TMI Blog2012 (8) TMI 887X X X X Extracts X X X X X X X X Extracts X X X X ..... e trade with the registered dealers under the CST Act by giving some credit known as input-tax credit and has not levied any tax or penalty upon the petitioners on their entry to trade with the unregistered dealers. Therefore, from the impugned substitution of sub-clause (ii) of sub-section (4) of section 18, neither the State Government has levied some additional tax on the subject-matters covered under the article 246(1) nor has put any restrictions against the trade by the petitioners with unregistered dealers. Therefore, the petitioners' challenge to substituted provisions of sub-clause (ii) of sub-section (4) of section 18 of the Jharkhand Value Added Tax Act, 2005, by the impugned Ordinance Act is misconceived. W.P. dismissed. - W.P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of tax leviable is higher in course of inter-State trade falling under sub-section (1) of section 8 of the CST Act. The petitioners also submitted that under the Jharkhand Value Added Tax Act, 2005, by section 18, input-tax credit has been given and earlier as per the sub-clause (ii) of sub-section (4) of section 14, the input-tax credit was allowable on the purchase of goods made within the State of Jharkhand from the registered dealers holding a valid certificate of registration and which are intended for the purpose of sale in course of inter-State trade and commerce. However, the State of Jharkhand has imposed tax by substituting new clause in place of original clause (ii) of sub-section (4) of section 18 by inserting: Sale in cours ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Act, 1956, thereby, it is a restriction against the trade. 5. The learned counsel for the State submitted that the Jharkhand Value Added Tax (Amendment) Ordinance being Ordinance No. 2 was notified in the Official Gazette vide S.O. No. LJ-10/2001-54/LEG dated May 7, 2011, whereby several amendments were carried out in the Jharkhand Value Added Tax Act, 2005. By section 9 of the said Ordinance, section 18(4) of the Jharkhand Value Added Tax Act, 2005 has been amended by substituting clause (ii) of sub-section (4) of section 18 by the phrase, which we have already quoted. The Ordinance was placed before the State Legislative Assembly and it has been passed by the State Legislative Assembly and thereafter it was placed before the honour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... put-tax credit. 7. The learned counsel for the petitioners relied upon the judgment of the Supreme Court delivered in the case of Jagannath Prasad v. State of Uttar Pradesh reported in [1963] 14 STC 536 (SC); [1963] SCR 220. Learned counsel for the petitioners submitted that taxing statute can be challenged on the ground that it infringes the fundamental rights guaranteed by the Constitution if it purports to impose restriction on the same class of persons; similarly situated, on incidence of taxation which leads to obvious inequality. However, in this very judgment, the honourable Supreme Court held that the plea of colourable legislation can succeed only when the relevant circumstances are strong enough to justify that it amounts to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter III of the Act of 2005 is also not under challenge. What is under challenge is, the withdrawal of credit given on the basis of input tax. Therefore, from the facts itself it is clear that the State has not imposed the tax but has granted some concessions in the matters of the tax levied under the Act of 2005. 11. At the cost of repetition, we may mention here that the imposition of the tax under the Act of 2005 is not under challenge but in fact, under some misconception, when the State Government decided to proceed to take a decision that certain incentives be given to the traders who deal with the registered dealers, then the petitioners have approached this court by challenging the validity of sub-clause (ii) of sub-section (4) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivered in Jagannath Prasad case [1963] 14 STC 536 (SC); [1963] SCR 220 by the honourable Supreme Court is concerned, in that matter the dispute was entirely different. This was a matter arising out of the U.P. Large Land Holding Tax Act, 1957 (U.P. Act of 31 of 1957) and a question involved in the said case of Jagannath Prasad case [1963] 14 STC 536 (SC); [1963] SCR 220 was answered while dealing with the various provisions of said Holding Act of 1957, which are neither similar nor they have any connection with the present dispute and particularly when the State Government's power to legislate for value added tax is not under question and its validity is not under challenge, then a question of giving the concessions under the Act is a d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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