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PETITIONER: THE BULLION AND GRAIN EXCHANGE LTD. AND OTHERS
Vs.
RESPONDENT: THE STATE OF PUNJAB
DATE OF JUDGMENT: 13/09/1960
BENCH: GUPTA, K.C. DAS BENCH: GUPTA, K.C. DAS DAS, S.K. HIDAYATULLAH, M. SHAH, J.C. AYYANGAR, N. RAJAGOPALA
CITATION: 1961 AIR 268 1961 SCR (1) 668
ACT: Forward Contracts Tax-Validity of enactment-Legislative competence-Severability of valid portion-Punjab Forward Con- tracts Tax Act, 1951 (Punj). 7 of 1951), s. 2-Constitution of India, Seventh Schedule, List II, Entry 62.
HEADNOTE: The appellants, who were carrying on the business of com- mission agents in forward contracts, filed a petition before the High Court of Punjab under Art. 226 of the Constitution of India challenging the validity of the Punjab Forward Contracts Tax Act, 1951, on the ground that it was ultra vires the powers conferred upon the State Legislature. The Act provided for the levy of a tax on forward contracts which were defined, by. S. 2, as agreements, oral or written, for sale of goods on a future date but on the basis of which actual delivery of goods was not made or taken but only the difference between the price of the goods agreed upon and that prevailing on the date mentioned in the agreement or any other date was paid or received by the parties. The High Court took the view that the Act was one to tax speculation in futures and fell wi...