MALAYALAM PLANTATIONS LTD. Vs. THE DEPUTY COMMISSIONER OF AGRICULTURAL INCOME‑TAX AND SALES

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeals Nos. 678 and 679 of 1963

Decision Date: 20 March 1964

Coram: N. Rajagopala Ayyangar, P.B. Gajendragadkar, K.N. Wanchoo, J.C. Shah, S.M. Sikri

The case was Malayalam Plantations Ltd versus the Deputy Commissioner of Agricultural Income‑Tax and Sales, decided on 20 March 1964 by the Supreme Court of India. The judgment was authored by Justice N. Rajagopala Ayyangar and the bench comprised Justices N. Rajagopala Ayyangar, P. B. Gajendragadkar, K. N. Wanchoo, J. C. Shah and S. M. Sikri. The petitioner was Malayalam Plantations Ltd and the respondent was the Deputy Commissioner of Agricultural Income‑Tax and Sales. The citation for the decision is reported as 1965 AIR 161 and 1964 SCR (7) 391. The relevant statutory provision was the Sales Tax‑Tea clause dealing with tea sold by auction at Fort Cochin, which lay outside the State of Travancore‑Cochin, and the question was whether such sales should be counted in the turnover for sales‑tax purposes. The doctrine of territorial nexus in sales‑tax legislation, although not raised before the High Court, could be considered at the Supreme Court level. The issue also involved the application of Article 286(i)(a) of the Constitution of India, both before and after the Constitution (Sixth Amendment) Act, 1956, as it related to the Travancore‑Cochin General Sales Tax Act, 1950.

The factual background revealed that the appellant company owned multiple tea estates and was assessed for sales‑tax on tea sold during the financial years 1954‑55 and 1955‑56. The appellant appealed the assessment, and the Appellate Assistant Commissioner rejected the appeal on the ground that the tea, at the time of sale, was stored in godowns within Travancore‑Cochin, thereby deeming the sale to have occurred inside that State and to be taxable. The appellant then appealed to the Sales Tax Appellate Tribunal, which held that ownership of the tea passed at Fort Cochin in Madras State when the auction hammer fell, and consequently the transaction was not taxable. The State filed a revision petition before the High Court, which accepted the Tribunal’s finding on the passage of title but diverged on the significance of the tea’s physical presence in godowns in Travancore‑Cochin, concluding that the sales were taxable. The appellant obtained a certificate of fitness from the High Court and appealed to this Court, limiting the argument to whether a sale effected by auction at Fort Cochin in Madras State constituted a sale inside or outside Travancore‑Cochin and whether it fell within the scope of the sales‑tax law. The Court accepted the appeal and held that no sales tax was levied because the sale occurred outside Travancore‑Cochin. The test applied was the location where the property in the goods passed, which in this case was Fort Cochin in Madras State, establishing that the transaction was an outside sale and therefore not subject to the Travancore‑Cochin General Sales Tax Act, 1950.

In this case the Court observed that the point that the property in the goods had not passed in Madras State had not been raised before the High Court and had not been included in the respondent’s statement of case; consequently that argument was not permitted to be raised before the Supreme Court. According to Shah J, the property in the tea passed at Fort Cochin, which lay within Madras State, and because the goods were delivered without any intention that they be consumed in any particular state, the sale was deemed to have occurred outside Travancore‑Cochin. The Court therefore held, following its earlier decision in A. V. Thomas & Co. v. Deputy Commissioner of Agricultural Income‑tax and Sales Tax Trivandrum, 14 S.T.C. 363, that the transaction was not liable to tax under the Travancore‑Cochin General Sales Tax Act, 1950. The judgment further explained that the doctrine of territorial nexus operated fully in the sales‑tax legislation enacted under the Government of India Act, 1935 and that the doctrine was not displaced by the introduction of Article 286 of the Constitution. The doctrine continued to operate during the period between the coming into force of the Constitution and the amendment of Article 286 by the Constitution (Sixth Amendment) Act, 1956, and it remains applicable today, subject to certain modifications. Parliament has been empowered to lay down principles for deciding when a sale or purchase of goods takes place outside a State or during the import of goods into India or the export of goods from India. By exercising the authority conferred by clause (2) of the relevant constitutional provision, Parliament enacted the Central Sales Tax Act, 1956, and through section 4(2) gave legislative recognition to the doctrine of territorial nexus, although in a limited manner. The Court referred to several authorities on the subject, including Deputy Commissioner of Agricultural Income‑tax and Sales Tax, Trivandrum v. A.V. Thomas & Co., I.L.R. 1960 Kerala 1395; India Copper Corporation Limited v. State of Bihar, [1961] 2 S.C.R. 276; A. V. Thomas & Co. Ltd. v. Deputy Commissioner of Agricultural Income‑tax and Sales‑tax, Trivandrum, 1953 Supp. 2 S.C.R. 608, 363; Poppat Lal Shah v. The State of Madras, [1953] S.C.R. 677; and Tata Iron & Steel Company Ltd. v. The State of Bihar, [1958] S.C.R. 1356. The judgment was rendered in the civil appellate jurisdiction for Civil Appeals Nos. 678 and 679 of 1963, which were appeals from the Kerala High Court judgment and order dated 4 April 1961 in Tax Revision Nos. 52 and 53 of 1959. The parties were represented by counsel as listed, and the judgment dated 20 March 1964 was delivered by Chief Justice Gajendragadkar, C.J., and judges Wanchoo, Rajagopala Ayyangar and Sikri, with the opinion being delivered by Ayyangar J. A separate opinion was delivered by Shah J. The Court noted that the appellant owned several estates where tea was cultivated and had been assessed to sales tax on that tea.

The Sales Tax Officer of the First Circle in Quilon, State of Travancore‑Cochin, issued an order on 23 December 1956 assessing sales tax on tea that the appellant had sold during the financial years 1954‑55 and 1955‑56. The assessment computed taxable turnover that incorporated two particular items, each of which formed the basis of a separate appeal concerning the respective assessment years. The appellant argued before the assessing officer that certain tea sales conducted by auction at Fort Cochin—then situated within Madras State—were transactions that occurred outside Travancore‑Cochin and therefore should be exempt from tax under Article 286(l)(a) of the Constitution. The Sales Tax Officer rejected this argument and added the amounts from those auction sales to the taxable turnover. The appellant subsequently appealed to the Appellate Assistant Commissioner, whose decision was also unfavorable. That authority held that, at the time of the auction, the tea was stored in godowns on Willingdon Island, which lay within Travancore‑Cochin, and therefore, by operation of a provision in the State Sales Tax Act, the sales were to be regarded as having taken place inside the taxing State and were consequently taxable. The appellant then appealed to the Sales Tax Appellate Tribunal. The Tribunal accepted the appellant’s contention, set aside the assessment insofar as it included the turnover from the Fort Cochin auctions, and ordered that the sums—Rs 56,43,184‑11 for the year 1954‑55 and Rs 62,13,604‑3 for the year 1955‑56—be excluded from the calculation of taxable turnover, remitting the matter for fresh disposal. The State filed a revision petition before the High Court under section 15(b) of the General Sales Tax Act of Travancore‑Cochin. The High Court dismissed the revision, affirmed the assessing officer’s order and the Appellate Commissioner’s decision, and held that the turnover represented by the auction sales was lawfully taxable under the State’s sales‑tax legislation. After obtaining a certificate of fitness from the High Court, the appellant’s appeals reached this Court.

Before further analysis, the Court found it necessary to set out the relevant statutory language contained in the State’s taxing enactment. The General Sales Tax Act (Act XI of 1125 (ME) 1950), which imposed a sales tax on dealers, defined the term “sale” in section 2(j) as follows: “‘Sale’ with all its grammatical variations and cognate expressions means every transfer of the property in goods by one person to another in the course of trade or business for cash or for deferred payment or other valuable consideration and includes also a transfer of property in goods involved in the execution of a works contract, but does not include a”. This definition would later be applied to determine whether the tea auction transactions fell within the scope of the State’s tax jurisdiction.

The provision labelled Explanation (2) stated that, notwithstanding any contrary rule in the then‑applicable Sale of Goods Act, a transaction involving the sale or purchase of any goods would, for the purposes of the present Act, be treated as having taken place in the State regardless of where the contract was actually made, if either (a) the goods were physically present within the State at the moment the contract of sale or purchase was executed, or (b) the contract concerned future goods identified by description and the goods were subsequently manufactured within the State at any time after the contract had been concluded. When the Constitution became operative, the Adaptation Order inserted a new Section 26 into the Act in order to bring it into conformity with Article 286(1) of the Constitution. Section 26 read: “No law of a State shall impose or authorise the imposition of a tax on the sale or purchase of goods where such sale or purchase takes place (a) outside the State or (b) …” The accompanying Explanation clarified that, for the purpose of sub‑clause (a), a sale or purchase would be deemed to have occurred in the State in which the goods were actually delivered as a direct result of that sale or purchase for consumption in that State, even though, under the general law of sale of goods, ownership of the goods might have passed in another State. Consequently, although Clause (a) to Explanation 2 of Section 2(j) provided that, despite any contrary rule in the Sale of Goods Act, a sale or purchase would be deemed to take place in the State if the goods were in the State at the time the contract was made, the non‑obstante clause embodied in Section 26 prohibited the levy of a tax on any sale or purchase that occurred “outside” the State of Travancore‑Cochin. It is also necessary to note that, even if Section 26 were disregarded, the language of Article 286(1)(a) would lead to the same result, namely that the State could not validly impose a tax on a sale that was “outside” its territorial limits. The core issue, therefore, was whether a sale of tea carried out by the appellant through an auction held at Fort Cochin, and which had been included in the appellant’s taxable turnover, could be characterised as an “outside” sale. The High Court set out the relevant facts in its own words, stating that “the sales of teas were concluded at Fort Cochin and the goods were stocked in godowns situated in the Travancore‑Cochin State.”

In the facts, the goods were stored in warehouses located on Willingdon Island in the State of Travancore‑Cochin, and the deliveries to the purchasers were also made from those warehouses. The Appellate Tribunal concluded that because ownership of the commodity transferred at Fort Cochin, the property did not pass within the taxing State, and therefore the sales were to be treated as “outside” sales for the purpose of Article 286(1) and were exempt from tax. The Tribunal recorded a finding that the title in the goods passed at the moment the auction hammer fell in Fort Cochin, and the learned judges of the High Court accepted that same factual premise. The only point on which the High Court judges differed from the Tribunal concerned the effect of the circumstance that, at the time of sale, the tea was physically located in warehouses situated in the State of Travancore‑Cochin. In reaching its conclusion in favour of the appellant regarding the taxability of the turnover generated by these auction sales, the Appellate Tribunal relied upon a large number of decisions of this Court as well as observations contained in those decisions and several rulings of various High Courts. When the matter was placed before the High Court, that Court, after reviewing most of the earlier cases cited by the Tribunal, held in Deputy Commissioner of Agricultural Income‑tax and Sales‑tax, Trivandrum v. A.V. Thomas & Co. (I.L.R. [1960] Kerala 1395) that the expression “outside sale” in Article 286(1)(a) was not limited solely to the transfer of property in the goods under the Sale of Goods Act. Consequently, the High Court held that Explanation 2 to section 2(j) did not violate Article 286(1)(a) and that, if at the moment the property passed the goods were situated in Travancore‑Cochin, the location of the passing of title was not decisive; therefore the transaction was not an “outside” sale within the meaning of Travancore‑Cochin law and could be subject to the State’s sales tax. The learned judges also considered the decision of this Court in India Copper Corporation Limited v. State of Bihar ([1961] 2 S.C.R. 276) which, in their view, led to a different result; however, they held that the Bihar decision could be distinguished on its facts and that the earlier ruling in A.V. Thomas’s case remained good law and fully covered the issue raised. The matter before this appeal was whether the view expressed by the High Court was correct. The decision in Deputy Commissioner of Agricultural Income‑tax and Sales‑tax, Trivandrum v. A.V. Thomas & Co. was subsequently placed before this Court on appeal and was reversed, as reported in A.V. Thomas & Co. Ltd. v. Deputy Commissioner of Agricultural Income‑tax and Sales‑tax, Trivandrum (see [1963] supp. 2 S.C.R. 608). In doing so this Court observed that the earlier ruling in India Copper Corporation had settled the law by holding that a State other than a “delivery‑cum‑consumption” State could tax a “non‑explanation sale” only if the property in the goods passed within that State.

In the earlier decision known as the Indian Copper Corporation case(1), this Court clarified the rule governing which State may levy tax on a sale that falls outside the explanation to Article 286(1)(a). The Court explained that, except for a State that functions as both the place of delivery and consumption, only the State in which the ownership of the goods passes may impose tax on such a “non‑explanation sale,” a term the Court used to describe a transaction that does not fall within the explanation to Article 286(1)(a).

Turning to the present appeal, the Court observed that the factual situation is identical to that found in A.Y. Thomas’s case(2). The High Court judges had also proceeded on the basis that the facts were the same. Addressing the issue of what constitutes an “outside” sale, Justice Kapur, speaking for the Court, quoted the judgment in A.Y. Thomas & Co.(2) Ltd. He stated that it had been established and was not contested that title to the goods in the present matter passed at Fort Cochin. The question, he noted, was whether the transaction should be characterized as an “outside sale” or an “inside sale,” terms that have been used in various judgments to distinguish sales occurring within a State from those occurring outside it. The Explanation to Article 286(1)(a) defines a sale outside the State when the explanation resolves the difficulty of situs; however, in the present case the difficulty remained because the Explanation does not apply when rival States claim to tax the same taxable event, and those States are neither the States of delivery for consumption nor the States where title passes.

After referring to the Indian Copper Corporation Ltd. v. State of Bihar decision(1), the Court held that the transaction before it qualified as an “outside” sale with respect to Travancore‑Cochin, because the title to the goods passed at Fort Cochin, which lay in the State of Madras. Accordingly, the Court set aside the High Court’s decision and declared that, being an “outside” sale, the transaction could not be taxed under the prohibition contained in Article 286(1)(a). The Court then examined the meaning of the word “outside” in Article 286(1)(a) and reiterated the observation made in India Copper Corporation Ltd. v. State of Bihar(1). It stated that if a single State is intended to have the authority to tax a particular sale, the next step is to determine which State can be said not to be an “outside” State for that sale, that is, which State can be considered the “inside” State. The Court identified two cues in the Article that guide this determination: first, the opening words of Article 286(1), which speak of a sale or purchase taking place; and second, the non‑obstante clause in the Explanation, which refers to the general law relating to the passage of property in the goods.

The Court explained that the Explanation to Article 286(1)(a) refers to “the sale of goods under which property in the goods has, by reason of such sale or purchase, passed in another State.” The two expressions together indicate that the legislative intent is to focus on the moment when ownership of the goods passes within a State. That moment is to be used as the test for deciding whether a particular sale is “inside” or “outside” the State, and consequently whether the Explanation applies. Under this test, only the State in which the property passes acquires the authority to levy a tax on the sale. The Court further noted that this principle had been reiterated in the recent decision of this Court in Burmah Shell Oil Storage and Distributing Co. of India Ltd. v. The Commercial Tax Officer. The same principle of law was applied by this Court in A. V. Thomas’s case, where the appeal was allowed on that basis. Consequently, the Court held that the present appeals, which hinge entirely on the correct interpretation of the term “outside sales” in Article 286(1)(a) as adopted by the High Court in A. V. Thomas’s case, must also be allowed.

Nevertheless, counsel for the respondent State argued that, in the present matter, a factual issue had been raised before the High Court concerning whether, on the facts, the ownership of the tea sold at an auction held at Fort Cochin actually passed at Fort Cochin, which lay within Madras State, or whether the ownership passed at Willingdon Island in Travancore‑Cochin when the goods were delivered to the buyer. Regarding this mixed question of fact and law, the Court observed that the Sales Tax Appellate Tribunal had made a finding in the following terms: “The question whether the sales took place outside the State or not will have to be decided on the basis of the general law relating to sale of goods. We hold that in the case of auction sales of full lots the sales were of ascertained goods and hence became complete on the fall of the hammer and that the sales took place within the Madras State.” The department, in its revision application to the High Court, raised the issue of whether the property in the goods actually passed at Fort Cochin. However, the High Court’s argument proceeded entirely on the basis of the Appellate Tribunal’s finding that the title to the tea passed on the fall of the hammer at Fort Cochin. The Court pointed out that the argument that the property did not pass within Madras State was never advanced before the High Court, nor was it mentioned in the respondent’s statement of case. Accordingly, the Court noted that this point had not been urged during the High Court proceedings.

In the earlier decision of A. Y. Thomas (supra), the Court noted that the transaction before it was exactly the same as the transactions that are the subject of the present appeals. The Court expressly stated that the title to the tea goods in that case had passed at Fort Cochin and that this fact was not disputed. On the basis of that observation, the Court refused to allow the respondent’s counsel to raise any argument that the title to the tea sold had not passed at Fort Cochin within the Madras State. The Court explained that the issue was not a pure question of law and, more importantly, it had never been put forward before the learned judges of the High Court. Consequently, the Court allowed the appeals, set aside the order of the High Court, and restored the order of the Sales Tax Appellate Tribunal. In addition, the Court ordered that the appellant would be awarded his costs in this Court as well as the costs incurred in the High Court, including the fee for a single hearing.

Shah J. continued by observing that, had the question presented in these appeals been entirely new, the Court would have held that the price obtained at the auction of tea at Fort Cochin, when the tea was stored in warehouses in the Travancore‑Cochin State, was liable to tax under the General Sales Tax Act (11 of 1125 M.E.). He explained that Article 286(1)(a), together with its Explanation, as it stood before being amended by the Constitution (Sixth Amendment) Act, did not completely exclude the doctrine of territorial nexus from the operation of sales‑tax legislation. The Court reiterated that, under the Government of India Act, 1935, it is established law that provincial legislatures were authorised, by relying on the concept of territorial nexus, to impose sales tax on transactions that were not wholly completed within their own territory. This could be achieved by attaching the tax to one or more elements of a sale that created a territorial connection with the taxing province, as illustrated in the decisions of Poppat Lal Shah v. State of Madras and The Tata Iron & Steel Company Ltd. v. State of Bihar. The Constitution later placed certain restrictions on the power of the states to legislate on taxes affecting sales and purchases. Article 286(1)(a) read with its Explanation made a sale in which goods were actually delivered in a state for consumption in that state taxable only by the state where delivery for consumption occurred. Nevertheless, Shah J. held that the provision was not intended to eliminate the operation of the territorial‑nexus doctrine in areas that were not covered by the constitutional prohibitions. In his earlier decision on the effect of section 33 of the Bihar Sales Tax Act, which incorporated the prohibitions of Article 286(1) and (2), he had explained that the enactment barred the imposition of tax when a sale took place outside the state, but it did not remove the power to tax “non‑Explanation” sales where a nexus existed between the sale and the taxing state.

The Court observed that the provision in the Bihar Sales Tax Act removes only the power to tax “Explanation sales” that occur outside the State of Bihar, but it does not remove the power to tax “non‑Explanation sales.” In such non‑Explanation sales, even though the general law of sale of goods may state that the property passes outside the State, a connection still exists between the State’s taxing authority and the sale because the definition of sale in section 2(g) includes that connection. Consequently, when goods are delivered outside Bihar but the delivery is not a direct consequence of the sale or is not for consumption in the State of first delivery, the transaction does not fall within the Explanation. In those circumstances, the State may still levy tax on the sale based on the territorial nexus, and the prohibition in clause (1)(a)(i) of section 33 does not affect that power.

The Court noted that section 33 of the Bihar Sales Tax Act was enacted specifically to give effect to the constitutional restrictions imposed by Article 286. In the earlier case of Indian Copper Corporation Ltd. v. The State of Bihar and others, certain sales were carried out after the Constitution came into force in which the property in the goods passed within Bihar while delivery was made outside Bihar for consumption also outside Bihar. In some of those transactions the goods were delivered to the first destination State for consumption there, while in other transactions the goods were delivered to the first destination State but not for consumption in that State.

The assessee argued that both categories of transactions were exempt from tax under Article 286(1)(a) because they were “outside sales.” The Court unanimously rejected that contention with respect to the transactions in which delivery in the first destination State was not for consumption there. The Court held that those transactions were not “Explanation sales” and therefore the State of Bihar was competent to tax those “non‑Explanation sales” in which the property in the goods passed within Bihar.

In reaching this conclusion, the Court recorded two separate lines of reasoning. The first line, expressed by Justices Hidayatullah, Das Gupta and Rajagopala Ayyangar, held that after the Constitution, the mere passage of property within a State should be the decisive factor for determining whether a sale is “inside” or “outside” that State, and consequently only that State would have the power to tax the sale under the Explanation. The second line, expressed by Justice S. K. Das and the author of this opinion, held that sales which do not fall within the constitutional prohibitions remain taxable because, when assessing whether a “non‑Explanation” transaction is “outside the State,” the doctrine of territorial nexus cannot be wholly excluded from consideration.

In the decision of A.V. Thomas and Co. Ltd. versus the Deputy Commissioner of Agricultural Income‑tax and Sales‑tax, Trivandrum, the Court examined the meaning of Article 286(1)(a) after the Constitution had been altered by the Constitution (Sixth Amendment) Act. The Court explained that when the Explanation that accompanies Article 286(1)(a) does not apply, the criterion that must be used is the “passing of property within the State.” This criterion, the Court said, is the one that determines whether a particular sale is to be regarded as taking place inside the State or outside the State. Consequently, as long as the Explanation is not in effect, the State in which the property in the goods actually passes acquires the exclusive authority to impose a tax on that sale.

The factual backdrop of the A.V. Thomas case involved several chests of tea that were kept in warehouses on Willingdon Island, which lay within the Travancore‑Cochin State. Although the tea was stored there, the auctions for the chests were conducted at Fort Cochin, a location that at the relevant time fell within the State of Madras. After the auction, the buyers paid the price at Fort Cochin and were then issued delivery orders that were addressed to the warehouse keepers on Willingdon Island. The actual physical delivery of the tea took place at those warehouses on the island. From the island, the tea was subsequently dispatched either to other parts of India for domestic consumption or was exported to foreign destinations. The Court held, relying on the report of [1963] Supplement 2 S.C.R. 608, that the legal “passing of property” occurred at Fort Cochin. Because the goods were not delivered for consumption in any specific State, the sale was deemed to have taken place outside the State of Travancore‑Cochin. As a result, the transaction was not subject to the Travancore‑Cochin General Sales Tax Act (Act 11 of 1125 ME). The Court further observed that for sales that are not “Explanation sales,” the decisive factor for liability to sales tax is the passing of property within the State.

The judgment did not express an opinion on whether the doctrine of territorial nexus— which gives a State the power to tax a sale that occurs outside the limits set by Article 286— had become ineffective after the Constitution was enacted. The Court noted that the facts giving rise to the present appeal are substantially the same as the facts that were considered in the A.V. Thomas case. Because of this close similarity, the Court concluded that the decision on the present appeals must be in favour of the assessee. The Court felt it necessary to record this view explicitly so that no one might assume that the Court accepted the position that the doctrine of territorial nexus, when applied to sales‑tax legislation, has been completely eliminated since the Constitution came into force.

Finally, the Court pointed out that, following the Constitution (Sixth Amendment) Act, Article 286(1)(a) remains unchanged but is now free from the constraints of the deleted Explanation. Moreover, clause (2) of the same article empowers Parliament to lay down principles for deciding when a sale or purchase of goods is to be treated as taking place in any of the situations listed in clause (1). Those situations include a sale occurring outside the State, a sale that takes place during the import of goods into India, or a sale that occurs during the export of goods out of the territory of India.

It was explained that a sale or purchase of goods may occur in any of the manners described in clause (1) of Article 286, that is, when the transaction is carried out outside the State or when it happens in the course of importing the goods into India or exporting the goods out of the territory of India. By exercising the authority conferred by clause (2), Parliament enacted the Central Sales Tax Act of 1956, identified as Act 74 of 1956, and through section 4(2) gave legislative recognition to the doctrine of territorial nexus, although that recognition was somewhat limited. Section 4(2) contains the following provision: “A sale or purchase of goods shall be deemed to take place inside a State if the goods are within the State—(a) in the case of specific or ascertained goods, at the time the contract of sale is made; and (b) in the case of unascertained or future goods, at the time of their appropriation to the contract of sale by the seller or by the buyer, whether assent of the other party is prior or subsequent to such appropriation. Explanation.—Where there is a single contract of sale or purchase of goods situated at more places than one, the provisions of this sub‑section shall apply as if there were separate contracts in respect of the goods at each of such places.” The Court observed that the doctrine of territorial nexus had full effect in the sales‑tax legislation that operated under the Government of India Act, 1935, and that it continues to apply, subject to certain modifications introduced by the amendment of the Constitution through the Constitution (Sixth Amendment) Act. The Court further stated that it could not be convinced that the enactment of Article 286 of the Constitution had completely abolished the doctrine during the period between the adoption of the Constitution and the later amendment of Article 286 by the Sixth Amendment Act. Consequently, the appeal was allowed.