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1991 (2) TMI 403 - SUPREME COURTWhether Section 4 of the West Bengal Entertainments and Luxuries (Hotels and Restaurants) Tax Act, 1972 can be held to be ultra vires the Article 14 of the Constitution of India for failure to make required classification and for imposition of luxury tax on flat or fixed rate only on the basis of air-conditioned floor space? Held that:- The Act requires the luxury tax to be in proportion of or proportional the air-conditioned space and it requires the tax to be uniform upon the same class of owners of airconditioned hotels and restaurants which means that all similarly situated owners shall be treated alike. It does not suffer from lack of classificaion but instead impliedly authorises it by leaving out non-air-conditioned hotels and restaurants. Equality and uniform policy means uniform and equal rates of assessment and taxation which has been followed in this tax. The concept of equality and uniformity has to adjust from time to time to new and advancing social and economic conditions and needs of public finance and fiscal policy, of course within constitutional limitations. Thus the measure or unit and the rate of taxation are uniform for all within the group subjected to tax. Further classification within the group was not considered necessary by the legislature which had wide latitude in the matter of classification keeping in view the nature of the taxable event. We accordingly hold that the luxury tax charged under s. 4 of the Act could not be said to be discriminatory, and consequently, the impugned notices also could not be said to be illegal or void. Appeal dismissed.
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