TMI Blog1970 (4) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... the gift. The value of the lands and buildings in only the measure of the value of the gift. A gift-tax is thus not a tax on lands and buildings as such (which is a tax resting upon general ownership of lands and buildings) but is a levy upon a particular use, which is transmission of title by gift. The two are not the same thing and the incidence of the tax is not the same. Since entry 49 of the State List contemplates a tax directly levied by reason of the ground ownership of lands and buildings, it cannot include the gift-tax as levied by Parliament. There being no other entry which covers a gift-tax, the residuary powers of Parliament could be exercised to enact a law. The appeals must, therefore, be allowed - C.A. 664 OF 1967 - - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere similarly taxed and the tax questioned. The High Court held that entry 49 of the State List read with entry 18 of the same list reserved the power to tax lands and buildings to the Legislatures of the States and Parliament could not, therefore, use the residuary power conferred by entry 97 of the Union List. This decision is challenged before us. The Gift-tax Act was passed in 1958 and subjected gifts made in the year ending on 31, 1958, to tax. The Act contained the usual exempted limits and other exemptions. We need not concern ourselves with them here. We are only concerned with the validity of parliamentary legislation imposing gift-tax at all. To consider the objection to the Gift-tax Act which was sustained by the High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and to avoid any doubts, an entry has also been included in the Union List to the following effect : " 97. Any other matter not enumerated in List II or List III including any tax not mentioned in either of those lists. " It will, therefore, be seen tfiat the sovereignty of Parliament and the Legislatures is a sovereignty of enumerated entries, but within the ambit of an entry, the exercise of power is as plenary as any legislature can possess, subject, of course to the limitations arising from the fundamental rights. The entries themselves do not follow any logical classification or dichotomy. As was said in State of Rajasthan v. S. Chawla the entries in the lists must be regarded as enumeratio simplex of broad categories. Since the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; transfer and alienation of agricultural land ; land improvement and agricultural loans ; colonization. " " 49. Taxes on lands and buildings. " The argument is that by entry 18, " land " of all description is made subject to legislation in the States and by entry 49 taxes of whatever description on lands in that large sense and buildings generally fall also in the jurisdiction of the State Reference is made to entries 45, 46, 47 and 48 of the State List in which certain taxes are to be imposed on land and agricultural land or income from agriculture exclusively by the States in contrast with entries 82, 86, 87 and 88 where the taxes are imposed on properties other than agricultural land or income from agriculture. It is submitted, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ary to deal with the matter except briefly. The Constitution divides the topics of legislation into three broad categories : (a) entries enabling laws to be made, (b) entries enabling taxes to be imposed, and (c) entries enabling fees and stamp duties to be collected. It is not intended that every entry gives a right to levy a tax. The taxes are separately mentioned and in fact contain the whole of the power of taxation. Unless a tax is specifically mentioned if cannot be imposed except by Parliament in the exercise of its residuary powers already mentioned. Therefore, entry 18 of the State List does not confer additional power of taxation. At the most fees can be levied in respect of the items mentioned in that entry, vide entry 66 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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