Y.V. Anjaneyulu, J.All these writ petitions raise a common question of law for consideration of this Court. It will be convenient to dispose them of together.

2. The Constitution (Forty-sixth Amendment) Act, 1982 inserted through section 4, clause (29-A) in Article 366 relating to definitions of certain expressions occurring in the Constitution of India. The said clause (29-A) may be reproduced below for the purpose of convenient reference :

"(29-a) tax on the sale or purchase of goods includes -

(a) a tax on the transfer, otherwise than in pursuance of a contract, of property in any goods for cash, deferred payment or other valuable consideration;

(b) a tax on the transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract;

(c) a tax on the delivery of goods on hire-purchase or any system of payment by instalments;

(d) a tax on the transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration;

(e) a tax on the supply of goods by any unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration;

(f) a tax on the supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (whether or not intoxicating), where such supply or service, is for cash, deferred payment or other valuable consideration,

and such transfer, delivery or supply of any goods shall be deemed to be a sale of those goods by the person making the transfer, delivery or supply and a purchase of those goods by the person to whom such transfer, delivery or supply is made;".

The above clause came into force on 2nd February, 1983. The Seventh Schedule to the Constitution consists of Lists I, II and III setting out the subject-matter of laws which the Parliament and the Legislature of the States have the power to make. List II is the State List and it contains the matters upon which the State has the exclusive power to make laws. Entry 54 of List II conferred power on the States to levy taxes on the sale or purchase of goods. Pursuant to the power conferred by entry 54, the State Government enacted the Andhra Pradesh General Sales Tax Act (hereinafter referred to as "the Act") to levy tax on the sale or purchase of goods in the State of Andhra Pradesh. On the Forty-sixth Amendment to the Constitution inserting clause (29-A) in article 366, consequential amendments were made to the Act. By the Andhra Pradesh General Sales Tax (Amendment) Act No. 18 of 1985, explanation IV was added in section 2(n) of the Act which defines the expression "sale". Explanation IV, which was inserted by Act 18 of 1985, was brought into force retrospectively from 2nd February, 1983 and it is extracted below :

"Explanation IV. - A transfer of right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration shall be deemed to be a sale."

By the same Act 18 of 1985, the definition of the expression "dealer" occurring in section 2(e) of the Act was also amended with effect from 13th September, 1985. By the said amendment, the expression "dealer" is defined to include "any person, who may transfer the right to the use of any goods for any purpose whatsoever (whether or not for a specified period) in the course of business to any other person". Section 5-E of the Act was also inserted by the same Act 18 of 1985 with effect from 1st July, 1985. It is relevant to refer to the same :

"Section 5-E. Tax on the amount realised in respect of any right to use goods. - Every dealer who transfers the right to use any goods for any purpose, whatsoever, whether or not for a specified period, to any lessee or licensee for cash, deferred payment or other valuable consideration, in the course of his business shall, on the total amount realised or realisable by him by way of payment in cash or otherwise on such transfer or transfers of the right to use such goods from the lessee or licensee, pay a tax at the rate of five paise in every rupee of the aggregate of such amount realised or realisable by him during the year :

Provided that no such tax shall be levied if the total turnover of the dealer including such aggregate is less than Rs. 1,00,000."

We may, for the sake of convenient reference, sum-up the legislative changes :

3. In view of the power conferred on the State Governments to levy tax on the transfer of the right to use any goods for any purpose and following the amendments made to the Andhra Pradesh General Sales Tax Act referred to above, the sales tax authorities felt that banks which provide safety-lockers for the use of customers are liable to pay tax on the charges realised. In that view, notices were issued to various banks by the Commissioner of Commercial Taxes to show cause why sales tax should not be levied at 5 per cent on the charges realised by hiring lockers which, in law, amounted to transfer of the right to use goods by the customers. In some cases notices related to the years commencing from 1983-84 and in some other cases the notices pertained only to the year 1984-85 and 1985-86, etc. The notices issued by the Commissioner pointed out that the banks failed to submit appropriate returns and consequently an estimate of hire charges was made in the notices for the purpose of levy of tax. After receipt of the aforesaid notices the banks filed writ petitions in this Court questioning the validity of the proposal of the sales tax department to levy tax on the charges realised by hiring lockers to customers.

4. Before we proceed to deal with the matters we may refer only to one more fact. In exercise of the powers conferred by section 9(1) of the Act, in G.O. Ms. No. 1091, Revenue, dated 10th June, 1957, the Governor of Andhra Pradesh directed exemption from all taxes payable under the Act to the banks in the State of Andhra Pradesh, except when they act as buying or selling agents of a dealer as specified in the explanation to clause (e) of section 2 or in section 11 of the Act. This notification continued to be in force until it was rescinded by G.O. Ms. No. 794 dated 19th August, 1987. By the aforesaid notification dated 19th August, 1987, the Governor of Andhra Pradesh rescinded the notification issued in G.O. Ms. No. 1091, Revenue, dated 10th June, 1957 and published in the Andhra Pradesh Gazette on 15th June, 1957. The date of publication of G.O. Ms. No. 794 dated 19th August, 1987 in the Gazette is not furnished to this Court.

5. Sri Ananta Babu led the arguments on behalf of the State Bank of India in W.P. No. 10983 of 1987. Learned counsel for the other petitioners M/s. K. Srinivasa Murthy, B. K. Seshu, L. P. R. Vittal, G. V. Seetharama Rao, V. R. Reddy, A. Ramalingeswararao and D. Hanumantharao adopted the arguments of Sri Ananta Babu, although some of them made a few submissions supplementing the arguments of Sri Ananta Babu.

6. We may first clear the ground proceeding on the assumption that there is conferment of power to levy tax on charges realised from customers by the banks for providing safety-lockers. It is urged that even if there is conferment of power, the power cannot be exercised so long as the Notification G.O. Ms. No. 1091, Revenue, dated 10th June, 1957 issued u/s 9(1) of the Act was in force. We have already referred to the aforesaid notification in para 4 supra under which exemption was granted from all taxes payable to the banks in the State of Andhra Pradesh. This notification continued to be in force till it was rescinded by G.O. Ms. No. 794 dated 19th August, 1987. We find considerable force in the contention of the learned counsel for the petitioners that in any case, no tax can be levied till the date of publication of G.O. Ms. No. 794 dated 19th August, 1987 rescinding the earlier notification dated 10th June, 1957. The notices issued by the department to the bankers proceeded to state that tax is leviable from the year 1983-84, obviously for the reason that the Forty-sixth Amendment to the Constitution inserting clause (29-A) in article 366 of the Constitution of India, came into force on 2nd February, 1983. We must, however, point out that the insertion of clause (29-A) in article 366 of the Constitution did not automatically confer power on the State Government to levy tax. Consequential steps have to be taken by effecting necessary amendments to the Sales Tax Act at the State level. Those amendments were made by Act 18 of 1985 whereunder explanation IV was added to section 2(n) of the Act containing the definition of the expression "sale". Clause (iii-b) was also inserted by the same Act amending the definition of the expression "dealer" in section 2(e). That provision came into force only on 13th September, 1985. The charging section empowering the levy of tax at 5 paise, which was also inserted by Act 18 of 1985, vide section 5-E of the Act, came into force on 1st July, 1985. If regard be had to these consequential amendments it is clear that until the definition of the expression "dealer" is amended by the Act 18 of 1985 which came into force on 13th September, 1985, it is not open to the authorities to levy tax, because the liability to pay the tax under the Act arises only if a person is a dealer and not otherwise. Thus till 13th September, 1985 there could be no levy of tax. We may also point out that the charging section 5-E itself came into force on 1st July, 1985 and there could be no levy of tax prior to section 5-E coming into force. Even after the necessary amendment came into force and there is full conferment of power to levy tax, the notification dated 10th June, 1957 issued u/s 9(1) of the Act directing exemption from all taxes payable under the Act to the banks in the State of Andhra Pradesh, continued to be in force. The notification would, therefore, have the effect of exempting the tax which might otherwise be leviable with effect from 13th September, 1985. Obviously it escaped the notice of the Government to withdraw the notification dated 10th June, 1957 issued u/s 9(1) of the Act and that was done through G.O. Ms. No. 794 dated 19th August, 1987. Thus, the ground is cleared for the State Government to exercise power to levy tax only from the date of publication of G.O. Ms. No. 794 dated 19th August, 1987, although some notices required the payment for the year 1983-84 and yet some other notices required payment for the years 1984-85 and 1985-86. On this short ground alone the notices issued by the authorities deserve to the quashed and a declaration given that the petitioners herein are not liable to pay tax till the date of publi-cation of G.O. Ms. No. 794 dated 19th August, 1987. We may state that the learned Government Pleader realising the above position did not seriously contend before this Court that the provisions in the Act relied upon conferred power upon the authorities to levy tax prior to the date of publication of G.O. Ms. No. 794 dated 19th August, 1987. We accordingly declare the law and quash the impugned notices in all the cases.

7. Learned counsel for all the petitioners made a request that the larger issue whether the petitioners-banks are liable to pay tax at all may be considered as extensive arguments were advanced and the sales tax authorities are bound to initiate action once again for levy of tax subsequent to the period of publication of G.O. Ms. No. 794. It is pointed out that the question would have to be reagitated once again by filing writ petitions and if the larger issue is settled one way or the other multiplicity of proceedings will be avoided. Having heard the arguments in some detail we feel that it is desirable to decide the larger issue concerning the liability of the banks to pay sales tax on the charges realised by the banks for hiring safe deposit lockers.

8. The main thrust of the argument of Sri Ananta Babu who led the arguments is that the impugned provision does not authorise the levy of tax on banks for hiring safe deposit lockers to constituents. Attention is invited to the relevant provision. Clause (29-A) of article 366 of the Constitution specifies that tax on the sale or purchase of goods include a tax on the transfer of the right to use any goods for any purpose, whether or not for a specified period, for cash, deferred payment or other valuable consideration. The amendments effected to the definition of the expression "sale" in section 2(n) of the Act and also of the expression "dealer" in section 2(e) of the Act were in line with clause (29-A) of article 366 of the Constitution. The charging section 5-E provided that every dealer who transfers right to use any goods for any purpose whatsoever, whether or not for a specified period, to any lessee or licensee for cash, deferred payment or other valuable consideration in the course of his business shall, on the total amount realised or realisable by him by way of payment in cash or otherwise on such transfer or transfers of the right to use such goods from the lessee or licensee, pay a tax at the rate of five paise in every rupee. No liability is attached if the total turnover of the dealer is less than rupees one lakh. The question for consideration is whether in the transaction of the banks hiring safe deposit lockers to constituents, there is any transfer of the right to use any goods.

9. A copy of the agreement for hiring of the locker executed between the State Bank of India and the constituents is obtained by us. We are informed that more or less identical agreements are entered into by all the banks with their constituents for hiring of lockers. Learned Government Pleader also stated that we may proceed on the basis of the covenants in the agreement filed by the State Bank of India and it is not necessary to examine the agreement in each case. The constituent to whom the locker is provided is called the hirer and the agreement is described as "the agreement for hiring of locker". The period for which the locker is hired is specified in the agreement. Where the lockers are taken in the joint names of constitutents the agreement provides for the manner of access and the rights of each one of the joint hirers. Clause 3 of the agreement is in the following terms :

"The hirer shall have no right of property in the locker but only an exclusive right of user thereof and access thereto during the period of this agreement and in accordance therewith. The hirer shall not assign or sublet the locker or any party of it, nor permit to be used to any purpose other than for the deposit of documents, jewellery or other valuables nor shall the hirer use the locker for the deposit of any property of an explosive or destructive nature."

There are provisions relating to the payment of the hire and the banks lien on all the moneys to sell the property by the safe deposit department of the bank if the rental is not paid. The agreement can be terminated by giving seven days time by either side. If no such termination is made, the bank will consider the renewal in favour of the hirer for a further period. Clause 9 of the agreement provides that all repairs required to be done to the locker or keys shall be done exclusively by workmen appointed by the bank. Clause 11 provides that for reasons of grave or urgent necessity the bank reserves the right of closing the safe deposit department for such period as it may consider necessary. The bank also reserves the right of making charges in the working hours. Clause 12 cautions the hirers to keep the keys of the lockers in a place of safety and not to divulge the number of their lockers and their passwords and not to deliver their keys for the purpose of operating on the lockers or otherwise to any person other than their duly authorised agent. Clause 13 provides that the relation between the bank and the hirer is that of licensor and licensee and not that of a banker and customer.

10. Omitting the routine covenants in the agreement the important condition specified in clause 3 of the agreement would indicate that the hirer has no right of property in the locker. He, however, has an exclusive right of user thereof and access thereto during the period of agreement. The hirer has no right to assign or sublet the locker; nor permit it to be used to any purpose other than the deposit of documents, jewellery or other valuables. The hirer is forbidden from using the locker for the deposit of any property of an explosive or destructive character.

11. We may now consider the arguments advanced by the learned counsel for the petitioners. It is contended that the safe deposit locker in a bank cannot be considered as "goods" within the meaning of section 2(h) of the Act. It is pointed out that the expression "goods" means all kinds of moveable property subject to the exceptions specified therein and also includes all growing crops, grass and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale. Learned counsel invited attention to explanation IV to section 2(n) defining "sale" which refers to a transfer of right to use any goods. Our attention is also invited to clause (iii-b) in section 2(e) defining "dealer" as any person who may transfer the right to the use of any goods and then reference is invited to section 5-E of the Act which provides that every dealer who transfers the right to use any goods for any purpose shall pay a tax specified therein. It is thus pointed out that the exigibility to tax would depend upon the question whether there is any transfer of the right to use goods by the bankers. It is contended that if safe deposit lockers are not "goods", then, no liability to tax arises. As the expression "goods" refers only to moveable property, then, safe deposit lockers are excluded from that expression, because the lockers are imbedded in the earth in the strong rooms of the banks. It is submitted that safe deposit lockers are permanently fixed in the strong rooms and they do not answer the description of moveable property. According to the General Clauses Act, Immovable property shall include land, benefits arising out of the land, and things attached to the earth. The Transfer of Property Act defines the phrase "attached to earth", but gives no definition of Immovable property beyond excluding standing timber, growing crops. The phrase "attached to the earth" is defined in the Transfer of Property Act as imbedded in the earth, as in the case of walls or buildings or attached to what is so imbedded for the permanent beneficial enjoyment of that to which it is attached. The definition of Immovable property in the General Clauses Act is held to apply even to the Transfer of Property Act. It is all the more applicable to the Sales Tax Act which levies tax on transactions relating to goods constituting moveable property. There is considerable force in the contention of the learned counsel for the petitioners that lockers imbedded in the earth cannot be regarded as moveable property and cannot, therefore, answer the description of "goods" for the purpose of the Sales Tax Act. Learned Government Pleader was on his feet quickly to contradict the petitioners that in some banks the lockers are not imbedded in the earth. That is a matter for verification. It is for the banks to establish the relevant fact. All that we can declare is that if the safe deposit lockers are imbedded in the earth in the strong rooms of the banks, they do not constitute "goods" for the purpose of levy of tax on the charges realised for transferring the right to use the lockers. If in any given cause the lockers are kept mobile in the bank then they answer the description of the goods and further considerations regarding the levy of tax may arise.

12. It is next contended that the hire charged by the banks for hiring of lockers is not exclusively for the use of the lockers. It is a composite charge to cover a variety of services associated with the lockers. It is submitted that the safe deposit lockers are located in strong rooms constructed at considerable cost by the banks. Walls of high thicknesses rendering them fire-proof are constructed. Steel doors of larger thicknesses in gauge are provided and special locking devices are arranged in the strong rooms. It is stated that some of the leading banks make their strong rooms an impregnable fortress by providing emergency alarm, etc., in the event of prowlers gaining access into the strong room. It is further stated that heavy security by employing security staff round the clock was provided. All these precautions were taken to ensure that the properties deposited in the safe deposit lockers located in the strong rooms are safe and inaccessible. Learned counsel contended that in fixing the hire charges the banks would take into consideration all the above services which are associated with the operation of the lockers. Learned counsel, therefore, urged that unless classification is made of the hire charged it is not possible to identify the sum charged for the transfer of right to use the lockers alone. As it is impossible to make any such classification no tax can be levied, contended the learned counsel for the petitioners.

13. We see considerable force in the submissions of the learned counsel for the petitioners. Let us ask the question as to why people go to banks for depositing their valuables in lockers. Is it because they do not have the facility of a locker at their residence It is common knowledge that every steel almirah is fitted with a safe deposit locker of high thickness and gauge. The class of customers who go to banks for depositing their valuables in lockers do certainly have steel almirahs in their houses or even otherwise can afford to purchase one such almirah with safe deposit locker. But then why do these persons prefer to go to a bank and deposit their valuables in the lockers located there without keeping the articles in their houses under constant watch by them The answer is obvious. It is because the safe deposit lockers hired by banks are located in impregnable strong rooms and prowlers cannot gain access into these strong rooms of the banks. The wide feeling is that valuables deposited in bank lockers are safer than at home because of the high security arrangements at the bank and the provision of strong rooms. It cannot, therefore, be gainsaid that persons pay the hire charges for the lockers not only for the right to use the lockers but also for a host of other services referred to above closely associated with the maintenance of lockers by the banks. In that sense the hire charges collected by the banks from the constituents represent a consolidated charge levied by the bank for a variety of services and facilities provided, of which the use of the locker forms a small part. The hire charge is inseparable into various services and because of the impossible nature of relating to any particular amount as hire charge solely for the use of the locker, the proposal to levy tax on such hire should fail. Any endeavour to levy tax on the aggregate hire charges levied by the bank would amount to levying tax not only on the right to use locker but also on the charges collected by the bank for the provision of strong rooms, providing round the clock watch and ward and employing necessary staff to have a close supervision in the operation of strong rooms. The inseparable character of the hire charged by the banks frustrates any attempt to separate the small sum which is the charge for the right to use the locker, which only can be subject to tax under the Act. We have, therefore, no hesitation in holding that, in the facts and circumstances above stated, the banks cannot be called upon to pay sales tax on the hire received for the use by the constituents of the lockers which forms a fractional and inseparable part of the composite charge for a variety of services.

14. Sri Ananta Babu raised a further plea that the levy of tax is contemplated only in respect of goods which are either delivered or capable of being delivered to the persons who seek exclusive use of the goods. Referring to the agreement between the bankers and the persons taking the lockers on hire, learned counsel submitted that it must be regarded as a contract in the nature of bailment falling under Chapter IX of the Indian Contract Act. Section 148 of the Contract Act defines a "bailment" is the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivered them. Learned counsel points out that the contract in these cases cannot be considered under any other head. It is submitted that delivery to the bailee may be made by doing anything which has the effect of putting the goods in the possession of the intended bailee or of any person authorised to hold them on his behalf. Learned counsel submits that in the first place no delivery of lockers is involved when a bank hires a safe deposit locker to a constituent. The bank keeps the custody of the locker and the constituent is merely a licensee having access to go into the strong room and operate the locker. Learned counsel also pointed out that the hirer does not even have the facility to open the locker on his own, because the locker cannot be opened unless the master key available with the bank is also simultaneously operated. Learned counsel, therefore, submitted that the bank does nothing having the effect of putting the lockers in the possession of the bailee. On the other hand, the conditions in the contract unmistakably indicate that the exclusive possession and custody of the locker are kept with the bank itself always and not even liberty is given to the hirer to open the locker whenever he likes. The lockers can be operated only during the prescribed hours and a hirer cannot operate the locker with his own key, unless the master key remaining with the banks is also simultaneously used. On these facts, the learned counsel contended that there is neither delivery of the lockers nor has anything been done by the bank having the effect of putting the lockers on the possession of the bailee. The facts indicate the contrary. Learned counsel invited our attention to Chitty on Contracts, 24th Edition, Volume II, to the observations at page 2236 concerning "Hire at common law". It is observed that in the bailment termed "hire" the bailee receives both possession of the chattel and the right to use it, in return for a price or remuneration to be paid to the bailor. The bailee is under an obligation to return the chattel to the owner at the expiration of the fixed period of the hiring and to pay the cost of returning it. While the bailment continues to subsist, the bailee is entitled to possessory remedies and can prevent anyone, including the owner, for interfering with the chattel against his will. Adverting to these observations, Sri Ananta Babu claims that the arrangement for providing lockers cannot but be regarded as a bailment under law and once that is accepted, none of the conditions associated with the contract of bailment is satisfied in the present case. In our opinion, the learned counsel is well fortified in his submissions. We are not told by the learned Government Pleader that the contract of hire between the bankers and the constituents can be regarded legally as anything other than the contract of bailment. Indeed the nature of the transaction undoubtedly puts the contract as one of bailment. That being so, delivery is essential which is lacking in the present case. Clause (29-A) of article 366 of the Constitution of India and the consequential amendments made to the Sales Tax Act refer in our opinion only to cases where there is a transfer of the right to use goods delivered to the person concerned. It does not take in its sweep transactions which merely licence a person to use goods without securing possession. Take for instance a case where a person takes on hire a cab from a rental agency. The agency delivers the car to the person for his use during a specified period and the person concerned returns the vehicle after user and pays to the agency the charge for such user. That clearly is a transaction caught by clause (29-A) in article 366 of the Constitution. Or, take for instance the case of a person who took on hire articles from a furniture makes for his use for a specified period. He carries the furniture home, used it for a particular period and returns it to the furniture maker after user and pays appropriate charges. That again is an instance falling under clause (29-A) of article 366 of the Constitution and the consequential amendments in the Act. It is not necessary to multiply instances of this type as there are plenty. In making the aforesaid amendments, in our opinion, the law envisaged the levy of tax in respect of sums paid for securing the right to use the goods, of which possession or delivery has been taken by him. It does not apply to cases where the person concerned is merely a licensee without possession of the goods.

15. Our attention has been invited to a decision of the Calcutta High Court in Bank of India Vs. Commercial Tax Officer and Others, wherein the same question was considered by a learned single Judge of the Calcutta High Court. The learned Judge held that tax is not leviable in respect of lockers hired by banks to customers. Although we tread the ground through a route slightly different from what the learned Judge did we reached the same destination; we are in respectful agreement with the view expressed by the learned single Judge.

16. For all the aforesaid reasons, we hold that no power is conferred on the sales tax authorities to levy sales tax in respect of hire charges collected by banks for providing safe deposit lockers u/s 5-E of the Act. If, however, a contrary view is possible, we still hold that the petitioners cannot be called upon to pay tax till the date of publication of G.O. Ms. No. 794 dated 19th August, 1987, as the notification issued u/s 9 of the Act withdrawing the exemption from the levy of tax had taken effect only from that date.

17. In the result, all the writ petitions are allowed, but in the circumstances, without costs. Advocates fee Rs. 200 in each.

18. Writ petitions allowed.