned judgment on this score
and is not aggrieved thereby.

        19. The respondents here have made payment of B
interest from time to time to the State. These payments will
be adjusted against any sum that would become payable as
a result of this judgment.

         20. The appeal is disposed of accordingly.                c
Nidhi Jain                                   Appeal disposed of.




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