Holding

The expression "goods" in the phrase "for use by him in the manufacture or processing of goods for sale" under Section 8(3)(b) includes newspapers, entitling newspaper publishers to the concessional 4% Central Sales Tax rate.

Summary

Printers (Mysore) Ltd. and other newspaper publishers challenged the Central Sales Tax authorities' demand that they pay tax at the higher 10% rate on raw materials used for printing, arguing that the amendment to the definition of "goods" in the Central Sales Tax Act, 1956 (which excluded newspapers) should not deprive them of the concessional 4% rate available under Section 8(3)(b) read with Section 8(1)(b). The Supreme Court examined the statutory construction of the term "goods" in the relevant clause, the constitutional scheme excluding newspapers from state tax under List‑II entry 54 and permitting Parliament to tax them under List‑I entries 92 and 92‑A (which it has not exercised), and the historic policy of giving newspapers special tax treatment in view of freedom of the press. It held that the word "goods" in the second half of Section 8(3)(b) does include newspapers, so the publishers are entitled to the 4% rate. Consequently, the appeals allowing the Karnataka High Court’s decision were set aside and the earlier High Court rulings in favour of the publishers were affirmed.

Issues considered

The meaning of "goods" in Section 8(3)(b) of the Central Sales Tax Act, 1956 with respect to newspapers.
Whether the 1958 amendment excluding newspapers from the definition of "goods" removes the concessional tax benefit under Section 8(3)(b).
The constitutional implications of Articles 19(1)(a) and 265 and the entries in the Seventh Schedule on taxation of newspapers.
Whether the special tax treatment of newspapers is justified by the freedom of the press doctrine.

Legislation cited

Central Sales Tax Act, 1956s. 2(d), s. 8(1)(b), s. 8(3)(b), s. 8(4)(a)
Constitution of Indias. Article 19(1)(a), s. Article 265, s. List I Entry 92, s. List I Entry 92-A, s. List II Entry 54
Essential Commodities Act, 1955s. Section 3
Taxes on Newspapers (Sales and Advertisements) Repeal Act, 1951

Subjects

Central Sales Taxdefinition of goodsnewspapersfreedom of pressconstitutional lawtax exemptioninter‑state purchaseconcessional tax rate

Judgment

(

A THE PRINTERS (MYSORE) l.,TD. AND ANR.
v.
ASSTT. COMMERCIAL TAX OFFICER AND ORS.

FEBRUARY 7, 1994

B [B.P. JEEVAN REDD i AND B.L. HANSARIA, JJ.]

Central Sales Tax Act, 1956: Section 2(d~"Goods"-Amended by the
Amending Ac~ 1958-Purpose and effect of. '.>...

C Section 8(3)(b) r/w 8(1)(b)-lnter-State purchase of raw materials by
printers/ publishers of newspapers-Rate of tax-Concessional rate of 4% as
against 10%-Amended definition of "goods" excluding newspapers-- Benefit
of concessional rate of tax denied to the newspapers-Validity of

Constitution of India, 1950: Articles 19(1)(a) and 265--Freedom of
D press-Right to publish, to dissiminate infonnatiort-f'ress not immune from
taxes and general laws-However, it is placed on a higher footing than other
enterprises-Given special treatment in the matter of tax.

Interpretation of statute: Definition clause-Not to be applied mechani-
cally since it may lead to absurd and unintended result-Contextual mean-
E ing--/mportance and application of.

The definition of the expression "goods" in Section 2 of the Central
Sales Tax Act, 1956 came to be amended in 1958, resulting in exclusion of
newspapers from the purview of "goods". According to the Revenue, this
amendment had the effect of disentitling the printers/publishers of
F newspapers to the benefit of concessional rate of tax on the raw material
purchased by them under Section 8(3) (b) r/w Section 8(1) (b) of the Central
Sales Tax Act and that they liable to pay tax at the rate of 10%. The
printers/publishers of newspapers approached the respective High Courts
questioning the demands raised on the above basis. The Madras and
G Kerala High Courts held that the newspapers were entitled to the benefit,
while the Karnataka High Court took a contrary view.

Against the judgments of the said High Courts, the present appeals
were filed.

H Disposing of the appeals, this Court
682
)
PRINTERS (MYSORE) LID. v. ASS TI. COMM. TAX OFFICER 683

HELD: 1. The expression "goods" occurring in the words "for use by A
him in the manufacture or processing of goods for sale" in Section 8(3)(b)
of the Central Sales Tax Act, 1956 does take in, i.e., does not exclude
newspeper. (695-H, 696-A]

Indian Express (Madurai) Ltd. v. Deputy Commercial Tax Officer,
(1972) 29 S.T.C. 88; Madras High Court & Malaya/a Manorama Co. & Ors. B
v. Assistant Commissioner (Assessment) I Sales tax Special Circle Kottayam
& Ors. O.P. No. 143 of 1989 disposed of on August 18, 1990 by the Kerala
High Court, affirmed.

Printers (Mysore) Ltd. & Anr. v. Asstt. Commercial Tax Officer VII C
Circle, Bangalore & Ors., 59 S.T.C. 306, overruled.

2. The special treatment given to newspapers has a philosophical and
historical background. Freedom of press has always been a cherished right
in all democratic countries. The newspapers not only purvey news but also
< ideas, opinions and ideologies besides much else. They are supposed to D
guard public interest by bringing to fore the misdeeds, failings and lapses
of the government and other bodies exercising governing power. Rightly,
therefore, it has been described as the Fourth Estate. The democratic
credentials of a State is judged today by the extent of freedom the press
.enjoys in that State. Any imposition or restriction directly relatable to the E
right to publish, to the right to disseminate information and to circulation
of newspapers is, therefore, prohibited, though the press is not immune
from taxes and general laws, of the land. [691-C-G]

Express Newspapers v. Union of India, A.I.R. (1958) S.C. 578; Ramesh
Thapar v. State of Madras, AI.R. (1950) S.C. 124; Sakal Papers v. Union of F
India, [1962) 3 S.C.R. 842; Bennett Coleman & Co. v. Union of India, [1972)
2 S.C.C. 788 and Indian Express v. Union of India, [1985] 1 S.C.C. 641,
relied on.

Tenniniello v. Chicago, (1949) 93 L.Edn. 1131 and De Jonde v. State G
of Oregon, [1937) 299 U.S. 353, referred to.

3.1. Entry 54 of List-II of the seventh schedule to the Constitution,
which empowers the State legislatures to levy tax on the sale of goods
expressly excludes newspapers. The result is, that the State legislatures are
not competent to levy tax on the sale or purchase of newspapers. Entry 92 H
(
684 SUPREME COURT REPORTS [1994] 1 S.C.R.

A of List-I empowered the Parliament to levy taxes on the sale or purchase
of newspapers and on advertisements published therein but the Parlia·
ment has not chosen to do so ULtil now. By the Constitution 6th (Amend·
ment) Act.1956, Entry 92-A was introduced in List-I and Entry 54 in List-II
was amended to make it subject to the provisions of Entry 92-A of List-I.
[690-D-E]
B
3.2. The amendment of the definition of "goods" in Section 2(d) of
the Central Sales Tax Act, brought in with a view to bring the said
definition in accord with the amendments brought in by the Constitution
Sixth (Amendment) Act was actuated by the very same concern, viz., to
exempt the sale of newspapers from the levy of Central Sales Tax. The
c amendment was not intended to create a burden which was not there but
to remove the burden, if already existing on the newspapers • a policy
evidenced by the enactment of the Taxes on Newspapers (Sales and Adver·
tisements) Repeal Act, 1951. This concern must have to be borne in mind
while understanding and interpreting the expression "goods" occurring in
D the second half of Section 8(3)(b). The expression "goods" occurs on four
occasions in Section 8(3)(b), and on three occasions (in the first halt) it
concerns what may generally be referred to as raw material (in cases where
they were purchased by a dealer for use in the manufacture of goods for
sale). However the said word occurring for the fourth time (i.e. in the latter
half) cannot obviously refer to raw material. It refers to manufactured
E "goods", i.e., goods manufactured by such purchasing dealer • in this case,
newspapers. If a different meaning is attached to "goods" in the second half
of Section 8(3)(b), it would place the newspapers in a more unfavourable
position than they were prior to the amendment of the definition in Section
2(d). Section 2 which defines certain expressions occurring in the Act
F opens with the words "in this Act, unless the context otherwise requires".
This shows that wherever the word "goods" occurs in the enactment, it is
not mandatory that one should mechanically attribute to the said expres-
sion the meaning ass5gned to it in clause (d). Ordinarily that is so. But
where the context does not permit or where the context requires otherwise,
G the meaning assigned to it in the said definition need not be applied. Ir
this consideration is kept in mind, the expression "goods" occurring in the
second half of Section 8(3)(b) cannot be taken to exclude newspapers from
its purview. The context does not permit it. [694-C-H, 695-A, BJ

3.3. It is well settled that where the context does not permit or where
H it would lead to absurd o!° unintended result, the definition of an expres-
PRINfERS (MYSORE) LTD. v. ASSIT. COMM. TAX OFFICER [B.P.J. REDDY, J.) 685

sion need not be mechanically applied. [695-E] A
1'.M. Kenniayan v. Income Tax Officer, Pondicheny & Anr., [1968) 2
S.C.R. 103; Pushpa Devi & Ors. v. Milkhi Ram (Dead) by his L.rs., [19901 2
S.C.C. 134 and Commissioner of Income Tax, Bangalore v. J.H. Got/a,
Yadagiri, [1985) 4 S.C.C. 343, relied on.
B
3.4. In case of tax on newsprint, it may be sufficient to show a distinct
and noticable burdensomeness clearly and directly attributable to the tax,
though ordinarily a taxing statute can be questioned only on the ground
of being openly ('Onfiscatory or a colourable devise to confiscate. [694-A-B]

Indian Express v. Union of India, [1985) 1 S.C.C. 641, relied on. c
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1550 of
1985.

From the Judgment and Order dated 10.8.1984 of the Karnataka D
High Court in W.P. No. 1848 of 1976.

WITH

C.A. No. 2494/1993, 694, 672/1994 AND W.P. (C) No. 278/1991
E
Soli J. Sorabjee, Arun Jaitley, G.V. Iyer, Harish N. Salve, N. Santosh
Hegde, Dr. V. Gaurishankar, J. Vellapally, Sunil Gupta, Sukumaran, K.V.
Viswanathan, K.V. Venkataraman, Gaurav Banerjee, Ranjan Karanjawala,
P.K. Mullick, Vidula Mehendale, Rajib Roy, Ms. Manik Knanjawala, M.A.
Firoz, M. Veerappa, K.H. Noblli Singh and K.J. John for the appearing
parties. F
The Judgment of the Court was delivered by

B.P. JEEVAN REDDY, J. 1. The question in this batch of appeals is
whether the publishers of newspapers are entitled to the benefit of Section G
8(3)(b) read with Section 8(1)(b) of the Central Sales Tax Act, 1956,
hereinafter referred to as 'the Act'. If they are so entitled, they can
purchase the raw material required by them at the concessional rate of 4%
If not, they will be liable to pay tax @ 10%. The Madras and Kerala High
Courts have taken the view that they are entitled to the said benefit while
the Karnataka High Court has held to the contrary. We may briefly indicate H
686 SUPREME COURT REPORTS [1994) 1 S.C.R.

A how the question arises.
2. The publishers of newspapers require various goods, hereinafter
referred to as the raw material, for producing, i.e., for printing and publish-
ing their newspaper. These publishers are registered as dealers under the
Tax Act. They purchase their raw material from other registered dealers.
B Most of these purchases are inter-state purchases; in the hands of the
selling dealers they are inter-state sales exigible to tax.

3. Section 8 prescribes the rate of tax on inter-state sales. Sub-section
(1) says that "every dealer who in the course of interstate trade or com-
C merce ... (b) sells to a registered dealer other than the government goods of
the description referred to in Sub-section (3), shall be liable to pay tax
under this Act which shall be 4% of his turnover". According to this
sub-section, a dealer selling goods of the description referred to in Sub-
section (3) to a registered dealer is entitled to pay a concessional rate of
Tax, viz., 4% subject to compliance with Sub-section (4), as will be ex-
D plained presently. Sub-section (2) says that where the inter-state sale
pertains to goods not falling under sub-section (1), the selling dealer shall
pay tax at a higher rate, i.e., if they are declared goods, he shall pay at
twice the rate applicable to the sale or purchase of such goods inside the
appropiate State and in the case of other goods, @ 10% or at the rate
E applicable to the sale inside the appropriate State, whichever is higher.
Sub-section (3) specifies the goods for the purposes of clause (b) of
Sub-section (1) of Section 8. We are concerned herein only with clause (b)
in Sub-section (3). Having regard to its crucial relevance, it would be
appropriate to set out clause (b) of sub-section (3):

F "The goods refeired to in clause (b) of Sub-section (1) are
goods of the class or classes specified in the certificate of
registration of the registered dealer purchasing the goods
as being intended for re-sale by him or subject to any rul~s
made by the Central Government in this behalf, for use
G by him in the manufacture or processing of goods for sale
or in mining or in the generation or distribution of
electricity or any other form of power".

(Underlining is ours)

H 4. Clause (b) thus refers to three categories of goods, viz., (1) goods
)
PRINTERS (MYSORE) LID. v. ASSIT. COMM. TAX OFFICER [B.P.J. REDDY, J.)687

of the class or classes specified in the certificate of registration of the A
registered dealer purchasing the goods as being intended for re-sale by
him; (ii) goods specified in the certificate of registration of the registered
dealer purchasing the goods for use by him in the manufacture or process-
ing of goods for sale, subject to any rules made by the Central Government B
in the behalf; (iii) goods of the class or classes specified in the certificate
of registration of registered dealer purchasing goods for use by him in
mining or in the generation or distribution of electricity or any other form
of power. We are concerned herein with the second category among the C
said three. Sub-section (4) of Section 8 says that provisions of Sub-section
(1) shall not apply to any sale unless the selling dealer furnishes to the
prescribed authority in the prescribed manner "a declaration duly filled and
signed by the registered dealer to whom the goods are sold containing the D
prescribed particulars in a prescribed form obtained from the prescribed
authority''. The Rules framed under the Act prescribe the authority and
other particulars contemplated by Sub-section (4)(a). The Rules prescribe
the form of certificate of registration of the registered dealer purchasing E
the goods (Form 'B') as well as the Form in which the declaration has to
be issued by such purchaser (Form 'C'). *

5. Section 8, read as a whole, says inter alia: where a dealer purchases F
goods (being non-declared goods) required by him for use in the manufac-
ture or processing of goods for sale and issues Ferm 'C' to the selling
dealer, the sclling dealer shall be liable to pay tax only@ 4% as per Section
8(1) and not 10% as provided in Section 8(2), provided that the certificate G
i. of registration of the purchasing dealer specifies the class of goods pur-
chased by him. (In case of declared goods, the selling dealer has to pay ta'C
at the rate applicable to sale of such goods within the appropriate State.)
It necessarily means that the selling dealer will collect (pass on) tax from H
the purchasing dealer only at the said concessional rate. The idea behind

A perusal of Form 'B' shows that it contains all the particulars, namely, the business
of the dealer, the class/classes of goods specified for the purposes of sub-sections (1)
and (3) of Section 8 and in particular whether the goodss being purchased are meant
for re-sale or for being used in the manufacture or processing of goods for sale or for
other purposes mentioned in Section 8(3)(b ). It also mentions inter alia the goods
manufactured by that dealer. Form 'C' similarly contains all the relevant particulllrs.
This has to be issued by the purchasing dealer. In this certificate, the purchasing dealer
mentions his registration certificate number and all other particulars including the
statement that the goods being purchased being purchased by him are meant for being
used inter alia in the manufacture or processing of goods for sale.
(
688 SUPREME COURT REPORTS [1994) 1 S.C.R.

A this provision is self-evident. It is to ensure that the price of the product
manufactured by such purchasing dealers does not go up to the detriment
of the consumers of those goods. The Parliament does not want to tax both
the raw material and the finished goods at the full rate. Where the finished
goods are meant for sale, the raw material utilised or consumed for the
manufacture of said finished goods is taxed at the concessional rate, for
B the reason that the State derives revenue again by taxing the sale of the
finished goods. However, it is not necessary that the finished goods are
actually subjected to tax on their sal~ - for they may be exempted either by
the Act or by a notification issued thereunder. It is enough that the fmished
goods are meant for sale. Ordinarily, of course, their sale is taxed.
c
6. The expression "goods" is defined in clause (d) in Section 2. As
originally enacted, the definition read: "(d) goods includes all materials,
articles, commodities and all other kinds of movable property but does not
include actionable claims, stocks, shares and securities". (The Central Sales
D Tax Act, 1956 came into force on January 5, 1957.} By amending Act 31
of 1958, the word "newspapers" was inserted in the said definition after the
words "but does not include" and before the words "actionable claims,
stocks, shares and securities". After the amendment, the defmition reads
as follows:

E ""Goods" includes all materials, articles, commodities and
all other kinds of movable property, but does not include
· newspapers, actionable claims, stocks, shares and
securities".

F 7. Now the situation is this: before the amendment of the definition
of the expresssion "goods" by the 1958 Amendment Act, the publishers of
the newspapers (who held the certificate of registration contemplated by
Section 8(3)(b)) were issuing Form 'C' ·(declarations contemplated by
Section 8(4)(a)) and on that basis the selling dealer was collecting from
them central sales tax at the concessional rate of 4% (in the case of
G non-declared goods). They were like any other manufacturer in this
respect. But after the newspapers were excluded from the purview of the
"goods" by the 1958 (Amendment) Act, the Central Sales tax authorities
took the stand that by virtue of the said amended definition, the
printers/publishers of newspaper were not entitled to the benefit of Section
H 8(3)(b) read with Section 8(1)(b) and are, therefore, not entitled to issue
)
PRINrERS (MYSORE) LTD. v. ASSIT. COMM. TAX OFFICER [B.PJ. REDDY, J.]689

Forms 'C'. Their reasoning was this: since the expression "goods" does not A
take in newspapers, it cannot be said that publishers of newspapers are
purchasing the goods (raw material) for use by them "in the manufacture
or processing of goods for sale"; what they purchase may be goods but
goods manufactured out of them (newspapers) are not goods; hence, they
do not satisfy the requirement of Section 8(3)(b). The result was that the B
publishers of newspapers were disabled from issuing Forms 'C' and hence
became liable to pay tax at the higher rate of 10% on goods (non-declared
goods) purchased by them as raw material for producing (manufacturing)
their newspapers, while all other manufacturers continued to enjoy the said
benefit. The publishers of the newspapers, therefore, questioned the action
of the Central Sales Tax authorities in various High Courts. The earliest C
decision is of the Madras High Court in Indian Express, (Madurai) Ltd. v.
Deputy Commercial Tax Officer, (1972) 29 S.T.C. 88, which held in favour
of the newspapers. That decision is said to have become final. The Kerala
High Court took a similar view in O.P. No. 143 of 1989 disposed of on
August 18, 1990 Malaya/a Manorama Co. & Ors. v. Assistant Commissioner D
(Assessment) I Sales Tax Special Circle, Kottayam 7 Ors., which is the
subject matter of an appeal arising from S.L.P. (C) 2 of 1991 in this batch.
Leave granted. The Karnataka High Court, however, took a contrary view
in Printers (Mysore) Ltd. & Anr. v. Asstt. Commercial Tax Officer VII circle,
Bangalore & Ors., 59 S.T.C. 306 which decision too is the subject matter of
an appeal (C.A. No. 1550 (NT) of 1985) in this batch. The decision in E
Printers (Mysore) Ltd. was followed by the Karnataka High Court in the
case of other newspapers as well against which S.L.P. (C) 3439 of 1992
(preferred by Indian Express, (Madurai)) and CA. No. 2494 of 1993
(preferred by M/s. Kasturi & Sons Ltd.) have been preferred. They too are
included in thiS batch. Leave granted in S.L.P. (C) No. 3439/1992. F

8. If a literal construction is adopted, it is conceded on all hands that
the view taken by the Karnataka High Court is the correct one. But what
the Madras and Kerala High Courts have done is to take the spirit behind
the amendment of the definition of the expression "goods" as well as the
scheme underlying entries 54 of List-I read with Entries 92 and 92-A of G
List I of the Vllth Schedule to the Constitution and hold on that basis that
the expression "goods" occurring in the latter half of clause (b) of Section
8(3) does not exclude newspapers from its purview. Accordingly, they held,
the publishers of newspapers are entitled to the benefit of Section 8(3)(b)
read with Section 8(1)(b). In this batch of appeals, we are called upon to H
(
690 SUPREME COURT REPORTS [1994) 1 S.C.R.

A decide which of the two views is the correct one.

9. For a proper appreciation of the question at issue, it would be
appropriate to notice certain provisions of the Constitution as well as the
basic importance and relevance of the freedom of press.

B 10. Article 19{1){a) of the Constitution declares that all citizens shall
have the right to freedom of speech and expression. Though freedom of
press is not explicitly guaranteed as a fundamntal right, it is no longer in
doubt that it is implicit in the freedom of speech and expression. This was
so. stated by Dr. Ambedkar in the Constituent Assembly during the
deliberations on Article 19{1){a) (vide Constituent Assembly D::bates Vol.
c 7, page 780) and it has been so held by this Court as far back as 1958 in
Express Nawspepers v. Union of India, A.I.R. {1958) S.C. 578-nay even in
Ramesh Thapar v. State of Madras, A.I.R. (1950) S.C. 124.

11. Entry 54 of list-II of the Constitution, which empowers the State
D legislatures to levy tax on the sale of goods expressly excludes newspapers. >-
The result is, the State legislatures are not competent to lavy tax on the
sale or purchase of newspapers. Entry 92 of List-I empowered the Parlia-
ment to lavy taxes on the sale or purchase of newspapers and on advertise-
ments published therein but the Parliament has not chosen to do so until
now. By the Constitution 6th {Amendment), Act, 1956, Entry 92-A was
E introduced in List-I and Entry 54 in List-II was· amended to make it subject
to the provisions of Entry 92-A of List-I. After the 6th Amendment, the
three Entries read as follows:

"Entry 54 List-II.--Taxes ·on the sale or purchase of goods
other than newspapers, subject to the provisions of Entry
F
92-A of List-I.

Entry 92 List-1.--Taxes on the sale or purchase of
newspapers and on advertisements published therein.

Entry 92-A List-1.--Taxes on the sale or purchase of goods
G
other than newspapers, where such sale or purchase takes
place in the course of inter-State trade or commerce".

12. As stated above, though the Parliament was empowered - at any
rate, till 1956 - to levy tax on sale or purchase of newspapers, no such tax
H was ever levied by it. On the contrary, soon after the coming into force of
)
PRINfERS (MYSORE) LTD. v. ASSIT. COMM. TAX OFFICER [B.P.J. REDDY, J.] 691

the Constitution, the Parliament enacted the Taxes on Newspapers (Sales A
and Advertisements) Repeal Act, 1951 where1ly taxes levied earlier on the
sale of newspapers and on the advertisements published therein was
repealed. It may be recalled that under the Government of India Act, 1935,
Entry 48 in List-II of the Vllth Schedule did not exclude the sale of
newspapers from its purview and on that account, they were liable to pay B
tax on their sale. It is this feature which was sought to be put an end to by
the aforesaid repealing Act. Entry 92-A of List-I, it is relevant to notice,
while empowering the Parliament to levy tax on sale or purchase of goods
taking place in the course of inter-state trade or commerce, specifically
excluded newspapers from its purview which means that no tax can be
imposed upon the inter-state sale or purchase of newspapers. In short, the C
position is: no tax can be imposed on the inter-state sale of newspapers
and no tax is imposed on their intra-state sale. This special treatment of
newspapers has a certain philosophy and an historical background behind
it which may briefly be noticed.
D
13. Freedom of press has always been a cherished right in all
democratic countries. The newspapers not only purvey news but also ideas,
opinions and ideologies besides much else. They are supposed to guard
public interest by bringing to fore the misdeeds, failings and lapses of the
government and other bodies exercising government power. Rightly, there-
fore, it has been described as the Fourth Estate. The democraiic creden- E
tials of a State is judged today by the extent of freedom the press enjoys
in that State. According to Douglas, J. (An Almanac Of Liberty) "accep-
tance by government of a dissident press is a measure of the maturity of
the nation". The learned Judge observed in Tenniniello v. Chicaqo, (1949)
93 L. Edn. 1131. "A function of free speech under our system of govern- F
ment is to invite dispute. It may indeed best serve its high purpose when
it induces a condition of unrest, creates dissatisfaction with conditions as
they are, or even stirs people to anger. Speech is often provocative and
challenging. It may strike at prejudices, and preconceptions and have
profound unsettling effects as it presses for acceptance of an idea......There G
is no room under our Constitution for a more restrictive view. For the
alternative would lead to standardisation of ideas either by legislatures,
courts or dominant political or community groups." The said observations
were of course made with reference to the 1st Amendment to the U.S.
Constitution which expressly guarantees freedom of press but they are no
less relevant in the Indian context subject, of course, to claus~ (2) of Article H
(
692 SUPREME COURT REPORTS [1994) 1 S.C.R.

A 19 of our Constitution. We may be pardoned for quoting another passage
from Hughes, CJ. in De Jonge v. State of Oregon, (1937) 299 U.S. 353, to
emphasise the fundamental significance of free speech. The learned Chief
Justice said: "the greate.r the importance of safeguarding the community
from incitements to the overthrow of our institutions by force and violence,
the more imperative is the need to preserve inviolence, the more imperative
B is the need to preserve inviolate the constitutional rights of free speech,
free press and free assembly in order to maintain the opportunity for free
political discussion, to the end that Government may be responsive to the
will of the people and the changes, it desired, may be obtained by peaceful
means. Therein lies the security of the Republic, the very foundation of
C constitutional government".

14. It is true that very often the press, whether out of commercial
reasons or excessive competition, descends to undesirable levels and may
cause prositive public mischief but the difficulty lies in the fact, recognised
D by Thomas Jefferson, that this freedom "cannot be limited without being
lost". Thomas Jefferson said, "it is, however, an evil for which there is no
remedy; our liberty depends on the freedom of the press and that cannot
be limited without being lost". (In a letter to Dr. J. Currie!, 1786). It is
evident that "an able, disinterested, public-spirited press, with trained intel-
E liqence to know the right and courage to do it, can preserve that public virture
without which popular government is a sham and a mockery. A cynica~
mercenary, demogogic press will produce in time a people as base as itself.
The power to mould the future of the Republic will be in the hands of the
journalism of future generation·~ as stated by Joseph Pulitzer.

F 15. This does not mean that the press is immune either from taxation
or from the general laws relating to industrial relations or from the State
regulation of the conditions of service of its employees, as has been
empha.>ised by this Court in &press Newspapers v. Union of India, A.I.R.
(1958) S.C. 578. Nor is it immune from the general law of the land including
G civil and criminal liability for libel and defamation. The prohibition is upon
the imposition of any restriction directly relatable to the right to publish,
to the right to disseminate information and to the circulation of
newspapers. In Sakal Papers v. Union of India, l1962] 3 S.C.R. 842, an Act,
the Newspaper (Price and page) Act, 1956, empowering the Central
H Government to regulate the price of newspapers in relation to their pages
)
PRINTERS (MYSORE) LTD. v. ASSIT. COMM. TAX OFFICER (B.P J. REDDY, J.)693

and size and to regulate the allocation of space for advetising matter, was A
struck down as violative of Article 19(1)(a). It was held that the said Act
was not saved by clause (2) of Article 19. It was held that freedom of press
was· implicit in Article 19(1)(a) and that a citizen not only has the right to
propagate his ideas but has also the right to publish them, to disseminate
them and to circulate them either by word of mouth or by writing. It. was B
further held that the said right extended not merely to the matter which he
was entitled to circulate but also to the vol:.une of circulation. It was further
held that the freedom of speech could not be restricted for the purpose of
~-4
regulating commercial aspect of the activities of the newspapers.

16. In Bennett Coleman & Co. v. Union of Intfia, [1972) 2 S.C.C. 788, c
the validity of the Newsprint Control Order, 1982 issued under Section 3
under the Essential Commodities Act, 1955 was questioned. The said
Control Order imposed several restrictions, viz., (a) a bar was created on
starting a newspaper or editions by common ownerhip unit; (b) it rigidly
limited the pages of newspaper to 10; (c) it imposed a bar on interchan- D
geability within common ownership unit; and (d) it allowed a 20% page
increase only to neW$papers below 10 pages. The import policy evoled for
the year 1972-1973 under the said Control Order was struck down on
various grounds. For our purpose, it is sufficient to notice one of those
grounds, viz., that the compulsory reduction of newspaper to 10 pages
offends Article 19(1)(a) and infringes the right to freedom of speech and E
expression. It was held that fixation of pages will not only deprive the
newspapers of their economic viability but also restrict the freedom of
expression by reason of compulsive reduction of page level entailing reduc-
tion of circulation and denuding the area of coverage for and views.
F
17. Reference must be made in this connection to the judgment in
Indian Express v. Union of India, [1985) 1 S.C.C. 641, wherein not only the
importance of freedom of press was emphasised, it was held that a
newspaper cannot survive and sell itself at a price within the reach of a
common man unless it is allowed to take in advertisements. (See para 84).
This decision is significant for the reason that it seeks to place freedom of G

- \
press on a higher footing than other enterprises. E.S. Venkataramiah, J.,
as he then was, speaking for the Bench, said:

"In view of the intimate connection of newsprint with the
freedom of the press, the tests for determining the vires H
(
694 SUPREME COURT REPORTS [1994] 1 S.C.R.

A of a statute taxing newsprint have, therefore, to be dif-
ferent from the tests usually adopted for testing the vires
of other taxing statutes. In the case of ordinary taxing
statutes, the law may be questioned only if they are either
openly confiscatory or a colourable device to confiscate.
On the other hand, in the case of a tax on newsprint, it
B may be sufficient to show a distinct and noticeable bur-
densomeness, clearly and directly attributable to the tax".

18. Now coming back to the amendment of the definition of "goods"
in Section 2(d) of the Central Sales Tax Act, the said amendment, brought
C in with a view to bring the said definition in accord with the amendments
brought in by the Constitution Sixth (Amendment) Act (referred to herein-
before) was actuated by the very same concern, viz., to exempt the sale of
newspapers from the levy of Central Sales Tax. The amendment was not
intended to create a burden which was not there but to remove the burden,
D if any already existing on the newspapers - a policy evidenced by the
enactment of the Taxes on Newspapers (Sales and Advertisements) Repeal
Act, 1951. This concern must have to be borne in mind while understanding
and interpreting the expression "goods" occurring in the second half of
Section 8(3)(b). Now, the expression "goods" occurs on four occasions in
E Section 8(3)(b). On first three occasions, there is no doubt, it has to be
understood in the sense it is defined in clause (d) of Section 2. Indeed,
when Section 8(1)(b) speaks of goods, it is really referring to goods
referred to in the first half of Section 8(3)(b), i.e., on first three occasions.
It is only when Section 8(3)(b) uses the expression "goods" in the second
half of the clause, i.e., on the fourth occasion that it does not and cannot
F be understood in the sense it is defined in Section 2(d). In other words,
the "goods" referred in the first half of clause (bfin Section 8(3) refers to
what may generally be referred to as raw material (in cases where they
were purchasecd by a dealer for use in the manufacture of goods for sale)
while the said "goods" occurring for the fourth time (i.e., in the latter half)
G cannot obviously refer to raw materia!. It refers to manufactured "goods",
i.e., goods manufactured by such purchasing dealer - in the case,
newspapers. If we attach the defined meaning to "goods" in the second half
of Section 8(3)(b), it would place the newspapers in a more unfavourable
position than they were prior to the amendment of the definition in Section
H 8(d). It should also be remembered that Section 2 which defines certain
)
P~INI'ERS (MYSORE) LTD. v. ASSIT. COMM. TAX OFFICER (B.P J. REDDY, J.) 695

expressions occurring in the Act opens with the words "in this Act, unless A
the context otherwise requires". This shows that wherever the word "goods"
occurs in the enactment, it is not mandatory that one should mechanically
attribute to the said expression the meaning assigned to it in clause (d).
Ordinarily, that is so. But where the context does not permit or where the
context requires otherwise, the meaning assigned to it in the said definition B
need not be applied. If we keep the above consideration in mind, it would
be evident that the expression "goods" occurring in the second half of
Section 8(3)(b) cannot be taken. to exclude newspapers from its purview.
The context does not permit it. It could never have been included by
Parliament. Before the said amendment, the position was: the State could C
not levy tax on intra-state sale of newspapers; the Parliament could but it
did not and Entry 92-A of List-I bars the Parliament from imposing tax on
inter-state sale of newspapers; as a result of the above provisions, while the
newspapers were not paying any tax on their sale, they were enjoying the
benefit of Section 8(3)(b) read with Section 8(1)(b) and paying tax only@ D
4% on non-declared goods which they required for printing and publishing
newspapers. Their position could not be worse after the amendment which
would be the case if we accept the contention of the Revenue. If the
contention of the Revenue is accepted, the newspapers would now become
liable to pay tax @ 10% on non-declared goods as prescribed in Section E
8(2). This would be the necessary consequence of the acceptance of
Revenue's submission inasmuch as the newspapers would be deprived of
the benefit of Section 8(3)(b) read with Section 8(1)(b). We do not think
that such was the intention behind the amendment of definition of the
expression "goods" by the 1958 (Amendment) Act. Even apart from the
opening words in Section 2 referred to above, it is well settled that where
F
the context does not permit or where it would lead to absurd or unintended
result, the definition of an expression need not be mechanically applied.
Vide T.M. Kanniyan v. Income Tax Officer, Pondicheny & Anr., (1968) 2
S.C.R. 103, Pushpa Devi & Ors. v. Milki Ram (Dead) by his L.rs., (1990) 2 G
S.C.C. 134 at 140, para 14, and Commissioner of Income Tax, Bangalore v.
J.H. Got/a, Yadagiri, (1985) 4 S.C.C. 343.

19. For the above reasons, we hold that the expression "goods"
occurring in the words "for use by him in the manufacture or processing
of goods for sale" in Section 8(3)(b) of the Central Sales Tax Act, 1956 H
696 SUPREME COURT REPORTS [1994] 1 S.C.R.

A does take in, i.e., does not exclude newspapers. We agree with the view
taken by the Madras and Kerala High Courts. In our view, the view taken
by the Karnataka High Court is unsustainable.

20. For the above reasons, Civil Appeal Nos. 1550 of 1985, C.A. No.
B 2494 of 1993 and CA. No. 694 of 1994 (arising from S.L.P. (C) No. 3439
of 1992) are allowed and the Civil Appeal No. 672 of 1994 (arising from
SL.P. (C) No. 2 of 1991) is dismissed. No orders in W.P. (C) No. 278 of
1991. No costs.

G.N. Appeal disposed of.