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2008 (12) TMI 398 - SC - VAT and Sales TaxWhether the State enactments relating to levy of entry tax have to be tested with reference to both clauses (a) and (b) of article 304 of the Constitution for determining their validity and whether clause (a) of article 304 is conjunctive with or separate from clause (b) of article 304? Whether imposition of entry tax levied in terms of entry 52, List II of the Seventh Schedule is violative of article 301 of the Constitution? If the answer is in the affirmative, whether such levy can be protected if entry tax is compensatory in character and if the answer to the aforesaid question is in the affirmative what are the yardsticks to be applied to determine the compensatory character of the entry tax? Whether entry 52, List II, Seventh Schedule to the Constitution like other taxing entries in the Schedule, merely provides a taxing field for exercising the power to levy and whether collection of entry tax, which ordinarily would be credited to the Consolidated Fund of the State being a revenue received by the Government of the State, would have to be appropriated in accordance with law and for the purposes and in the manner provided in the Constitution as per article 266 and there is nothing express or explicit in entry 52, List II, Seventh Schedule which would compel the State to spend the tax collected within the local area in which it was collected? Will the principles of quid pro quo relevant to a fee apply in the matter of taxes imposed under Part XIII? Whether the entry tax may be levied at all where the goods meant for being sold, used or consumed come to rest (standstill) after the movement of the goods ceases in the "local area"? Whether the entry tax can be termed a tax on the movement of goods when there is no bar to the entry of goods at the State border or when it passes through a local area within which they are not sold, used or consumed? Whether interpretation of articles 301 to 304 in the context of tax on vehicles (commonly known as "transport") cases in Atiabari's case [1960 (9) TMI 94 - SUPREME COURT] applies to entry tax cases and if so, to what extent? Whether the non-discriminatory indirect State tax which is capable of being passed on and has been passed on by traders to the consumers infringes article 301 of the Constitution? Whether a tax on goods within the State which directly impedes the trade and thus violates article 301 of the Constitution can be saved by reference to article 304 of the Constitution alone or can be saved by any other article? Whether a levy under entry 52, List II, even if held to be in the nature of a compensatory levy, must, on the principle of equivalence demonstrate that the value of the quantifiable benefit is represented by the costs incurred in procuring the facility/services (which costs in turn become the basis of reimbursement/recompense for the provider of the services/ facilities) to be provided in the concerned "local area" and whether the entire State or a part thereof can be comprehended as local area for the purpose of entry tax?
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