Judgment :- Petitioners, the Head Officers of State Bank of Mysore, Vijaya Bank, UCO Bank and State Bank of India situate at Bangalore, through their heads like Chief Manager, General Manager, Assistant Manager and Zonal Manager, are seeking for a writ of certiorari to quash the explanation to S.2(h) of the Karnataka Tax on Professions, Trades, Callings & Employment Act, 1976 and, to quash the amendment inserted during 2003 with effect from 1.4.2003 as violative of Art.276(2) r/w Art.367(1) of the Constitution and S.3(42) of the General Clauses Act in so far as petitioners are concerned. By the amendment to S.2(h) of the Karnataka Tax on Professions, Trades, Callings & Employment Act, 1976 (‘1976 Act’ for short), the definition of ‘person’ was expanded which covers each branch of the company, as such interpreting, the respondent issued a proposition notice calling upon every Branch of the petitioners to pay professional tax. As such, petitioners have filed these petitions questioning the validity of the 2003 Amendment contending that respondents have no locus standi to levy tax without the authority of law. In this regard, petitions were filed earlier before this Court for quashing of the proposition notices issued and this Court has quashed those notices. As against which, the explanation was inserted on 1.8.2008 with retrospective effect i.e., from 1.4.2003. The main contention of the petitioners is, they are covered by the provisions of the Banking Regulation Act, 1949 falling within Entry 24 of the Schedule i.e., Banking Companies as defined in the Banking Regulations Act, 1949. Subsequent to the amendment, respondent authority demanded for payment of professional tax from each of the Branches and also proposed interest and penalty with effect from 2003. According to the petitioners, under the Banking Regulation Act, 1949, ‘banking company’ has been defined under S.5(c) as any company which transacts the business of banking in India. ‘Company’ has been defined under S.5(d) as any company as per S.3 of the Companies Act, 1956, and includes a foreign company as per S.591 of the Companies Act, 1956, S.5(n-d) defines a ‘subsidiary bank’. As per S.51 of the banking Regulation Act, subsidiary banks are partly subjected to provisions of this Act. Under the provisions of the Banking Regulation Act, ‘banking companies’ and ‘subsidiary banks’ are different entities. As per S.51 of the banking Regulation Act, subsidiary banks are partly subjected to provisions of this Act. Under the provisions of the Banking Regulation Act, ‘banking companies’ and ‘subsidiary banks’ are different entities. The definition of ‘banking company’ does not include any ‘subsidiary bank’ as held in the case of State Bank of Travancore Vs Khan – AIR 1981 SC 1744 . It is also contended, except State Bank of India, all other banks are subsidiary banks under the State Bank of India and they cannot be treated as independent banking companies. The auditors appointed by the Reserve Bank of India, audits the books of account maintained and also petitioner banks have been paying income tax. Petitioners have various branches established all over India having their head office at Bangalore and Mumbai respectively. Based on the permission granted by the Reserve Bank of India, the branches have been opened by the petitioners, S.3 of the 1976 Act enables the levy and collection of tax on profession, trade, calling or employment which are conducted within the State of Karnataka. As per S.3(2), a person who exercise any profession or calling or is engaged in any trade or holds any appointment in any manner in the State, shall be liable to pay tax at the rate mentioned in the corresponding Entry in the third column of the Schedule. The Act came into force with effect from 1.4.1976. The word ‘person’ has been defined as per S.2(h) of the 1976 Act as – S.2(h) – ‘Person’ means any person who is engaged in any profession, trade, calling or employment in the State of Karnataka and includes a Hindu Undivided Family, Firm, Company, Corporation or other Corporate Body, any Society, Club or Association, so engaged but does not include any person who earns wages on a casual basis. An Explanation is inserted by Karnataka Taxation Laws (Amendment) Act, 2003 to S.2 (h) with effect from 1.4.2003 thereby, every Branch of a firm, company, corporation or other corporate body, any Society, Club or Association shall be deemed to be a person which directly has a bearing upon the Branches of these subsidiary banks. Thereby, according to the petitioners, the respondent authority demanding tax from each of the branches of the petitioners is illegal and ultra vires.. Thereby, according to the petitioners, the respondent authority demanding tax from each of the branches of the petitioners is illegal and ultra vires.. By the amendment, each branch has to pay Rs.2,500/- p.a. towards professional tax and the explanation which is added by way of amendment Act of 2003 providing a provision for collection of professional tax for separate assessment, is bad in law. Various notices have been issued by the respondent officers calling upon the petitioners to pay professional tax within seven days of the notices served which is ultra vires the provisions of Art.276(2) and Art.367 of the Constitution and petitioners have sought for quashing the explanation stating that it is ultra vires the General Clauses Act and have prayed to charge only the head office to collect Rs.2,500/- p.a. and not from every Branch since ‘person’ as defined, only refers to the Head Office and not the Branch offices. The main grievance of the petitioners, submitted through the Sr. Counsel is, S.4 of the Andhra Pradesh Tax on professions, trades, callings and Employment Act, 1987 is not in identical terms with the charging S.3 of the 1976 Act. The 2nd proviso to the Karnataka Act was inserted by Act 8 of 1981 with effect from 4.4.1981 to the 1976 Act, and the proviso so introduced continued to be in the statute book. The second proviso to S.3 of the Act cannot be treated as redundant rather, Legislature has not made any reference to the other provisions of Art.276 of the Constitution. After the amendment, the word ‘person’ as defined under S.2(h) of the 1976 Act with effect from 1.4.2003 is ultra vires the provisions of Art.276(2) and Art.367 of the Constitution and the provisions of the General Clauses Act. It is also the contention of the petitioners’ counsel that the decision rendered in Karnataka Bank Ltd Vs State of Andhra Pradesh – 12 VST 459 considering the provisions of the Andhra Pradesh Act is not in pari material with the charging provision of the Karnataka Act. The Supreme Court also in Karnataka Bank’s case has not stated anything other than what was competent for the Andhra Pradesh Legislature to define the word ‘person’ in any manner they like within the State of Andhra Pradesh. The Supreme Court also in Karnataka Bank’s case has not stated anything other than what was competent for the Andhra Pradesh Legislature to define the word ‘person’ in any manner they like within the State of Andhra Pradesh. It is also the main crux of the argument that in Karnataka Bank’s case, the Supreme Court has not considered whether the word ‘person’ which is defined in the General Clauses Act is referable to a branch of business entity. Accordingly, on various grounds, these petitions have been filed with a prayer as mentioned above. In the statement of objections filed on behalf of the State, it is stated that the writ petitions are not maintainable either in law or on facts. The 1976 Act enacted by the State Legislature comes within the purview of Entry 60 of the II List to the VII Schedule of the Constitution. Professional Tax is levied under the Act on a person engaged in any profession, trade, calling or employment. S.3 of the 1976 Act is the charging section and sub-sec.(1) provides for levy and collection of tax. Sub-sec.(2) specifies the persons mentioned in the Schedule to pay tax under specified heads. The amendment introduced to Professional Tax Act as per explanation 6 to the Schedule with effect from 1.4.2003 provides for every branch of any self employed assessee enumerated in any item of the Schedule shall be deemed to be a separate assessee for the purpose of levy of professional tax specified in the schedule. With effect from 31.3.2003 onwards, Entry at SI.No.24 to the 1976 Act provides for banking companies as defined in the Banking Regulation Act, 1949, to collect Rs.2,500/- p.a., The explanation introduced to SI.No.81 i.e., with effect from 1.4.1976 and to S1.No.24 introduced makes it clear that banking company shall include any bank whose operations are governed by the provisions of the Banking Regulation Act, 1949. Art.276(2) of the Constitution provides for payment of professional tax in respect of any one person, municipality, district board, local board for other local authority shall not exceed Rs.2,500/- p.a. by way of tax on profession, trade calling or employment. Till 31.3.2003, the State Legislature provided for levy and collection of professional tax treading them as one person irrespective of the number of branches of such firms, companies, etc. Till 31.3.2003, the State Legislature provided for levy and collection of professional tax treading them as one person irrespective of the number of branches of such firms, companies, etc. What has been stated further is, as per S.2(h) and explanation 6 to the Schedule was introduced in order to mobilise additional resources at the specified rates on each branch of the firm, company, corporation etc. So, thus in defining the word ‘person’ for each branch is within the legislative competence of the State and there is no prohibition under the Constitution. Referring to the decision of the Supreme Court in Karnataka Bank’s case, it is stated, the validity of similar levy of tax on branches, firm, companies, etc., and the explanation introduced to the Andhra Pradesh Tax on Profession, Trade, Calling or Employment Act has been upheld. It is further stated, petitioners are registered under the Companies Act, 1956 and also are banking companies carrying on the business of banking governed by the Banking Regulation Act, 1949. Petitioners fall under Entry 24 of the Schedule to the 1976 Act. As per the definition of a ‘person’ under Entry 24 of the Schedule, each person is liable to pay tax at Rs.2,500/- p.a. i.e., as per explanation 6 to S.2(h) to the schedule. As such, levy and collection of tax from each of the petitioners’ branches is legal and constitutionally valid. The stand of the petitioners that such levy is contrary to the settled legal position is untenable and even the legislative competence of the State has also been upheld in the decision cited above since it falls within Entry 60 of List II of the VII Schedule to the Constitution. The definition of ‘person’ in S.3 (42) of the General Clauses Act is only illustrative and not exhaustive. The Legislature is competent in its wisdom to define ‘person’ for the purpose of each of the enactment and different from the one in the General Clauses Act. It is also submitted, a ‘person’ is not defined under the Constitution. But, Art.367 of the Constitution provides that the explanation contained in the General Clauses Act applies to the interpretation of the Constitution. S.3(42) of the General Clauses Act does not restrict the power of the State Legislature to define the term ‘person’. It is also submitted, a ‘person’ is not defined under the Constitution. But, Art.367 of the Constitution provides that the explanation contained in the General Clauses Act applies to the interpretation of the Constitution. S.3(42) of the General Clauses Act does not restrict the power of the State Legislature to define the term ‘person’. Accordingly, it is contended that restrictive amendment and validation of the assessment of tax made prior to such amendment in respect of banking companies covered under the Banking Regulation Act, 1949, by Act 6/2008 is within the legislative competence of the State and is constitutionally valid. The main line of argument advanced on behalf of the petitioners by the learned Sr.counsel Sri Sarangan is, Art. 276(2) of the Constitution relates to collection of tax and also the competence of the State Legislature. In the light of the fact that Rs.2,500/- has been fixed as the minimum per person, collection of professional tax from subsidiary bank and each of the branches of the bank exceeds its scope and competence to impose and collect more tax than Rs.2,500/-. Learned counsel taking me through the provisions of Art.276 of the Constitution and also the provisions of the Banking Regulations Act, 1949 submitted that imposition of tax amounts to exceeding its limit by the Legislature since nothing has been described in the Constitution about a ‘person’. In view of Art.367 of the Constitution, the General Clauses Act, 1897 shall be valid for any such interpretation and definition as such, even the amendment introduced by way of explanation under the 1976 Act to the word ‘person’ is beyond the scope of the Legislature. It is also submitted that the provisions of Andhra Pradesh Tax on Professional Act is not in part material with the chagrining provisions of the Karnataka Act as such, the decision in Karnataka Bank’s case has no application. The very amendment of the word ‘person’ introduced is contrary to Art.276(1) and Entry 60 of List I and also violative of the Constitution. As such, it has to be struck down. Government pleader referring to the detail objections filed submitted that the word ‘person’ defined under the 1976 Act is in consonance with the provisions which has been upheld by the Apex Court in Karnataka Bank’s case and the definition of the word ‘person’ is not in derogation of the word ‘person’ under the General Clauses Act. Government pleader referring to the detail objections filed submitted that the word ‘person’ defined under the 1976 Act is in consonance with the provisions which has been upheld by the Apex Court in Karnataka Bank’s case and the definition of the word ‘person’ is not in derogation of the word ‘person’ under the General Clauses Act. Only a further interpretation is there in view of the latest developments as such, petitioners cannot that each branch is not liable to pay the tax. Imposition and collection of professional tax from each of the branches is not in contravention of Art.276 of the Constitution and also the provisions of the Banking Regulation Act. This Court while disposing of WP 43632/2003 and connected matters on 14.3.2008, referring to Karnataka Bank’s case has opined that the judgment of the Apex Court applies squarely to the case on hand. Article 276 of the Constitution is a special provision which empowers the State to impose and collect tax in respect of profession, trade, calling or employment. Art.246 of the Constitution provides for distribution of powers between Centre and State which is detailed in the VII Schedule to the Constitution. In Art.276, it is specifically made clear that the law enacted relating to taxes for the benefit of the State by way of imposing tax on profession, trade, calling or employment to derive the income of the State is valid. Art.276(2) provides by way of amendment introduced with effect from 20.12.1988 to impose Rs.2,500/- p.a. per person. So far as interpretation of Art.367 is concerned, on the matter of interpretation, the General Clauses Act, 1897 applies subject to any adaptation and modification that may be made under Art.372. Art.372 deals with providing adaptation of the laws in force i.e., existing laws prior to the commencement of the Constitution shall continue to be in force until ordered or repealed or amended by competent legislature. Clauses (1) of Art.372 of the Constitution impliedly provides for the laws which are in existence to be continued after the commencement of the Constitution much less also it provides for amendment of those provisions of the legislation by the legislatures concerned for its benefit but it shall not be ultra vires the constitution. Art.372(2) provides for the assent either by the President of India or as is provided as matter of procedure for the assent of those modifications required. Art.372(2) provides for the assent either by the President of India or as is provided as matter of procedure for the assent of those modifications required. Art.13 of the Constitution provides for laws in force and laws to be enacted for the purpose of maintaining uniformity in the matter of adopting/continuing the laws which were in force prior to the commencement of the Constitution. The laws which were in force to the extent in so far as they are ultra vires the Constitution or constitutional provisions are void. Similarly, laws to be enacted by the Legislature shall meet the requirement of the constitutional touch stone. In other words, to say, they must withstand the constitution limitations. Any enactment which exceeds the constitution arrangement or scheme definitely provides to declare them as ultra vires the constitution. The Banking Regulation Act, 1949 has been introduced to consolidate the banking activities and the nature of transactions to be carried out by the banks in India. As a matter of history, the law relating to banking companies normally was the general law applicable to the companies contained in Part XA of the Indian Companies Act, 1913. Since they were found inadequate, to have an independent exhaustive enactment to provide for banking legislation, the Banking Regulation Act, 1949 was introduced and the same has been maintained. Even a comprehensive definition of banking has been provided under the Act i.e., the banking activity like, to receive deposits, repayable on demand or otherwise, for lending or investment and each of the branches of these banking companies do carry out the nature and object as is mentioned in the Banking Regulation Act, just like receiving deposits repayable on demand and for lending or for investment, etc. Although for the purpose of Companies Act, at the inception on registration of banking companies, they were treated as one entity ultimately, the Banking Regulation Act, 1949 was framed which has undergone a sea change and even provide for Banking Regulation Amendment Act, 2004. Although for the purpose of Companies Act, at the inception on registration of banking companies, they were treated as one entity ultimately, the Banking Regulation Act, 1949 was framed which has undergone a sea change and even provide for Banking Regulation Amendment Act, 2004. As and when there is growth of financial transaction, necessarily several branches have been opened to carry out the activities which is similar to the one carried out by the main Unit through its subsidiary unit or branches which carry out similar function no less than the one which is carried out by some other sister concern or branches of the parent company which undertakes borrowing and lending and also accept deposits repayable on demand, etc. This nature of activities have been recognised by the realm of the State Legislature in its competence, to enhance the revenue, to treat each of the branches as an independent unit. Consequently, in the absence of any exhaustive definition either provided under the Constitution or under the General Clauses Act, having recognised the nature of the activities of the branches of the banking companies, explanation has been introduced by way of amendment to the word ‘person’ occurring in S.2(h) of the 1976 Act explaining that every branch of firm, company or corporation or other corporate body or any society, club or association shall be deemed to be a person. Exercising power which is provided under Art.372 of the Constitution, in exercise of powers of competence of Legislature, when the word ‘person’ has been defined for the purpose of furtherance of the Act, it cannot be treated as derogatory to the Constitution laws enacted by the Centre. The word ‘person’ defined under the General Clauses Act is not sufficient to meet the explanation, in the context, this has been further defined to bring into effect the nature of activity carried out by each of the branch of the companies or societies to be treated as independent entity as a ‘person’ to collect tax to promote the object of collection of revenue for the State. In Karnataka Bank Ltd case, the Apex Court has upheld similar provision enacted and the explanation provided in the Andhra Pradesh Act, as within the legislative competence of the State. Accordingly, its validity has been upheld. In Karnataka Bank Ltd case, the Apex Court has upheld similar provision enacted and the explanation provided in the Andhra Pradesh Act, as within the legislative competence of the State. Accordingly, its validity has been upheld. Art.367(2) of the Constitution provides that acts or laws made by the Parliament or acts or laws made by the Legislature of the State shall be construed as including a reference, of course, to the ordinance also, but, the beginning of clause (2) of Art.367, necessarily provides for reference to the laws made by the State Legislature for the purpose of interpretation. A reading of explanation to S.2(h) of the 1976 Act, clearly indicates that it is in furtherance of the word ‘person’ as defined under the General Clauses Act or enacted earlier at the time of enactment of legislation by Act 35/1976. When once each Unit is treated as a ‘person’, collection of tax of Rs.2,500/- as provided under Art.270 and 276(2) of the Constitution from each person cannot exceed Rs.2,500/-. The definition of ‘person’ as defined earlier under the Banking Regulation Act or the Companies Act is only a restrictive one. At the relevant point of time, the nature of activities carried out was not thought of exhaustively and as a matter of law and social change when the nature of banking companies has undergone a sea change, the definition of a ‘person’ also accordingly requires to be specifically stated to make out a case for imposition of tax and to bring it within the purview of taxation laws. The Constitution provides that there shall not be any imposition of tax without there being authority of law and legislative sanction. In the circumstances, since already the Apex Court has exhaustively dealt with the matter in the case of Karnataka Bank Ltd, noted supra as to the explanation of ‘person’ as including branches of every bank registered under the Banking Companies Act and the Banking Regulation Act, the argument advanced by the learned Sr. Counsel for the petitioners in these case do not in any way require interpretation than the one which is arrived at by the Apex Court. Petitions are dismissed.