Case Law Details
CA Koduri Jitendra Babu
1. Long pending dispute regarding constitutional validity of entry tax levied by various States has been settled by Hon ‘bless Supreme Court by its judgement delivered on 11.11.2016. The court by a majority judgement of 7-2 held that States are within their right to levy entry tax, provided there is no discrimination between the goods imported from other States and goods within the State. The Court held that tax is not a restriction on freedom of trade and commerce as envisaged under Article 301 of the Constitution. The court held that levy of entry tax cannot be treated as restriction and therefore cannot be held as unconstitutional. The Court overruled it’s earlier judgements in the cases of Atiabari and Automobile Transport, which ruled the field for more than 50 years.
2. Summary of the issues decided as per judgement are as under:
I. Taxes simpliciter are not within the contemplation of Part XIII of the Constitution of India. The word ‘Free’ used in Article 301 does not mean “free from taxation”.
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WILL SOMEBODY PLEASE INFORM THE PAGE NO OF THE JUDGEMENT WHERE IT IS MENTIONED THAT NO INTEREST IS PAYABLE BY THE LOSING PARTY IN THE CASE
Sir,
Can we also assess from this judgement that if a state has not levied entry tax on locally produced goods and such levy was only for goods purchased from outside state to be discriminatory and violation of Article 301.
The honorable supreme Court said that exemptions, set off can be given to certain class or classes of dealer for a limited period, but such exemption shall be intelligible, it shall not be unspecified, general.
The judgement given by the majority states that only non discriminatory taxes under article 304(a) could come to rescue of Article 301.
Sir can we assume by this judgement that majority of states including West bengal have higher chances of loosing the case on this particular question of law??
comprehensively conceptualized, very nice ?
very helpful article
very useful way to present