Case Law Details
Bharat International Vs Assistant Commissioner of Commercial Tax & Ors. (Supreme Court of India)
Introduction: The Supreme Court of India recently rendered a significant decision by dismissing an appeal filed by M/s Bharat International against the Assistant Commissioner of Commercial Tax & Ors. This case centered around the imposition of entry tax and is closely tied to a precedent set by the Supreme Court in the matter of Jindal Stainless Limited and Anr. vs. State of Haryana and Ors. in 2017.
Detailed Analysis: The crux of the matter lies in the constitutional validity of state government legislations imposing entry tax on goods entering their territories. The nine-judge Bench, led by the then Chief Justice of India, upheld the constitutional validity of such legislations, emphasizing that entry tax does not violate the constitutionally recognized right to free trade and commerce under Article 301 of the Constitution of India.
The bench clarified that taxes, in general, are not within the contemplation of Part XIII of the Constitution, and the word ‘Free’ in Article 301 does not imply freedom from taxation. Only discriminatory taxes are prohibited under Article 304(a). Therefore, the imposition of a non-discriminatory tax, such as entry tax, does not infringe upon Article 301.
The present appeal by Bharat International contested an order dated 12.10.2009 from the High Court of Madhya Pradesh (Indore Bench). The appellant’s counsel argued that the issues in the appeal align with the judgment in Jindal Stainless Limited. The Supreme Court, having limited the consideration to the question of entry tax, acknowledged the alignment and dismissed the appeal.
The Deputy Advocate General representing the respondent department concurred, asserting that nothing further would survive in this appeal in light of the earlier judgment in Jindal Stainless Limited. The dismissal was explicitly based on the restricted scope of the notice, limiting consideration to the levy of entry tax, and no other issues were entertained.
Conclusion: In conclusion, the Supreme Court’s decision to dismiss Bharat International’s appeal reinforces the precedent set in Jindal Stainless Limited. The ruling clarifies that the imposition of entry tax, when non-discriminatory, does not contravene constitutional provisions on the right to free trade and commerce. This development holds implications for similar cases and underscores the importance of aligning legal arguments with established precedents for a favorable outcome. The order, dated November 09, 2023, by Justice B.V. Nagarathna and Justice Prashant Kumar Mishra, signifies the finality of the matter, with pending applications also disposed of in line with the judgment.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
This appeal is directed against the order dated 12.10.2009 passed by a division bench of the High Court of Madhya Pradesh (Indore Bench) in W.P. No.5874 of 2008.
Learned counsel for the appellant Shri S. Hariharan submitted that the issues which arise in this appeal are covered by a nine-judge Bench decision of this Court in the case of Jindal Stainless Limited and Anr. vs. State of Haryana and Ors. reported in (2017) 12 SCC 1. He also submitted that while issuing notice in this appeal, this court had restricted the consideration of the matter only on the question of levy of entry tax. Since the controversy which arises in this appeal is now covered by the aforesaid judgment of this Court, appropriate orders may be made in this appeal.
Learned Deputy Advocate General appearing for the respondent-department submitted that indeed nothing further would survive in this appeal having regard to the judgment of this Court in the case of Jindal Stainless Limited and Anr. vs. State of Haryana and Ors.
Recording the submissions of learned counsel for the respective parties, we dismiss this appeal in view of the majority judgment passed in Jindal Stainless Limited and Anr. vs. State of Haryana and Ors., by taking note of the fact that notice in this appeal was limited only to the question of levy of entry tax and no other issue is to be considered in the appeal.
Pending application(s), if any, shall also stand disposed of.
. . . . . . . . .,J
[B.V. NAGARATHNA]
. . . . . . . . . . . ,J
[PRASHANT KUMAR MISHRA]
NEW DELHI,
NOVEMBER 09, 2023
UPON hearing the counsel the Court made the following
ORDER
The appeal is dismissed in terms of the signed order.
Pending application(s), if any, shall also stand disposed of.
