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Report No. 61

2.37. Past interpretation not a sure guide.-

No doubt, it is true that the Central Sales Tax has-on one plausible interpretation1-itself levied a tax on hire-purchase not resulting in sale, and, on that basis, it could be argued that the strict common law concept of "sale" has not been adhered to by the legislature. But this does not necessarily lead to the conclusion that, for the purpose of Article 269 of the Constitution, the interpretation of the expression "sale" should be wide. Legislative practice, reflected in a definition (which itself is open to two interpretations), is not conclusive on a question of competence of the very legislature which has adopted that practice. (The word 'competence' is used here not to indicate the power of the Union to tax, but to connote its power to assign the revenues from the tax to the States). As Lord Radcliffe emphasised2, "resort to a later Act can rarely, if ever, be justified, unless the message that it conveys is a plain one itself, at least free from ambiguity".

1. See discussion relating to hire-purchase.

2. Mac Manaway (in re:), 1951 AC 161 (177) (PC).

Certain Problems connected with Powers of the States to Levy a Tax on the Sale of Goods and with the Central Sales Tax Act, 1956 Back

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