Holding

The special contribution under Chapter V‑A is a valid levy within Parliament's competence and is not ultra vires; the appeal is dismissed.

Summary

Gasket Radiators Pvt. Ltd., incorporated in 1964, was initially exempted from paying the special contribution imposed by Chapter V‑A of the Employees' State Insurance Act, 1948, until the scheme was extended to its area. The exemption was withdrawn on 31 May 1969 and the company challenged the liability, arguing that the contribution was a fee or tax without any quid pro quo and therefore ultra vires. The Gujarat High Court dismissed the writ petition and the company appealed to the Supreme Court. The Court examined whether the special contribution fell within the legislative competence of Parliament under List III entries 23 and 24, whether it could be characterised as a tax or fee, and whether a sufficient quid pro quo existed despite the benefits being deferred. It held that the contribution is a valid levy under the social‑security scheme, not a prohibited tax or fee, and that the deferred benefits satisfy the quid pro quo requirement. Consequently, the appeal was dismissed with costs.

Issues considered

The constitutionality of Chapter V‑A of the Employees' State Insurance Act, 1948
Whether the special contribution is a tax, a fee, or a permissible social‑security levy
Whether the levy requires a contemporaneous quid pro quo
Whether Parliament had legislative competence to impose the contribution under List III entries 23 and 24

Legislation cited

Constitution of Indias. Art.132, s. Art.133, s. Art.226, s. Art.41, s. Art.42, s. Art.43, s. List III Entries 23,24
Employees' State Insurance Act, 1948s. Chapter V-A, s. s.20, s. s.26, s. s.28, s. s.46, s. s.73-1

Subjects

Employees' State InsuranceSpecial contributionTax vs feeConstitutional validityLegislative competenceDirective PrinciplesQuid pro quoSocial welfare legislationUltra vires

Judgment

1085

A
GASKET RADIATORS PVT. LTD.

v.

EMPLOYEES STATE INSURANCE CORPN. & ANR.
B
February 28, 1985

0. CHINNAPPA REEDY, E. S. VENKATAiAMIAH & R. B.
MISRA, JJ).

Constit:ition of India, Articles 41, 42 and 43 and Entries 23 and C
24, List III, Schedule VJI-Campetency of legblature to make laws.

Employees' State Insurance Act, 1948-Chapter V-A (Prior to its
deletion w. e. /. Juley 1, 1973 by notification issued uuder s. 73-1)-Whether
contemplates rendering of any serv:ce or conferment of benefit-Employer's
special contributfon-Whethernecessory to label constitution as a tax or fee-
Whethl'r quid pro quo exists between cantribution and benefit-Whether quid D
pro quo need be simultaneous or deferred.
)

Interpretation : Whether observation in Judgments to be construed as
provision of statute.

The Employee' State Insurance Act 1948, a social welfure legislation E
in tune with the Directive Principles of State Policy contained in Articles
41, 42 and 43 of the Constitution, was enacted to provide for certain
benefits to employees in the case of sickness, maternity and employment
injury and to make provisions for certain other matters in relation thereto.
The Act directly falls under Entries 23 and 24 of List III of the Vllth
Schedule of the Constitution, which are, "social security and social insur-
ance; employment and unemployment", and ''welfare of labour including F
conditions of work, pro\,'.ident funds, employers liability, w0rkmeo's compen-
sation, invalidity and old age pensions and maternity benefits'',

The Act applies to all factories including factories belonging to the
Government other than seasonal factories. Chapter II provides for the
J establishment of the Employees' State Insurance Corportttion, to be a body
G
corporate, for administering the scheme of Employe\::s' State Insurance.
Section 26 provides for the establishment of a Fund called the Employees'
State Insurance Fund. Section 28 lists tho purposes for which the Fund
may be expended. Chapter IV provides for the manner of insurance of
all the employees in factories or ostablishmenta to which tho Act applies
H
1086 SUPREME COURT REPORTS (198512 s.c.R.

A and the payment of c oatributioo for that purpose. The contribution pay-
able io respect of an employee shall comprise contribution payable
by the empt oyer called employer's contribution and contribution payble
by the employee called employee's contribution. The contribution
has to be paid at tbe rates specified in the first Ecbedule. Section 46
specifies the benefits to wbi.::h the insured persons, their dependants and olhers
shall be entitled. The scheme under the Acl could only be implemented by
8 stages, and, therefore, "transitory provisions" were made by introduction
of Chapter V-A by s. 20 of Act No. 53 of 1951, which provided for the
payment by the principal employer of a special contribution which shall be
in lieu of the employer's contribution payable under Chapter IV in the
case of factories or establishments situate in areas in which the provisions
of both Chapters IV and V are in force. The provisions or Chapter V-A.
however. ceased to have effect on and from July 1, 197 J.
c
The appellant company was foemed in 1964 and started production
the same year. The appellant company was exempted from the provisiona
of Chapter V·A until the provisions of Chapter V of the Act were enforced
in the area where the appellant's factory was situated. This exemption was
withdrawn with effect from May 31, 1969, The appellant company ques·
tioned its liability to pay special contribution under Chapter V-A of the
D Act under Article 2 26 of the Constitution. The High Court dismissed the
petition.

In the appeal to this Court it was contended that the contribution
payable under Chapter V -A is a fee and its levy is illegal as the Act does
not contemplate the rendering of any service or the conferment of any
benefit to the appellant company or its employees as quid pro quo for the pay·
E meat, and the provisions of Chapter V-A are, therefore, ultra vires.

Dismissing the appeal.

HELD : 1. The payment of contribution by an employer towards the
premium of an employee's compulsory insurance under the Employee' State
Insurance Act falls directly within Entries 23 and 24 of List III of the
F VII th Schedule and it is wholly unnecessary to seek justification fot it by
recourse to Entry 97 of List I or Entry 4 7 of List III in any circumlocutous
fashion. [!094A·B]

2. These contributions or for example coiltributions to Provident
Funds or payment of other benefits to workers cannot be labelled as taxes
or fees. They are neither taxes nor fees. They donot require to be labelled
G as taxes or fees to receive 1igitimation. [1093F]

3. (i) Even if the charge is to be construed as a fee it is justifiable on
that basis also as there was sUfticient quid pro quo. [1096A]

3. (ii) Services and benefits are indeed meant to be and are bound to
be conferrt"d on the employees and through them on the employer, in due
course. when the scheme becomes fully operative in all areas. For a start
H the scheme. is confined to a few areas and though special contribution is
GASKET RADIATORS V. E.S.I. CORPN. 1081

levied from all employers wherever they be, in the case of employers who
A
straightaway receive the benefits of the insurance scheme, their rate of
contribution is higher while in the case of employrrs, who do not yet
receive the benefits of the scheme, their rate of contribution is lower. For
the latter the scheme is analogou3 to a deferred insurance policy. Merely
because the benefits to be receive are postponedj it cannot be said that
there is no quld pro quo. Ordinarily a return in presenti i!I generally
present when fee is levied, but simultanei1y or contemporaneity of payment B
is not the most vital or cl'ucial test to determine whether a levy is a fee or
not. In fact, it may often h:ippen that th~ rendering of a service or the
conferment of a benefit may only follow after tbe consolidation of a fund
from the fee levied. It is only after a s~ffi.cient nucleus. is. available that
one may reasonably except a compensating return. The question of how
soon a return may be expected or ought to be given must necessarily depend
on the nature of ibe services required to be perrormed and benefits required c
to be conferred. [10940-H]

Basant Kumar vs. Eagle Rolling Mills, AIR 1964 SC 1260=[!964] 6
SCR 913, referred to.

K. C. Sarma vs. R•giona/ Director, E. S. I Corporation, AIR 1962
ASSAM 120, followed. D

4. The observations in the case of Kewal Krishan that the benefit
should not be indirect and remote was not made in connection with any
delayed benefit from the point of view of time, but with reference to the
very benefit iti>elf and its connection with the kvy. The judgments of
Courts are not to be construed as Acts of Parliament. Nor can a Judg·
ment on a particular aspect of a question be read ao; a Holy Book covering E
all aspects of every question whether such questions arose for consideratioo
of not in that case. [1096B-C)

Kewal Krishan vs. State of Punjab, AIR 1980 SC 1008 destinguishcd.

Amar Nath Om Parkash vs. State of Punjab, AIR 1985 SC 218, F
relLd on.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 764 of
1972.
i
From the Judgment and order dated the 6th/7th September,
G
1971 of the Gujarat High Court at Ahmedabad in Special Civil
,
.,. Application No. 1489 of 1969 .

G.B. Pai, D.N. Misra, A.N. Ditia and Miss Meera Mathur,
for the Appellant.
H
iilss SUPREME COURT REPORTS [1985] 2 S.C.ll.

A Abdul Khader, S.T. Desai, Girish Chandra, N.L. Kekar, CV.
Subba Rao, R.N. Poddar for the Respondents.

The judgment of the Court was delivered by

B CHINNAPPA REDDY, J. The question raised in this appeal
concerns the vires of Chapter V-A of the Employees' State Insu-
rance Act, 1948. The principal Act was enacted in 1948. Chapter
V-A was inserted by s. 20 of Act No. 53 of 195!. The provisions
of the Chapter, however, have ceased to have effect on and from
July I, 1973. That is the sequel to a notification issued under s. 73-I
c of the Act. Chapter V-A is headed "Transitory Provisions" and
provides for the payment by the principal employer of a special
contribution which shall be in lieu of the employer's contribution
payable under Chapter IV in the case of factories or establishments
situated in areas in which the provisions of both Chapte«s IV and V ·
are in force. The special contribution is required to be such per-
centage, not exceeding five per cent of the total wage bill of the
D employer, as the Central Government may specify. It is also pro-
vided that the employer's special contribution in the case of factories
or establishments in areas in which the provisions of both Chapters
IV and V are in force shall be fixed at a rate higher than that in the
case of factories or establishments situate in areas in which the
provisions of the said Chapters are not in force. •
E
The employees' State Insurance Act, 1948 was enacted to
provide for certain benefits to employees in the case of sickness,
maternity and employment injury and to make provisions for certain
other matters in relation thereto. It is an obvious social welfare
legislation in tune with the Directive Principles of State Policy
F contained in Articles 41, 42 and 43 of the Constitution. It is a
legislation which comes directly under entries 23 and 24 of list III
of the VII th schedule of the Constitution, which are, "social security
and social insurance ; employment and unemployment", and
"welfare of labour including conditions of work, provident funds, I
employers' liability, workmen's compensation, invalidity and old age
G
pensions and maternity benofits". The Act extends to the whole of
India and comes into force on such date or dates as the Central
Government may appoint, different dates being permissible for
different provisions of the Act and or different States or for diffe- '
rent parts thereof. It applies to~ll factories including factories
H belonging to the Government other than seasonal factories. Chapter
GASKET RADIATORS v. B.S.I. CORPN. (Chlnnappa Reddy, J.) 1089

II provides for the establishment of the Employees' State Insurance A
Corporation for administering the scheme of Employees' State
Insurance in accordance with the provisions of the . Act. The
Corporation is to be a body corporate having perpetual succession
and a common seal. There are detailed provisions for the Consti·
tution of a Standing Committee and a Medical Benefit Council.
B
Chapter III provides for Fmance and Audit. Section 26, in parti-
cular, provides for the establishment of a Fund called the Emplo-
yers' State Insurance Fund into which all contributions paid under
the Act and all other money received on behalf of the Corporation
shall be paid. The Corporation is authorised also to accept grants,
donations and gifts from the Central or any State Government, c
local authority or any individual or body whether incorporated or
not, for all or any of the purposes of the Act. Section 28 lists the
purposes for which the Fund may be expended and it includes
among other items,
D
fi) payment of benefits and prov1S1on of medical
treatment and attendance to insured persons and, where the
medical benefit is extended to their families, the provision
of such medical benefit to their families, in accordance with
the provisions of this Act and defraying the charges and
costs in connection therewith ; and E

(ii) ...........................
(iii)
···························
(iv) establishment and maintenance of hospitals, dispensa- F
ries and other institutions and the provisions of medical
and other ancillary services for the benefit of insured per-
sons and, where the medical benefit is extended to their
families;"

} . Chapter IV provides for the manner of insurance of all the
employees in factories or establishments to which the Act G
applies and the payment of contribution for that purpose. The
J contribution payable in respect of an employee shall comprise oontri-
butio~ p~yable by the employer called employers's contribution and
contnbut1.on payable by the employee called employee's contribution.
The contnbut10~ has to be paid at the rates specified in the first
schedule. Detailed provision i~ made for the method and payment
tt
1090 SUPREME COURT REPORTS [l 985] 2 S.C.R.

A of contribution. Chapter V deals with benefits. Section 46 speci-
fies the benefits to which the insured persons, their dependants and
others shaU be entitled. There are other detailed provisions indi-
cating the manner of working out the various benefits.

Quite obviously the scheme could n3t be implemented straight
B
away throught out the country but could 01.ly be implemented by
stages. It, therefore, became necessary for the Parliament t0 make
certain transitory provisions, which it did by the introduction of
Chapter V-A by Act 53 of 1951. The Statement of objects and
reasons of Act 53 of 1951 may be usefuUy extracted here. The
c Statement is as follows :-

"The Employees' State Insurance Act, 1948, was
passed by the Dominion Legislature in April 1948. It pro-
vides for certain benefits to industrial employees in case of
sickness maternity and employment injury The Act per-
D mits the implementation of tbe scheme by stages.

It was intended that the scheme should be implemented
in the first instance in Delhi and Kanpur, but regional
implementation of such schemes is always attended with
certain practical difficulties. The principal difficulties are
E the 'rise in the cost of production and the diminution of the
competitive capacity of industries located ia those regions.
The main objections of the employers centred round the
former difficulty and those of the Uttar Pradesh Govern·
ment emphasised the latter. The Central Government have
F considered those objections and are anxious to avoid any
competitive handicap to any region. This may be best
achieved by an equitable distribution of the employer's
contribution, even where implementation is affected only
in certain areas, among the employers in the whole country.
employers in regions where the scheme is implemented
paying slightly higher contributions. This will minimise
!
G the contribution leviable from the employers and spread
the incidence of the cost of the scheme equitably. This
Bill is primarily intended to achieve this object.''

The notes on Clause lO of the Bill which provided for the •
introduction of Chapter V-A was to the following effect,
H
GASKET RADIATORS v. B.s.i. CORPN. (Chinnappa Reddy, J.) 1091

"Clause 20-A new self-contained chapter is proposed A
providing for the collection of employer's special contribu-
tion throughout the Union. The rate of the contribution
which may be varied from time to time is to be fixed by the
Central Government after two months' notice by notifica-
tion. The rate of tbe contribution shall be higher m areas
where the scheme applied than in other areas. The manner B
of and time within which the special contrtbution is to be
paid would be notified by the Central Government. Conse-
quential provisions fitting the employer's special contri-
bution into the existing scheme of the Act and other nece-
ssary provisions have been made in this Chapter. The
Central Government is empowered to give directions or C
provide for such matters as may be necessary for the remo-
val of any difficulty. The Chapter can be withdrawn from
operation by the Central Government after giving three
months' notice."

The desirability and the necessity for the implementation of D
the scheme by stages has been brought out by a Constitution
Bench of this court in Basant Kumar v. Eagle Rolling Mi/ls( 1J where
it was stated.

" ............ In the very nature of things, it would have E
bee11 impossible for the legislature to decide in what areas
and in respect of which factories the Employees' State
Insurance Corporation should be established. It is obvious
that a scheme of this kind, though very beneficent, could
not be introduced in the whole of the country all at once.
Such beneficial measures which need careful experimenta- F
tion have some times to be adopted by stages and in diffe-
rent phases, and so, inevitably, the question of extending
the statutory benefits contemplated by the Act bas to be
left to the discretion of the appropriate Government.
"Appropriate Government" under S. 2(1) means in respect
of establishments under the control of the Central Govern-
ment or a Railway administration or a major port or a G

J mine or oil field, the Central Government, and i9 all other
cases, the State Government. Thus, it is clear that when
extending the Act to different establishments, the relevant

(]) AIR 1964 SC 1260=(1964] 6 SCR 913 H
1092 SUPREME COURT REPORTS [1985] 2 s.c.R ..

A
Government is given the power to constitute a Corporation
for the administration of the scheme of Employees' State
Insurance. The course adopted by modern legislatures in
dealing with welfare scheme has uniformly conformed to
the same pattern. The legislature evolves a scheme of
B
socio-economic welfare, makes elaborate provisions in res-
pect of it and leaves it to the Government concerned to
decide when, how and in what manner the scheme should
be introduced."

In the present case the appellant company which was formed
c in 1965 and went into production the same year, was exempted
from the provisions of Chapter V· A of the Act until the provisions
of Chapter V of the Act were enforced in the area where the appel-
lant's factory was situated. However this exemption was withdrawn
with effect from May 31, 1969 by a notification of the Government.
D The appellant company questioned its liability to pay special contri·
bution under Chapter V-A of the Employees' State Insurance Act
by filing a writ petition in the High Court of Gujarat under
Art. 226 of the Constitution. The writ petition was dismissed by
the High Court on September 7, 1971 and the present appeal has
been filed pursuant to a certificate granted by the High Court under
E Art. 132(1) and 133(1) (c) of the Constitution. Meanwhile Chapter
V-A has ceased to have effect on and from July l, 1973. We are,
therefore, concerned in this appeal with the question of the payment
of special contribution under Chapter V-A by the appellant company
for the period, May 31, 1969 to March 26, 1973. The main ground
on which the appellant canvasses the correctness of the judgment of
the High Court is that the contribution payable under Chapter V·A
is a fee and its levy is illegal as the Act does not contemplate the
rendering of any service or the conferment of any benefit to the
appellant company or its employees a• quid pro quo for the pay-
ment. The provisions of Chapter V-A, therefore, according to the
learned coumiel, are ultra vires.

G We are afraid that the very approach of the appellant to the
problem at issue suffers from a basic defect. The appellant's
argument proceeds on the fundamental misconception that the
payment of contribution directed to be made by the employer under
the Employees' State Insurance Act or other similar payment or
benefit under various other social welfare legislations must either
be labelled as a tax or a fee in order to attain legitimacy or not at
all. The idea that such payment, contribution or whatever name
'

UASKBT RADIATORS v. E.S.I. CORPN. (Chinnappa Reddy, J.) !093

is given to it should be so pigeon-hold and fitted in stems from a A
misunderstanding of the schen'e of our Constitution in regard to
social welfare legislation. Apart from the preamble which promises
to s~cur~ to all its citizens, ''ju11tice, social, economic and political",
the State is enjoined by the Direct:ve Principles of State Policy to
secure a social order for the promotion of the welfare of the people.
In particular Arts. 41, 42 and 43 enjoin the State to make effective B
provision for securing the right to work, to education and public
assistance in cases of unemployment, old age, sickness and disable-
ment, and in other cases of any undeserved want. to make provision
for securing just and humane conditions of work and maternity
relief and to secure by suitable legislation or economic organisation c
or in any other way, to all workers, agricultural, industrial or other-
wise, work, a hving wage, conditiom of work ensuring a decent
standard of life and full enjoyment of leisure and social and cultural
opportunities. [t is in pursuance of these Directive Principles that
we find entries 2~ and 24 in list Ill of the VJith Schedule of the
Constitution. Both Parliament and the Legislature of any State,
sufijcct to conditions with which we are not concerned, have power
n
to make laws with respect to any of the matters enumerated in List
Ill It is pursuant to tho power entrusted in respect of entries 23
and 24 of List Ill that Parliament has enacted the Employees' State
Insurance Act. In our understanding, entries 23 and 24 of List II!,
• of their own force, empower Parliament or the legislature of a State E
to direct the payment by an employer of contributions of the nature
of those contemplated by the Employees' State Insurance Act for
the benefit of the employees. These contributions or for example
contributions to provident funds or payments of other benefits to
workers are not required to he and cannot be labelled as taxes or
• fees for the sole and simple reason that they are neither taxes nor F
fees. List I and List II contain several entries in respect of which
taxes may be levied by the Parliament, by the Legislature of any
State and by both. Entry 97 is a residuary clause which enables
Parliament to legislate in respect of any other matter not enumera-
ted in List JI or List 11 I including any tax not mentioned in either
5 of those lists. Entry 96 of List I enables Parliament to levy fee in
respect of any of the matters in that list, but not including fee taken G
in any court Similarly entry 66 of List II enables the legislature
) of a State of levy fee in respect of the matters in that list but not
including fees taken in any court. Again entry 47 of 'List JU
enables Parliament and the Legislature of a State to levy fees in
respect of any of the matters in that list but not including fees in
u
1094 SUPREME COURT REPORTS [1985] 2 s.c.a.
A any court. The payment of contribution by an empbyer towards
the premium (what else is it ?) of an employee's compulsory insu-
rance under the Employees' State Insurance Act falls directly within
entries 23 and 24 of List I JI and it is wholly unnecessary to seek
justification for it by recourse to Entry 97 of List I or Entry 47 of
List III in any circumlocutous fashion. We see no reason to brand
B
or stamp the contribution as a tax or fee in order to seek t) legiti-
mise it. Legitimation need not be sought fictionally from Entry 97
of List I or Entry 47 of List III when legitimation is directly derived
for the charge from Entries 23 and 24 of List III.

Even if the charge is to be construed as a fee as the High
Court has done, it appears to us to be justifiable on that basis too.
It is not disputed and indeed it is not capable of any controversy
that services and benefits are indeed meant to be and are bound to
be conferred on the employees and through them on the employer,
in due course, when the scheme becomes fully operative in all areas.
D For a start the scheme is confined to a few areas and though special
contribution is levied from all employers wherever they be, in the
case of employers who straightaway receive the benefits of the
insurance scheme, their rate of contribution is higher while in the
case of employers, who do not yet receive the benefits of the scheme,
their rate of contribution is lower. So far as the latter arc concer-
E ned, the scheme is analogous to a deferred insurance policy which
parents often take out on the lives of their children, but which are
•
to be effective only from a future date after the children attain a
certain age, though premium is liable to be paid right from the
start. Merely because the benefits to be received are postponed,
it cannot be said that there is no quid pro quo. It is true that
F ordinarily a return in proe senti is geneially present when fee is
levied, but simultaneity or contemporaneity of payment and benefit •
is not the most vital or crucial test to determine whether a levy is a
fee or not. In fact, it may often happen that the rendering of a
service or the conferment of a benefit may only follow after the
consolidation of a fund from the fee levied. Hospitals, for instance,
G cannot be built in ~ day nor medical facilities provided right from .,
)

the day of the commencement of the scheme. It is only. after a
sufficient nucleus is available that one may reasonably expect a
compensating return. The question of how soon a return may be
expected or ought to he given must necessarily depend on the nature
oi the services required to be performed and benefits required to be
H
GASKET RADIATORS v. E.S.j. CORPN. (Chinnappa Reddy, J.) 1095

conferred. Jn K C Sarma v. Regional Director, E S. I. Corpo· A
ration(') it was observed:

" ...... It appears that the employed special contribution
is not a tax but a fee. This contribution goes to a fund
known as the Employees' State Insurance Fund which is to
be utilised for ·the bc.1efits to be given to the employees B
under the Act. The cost of these benefits will not be met
from the general revenues of the State, but will be borne
entirely from the aforesaid fund only ...... the employers'
contribution under the Act constitutes only a fee and not a
tax ....................................................................... .
The Government cannot go on levying employers' contri- C
bution under sec. 73A of the Act without giving a service
in return. But from this it does not follow that the service
must be given as soon as the contribution is made. The
• object of the Act is that the benefits which it provides
should become available to the employees in all factories
through out India as soon as circumstances make it practi· D
cable. Statutory bodies have to be set up, various officers
have to be appointed and arrangements have to be made
for providing medical help. All these required time and
money and in some areas the time required may be more
than in other areas. Chapter VA is for meeting the needs
of the transitory period. When the whole Act is brought E
into force in the whole of India, it would not be necessary
to retain this Chapter. Then all contributions will be made
under Chapter IV. It may bo noted that Chapter VA was
inserted, as pointed out above, by an amending Act only in
1951. The object of the amendment was to make an equi-
table distribution of contributions by all employers. It was F
not considered fair that only employers of these regions to
which the benefit provisions were ~extended should alone
make contrtbutions and thereby help to set up a corpor-
ation. The benefit provisions will sooner or later be
extended to all areas. Therefore, the amendment provides
that employers of regions to which the benefit clauses are G
not extended must also make their contributions though at
a lesser rate."
As anticipated by the Assam High Court, Chapter VA has
now ceased to have effect from July l, 1973, as already mentioned

11) AJR 1962 Auam 120.
H
•.
1096 SUPREME COURT REPORTS [1985) 2 S.C R
,_
A by us earlier. If the charge was to be levied as a fee, we are satis- ...
fied that there was sufficient quid pro q:io. The learned counsel for
the respondent attempted to argue that simultaneity or contemperan-
eity oflevy and service were of the essence of a fee and that it had
been so laid down in Kewal Krishan Vs. State of Punjab( 1 ). Inspira·
tion for the argument was drawn from the statement in Kewal
B Krishan's (supra) case that the benefit should not be indirect and
remote The reference, there, to indirectness and remoteness was
not made in connection with any delayed benefit from the point of
\
view of \ime, but with reference to the very benefit itself and its
connection with the levy. We once again have to reiterate what we
were forced to point out in Amar Nath Om Parkash 1s. State of
c Punjab(') that judgments of courts are not to be construed as Acts
of Parliament Nor can we read a judgment on a particular aspect
of a question as a Holy Book covering all aspects of every question
whether such questions and facets of such questions arose for
consideration or not in that case. We must however, haskn to
D notice that the Madras High Court in Shak ti Pipe Limited vs E. S I.
Corporation(') and the Kerala High Court in Gwalior Rayon Stlk
Manufacturing Company vJ. E S. /.Corporation(') have upheld the
levy of special contribution as a tax. Therefore, whether the special
contribution is to be viewed as a tax, fee or neither it has sufficient
constitutional protect10n. The appeal is, therefore, dismissed with
costs.
E •

A.P.J. Appeal dismissed.

l'

G

------------
(1) AIR 1980 SC 1008
-
(2) AIR t985 SC 2t8
(3) 1978 Labour & Ind. cases 410
H (4). 1975 Labour & Ind. cases 1390.