Siriwardvna r. Air Cryhnt tJit. (I .11 dr tAw. J.)
UNITED MOTORS LTD.
COURT OF APPEAL
TAMBIAH, J. AND L.H. DE ALWIS. J.
C A 21(11/80 _ C A 2102/8(1
FEBRUARY 11, MARCH 30. 31 AND JUNE' 10 ANDIf.-1982
Writs of Certiorari and Mandamus -;Bjusiness Undertakings -Acquisition .Ac/,. bio.35 of 1971, section 3,4,5 and 17 – Permissibility of deduction of liabilities toGovernment.
By order dated 8.3.72. of the Minister of Finance under section 2(l.)(b) of theBusiness Undertakings Act, No. 35 of 1971 the business undertaking of theUnited Motors Ltd." and Automobile Assembly and Manufacture and- profitrtyused for the purpose of the undertaking vested in the Government-.
Sri Lanka Law Reports
(m2) 2 S.L.h.
On 1.9.80 the Minister of Finance made an order consequent to a report madeby a Committee appointed to examine the assets and liabilities of undertakingsthat vested. On the basis of this report order was made for payments of Rs.596,694.26 in respect of United Motors and Rs. 262,943.15 to AutomobileAssembly and Manufacture Limited after deductions of commission on debtcollection, professional charges. Income and Turnover Tax.
The petitioners appealed for Writs of Certiorari and Mandamus against thedeductions.
The contention of the petitioners was that section 4(1) of Act permitted onlydeduction of all contractual liabilities subsisting at the date of vesting from thepayment of compensation and that the liabilities to government departments werenot deductible.
Income Tax and Turnover Tax liabilities were deductible before any paymentswere made in respect of acquisition of business undertakings or their propertyunder Act No. 35 of 1971.
APPLICATION for Writs of Certiorari and Madamus.
S.J. Kadirgamar, Q.C., with K. Nadarajah and K. Thevarajah for the petitionerin both applications.
Shibly Aziz, Deputy Solicitor-General with K. Siripavan, State Counsel, for therespondents. –
11th July 15. 1982
There are two connected applications before us. In C.A. 2301/80,the petitioner is the United Motors Limited; in C.A. 2302/80,Automobile Assembly & Manufacture Limited is the petitioner.
By Order dated 8.3.72 made by the Minister of Finance unders.2 (1) (b) of the Business Undertakings (Acquisition) Act, No. 35of 1971, and published in the Government Gazette Extraordinary,No. 15,000/7, dated 8.3.72 (PI), the business undertaking carried onby the United Motors Limited and the property used for the purposesof that undertaking were vested in the Government. By a similarOrder dated 8.3.72 and published in the same Gazette (PI), thebusiness' undertaking of Automobile Assembly and ManufactureLimited and the property used for the purposes of that undertaking,were also vested in the Government. The properties that were takenover were specified in the vesting orders as the lands, buildings,plant, machinery, fixtures and moveable property, used for thepurposes of the undertakings. It would appear that it was or. a
CAUnited Motors Ltd. r. lie Mel I I'tnnhioh. J.l551
request made, by the shareholders that the Government decided totake oyer the undertakings of the two Companies. The 2nd rcsponifdntis the competent authority appointed in terms of s. .3 of the Act.to manage and administer the affairs of both business undertakings. ''
The Minister of Finance is empowered to make Rcgulations,.undej,s. 12 of the Act. Two sets of regulations were made bn 9„4.75'—the United Motors Limited (Assets and Liabilities) Regulations 1975,and the Automobile Assembly and Manufacture Limited (Assets andLiabilities) Regulations 1975. These were, published in the jpovcrrvncntGazette Extraordinary, No. 158/8 of 10.4.75.
In terms of Regulation 2 the Minister appointed a'Committeeconsisting of the 3rd, 4th and 5th respondents to examine and reportto him on the assets and liabilities of both .undertakings. . TheCommittee consisting of the said 3 respondents .made its report tothe Minister of Finance.
By Order dated 12.3.79 (P3) made in terms of Regulation 7, theMinister of Finance and (Planning, the 1st respondent, ordered thata sum of Rs. 552,741.13 be paid in respect of the business undertakingof Automobile Assembly and Manufacture Limited, and a sum ofRs. 1,000,000.00 to Messrs Chettinad Corporation Limited in respectof the land belonging to it, on which the business undertakings weresited. The said order did not specify any sum payable to UnitedMotors Limited.
The petitioners then wrote letters dated 17.5.79 addressed to theSecretary to the 1st; respondent (P4), and letter dated 2.1.80, addressedto the 1st respondent, (P5), and sought a revision pf the said orderin view of the reduction of Income Tax and Business Turnover. Taxliabilities following the settlement of appeals against the assessmentsmade. According to the letter (P5), in consequence of a settlement.with the Commissioner of Inland Revenue, the outstanding taxliabilities were as follows:
United Motors Limited
: income TaxRs'.1,342,484.00
Automobile Assembly <6 Manufacture Limited
Business Turnover TaxRs.2,478,829.00
Sri Lanka Imw Reports
(1982) 2 S L R.
The petitioners wrot? a further letter dated .10.7.80 (P6) addressedto the 1st respondent, in which they stated that they accepted thevaluation of assets as per report made by the Committee appointedby the Minister of Finance. They however took up the position thatthe liabilities relating to outstanding Income Tax, outstanding BusinessTurnover Tax and loans do not fall within the ambit of s.4(l) ofthe Act, and arc not deductible in arriving at the compensationpayable to them. They requested that the amount payable ascompensation be first computed by taking the gross value oif theassets and adding the interest that has accrued thereon, and that the1st respondent may thereafter pay to the Cornmisfciorier-General of .Inland Revenue the sums due as Income Tax and BusinessTurnover Tax.
The assets of United Mptors Limited were valued at Rs. 5,875,861.83and of Automobile Assembly and Manufacture Limited at Rs.3,073,264.00.
On 1.9.80, the 1st respondent made a revised order (P7) settingout that a sum of 'Rs. 596,694.26 be paid to the United MotorsLimited, and a sum of Rs. 262,943.45 be paid to the AutomobileAssembly and Manufacture Limited.
The petitioners then appealed to the 1st respondent (P9) and statedinter alia that in determining the compensation payable, the deductionof liabilities, other than those falling under s.4(l) of the Act. iscontrary to law and that there being no sum deductible under s.4(l),interest is payable oir the gross value of the assets vested at therates prescribed in terms of the Business Undertakings (Acquisition)Amendment Act No. 21 of 1980, and Regulations made thereunder.The 1st respondent, however, did not grant the petitioners the reliefsasked for.
At the hearing before us, learned Queen’s Counsel for the petitionersstated that the amounts that have been deducted as liabilities fromthe payments due as compensation and which are in dispute are asfollows:-
Application No. C,A. 2301/80 — United Motors Limited
5% commission on debt collection Rs. 33,700.63
Professional charges reclaim against Walker Bros. (London)Rs. 80,511.25
Outstanding Income Tax and Business Turnover Taxand penalty thereon Rs. 3,162,739.00
CAUnited Motors Ltd. r. lie Mel tTumbudi. J.)553
Application No. C. A. 2302180 — Automobile Assembly& Manufacture Limited
Income Tax & Business Turnover Tax Rs. 2.504.029.68 .
Learned Deputy Solicitor-General agreed that 'the sum of Rs.33.700.63 is not deductible. He did not make the same concessionas regards the sum of Rs. 80.511.25. He however stated that for thepurpose of our judgment, what is in issue is restricted to unpaidIncome Tax and Business Turnover Tax.
S. 2 (1) (b) of Act No. 35 of 1971 empowers the Minister ofFinance to vest in the government by a primary vesting order anybusiness undertaking as shall be specified in such order.
S. 2 (2) reads —
“Where any business undertaking is acquired by the Governmentby agreement or is vested in the Government by a primaryVesting Order, the Government shall, with effect from thedate of transfer or the primary vesting date, as the case maybe, have absolute title to such business' undertaking free fromall. encumbrances.”
S. 17 defines “business undertaking” as follows
“business undertaking” means any undertaking of a commercial,industrial, agricultural or professional nature and includes —
all property, movable or immovable, which was usedfor the purposes of the undertaking on the day immediatelypreceding the date of transfer or the primary vestingdate and which may be specified by the Minister ofFinance in the primary Vesting Order;
subject to the provisions of this Act, all rights, powers,privileges and interests arising in or out of such propertyor business and all the liabilities of that undertaking;
all books, accounts and documents relating or appertainingto the business undertaking or any property of thatundertaking.”
S. 17 also defines the term “proprietor” as follows:-
“proprietor” when used in relation to a business undertaking;means the owner of that undertaking or any other personauthorised by the owner to enter into contracts for the purposesof that undertaking.”
Sri Lanka Law Reports
(m2) 2 S L R.
S. 4 reads —
– “4(1) Subject t,o the provisions of sub-section (2), where anybusiness undertaking is acquired by or vested in theGoveriitnent, all the rights and liabilities under anycontract or agreement which'relates to the purposes ofthat undertaking and which subsists on the date oftransfer or on the primary vesting date of that undertakingshall vest in the Government.
The Minister of Finance may at any time repudiate theliabilities under any contract or agreement referred toin. sub-section (1) if he is of opinion that such .liabilitieswere incurred mala fide, dishonestly or fraudulently.Notice of the repudiation shall be given by the competentauthority to the parties to the contract or agreement.
Where the Minister of Finance under sub-section (2)repudiates the liabilities under any contract or agreementsuch liabilities shall be deemed never to have vestedin the Government’.
For the purposes of-this section, “liabilities" shall notinclude any'loan repayable to a director or any businessundertaking which is acquired by or vested in theGovernment or to any member of the family of suchdirector.”
The Business:.Undertakings (Acquisition) (Amendment) Act, No.21 of-. .1980 introduced a’new section. 12A which reads:-
“Payme’nts to be made in respect of:-
any business undertaking acquired by, or vested in. theGovernment; or
any property vested in, or requisitioned by, the Government,for the purpose of any undertaking, shall be consideredas accruing due from the date on which such businessundertaking or property, as the case may be, was transferredto, or vested in, or requisitioned by, the Government.Interest at the prescribed rate shall be paid on every suchpayment from the date on which it accrues due until thedate of payment.”
S. 3 of the amending Act gave retrospective effect to the amend-ment.
Learned Queen’s Counsel submitted that the only liabilities thatbecome vested in the State are those envisaged in s. 4 (1) of the
( AUnited tntors Ltd. r. De Me1 ( hntibnih. ./.,555
Act, viz, liabilities “under any contract or agreement," that is.contractual liabilities only. Payments due as Income Tax and BusinessTurnover Tax are statutory levies and liabilities, i.e.. imposed byAct of Parliament, and not liabilities under any contract or agreement.The Minister has therefore acted in error when he deducted IncomeTax and Business Turnover 'fax in making the orders for paymentto the petitioner-companies. The Minister must compute the paymentsto the two companies by taking the gross value of assets withoutdeduction of taxes, as these are not contractual liabilities, and addinterest that has accrued thereon, from the date of vesting. Tlv? twocompanies do not deny that the taxes are payable, but in makingthe order for the payments due to the companies, the taxes are notdeductible. He therefore submitted that the petitioners are entitledto have that part of the order dated 1.9.80 deducting the tax liabilities,quashed on certiorari, and also to a mandamus directing the 1strespondent to make an order for payment computed on the basis ofgross value of assets, without deduction of taxes, plus interest onthe gross value of the assets vested, from the date of vesting. Thepetitioners have no objection, he stated, once the amount is thuscomputed, to the 1st respondent appropriating from the said amountand paying to the Commissioner General of Inland Revenue, thesums due as Income Tax and Business Turnover Tax.
Learned Deputy Solicitor-General conceded that the amounts dueas Incdme Tax and Business Turnover Tax are not contractualliabilities: he also conceded that if learned Queen s Counsel's contentionis right that tax liabilities do not vest and arc not deductible, thewrits will go. His, position however was that .all liabilities of theundertaking become vested in the State (s. 17) and the tax liabilitiesare deductible in terms of Regulation 5 (3), read with Regulation 7.
Learned Queen’s Counsel referred us to the words "subject to the
provisions of this Act all the liabilities of that undertaking"
contained in the interpretation section 17 (ii) of the Act. He statedthat s. 4 (1) is the only substantive section in the Act dealing withliabilities. The expression “all the liabilities of that undertaking" musttherefore be read subject to s. 4 (l) as being liabilities – (1) underany contract or agreement, (2) which contract relates to the purposesof that undertaking, and (3) which contract subsists on the date ofvesting.' He contended that the legislature intended to limit the vestingof liabilities to those arising under a "contract or agreement" only.If the intention was to vest “all the liabilities,” it was unnecessaryto enact section 4. S. 4 then is a mere repetition or tautology.
556Sri Lanka Law Reports(I9H2) 2 S.L.R.
I cannot agree with this submission of learned Queen's Counselthat the words “all liabilities’’ must be limited to contractual liabilitiesonly. The opening words in s. 17 (ii) are “subject to the provisionsof the Act” and not “subject to the provisions of s. 4.” Nor doess. 4 (I) use the words “all rights and liabilities under-any contractor agreement only etc. vest in the Government.” Are delictualliabilities to be excluded ? –
“A Court should not be prompt to ascribe, and should not.without necessity or sound reason, impute to the language ofa statute tautology or superfluity and should be rather at theoutset inclined to suppose every word intended to have someeffect or be of some use.”
(Craies on Statute Law, 7th Edn. p. 103)
S. 4 contains special provisions relating to a category of rights andliabilities, namely, contractual. It seems to me that s. 4 was enactedto quiet the fears and apprehensions of those who had honestlycontracted with the business organisation before the acquisition orvesting, and to empower the Minister of Finance to select bona fideliabilities and reject those incurred mala fide, dishonestly or fraudulently.Loans repayable to a director or any metnber of his family werealso taken out of the ambit of contractual liabilities.
S. 4 is not the only provision that the words “all the liabilities”are made subject to. For example, the said words are also subjectto s. 2 (2) which states that when a business undertaking is acquiredor vested, that Government has absolute title to the business undertakingfree from all encumbrances. As was submitted by learned DeputySolicitor-General, the provisions of s. 17 (ii), s. 2 (2) and s. 4 canco-exist. Read together, what is. intended is that on the date ofvesting, all the liabilities of that undertaking are transferred to theState (s. 17 (ii) ), save and except, (1) those which .the Minister ofFinance can repudiate as having been incurred mala fide, dishonestlyor fraudulently (s.4 (2) ), (2) loans repayable to a director dr anymember of the family of such director'(s. 4 (4) ) and (3) suchliabilities which do not attach to the Government under s. 2 (2) -encumbrances on title.
Learned Queen's Counsel next submitted that payments due asIncome Tax and Business Turnover Tax are liabilities that cannotvest in the State. He said that only liabilities that can be vested,canfall within the ambit of the expression “all the liabilities of thatundertaking” in s. 17 (ii) of the Act. Income Tax and Business
CAUnited Minors Lid. v /V Mel (Tumhiah. J.i557
Turnover Tax arc debts due to the State. If these tax liabilitiesbecome vested in the State, he argued, it would lead to the absurdresult of the State becoming a debtor to itself, of the State owing to itself.
Learned Deputy Solicitor-General referred us to the Statutes relatingto Income Tax and Business Turnover Tax.
S. 2 (I) of the Inland Revenue Act No. 4 of 1963 states –
‘ Income tax shall, subject to the provisions of this Act. becharged at the appropriate rates specified in the FirsJ andSecond Schedules to this Act for every year of assessmentcommencing on or after April 1, 1963, in respect of theprofits and income of every person for the year precedingthe year of assessment " etc.
“Person" is defined in s. 129 as follows
‘‘Person" includes a company or body of persons.
“Body of persons" is defined as follows
“Body of persons” includes any local or public authority etc.
The 1st Schedule mentions Public Corporations established withcapital wholly or partly provided by the Government of Ceylon andstates that the rate of tax will be that chargeable in respect of theresident company.
S. 32 (1) of the Inland Revenue Act No. 28 of 1979 enacts as follows:-
“Subject as hereinafter provided, income tax shall be charged,for each year of assessment commencing on or 'after April1, 1979. on the taxable income for that year of assessmentof any person –
if he is an individual other than.a receiver, trustee,executor or liquidator acting in such capacity, at theappropriate rates specified in the First schedule to thisAct. or
if such person is a person other than a company or anindividual to whom paragraph (a) applies at theappropriate rates specified in the Third Schedule tothis Act."
In s. 163 the term “person” is defined as follows:-
“Person" includes a company or body of persons etc.
"Body of persons" is defined thus:-
“Body of persons" includes any local or public authority etc.
Sri Lanka Law Reports
(m2) 2 S L R.
In the 3rd Schedule, item 10 states that in regard to PublicCorporations, the rate of tax chargeable is 50% and in respect ofBusiness Undertakings vested in the Government under the BusinessUndertakings (Acquisition) Act, No. 35 of 1971, 50% (item 11).
In the Turnover Tax Act, No. 69 of 1981, s. 2 states –
“Subject to the other provisions of this Act there shall becharged for the period November 13, 1981, to December31, 1981 and for every quarter commencing on or afterJanuary 1, 1982 from- every person who –
carries on any business in Sri Lanka; or
renders services outside Sri Lanka for which paymentis made from Sri Lanka, a tax (hereinafter referred toas the “turnover tax”) in respect of the turnover madeby that person from that business or from servicesrendered outside Sri Lanka computed at such fate asthe Minister may fix by Order published in the Gazette.”
In s. 59 “person” is defined as follows
“Person” includes a company or body of persons.
“Body of persons” is defined thus
“body of persons” means any body corporate or unincorporate,local authority, any fraternity, fellowship, association orsociety of persons, whether corporate or unincorporate, anypartnership and atiy Hindu undivided family and includesany Government department or any undertaking of theGovernment of Sri Lanka.
In terms of these tax laws, public corporations, business undertakingsvested in the Government, any government department, and anyundertaking of the Government can become liable to pay. tax andclearly in the last 'twd instances, it will be a case of the State owingto itself, of the State being indebted to itself. The argument oflearned Queen’s Coiirisel that the concept of a State being both acreditor and debtor is a contradiction and results in an absurdity,seems to me to be untenable.
Learned Queen’s Counsel finally submitted that what has vestedin the State is the1 Business Undertaking and the assets used for thepurposes of the .Undertaking, and not the Company. The Companycontinues to exist with its legal status unimpaired. The tax liabilitiesare liabilities of the company and not of the undertaking and thereforecannot vest in the 5’" r s •b^^sior also, in my view, canni/c
CAUntied Motors 1 .id r. I)e Mel t I'tiiiihinli. ].).559
The preamble to the Act states that it is an Act to provide forthe acquisition for the Government of any Business Undertaking andof any property necessary for the purposes of that undertaking. Thevesting orders also state that what were vested in the State are thebusiness undertakings carried on by the petitioner-companies and theproperties used for the purposes of those undertakings. S. 17 of theAct .draws a distinction between ‘ business undertaking" and“proprietor”. This distinction is maintained in sections 7.11 and 14.wherein the terms “proprietor" and “business undertaking"* arcjuxtaposed. The regulations speak of “the specified undertaking."
The Act therefore introduced a new concept called “BusinessUndertaking.” But it did not invest it with a legal personality capableof owning assets, enjoying rights and incurring liabilities; nor has itbeen contended before us, that the “Business Undertaking" is a legalperson.
“The golden rule of interpretation is that wc must just try toascertain the intention of the Legislature from the words used,by attaching the ordinary meaning of the word on the grammaticalconstruction — adding nothing and omitting nothing and togive effect to the intention thus ascertained, if the language
is unambiguous, and no absurdity results If. even though
free from ambiguity, the ordinary meaning of the words usedgives rise to an absurdity, we have to endeavour to avoid theabsurdity, by adding, if possible, some words and omittingsome words, to ascertain the Legislature's intention."
(Bindras Interpretation of Statutes. 6th Edn. p. 217)“The words of a Statute must be construed so as to give asensible meaning to them if possible."
(Maxwell on Interpretation of Statutes, 11th Edn. p. 228)
The “Undertaking" is not a legal person and cannot have rightsand liabilities. So it seems to me that when the Legislature used thewords “all the liabilities of that undertaking" in s. 17 (ii) of theAct, the words must be construed to mean liabilities of the undertakingsowned by a natural or legal person. In fact this very idea is containedin Regulation 10 of the two sets of Regulations made by the Ministerof Finance, where “specified undertaking" is defined as the undertakingswhich were.-carried on by the companies called and known as theAutomobile Assembly and Manufacture Limited and the UnitedMotors Limited.
Sri Lanka Law Reports
(Im2) 2 SI..It.
Learned Deputy Solicitor-General submitted that the Act nowherementions the payment of any compensation. The Act and the Regulationsonly speak of “payments” to be made. The Order dated 1.9.80 madeby the Minister of Finance is one which he had the power to makein terms of Regulation 5 (3), read with Regulation 7, and is a validorder. This submission appeals to me.
S. 12 (2) (c) empowered the Minister of Finance to make regulationsin respect of “the payments to be made in respect of any businessundertaking or property acquired or requisitioned by or vested inthe Government and any matter regarding the assessment of theamount of the payments and mode of making such payments."(emphasis added)
S. 16 states, “All payments made in respect of any propertyacquired or requisitioned by or vested in the Government under thisAct shall be charged on the Consolidated Fund of Ceylon.” (emphasisadded)
In terms of the regulation making power, the Minister has maderegulations in respect of both Undertakings which were published inthe Government Gazette on 10.4.75. Of relevance are the followingregulations
Regulation 2 (1) — “The Minister of Finance may, appointnot less than three persons by name or by office toconstitute a Committee to examine and report to himon the assets and liabilities of the specified undertaking.”Regulation 3 — “The Committee may publish or cause to bepublished a notice in one .or more newspapers requiringany person owing any moneys to or having any claimsagainst the specified undertaking to communicate suchdebt or claim to the Committee on or before a date tobe specified in the notice.”
..Regulation 5 (3) — “For the purposes of arriving at thevaluation of the liabilities of the specified undertaking,the Committee may take into consideration inter alia,any outstanding contractual or other lawful obligations,bona fide transactions with any recognised financial orcommercial institutions or other persons excluding anymember of the Board of Directors of the specifiedundertaking, payments due to any Government Departmentor other State institution and any loss sustained by anystatutory board or corporation due to the activities ofthe specified undertaking.”
CAUnih'rf Motors Ltd. r. Dc Mel iTanibiah. J.i561*
Regulation 7 — “The Committee shall report to the Ministerof Finance on the assets and liabilities of the specifiedundertaking together with their recommendations thereon -as regards any payment.'; that may be due in respect ofthe specified undertaking and the party or parties towhom such payment, if any., may be made. On receiptof such report the Minister of Finance may make such •order as he may deem fit in respect of any such payment."
■ (emphasis added)
The Business Undertakings (Acquisition) (Amendment) Act No.21 of 1980 introduced a new section 12A which also uses the words“payments to be made. ' (emphasis added)
Nowhere in the Act is there any mention of compensation payablein respect of the business undertaking taken Over by the State. S.12 (1) (c) talks of “payments” to be made in respect of the businessundertaking taken over by the State. This notion of “payments” iscarried on, in the regulations made, and is continued in the amendingact. In this respect, the Statute differs from other Statutes wherespecific provisions are made in the Statutes themselves for the paymentof compensation in respect of the property vested, the manner ofcomputation and the mode of payment. (Sec. for example, the LandReform Law No. I of 1972. Part III; Mines and Minerals Law No.
4 of 1973, s. 58; Sri Lanka State Trading Corporation Act No. 33of 1970, Part IV). The whole scheme of payments is set out in theRegulations only.
Under Regulation 2 (1), the Minister of Finance appoints aCommittee to examine and report to him on the assets and liabilitiesof the Undertaking. The Minister, in Regulation 5 (3). has set outthe matters to be taken into consideration by the Committee inarriving at other valuation of the liabilities of the Undertaking, interalia, outstanding contractual or other lawful obligations, payment dueto any Government Department or other State institution. Theseserve as guidelines. The Committee is then required to report to theMinister on the assets and liabilities of the undertaking together withits recommendations thereon and the party or parties to whom such,payments be made. On receipt of the report, the Minister is empowered-to make such order as he may deem fit in respect of any suchpayments (Regulation 7). The words “ in respect of any such payment"refer to-“any payments that may be due in respect of the undertakingand the party or parties to whom such payments may be made,”The Committee “advises but it is the Minister who makes the orderspayments.
Sri Lanka Law Reports
(19H2) 2 S I. R.
The petitioner-companies do not challenge the validity of any ofthese regulations. Among the matters that the Committee can takeinto consideration in order to arrive at the liabilities arc, “any
outstanding contractual or other lawful obligations payments
due to any Government Department or other State Institution.” Thematters specified take the nature and scope of liabilities beyond whatis contended for by learned Queen’s Counsel — that only contractualliabilities vest in the' State.
The Committee is authorised to take into account, inter alia,payments due to any Government Department. Income Tax andBusiness Turnover Tax are payments due to the Inland RevenueDepartment, which is a Government Department. Regulation .7 givesthe Minister of Finance the power' to order that monies due as taxliabilities be paid to the Commissioner-General of Inland Revenue.This very same regulation also gives the Minister the power to orderthat payments be made to the two petitioner-companies, in respectof the undertakings that have been taken over. The revised Orderof the Minister dated 1.9.80 is challenged by the petitioner-companies,only on the ground that the Minister had ^vrongly deducted the taxliabilities in making the order for payments due to them. Thissubmission, I have already rejected. The petitioner-companies havenot pointed out to any other infirmities in the Order made by the1st respondent which would attract the Writ of Certiorari.
Both applications, C.A. 2301/80 and 2302/80. are refused, but-taking into account all the circumstances, there will be no order for costs.
L.H. DE ALWIS, J. – I agree.
UNITED MOTORS LTD v. DE MEL