1982 (4) TMI 291 - HC - Indian Laws

Summary

Issues Involved:
1. Constitutional validity of the Karnataka Tax on Entry of Goods into Local Areas for Consumption, Use, or Sale Therein Act, 1979 (Entry Tax Act, 1979).
2. Binding nature of the High Court's previous judgment declaring the Entry Tax Act, 1979 unconstitutional.
3. Effect of the Supreme Court's judgment upholding the Entry Tax Act, 1979.
4. Impact of subsequent legislative actions including the Karnataka Tax on Entry of Goods into Local Areas for Consumption, Use, or Sale Therein (Repeal) Act, 1981.

Issue-Wise Detailed Analysis:

1. Constitutional Validity of the Entry Tax Act, 1979:
The petitioners challenged the constitutional validity of the Entry Tax Act, 1979, which came into force on 1-6-1979. Initially, a Division Bench of the Karnataka High Court declared the Act unconstitutional in a common order dated 24-8-1979, and issued a mandamus restraining the State from enforcing the Act. However, the Supreme Court in State of Karnataka v. M/s Hansa Corporation (1980) reversed this decision, upholding the constitutional validity of the Entry Tax Act, 1979.

2. Binding Nature of the High Court's Previous Judgment:
The petitioners contended that the High Court's order dated 24-8-1979, which declared the Entry Tax Act, 1979 unconstitutional, had become final for them as no appeals were preferred to the Supreme Court from that order concerning their writ petitions. They argued that the State and its officers were bound by that order and could not enforce the Entry Tax Act, 1979 against them.

3. Effect of the Supreme Court's Judgment:
The State argued that the Supreme Court's judgment upholding the Entry Tax Act, 1979 was a judgment in rem, binding on every court, authority, and person. Additionally, Section 3 of the Repealing Act, 1981 rendered ineffective every judgment or order of the High Court that had declared the Entry Tax Act, 1979 unconstitutional, and made the mandamus unenforceable.

4. Impact of Subsequent Legislative Actions:
After the Supreme Court's judgment, the Karnataka legislature enacted the Repealing Act, 1981, which included Section 3 stating that the Entry Tax Act, 1979 shall be deemed always to have been valid and in force, notwithstanding any judgment, decree, or order of any court. The petitioners argued that Section 3 did not remove the defects found by the High Court in the Entry Tax Act, 1979. However, the court held that since the Supreme Court had reversed the High Court's decision, there were no longer any defects in the Entry Tax Act, 1979. Thus, Section 3 of the Repealing Act, 1981 effectively re-enacted the Entry Tax Act, 1979, making the High Court's previous mandamus ineffective.

Conclusion:
The High Court dismissed the appeals, concluding that the Supreme Court's judgment and subsequent legislative actions rendered the previous High Court judgment and mandamus ineffective. The Entry Tax Act, 1979 was deemed valid and enforceable. The court directed the parties to bear their own costs and declined to grant the certificate prayed for by the appellants.