Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2006 (8) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2006 (8) TMI 549 - HC - VAT and Sales TaxEntry tax on "imported coal" from outside the country - Notification No. S.O. 88 issued by the State of Jharkhand - two per cent entry tax has been sought for to be levied - Validity of section 3 Of the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Act, 1993 - whether the entry tax under the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993, as adopted and modified by the Jharkhand Tax on Entry of Goods into Local Areas for consumption, Use or Sale Thereof (Amendment) Ordinance, 2001, satisfies the test of compensatory tax so as to come within the protection under article 304(b) of the Constitution of India - HELD THAT:- No basis has been shown to levy entry tax in the nature of compensatory tax to find out quantifiable and measurable benefits. Nothing has been indicated either in the "Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993", adopted by the State of Jharkhand, or in the "Jharkhand Tax on Entry of Goods into Local Areas for Consumption, Use or Sale thereof (Amendment) Ordinance, 2001 (Jharkhand Ordinance 2 of 2002)" showing any quantifiable data or a benefit which is measurable. Thus, in our considered view the entry tax levied under the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993, as adopted by the State of Jharkhand and amended by Jharkhand Tax on Entry of Goods into Local Areas for Consumption, Use or Sale thereof (Amendment) Ordinance, 2001 (Jharkhand Ordinance 2 of 2002), is, thus, not based on the principle of equivalence and is not compensatory in nature. From the judgment, rendered by the Supreme Court in the case of Bihar Chamber of Commerce [1996 (2) TMI 430 - SUPREME COURT], though it will be evident that the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993 was assented to by the President and the said entry tax was levied in public interest, there is nothing on the record to suggest that Jharkhand Tax on Entry of Goods into Local Areas for Consumption, Use or Sale thereof (Amendment) Ordinance, 2001 (Jharkhand Ordinance 2 of 2002), so far it relates to further restriction on certain goods, as introduced by the amended Schedule, had prior sanction of the President, as required under proviso to article 304(b), nor there is anything on the record to suggest that while amending the Schedule, assent of the President was obtained by the respondents, as contemplated by article 255 of the Constitution of India. The respondents having failed to show that the entry tax, imposed by Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993, as adopted by the State of Jharkhand and amended by the Jharkhand Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Thereof (Amendment) Ordinance, 2001 (Jharkhand Ordinance 2 of 2002), constitutes reasonable restriction, we are of the view that the entry tax imposed by the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale therein Act, 1993, as adopted by the State of Jharkhand and amended by the Jharkhand Tax on Entry of Goods into Local Areas for Consumption, Use or Sale thereof (Amendment) Ordinance, 2001 (Jharkhand Ordinance 2 of 2002), is also not saved by the provisions, contained in article 304(b) of the Constitution of India. Thus, we hold that the provisions of the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993, as adopted by the State of Jharkhand vide notification dated December 15, 2000 and as amended vide Jharkhand Tax on Entry of Goods into Local Areas for Consumption, Use or Sale thereof (Amendment) Ordinance, 2001 (Jharkhand Ordinance 2 of 2002) do not satisfy the requirement under article 301 read with article 304(b) of the Constitution of India and section 3 of the said Act is ultra vires. It is, thus, also held that the State-respondent cannot enforce the provisions of the aforesaid Act. Notification No. S. O. 88 dated March 23, 2002, issued under the provisions of the aforesaid Act, and memo dated July 1, 2004, issued by the Commissioner of Commercial Taxes-cum Special Secretary, Jharkhand, Ranchi, are held unsustainable and are, therefore, quashed. The writ petition is allowed in the terms indicated above.
|