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2010 (12) TMI 742 - HC - Income TaxTCS u/s 206C - Obligation of state government to collect tax at source -large number of persons died on account of consumption of spurious country-made liquor - State Government was directed to take over the wholesale trade and business of country-made liquor - Protection under constitution of India - Held that:- sub-article (2) of article 289 is equally inapplicable to the facts and circumstance of the present case, because the same authorizes Parliament to enact laws for imposition of tax on properties, on any trade or business carried on by the State Government. - TDS (TCS) in the present case was not taxation or levy on the income of the State of Bihar, but was indeed an advance collection of tax to be done by the State of Bihar in the capacity of wholeseller in relation to the income of the retailers. - the provisions of article 289 of the Constitution are inapplicable to the facts and circumstances of the present case. - Revenue did suffer on account of inaction on the part of the petitioner to realize TDS (TCS) at the time of sales to the retailers. Furthermore, even if part of the amount of income-tax was paid by a few of the retailers, in contradistinction to thousands of retailers, it will be open to the petitioner to apply for refund of the same in accordance with the prescribed procedure. - decided in favor of revenue.
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