Page 1

Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.     1798 OF 2005

Commercial Tax Officer & Ors. ... Appellant(s)

                                         Versus

State Bank of India & Anr.         ...Respondent(s)

J U D G M E N T

Dipak Misra, J.

The seminal question that emerges for consideration in

this appeal is whether the State Bank of India (SBI) and its

branches,  which  are  registered  dealers  under  the  Bengal

Finance (Sales Tax) Act, 1941 (for brevity, ‘the Act’) would be

liable to levy of purchase tax under Section 5(6a) of the Act

for  accepting the  Exim Scrips (Export  Import  Licence)  on

payment of premium of 20 per cent of the face value of the

scrips  in  compliance  with  the  direction  contained  in  the

letter of Reserve Bank of India (RBI) dated 18th March, 1992.

Page 2

2

The  authorities  of  the  revenue  as  well  as  the  Taxation

Tribunal (for short, ‘the tribunal’) had held against the SBI

but the Division Bench of the High Court of Calcutta in a

writ petition has dislodged the said conclusion holding, inter

alia, that the purchase of Exim scrips by the Bank did not

attract  the  provisions  of  Section  4(6)  (iii)  of  the  Act  and

resultantly  quashed  the  orders  of  fora  below  and  issued

consequential directions.   

2. It is necessary to state the facts in detail to appreciate

the  controversy  at  hand.  The  SBI  is  a  body  corporate

constituted under the State Bank of India Act, 1955 for the

extension of banking facilities in the country and for other

public purposes. The bank has to perform various functions

as per the directions issued from time to time by the RBI in

keeping  with  the  economic  and  monetary  policies  of  the

Central Government.  

3. Policies are notified by the Government of India under

the Imports and Exports (Control) Act, 1947, as amended

from time to time, and the Imports (Control) Order, 1955, to

regulate imports into and exports out of  the country and

contain different incentive schemes and subsidies to build

Page 3

3

up foreign exchange resources of the country. As the facts

would reveal  before  July  4,  1991 there was provision for

issuance of Replenishment Licences which were referred to

as "REP Licences". The objective behind the grant of such

licences was to provide the registered exporters the facility

of importing essential goods required for the manufacture of

the products to be exported. Such licences were made freely

transferable  and  such  transfer  did  not  require  any

endorsement or permission from the licensing authority and

only a letter from the transferor the transferee became the

lawful holder of the licence and was entitled to either import

the goods for which the licence had been issued or sell the

licence to someone else.

4. The  aforesaid  policy  remained  in  vogue  till  July  3,

1991, when it was substituted by a new policy with effect

from July 4, 1991 and the nomenclature of the REP Licence

was changed to "Exim Scrip" (Export Import Licence). The

provisions  governing  Exim  scrips  were  more  or  less  the

same as those governing REP licences with certain minor

variations which are really not pertinent for the purpose of

adjudication of the controversy.

Page 4

4

5. In March, 1992, the RBI took a policy decision to the

effect that the unutilised Exim scrips in the hands of the

holders who were willing to dispose of the same should be

mopped  up  through  specified  branches  of  the  SBI.  In

pursuance to such a decision,  the RBI  issued a circular,

being No. 12/92 on 27th March, 1992. The said circular is

as follows:-

"Reserve Bank of India had earlier notified that arrangements were being made to purchase Exim scrips  at  an  appropriate  premium  from  those holders  of  Exim Scrips  who wish to  dispose  of them. The designated branches of State Bank of India  would  be  purchasing  these  Exim  scrips from March 23, 1992, up to the end of May 1992, at a premium of 20 per cent of the face value. The list of branches which would be purchasing these Exim scrips would be notified by the State Bank of India. The bona fide holder of the Exim scrips should submit an application to the designated branch of  the State Bank of  India, in the form prescribed by the State Bank of India. The scrips up  to  the  face  value  of  Rs.  5  lakhs  will  be straightaway  purchased  by  the  designated branch of State Bank of India and the premium amount would be paid to the holder of the scrips. Where the face value of the scrips exceeds Rs. 5 lakhs, the concerned branch would send it to the office of the JCCI, which had issued the scrip, for authentication and on receipt  of  the scrip duly authenticated  would  pay  the  amount  of premium."

Page 5

5

6. The  RBI,  pursuant  to  the  circular  sent  a  letter  on

March  18,  1992  to  the  Chairman,  State  Bank  of  India,

Bombay,  authorising  all  designated  branches  of  the  said

Bank to purchase Exim scrips from holders, who intended

to dispose of the same at a premium of 20 per cent of the

face value of the Exim scrips, from March 23, 1992, subject

to  certain terms and conditions.   Thereafter,  the  General

Manager (Planning of the International Banking Department

of  the  State  Bank of  India)  communicated to  the  Deputy

Manager, State Bank of India, Overseas Branch, Calcutta,

the respondent no.1 herein, on March 21, 1992, forwarding

the  memorandum of  procedure  drawn up by  the  Central

Officer of the SBI for the purpose of purchasing the Exim

scrips  as  directed  by  the  RBI.   In  due  course,  various

holders of Exim scrips sold and/or surrendered their Exim

scrips to the Bank and received a premium of 20 per cent of

the face value of the scrips in compliance with the direction

contained in the letter of the RBI dated March 18, 1992.

7. In the course of assessment proceedings under the Act

for  the  four  quarters  ending  on  March  31,  1993,  the

Commercial  Tax Officer,  Park Street  Charge informed the

Page 6

6

assessee that apart from payment of sales tax on the sale of

gold and silver, it would also be liable to pay “purchase tax”

in  respect  of  purchase  of  Exim  scrips  from  the  holders

thereof  at  a  premium  of  20  per  cent  of  the  face  value.

Before the assessing authority, it was contended by the SBI

that the Exim scrips had not actually been purchased but

the same had been surrendered by their holders pursuant

to the terms contained in the letter of the RBI dated March

18, 1992. It was also put forth that such surrender could

not be treated as purchase for the purpose of levying tax

under Section 4(6) of the Act. It was also averred that Exim

scrips were not "goods" within the meaning of Section 2(d) of

the Act and hence, no purchase tax could be levied under

Section 4(6) of the said Act on the surrender of the Exim

scrips by its holders.  In addition to the above, a specific

objection was taken that the Bank had not entered into any

transaction on its own which could be regarded as purchase

to attract the provisions of Section 4(6) of the Act but had

merely acted as an agent of the RBI in terms of the order

contained in the above mentioned circular dated March 18,

1992.

Page 7

7

8. The assessing officer did not accept the said stand of

the Bank and levied purchase tax under Section 5(6a) of the

Act,  amounting to sum of  Rs.  1,00,04,000/- on the total

taxable specified price of Rs. 25,00,00,000/-.  In the order

of assessment, the assessing authority held that the scheme

contained in the circular of the RBI dated March 18, 1992,

provided for sale of Exim scrips by the holder and purchase

by  designated  bankers  and  consequently  such  sale  or

purchase  by  the  bankers  could  not  by  any  stretch  of

imagination be treated as an act of surrender. It was also

held that the purchase of the Exim scrips by the bankers

from the holders thereof were as much sales as purchase by

private  importers  who  availed  of  the  same  for  import  of

goods.   

9. The aforesaid order of assessment was assailed in an

appeal  before  the  Assistant  Commissioner,  Commercial

Taxes,  Calcutta  (South)  Circle,  who  vide  order  dated

September 19, 1996, rejected the appeal and confirmed the

order of assessment.  The Bank Manager of the concerned

Branch  and  the  Chairman  of  SBI  approached  the  West

Bengal Taxation Tribunal (for short, ‘the tribunal’).  During

Page 8

8

the hearing of the appeal it was contended on behalf of the

SBI that in order to attract the mischief of Section 4(6)(iii) of

the Act, a dealer must be liable to pay tax under Section

4(1), 4(2), 4(4) or 8(3) of the aforesaid Act and since the said

Bank was not a dealer under the provisions of the aforesaid

Act, it did not have any liability to pay tax under Section

4(6)  of  the  said  Act.   It  was  also  submitted  that  the

transactions  involving  recovery  of  Exim scrips  from their

holders  could  not  be  treated  to  be  "purchases"  for  the

purpose of Section 4(6) of the above Act, but amounted to

"surrender" by the holders which had been wrongly equated

with "purchase" at the Branch level.  A further stand was

taken that for Section 4(6) to apply, the purchase must have

been made with the intention of re-selling the Exim scrips

and that the same would be apparent from proper reading of

Clauses (i) and (iii) of Section 4(6) of the above Act.  It was

argued that if such a construction was not adopted, Clause

(iii) of Section 4(6) would be unconstitutional and violative of

Article 14 of the Constitution.

10. The tribunal  by  its  order  dated 11th February,  1998

rejected all the contentions made on behalf of the appellants

Page 9

9

and dismissed the appeal preferred by them. As  has  been

stated earlier, the SBI had not levied purchase tax. When

the  matter  travelled  to  the  tribunal,  the  question  arose

whether the Bank by payment at a premium of twenty per

cent on the face value or unutilised face value thereof was

exigible  to  purchase  tax  under  Section  4(6)(iii)  read  with

Section 5(6) of the Act.  The tribunal narrated  the facts  and

noted  the  stand and  the  stance  of  the  assessee  and the

Revenue  and  came  to  hold  that  the  Bank  had  acted  in

relation  to  the  impugned  transactions  as  agent  of  RBI,

which is an instrumentality of the Government of India, to

accept Exim scrips on payment of a premium to the holders

thereof and the activity is thus covered by Section 6(1)(a)

and  (b);   that  under  Section  6(1)(n)  such  activity  was

certainly  “incidental”  or  “conclusive”  to  the  promotion  or

advancement  of  the  business  of  the  Company,  because

admittedly  the  assessee  received  commission  for  these

transactions; that the stand that the Bank was not a dealer

in  view  of  the  Banking  Regulation  Act,  1949  was

unacceptable,  for  when  Section  8  of  the  Act  is  correctly

construed, it  would be clear that purchase of Exim scrips

Page 10

10

was not prohibited by it; that the Exim scrips were goods as

has been conclusively settled in  Vikas Sales Corporation

and another v. Commissioner of Commercial Taxes and

another1;  that  the  submission  to  the  effect  that  the

purchase is made not for resale and hence, the bank would

not  be  liable  for  tax  does  not  commend  acceptation,  for

legislature does not contemplate or lay down that Section

4(6)(iii)  would  apply  to  purchase  for  the  purpose  of  only

resale  but  has  left  the  expression  unspecified  and

unqualified; that there is no rationale to restrict it to resale

and limit the expression; that Section 4(6)(iii) uses the word

“purpose”,  a  purchase  for  any  purpose  other  than  those

specified  in  clauses  (i)  and  (ii)  of  Section  4(6)  would  be

enough to attract the clause and in the case at hand, RBI’s

letter dated March 18, 1992 the purpose was to forward the

“scrips”  to  the  Joint  Chief  Controller  of  Imports  and

Exports,  Government  of  India,  after  suitably  cancelling

them;  that  use  of  the  purchased  scrips  by  way  of

cancellation  and  onward  transmission  to  the  Joint  Chief

Controller  was  clearly  subsequent  to  completion  of  the

1  (1996) 4 SCC 433

Page 11

11

transactions  and such use cannot keep the transactions

out of the mischief and purview of Section 4(6)(iii); that the

transactions were really “surrenders” and not “purchases” is

untenable because surrender is also envisaged by operation

of law and hence, the concept of “surrender” is inapplicable

in the instant case; and that there was enough indication of

“sale” and “purchase” and transfer of property in the scrips

as is evident from documents that the holder of script was

“encashing” them by completely foregoing his “entitlements”

under  it.    After  so  holding,  the  tribunal  dealt  with  the

concept of business as has been defined under Section 2(1)

of  the  Act,  referred  to  various  decisions  including

Commissioner of Sales Tax v. Billion Plastics Pvt. Ltd.2,

State of Tamil Nadu v. Burma Shell Co. Ltd.3,  District

Controller of Stores v. A.C. Taxation Officer4 and State

of Tamil Nadu v. Binny Ltd., Madras5, Board of Revenue

v.  A.M.  Ansari6 and  State  of  Gujarat  v.  Raipur

Manufacturing Co. Ltd.7 and after deliberating on them,

2 [1995] 98 STC 184 3 31 S.T.C. 426 (S.C.) 4 37 S.T.C. 423 (S.C.) 5 49 S.T.C. 17 (S.C.) 6 38 S.T.C. 577 (S.C.) 7  AIR 1967 SC 1066

Page 12

12

posed  the  question  whether  mere  lack  of  the  element  of

regularity  or  frequency,  when  the  other  elements  are

present would it be sufficient to keep take the transactions

out of the compass of “business” and opined that where an

intention to carry on business was clearly established, mere

lack  of  the  element  of  regularity  or  frequency  would  not

convert  business  transactions  into  non-business

transactions and would not make a “dealer” a “non dealer”.

To arrive at the said conclusion, the tribunal referred to the

definition  of  “dealer”  under  Section  2(c)  of  the  Act  and

definition  of  “business”  and other  provisions  and in  that

context, referred to State of Andhra Pradesh v. H. Abdul

Bakhi and Bros.8 and  Hindustan Steel Ltd v. State of

Orissa9  and  came  to  hold  that  profit  motive  is  not

imperative,  because as per  law “business” connects  some

activity  actually  in  the  nature  of  trade  or  commerce  or

manufacture which is done not for sport or pleasure or for

charity.  Thus, there is little difference between the primary

or main part of the definition of “business” and its inclusive

part which basically means, as in the present context, any

8 AIR 1965 SC 531 9 AIR 1970 SC 253

Page 13

13

trade or commerce or similar activity and any transaction in

connection with, or ancillary or incidental to, such trade or

commerce.  Process  of  exchange can be  completed by  the

exchange of goods and services for money.  The tribunal has

observed  that  in  the  instant  case  the  purchase  of  exim

scrips  was  by  way  of  exchange  of  the  scrips,  which  are

financial instruments, for money.  Thereafter, the tribunal

referred to the meaning of the terms trade and commerce

and  stated  in  Black’s  Law  Dictionary  and  certain  other

dictionaries  including  Aiyer’s  Judicial  Dictionary  and

eventually came to hold as follows:-  

“Thus,  purchase  of  exim  scrips  for  money, comprising a large volume (at least Rs. 25 crores) is in every sense a “business” within the meaning of Section 2(1a).  That being so, having carried on such a “business” the applicant bank became a “dealer” under section 2(c),  even apart from the fact that it was already a registered dealer for sale of gold. Since sale of gold has no connection with purchase of  exim scrips, the latter transactions cannot be said to be either in connection with or ancillary or incidental to sale of gold. In our view, the  purchase  of  exim  scrips  was  a  separate “business”  of  the  applicant  bank.  A  point  was argued  on  behalf  of  the  bank  that  it  had  to undertake  this  activity  under  instructions  from the Reserve Bank of India.  The fact that it was so, indicates that it was carried on as a business and  with  the  intention  to  carry  it  on  as  a business”.  

Page 14

14

11. Thereafter, it  opined that the SBI is not an ordinary

businessman, but it is a body created by an Act.  Analysing

the  statutory  scheme  and  the  obligation,  it  proceeded  to

state thus:

“We have to keep this distinction in mind when we consider whether purchase of exim scrips was done  by  the  bank  as  a  business  with  the intention to do a business.  It is undisputed that not  only  the  bank  paid  money  for  purchasing exim  scrips  but  also  it  made  some  gain  by receiving  commission  out  of  the  transactions. Even without any commission the activity clearly constitutes a “business”.   Another question is : when  the  activity  was  carried  on  under  the instructions of the Reserve Bank of India, can it be said to be a “business”?  In the facts of the case,  the  apparently  compulsory  nature  of purchase of exim scrips was not such as to take it out of the ambit of “business”.  The bank could not compel any holder of exim scrips to sell the same to it. It was wholly voluntary on the part of a holder to sell scrips to the bank.  As soon as a holder exercises his  opinion to sell  and gives a scrip  to  the  bank,  the  bank  purchases  it  on payment  of  money.  As  already  said,  the compulsory nature of performance of the duty of purchase  of  exim  scrips  emanates  from Act  of 1955 which created the bank.  Unlike any other dealer,  the  applicant  bank  could  not  think  of acting beyond the provisions of Act of 1955.  That being  so,  in  the  special  circumstances  of  the case, the element of compulsion involved in the instruction  of  the  Reserve  Bank  of  India  is irrelevant.  Apart from that aspect, we may refer to the case of  Coffee Board v.  Commissioner of

Page 15

15

Commercial Taxes (1988) 70 S.T.C. 162 (S.C.) in which it  was held that there was a sale,  where the growers of coffee delivered coffee to the Board, though the growers did not actually sell it. It was a sale by operation of law. The imposition of sales tax on such sale of coffee was upheld.  From the above points of view we hold that the purchase of exim scrips  by the  applicant  bank were  rightly brought to purchase tax under 1941 Act.”

12. The said order was challenged before the High Court of

Calcutta in a writ petition wherein it was contended that the

Bank was not a "dealer" within the meaning of Section 2(c)

of the Act in respect of the Exim scrips since it does not

and/or did not carry on the business of sale or purchase of

such Exim scrips; that in the case at hand it was only a

solitary case and that too for a brief period from March 23,

1992 to May 31, 1992 but neither before nor after the said

period had any such transaction been entered into which

could  justify  the  finding  of  the  tribunal  that  the

assessee-Bank  had  an  intention  to  carry  on  business  in

purchase of Exim scrips and that mere lack of regularity or

frequency would not convert a business into non-business

and would not make a dealer a non-dealer; that there was

no material on record to arrive at the conclusion that it was

Page 16

16

clearly established that the writ  petitioner No.  1,  i.e.,  the

SBI, had the intention to carry on business in purchase of

Exim scrips; that even if the Bank was to be treated as a

dealer, the provisions of Section 4(6)(iii)  would have to be

related  to  the  business  being  carried  on  by  the  Bank

inasmuch  as  the  said  provisions  would  otherwise  suffer

from vagueness and would expose it to attack on the ground

of constitutional validity; that keeping in view the scheme of

the Act and the intent and purpose of relevant provision,

purchase tax could be levied on a dealer only if he carried

on business of buying or selling the goods in question; that

whatever may be the nature of  the transaction, the Bank

had only acted as an agent of the RBI in the transaction

relating  to  Exim  scrips  and  would  not,  therefore,  come

within the definition of the expression "dealer" as defined in

Section 2(c) of the 1941 Act; that the transaction involving

the acquisition of Exim scrips by the Bank could not be said

to be a case of purchase but a case of surrender; that the

Exim scrip was in substance a licence or a grant from the

Sovereign and there could  not  be any sale  of  such Exim

scrips to the Sovereign and accordingly, when the holder of

Page 17

17

the Exim scrips gives up his right in favour of the granter it

is an act of surrender and nothing else; that SBI had merely

acted as an agent of the Sovereign, namely, the department

of  the  Central  Government  which  had  issued  the  Exim

scrips,  that  is,  the  Joint  Chief  Controller  of  Import  and

Export and under the instruction of the RBI and once the

said Exim scrips were surrendered by the holders, the same

were required to be cancelled and forwarded to the office of

the Joint Chief Controller of Import and Exports who had

originally issued the same and in effect the grant under the

Exim scrips would, upon cancellation by the Bank, cease to

exist, which state of affairs is consistent with the concept of

surrender and it was not intended that upon acquisition of

the  Exim  scrips  from  their  holders,  the  same  would  be

utilised by the Bank for  the purpose of  either selling the

same or using the same for the purpose for which they had

been intended.  Be it noted learned counsel for the Bank

placed reliance on the decisions in Raipur Manufacturing

Co. Ltd. (supra),  Board of Revenue v. A.M. Ansari10 and

Billion Plastics Pvt. Ltd. (supra).  

10  (1976) 3 SCC 512

Page 18

18

13. Learned  counsel  for  the  Commercial  Tax  Officer,

resisting  the  submissions  of  the  learned  counsel  for  the

Bank contended that  the  controversy raised by  the  bank

having set at rest by the three-Judge Bench in Vikas Sales

Corporation (supra), wherein the Supreme Court had given

stamp  of  approval  to  the  decision  in  P.S.  Apparels  v.

Deputy Commercial Tax Officer, Madras11.  It was urged

by  the  revenue  that  REP  Licence  are  goods  and  the

premium or price received therefrom by transfer thereof was

liable to sales tax within the ambit and sweep of Section 4(6)

(iii)  of  the Act and, therefore,  the finding recorded by the

tribunal that the transaction involving the purchase of Exim

scrips by the assessee bank amounted to sale could not be

found fault with.  It was also canvassed that the intention of

the  legislature  was  clear  and  in  view  of  the  authority

rendered  in  Vikas  Sales  Corporation (supra),  P.S.

Apparels (supra) and the decision in Bharat Fritz Werner

Ltd.  v.  Commissioner  of  Commercial  Taxes12 nothing

really remain to be adjudicated.

11  [1994] 94 STC 139 12  [1991] 86 STC 175

Page 19

19

14. The  High  Court  analysed  the  principles  in  all  the

authorities cited before it and came to hold that this Court

has  opined  that  REP  licences/Exim  scrips  were

merchandise  and/or  goods  in  the  commercial  world  and

were freely bought and sold in the market and hence, no

argument could be urged that they do not constitute goods

for  the  purposes  of  commercial  transactions.   The  High

Court referred to the circular dated March 18, 1992, issued

by  the  RBI  regarding  purchase  of  Exim  scrips  by  the

designated branches of  the SBI and opined that  the said

Exim scrips were handed over to the Bank solely for  the

purpose of cancellation and not be used as goods for the

purpose of commercial transactions.  According to the High

Court,  they  were  reduced  to  mere  paper  having  no

commercial  value.   The Division Bench distinguished the

judgments rendered by this Court as well as by the High

Courts of Madras and Karnataka.  It further proceeded to

opine that the purchases by the SBI were not effected in the

usual course of business of the Bank, for it was a one-time

affair and there was no continuity or regularity involved in

such  transactions  so  as  to  bring  the  same  within  the

Page 20

20

concept of business.  The High Court took note of the fact

that the Bank was mainly confined to purchase and sale of

gold and silver.  On behalf of the revenue, it was contended

that the bank was a registered dealer under the Act, but the

said submission did not weigh with the High Court because

as the impugned order would show, it has been persuaded

by  the  decision  rendered  by  the  Bombay  High  Court  in

Billion  Plastics  Pvt.  Ltd. (supra).   Thereafter,  the  High

Court came to the following conclusion:-

“56. ….we are not inclined to accept the arguments advanced on behalf of the Revenue that purchasing of Exim scrips on the direction of the Reserve Bank of  India  for  the  purpose  of  destroying  its  very commercial  nature,  amounted  to  business  being carried on by the writ petitioner-Bank in such Exim scrips. There was no question of selling the Exim scrips once they had been purchased by the Bank. The entire transaction appears to be in the nature of a  mopping  up  operation  for  removing  the  Exim scrips from the market.

57.  Having regard to the view taken by us that the  purchase  of  Exim  scrips  by  the  writ petitioner-Bank  did  not  attract  the  provisions  of Section 4(6)(iii) of the 1941 Act, we do not think it necessary  to  go into  the  other  submission of  Mr. Ghosh  that  the  aforesaid  provisions  were  either vague or uncertain and thus unconstitutional. We are not, therefore, inclined to dilate further on such point.

Page 21

21

58. In  view  of  what  we  have  indicated hereinabove, we are unable to sustain the judgment and  order  of  the  learned  Tribunal  and  we, accordingly, set aside the same and we also quash the  order  of  assessment  dated  June  30,  1995 passed by the Commercial Tax Officer, Park Street Charge,  as  also  the  order  dated  September  19, 1996,  passed  by  the  Assistant  Commissioner, Commercial  Taxes,  Calcutta  (South)  Circle,  in Appeal case No. A495/1995-96 under Section 20(1) of the Bengal Finance (Sales Tax) Act, 1941”.

The  aforesaid  conclusion  entailed  allowing  the  writ

petition preferred before the High Court and resultantly the

assessee was discharged from the undertaking given for the

purpose of continuation of the interim order initially passed.

15. We have heard Mr.  Soumitra G. Chaudhuri,  learned

counsel for  the appellants and Mr. Pradip Kumar Ghosh,

learned senior counsel with Mr. Chiraranjan Addey, learned

counsel appearing for the respondents.

16. To appreciate the controversy, it is pertinent to extract

the communication dated March 18, 1992 sent by the RBI,

Exchange Control Department to the Chairman, State Bank

of India, Bombay. The said letter is as follows:-

“Dear Sir,

Purchase of Exim Scrips by designate branches of SBI.

Page 22

22

This is with reference to our discussion with Shri. B.S.  Pandya,  General  Manager  (Domestic  & Operations) on the captioned subject.  It has been agreed that designated branches of the State Bank of India would commence purchasing ‘Exim Scrips’, from  holders  who  wish  to  dispose  of  them,  at  a premium of 20 percent on the face value of the scrip &  (unutilized  face  value)  from  23rd March  1992, subject to the following terms and conditions:

a)  The  holder  of  the  scrips  would  be  required  to submit an application to the designated branch in the form prescribed by the State Bank of India.

b)  State  Bank  of  India  would,  incorporate,  in consultation with their legal department, a suitable indemnity  clause  in  the  application  form  to  be submitted by the holder of the scrip.

c) As the scrip is transferred by a letter, State Bank of  India  would  verify  the  letter  in  favour  of  the holder presenting the scrip and would then make payment on the basis of usual banking procedures adopted  for  identification  of  the  person  to  whom payment is made.

d) The payment would be rounded off to the nearest rupee  and  would  be  made  only  by  means  of  a Crossed Banker’s Cheque.

The term ‘Exim Scrip’  would also cover post  paid REP licenses  issued  up to  29th February  1999 of export proceeds.

e) State Bank of India, Bombay Main Branch, would arrange to get daily details of scrips paid by their various  designated  branches  and  then  seek reimbursement, on a consolidated basis, daily from Reserve Bank of  India,  Bombay on the basis of  a certificate indicating the total amount paid by them.

Page 23

23

f) Designated Branches of SBI would maintain the particulars of scrips paid including the application forms  for  such  period  as  may  be  considered necessary.   Bombay main branch would maintain the particulars of payments made by their various designated  offices  on  the  strength  of  which reimbursement  was  claimed  by  them  from  RBI, Bombay.

g)  The paid scrips would be suitably cancelled and forwarded to the concerned office of  J.C.C.I.  & E. which had issued the scrips.  In the case of scrips of face value up to Rs.5 lakhs, the concerned office of J.C.C.I.  &  E.  should  also  be  asked  to  conduct  a check about genuineness of the scrips cancelled by SBI  and  report  objections,  if  any,  in  regard  to payments to the concerned designated office of SBI.

h) If in the case of any scrip of the face value up to Rs. 5 lakhs (which is paid without prior check by the office of J.C.C.I. & E.), it later turns out that the scrip was not genuine or not validly issued etc., the matter would have to be pursued by the office of the J.C.C.I.  &  E.  SBI  will,  however,  render  whatever assistance is necessary to tract the party to whom payment has been made.

i) SBI would be acting on behalf of the Reserve Bank of India and would be paid commission at the rate at  which  commission  is  payable  to  them  for conducting Government business. They would also be paid out-of-pocket expenses including expenses incurred  on  advertisements  notifying  designated branches.

2. As desired by you, we have also advised the Chief Controller of Imports & Exports to instruct all his regional  offices  to  render  necessary  assistance  to designated  branches  of  SBI  for  a  smooth implementation  of  the  scheme.  He  has  also  been

Page 24

24

advised to instruct his regional offices in particular that  they  should  promptly  (say,  within  48 hours) furnish authentication of scrips of face value above Rs. 5 lakhs sent to them and their findings of the check done of scrips up to the face value of Rs. 5 lakhs  paid  without  any  prior  authentication.   He has  also  been  requested  to  advise  J.C.C.I.  &  E., Bombay, to assist you with a check list containing important features of the Exim Scrip to check their genuineness.”  

[Emphasis added]

17. The aforesaid,  as  is  manifest,  authorises  the  SBI  to

purchase  the  Exim  scrips  as  an  agent  of  RBI  and  after

payment of the premium at 20% of the value to the holder,

the  scrip  was  to  be  cancelled.   Certain  formalities  were

stipulated to be complied by the holder as well as by SBI.

18. Section 2(1a) of the Act defines “business” as follows:-

“business” includes –  (i)  any  trade,  commerce  or  manufacture  or execution of work contract or any adventure or concern  in  the  nature  of  trade,  commerce  or manufacture  or  execution  of  works  contract, whether  or  not  such  trade,  commerce, manufacture,  execution  of  works  contract, adventure  or  concern  is  carried  on  with  the motive  to  make  profit  and whether  or  not  any profit  accrues  from  such  trade,  commerce, manufacture,  execution  of  works  contract, adventure or concern; and

(ii)  any  transaction  in  connection  with,  or ancillary or incidental to, such trade, commerce, manufacture,  execution  of  works  contract,

Page 25

25

adventure or concern;”

19. The term “dealer” has been defined under Section 2(iv)

(c), which reads thus:-

“”dealer”  means  any  person  who  carries  on  the business  of  selling  goods  in  West  Bengal  or  of purchasing  goods  in  West  Bengal  in  specified circumstances or any person making a sale under Section 6D and includes –  

the  Central  or  a  State  Government,  a  local authority, a statutory body, a trust or other body corporate  which,  or  a  liquidator  or  receiver appointed by a Court in respect of a person defined as a dealer under this clause who, whether or not in  the  course  of  business  sells,  supplies  or distributes  directly  or  otherwise,  for  cash  or  for deferred payment or for commission, remuneration or other valuable consideration.

Explanation 1. – A co-operative society or a club or any association which sells goods to its members is a dealer.

Explanation 2. – A factor, a broker, a commission agent, a del credere agent, an auctioneer, an agent for handling or transporting of goods or handling of  document  of  title  to  goods  or  any  other mercantile  agent,  by  whatever  name  called,  and whether  of  the  same description as  hereinbefore mentioned or not, who carries on the business of selling  goods  and  who  has,  in  the  customary course  of  business,  authority  to  sell  goods belonging to principals is a dealer;”

20. Section 2(d) of the Act defines “goods” as follows:-

Page 26

26

““goods”  includes all  kinds of  movable  property other  than actionable  claims,  stocks,  shares  or securities”

21. Section 4 of the Act deals with incidence of taxation.

Sub-Section (6) of Section 4 of the Act is as follows:-

“(6) Every dealer, who has become liable to pay tax  under  sub-section  (1)  or  sub-section  (2)  or sub-section (4) of this section or sub-section (3) of section 8 and is registered under this Act, shall, in addition to the tax referred to therein, be also liable  to  pay  tax  under  this  Act  on  all  his purchases from –  

(i) a dealer who is not registered under this Act, of goods other than [gold, rice (Oryza sativa L.) and wheat  (Triticcum  Vulgare,  T.  compactum,  T. sphaerococcum,  T.  durum,  T.  aestivum  L.,  T. dicoccum)],  intended  for  direct  use  in  the manufacture  in  West  Bengal  of  goods  for  sale, and  of  containers  and  other  materials  for  the packing of goods so purchased or manufactured;

(ii)  a  registered  dealer,  to  whom  a  declaration referred  to  in  the  proviso  to  clause  (bb)  of sub-section (1) of section 5 has been or will  be furnished by him in respect of sales referred to in sub-clause (i) or sub-clause (ii) of the said clause, of goods purchased against such declaration, and used by him directly in the manufacture in West Bengal, of goods or in the packing of such goods, when such manufactured goods are transferred by  him  to  a  place  outside  West  Bengal  or disposed of by him, otherwise than by way of sale in West Bengal.

(iii) any person, whether a dealer or not, who is not registered under this Act, of goods other than gold,  rice  and  wheat  intended  for  a  purpose, other than those specified in clause (i).”

Page 27

27

22. Section  6C  stipulates  the  liability  to  payment  of

purchase tax and rate thereof.  

23. We have referred to the aforesaid statutory provisions

as the learned counsel for the revenue would stress upon

the tenor of the said provisions and submit that respondent

Bank  is  a  dealer  and  once  it  has  purchased  something,

which is  goods,  it  is  liable  to  pay  the  purchase  tax.   In

essence, the learned counsel for the State would defend the

order passed by the tribunal in entirety and would contend

that the High Court has wholly flawed in appreciation of the

factual  score  and  the  provisions  applicable  to  the

transaction.  

24. In  Vikas  Sales  Corporation  (supra),  the  question

arose whether the transfer of an Import Licence called REP

Licence/Exim Scrip by the holder thereof to another person

constitutes a sale of goods within the meaning of and for the

purposes of the Sales Tax enactments of Tamil Nadu, Kar-

nataka and Kerala and if it does, it is exigible to sales tax,

otherwise not. In the said case, the High Court had taken

Page 28

28

the view that REP Licences/Exim Scrips constitute  goods

and, therefore, on their transfer, sales tax is leviable and the

judgment of the High Court was founded on the decision of

this Court in H. Anraj v. Government of Tamil Nadu13.  It

was contended before this Court that the license/scrips are

not goods and hence, they are not property. It was further

urged  that  they  represent  merely  a  permission  to  import

goods which permission can be revoked at any time by the

licensing authority and, therefore, they are really in the na-

ture of share and securities which have been expressly ex-

cluded from the definition of goods in the relevant enact-

ments. Analysing various facets, the three-Judge Bench re-

ferred to Para 199 of “Import and Export Policy 1990-93”

which deals with Transferability of REP Licences.  It reads

as follows:-

“199. (1) The REP Licence will  be issued in the name of the registered exporter only and will not be subject to ‘Actual User Conditions’. A licence- holder may transfer  the licence to another per- son.  The licence-holder  or  such transferee  may import the goods permitted therein.

(2) The transfer of a REP Licence will not require any endorsement or permission from the licens- ing authority, i.e., it will be governed by the ordi-

13  (1986) 1 SCC 414

Page 29

29

nary law. Accordingly, clearance of the goods cov- ered by a REP Licence issued under this policy will  be  allowed  by  the  Customs  authorities  on production  by  the  transferee  of  only  the  docu- ment of transfer of the licence concerned in his name. Whenever a REP Licence is transferred the transferor should give a formal letter to the trans- feree,  giving  full  particulars  regarding  number, date and address of the transferee, and complete description of the items of import for which the li- cence is transferred.”

25. The Court also observed that the relevant features of

Exim Scrips are identical to REP Licences.  Thereafter, the

Court proceeded to state:-

“They are bought and sold as such. The original licensee or the purchaser is not bound to import the goods permissible thereunder. He can simply sell it to another and that another to yet another person.  In  other  words,  these  licences/Exim Scrips have an inherent value of their own and are traded as such. They are treated and dealt with in the commercial world as merchandise, as goods.  A  REP  Licence/Exim  Scrip  is  neither  a chose-in-action nor an actionable claim. It is also not in the nature of a title deed. It has a value of its own. It is by itself a property — and it is for this reason that it is freely bought and sold in the market. For all purposes and intents, it is goods. Unrelated to the goods which can be imported on its basis, it commands a value and is traded as such. This is because, it enables its holder to im- port goods which he cannot do otherwise”.

And again:-

Page 30

30

“Another contention raised in the written submis- sions of Shri K.V. Mohan is that even if the said licences/scrips are treated as goods, the tax must be levied at the first point of sale, viz., upon the authority  issuing the  licence.  We cannot  agree. The grant of licence by the licensing authority to the registered exporter is not a sale. The sale is when  the  registered  exporter  or  the  purchaser sells it to another person for consideration”.

26. The  High  Court  has  distinguished  the  aforesaid

authority  by  stating  that  this  Court  did  not  have  the

occasion to consider the effect of purchase of Exim scrips

made by SBI,  for  it  was not  a part of  business regularly

carried  on  by  it  but  was  a  transaction  which  was  to  be

undertaken on the direction of the RBI.  Exim scrips were

no longer available as “goods” for the purpose of commercial

transaction and were to be reduced to mere papers having

no  commercial  value  whatsoever  and  such  a  scenario

changed the entire perspective.   The High Court has laid

emphasis  on  immediate  cancellation  of  Exim  scrips  and

after  cancellation  to  be  sent  to  the  original  granting

authority.  

27. The controversy involved in the case at hand, in our

considered opinion, has to be analysed regard being had to

Page 31

31

the existing factual score.  The observations made in Vikas

Sales  Corporation (supra),  as  the  aforequoted  passages

would show, the initial grant of license by the Government

to the registered exporters was not a sale. The said finding

is significant and it has potency.  It is also seen that the

said authority extensively relies on the earlier judgment in

H.  Anraj (supra)  that  dealt  with  the  question  whether

lottery  tickets  are  “goods”  and  accordingly  whether  sale

thereof  would  invite  sales  tax.    H.  Anraj (supra)  draws

distinction  between  lottery  tickets  and  steamship  tickets,

railway  tickets,  cinema  tickets,  etc.  Salmond’s

Jurisprudence,  12th Edition  at  pages  338-339  under  the

heading “The Classes of  Agreements” was quoted to draw

distinction  between  three  classes,  namely,  agreements

which create  rights,  agreements  which transfer  or  assign

rights,  and  lastly  agreements  which  extinguish  them.

Agreements  which  create  rights  were  divided  into  two

sub-classes, namely, contracts and grants.  A contract is an

agreement, which creates an obligation or right in personam

between  the  parties,  whereas  a  grant  creates  a  right  of

another description such as leases, assignments, patents,

Page 32

32

etc.  An agreement, which transfers a right, may be termed

generically as an assignment.   However, when a transaction

extinguishes  a  right,  it  is  called  a  release,  discharge  or

surrender.  The distinction between creation of a right by a

grant  and  subsequent  transfer  or  assignment  was  also

highlighted in  H. Anraj (supra)  and noted by Sabyasachi

Mukherjee, J. (as His Lordship then was) in his concurrent

judgment with the following observations:-

“41. It was urged before us on behalf of the deal- ers that by the issue of lottery tickets, the right to participate  in  the  draw  is  created  for  the  first time in the buyers. In other words, it was urged that by the sale of lottery ticket, the right to par- ticipate is created for the first time; if it is consid- ered to be a “grant” and as such a sale of goods, it was contended that such right was not existing before  the  sale  of  the  lottery  ticket.  This  con- tention has caused me anxiety from the jurispru- dential point of view. 42. I agree with respect that “grant” is an agree- ment  of  some  sort  which  creates  rights  in  the grantee and an agreement which transfers rights may be termed as assignment. But the question, is, before the grant, was such a right, namely the right to participate in the draw, existing in the grantor? The point made is that there is no trans- fer of property involved in the issue of a lottery ticket and it is only after the issue of the lottery ticket that the grantee gets a right to participate. In other words, it was sought to be urged that in a  lottery,  the  promoter  sponsoring  it  does  not have any right to participate nor to claim a prize

Page 33

33

in a draw and these come into existence for the first time by the purchase of lottery ticket when he purchases the ticket and therefore it cannot be said that any transfer of right is involved, but only  creation  of  new  right  by  the  grantor  in favour of the grantee.”

The  observations  made  in  the  aforesaid  paragraphs

that there is no transfer of property involved in a grant, for

the rights come into existence after purchase.  

28. The  decision  in  the  case  of  H.  Anraj (supra)  was

overruled by the Constitution Bench in Sunrise Associates

v. Govt. of NCT of Delhi and others14 on several grounds

including that there was no distinction between the chance

to win and the right  to participate in the draw.  Such a

sub-division was not correct.  There was no value in mere

right to participate in the draw.  Therefore, lottery tickets

were not “goods” but were actionable claims.    These were

merely token of chances purchased and even otherwise the

right to participate in the draw was not a moveable property

and,  therefore,  there  cannot  be  any transfer  of  beneficial

interest in a moveable property.  The reason being, the right

to  participate  in  a  lottery  draw was  an actionable  claim.

14 (2006) 5 SCC 603

Page 34

34

More significant for our purpose would be the observations

of the Constitution Bench relating to the word “goods” for

imposition  of  sales  tax  which,  it  was  observed  in  the

context,  would  carry  its  ordinary  meaning  of  the  subject

matter of ownership and not denote the nature of interest of

goods.   The word “goods” was used to describe the thing

itself.  The relevant passages of the Constitution Bench in

Sunrise  Associates (supra)  on  the  said  aspect  read  as

under:-  

“35. The word “goods” for the purposes of imposi- tion of  sales tax has been uniformly defined in the various sales tax laws as meaning all kinds of movable property.  The word “property” may de- note the nature of the interest in goods and when used in this sense means title or ownership in a thing. The word may also be used to describe the thing itself. The two concepts are distinct, a dis- tinction which must be kept in mind when con- sidering the use of the word in connection with the sale of goods. In the Dictionary of Commercial Law by A.H. Hudson (1983 Edn.) the difference is clearly brought out. The definition reads thus:

“  ‘Property’.—In  commercial  law  this  may carry  its  ordinary  meaning of  the  subject- matter  of  ownership.  But elsewhere,  as in the sale of goods it may be used as a syn- onym  for  ownership  and  lesser  rights  in goods.”

Hence, when used in the definition of “goods” in the different sales tax statutes, the word “prop- erty” means the subject-matter of ownership. The

Page 35

35

same word in the context of a “sale” means the transfer of the ownership in goods.

36. We have noted earlier that all the statutory definitions of the word “goods” in the State sales tax laws have uniformly excluded, inter alia, ac- tionable  claims from the definition for  the pur- poses of the Act. Were actionable claims, etc., not otherwise includible in the definition of  “goods” there was no need for excluding them. In other words, actionable claims are “goods” but not for the purposes of the Sales Tax Acts and but for this  statutory  exclusion,  an  actionable  claim would be “goods” or the subject-matter of owner- ship. Consequently, an actionable claim is mov- able property and “goods” in the wider sense of the term but a sale of an actionable claim would not be subject to the sales tax laws.”

And, again:-  

“51. We are therefore of the view that the decision in H. Anraj (supra) incorrectly held that a sale of a lottery ticket involved a sale of goods. There was no sale of goods within the meaning of Sales Tax Acts of the different States but at the highest a transfer of  an actionable claim. The decision to the  extent  that  it  held otherwise is  accordingly overruled  though prospectively  with  effect  from the date of this judgment.”

 29. We  may  note  with  profit  that  Sunrise  Associates

(supra)  did  not  specifically  deal  with  the  question  of

replenishment  licences,  for  the  reference  made  to  the

Constitution Bench was limited to whether  lottery  tickets

Page 36

36

were  “goods”.   The  Constitution  Bench  had  specifically

observed  that  they  were  not  called  upon  to  decide  the

question whether the replenishment licences were “goods.”

We may usefully refer to the relevant passage:-  

“29. ..  We have not been called upon to answer the question whether REP licences (or the DEPB which has replaced the REP licences) are “goods”. Although  we  have  heard  counsel  at  length  on this,  having regard to the limited nature of  the reference, we do not decide the issue. The deci- sion in  Vikas Sales (supra) was referred to only because  it  approved  the  reasoning  in  H.  Anraj (supra) and not because the referring court dis- agreed with the conclusion in Vikas Sales (supra) that REP licences were goods for the purposes of levy of  sales tax.  Indeed REP licences were not the subject-matter of the appeal before the refer- ring court and could not have formed part of the reference. The only question we are called upon to  answer  is  whether  the  decision  in  H.  Anraj (supra) that lottery tickets are goods for the pur- poses of Article 366(29-A)(a)  of the Constitution and the State sales tax laws, was correct.”   

30. Thus,  the  Constitution  Bench  did  not  overrule  the

decision of the Court in  Vikas Sales Corporation (supra)

holding  replenishment  licences  were  goods.   The

Constitution Bench, however, held that the reliance placed

in Vikas Sales Corporation (supra) on the observations in

H. Anraj (supra), which was agreed to and stood overruled,

was  to  this  extent  bad  in  law.   To  clarify,  Vikas  Sales

Page 37

37

Corporation (supra) specifically dealt with the transfer of

replenishment licences after they had been issued. However,

in Vikas Sales Corporation (supra) it was opined that the

grant of a licence by the licensing authority to a registered

exporter was not a sale. Sale will take place only when the

registered  owner  further  sells  it  to  another  person  for

consideration.  The relevant paragraph of the judgment has

been earlier reproduced.  

31. A three-Judge Bench of the Court in Yasha Overseas

v. Commissioner of Sales Tax and others15 had examined

the question whether the sale or transfer of replenishment

licences and duty entitlement passbooks would attract sale

tax.   Reliance  placed  on  Sunrise  Associates (supra)  to

contend  that  the  decision  in  Vikas  Sales  Corporation

(supra)  impliedly overruled. The three-Judge Bench did not

accept the contention by stating thus:-  

“40. Thus, on a detailed examination, we are un- able to see how the decision in  Sunrise (supra) can be said to alter the position in regard to the sale of REP licences as held by the earlier deci- sion in  Vikas (supra). It is noted above that the Constitution Bench in Sunrise (supra) firmly and expressly  declined  to  go  into  the  question

15 (2008) 8 SCC 681

Page 38

38

whether REP licences (or  DEPB which replaced REP licences) were “goods”. It is indeed true that the Constitution Bench in Sunrise (supra) did not approve the decision in Vikas (supra)   insofar as it  gave their  free marketability  as an  additional reason to hold that REP licences were not action- able  claim  but  “goods”  properly  so  called.  The Constitution  Bench  held  that  the  assumption that actionable claims were not transferable for value  was quite  unfounded and the  conclusion drawn on that basis was quite wrong. In paras 39 and 40 of the decision,  Sunrise (supra) decision gave  illustrations  of  a  number  of  actionable claims which are transferable.

41. But to our mind that does not in any way change the position insofar as REP licences are concerned.  While  examining  the  three-Judge Bench  decision  in  Vikas  (supra) earlier  in  this judgment it is seen that the Court first came to hold that REP licence/Exim scrip fell within the definition  of  goods  quite  independently.  The Court found and held that REP licences had their own value; they were freely bought and sold in the market for their intrinsic value and for that reason alone those were goods. (See para 29 of the decision in  Vikas (supra) that is reproduced above.) It was only after coming to the conclusion that the Court proceeded to examine the matter in light of the observations made in Anraj (supra) relating  to  lottery  tickets  and that  too  because the Karnataka and the Madras High Courts had heavily  relied  upon  Anraj  (supra) decision  for holding that the sale of REP licences was exigible to sales tax. On a careful reading of the decision in Vikas (supra) it is apparent that it was the in- trinsic value of REP licence that brought it within the definition of goods.”

32. After so stating, the Court specifically referred to the

Page 39

39

term “goods” as interpreted in  Sunrise Associates (supra)

to  mean the  title  and  ownership  of  a  thing  and  not  the

nature  of  interest  in  the  goods.   The  question  of

free-marketability, it was held, was not primarily relevant as

per the decision in Sunrise Associates (supra), albeit could

be relied upon as an additional reason, for replenishment

licences  fall  within  the  definition  of  “goods”  quite

independently.  These  licences  could  have  their   own

intrinsic value and could be freely brought and sold at their

market value.   There was also a ready market for the sale

and purchase of replenishment licences.  

33. Thus  analysed,  the  replenishment  licences  or  Exim

scrips  would,  therefore,  be  “goods”,  and  when  they  are

transferred  or  assigned  by  the  holder/owner  to  a  third

person  for  consideration,  they  would  attract  sale  tax.

However,  the  position  would  be  different  when

replenishment licences or Exim scrips are returned to the

grantor  or  the  sovereign  authority  for  cancellation  or

extinction.   In  this  process,  as  and  when  the  goods  are

presented,  the  replenishment  licence  or  Exim  scrip  is

cancelled  and  ceases  to  be  a  marketable  instrument.  It

Page 40

40

becomes a scrap of paper without any innate market value.

The SBI, when it took the said instruments as an agent of

the RBI did not hold or purchase any goods.   It was merely

acting as per the directions of the RBI, as its agent and as a

participant in the process of cancellation, to ensure that the

replenishment  licences  or  Exim  scrips  were  no  longer

transferred.  The intent and purpose was not  to purchase

goods in the form of replenishment licences or Exim scrips,

but to nullify them. The said purpose and objective is the

admitted position.  The object was to mop up and remove

the replenishment licences or Exim scrips from the market.

34. Be it noted that the initial issue or grant of scrips is

not treated as transfer of  title or ownership in the goods.

Therefore, as a natural corollary, it must follow when the

RBI acquires and seeks the return of replenishment licences

or  Exim  scrips  with  the  intention  to  cancel  and  destroy

them, the replenishment licences or Exim scrips would not

be  treated  as  marketable  commodity  purchased  by  the

grantor.    Further,  the  SBI  is  an  agent  of  the  RBI,  the

principal. The Exim scrips or replenishment licences were

not “goods” which were purchased by them.  The intent and

Page 41

41

purpose  was  not  to  purchase  the  replenishment  licences

because the scheme was to extinguish the right granted by

issue  of  replenishment  licences.  The  “ownership”  in  the

goods was never transferred or assigned to the SBI.

35. In view of the preceding analysis, the other issues and

questions,  including  the  question  whether  the  aforesaid

exercise of procuring and cancelling replenishment licences

or Exim scrips is “business” within the meaning of the Act,

need not be decided. The facts of the case at hand  has its

distinctive features and, therefore, we unhesitatingly concur

with the view of the High Court that the SBI was not liable

to levy of purchase tax under the Act.  

36. Consequently,  the  appeal,  being  devoid  of  merit,

stands dismissed.  There shall be no order as to costs.   

                                               .............................J.                                                 [Dipak Misra]

                                               .............................J. New Delhi;                                          [Shiva Kirti Singh] November 8, 2016