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2015 (2) TMI 795 - ALLAHABAD HIGH COURTLevy of sales tax / VAT on import of yarn from outside India - Constitutional validity of impugned notification dated 13.9.2001 - Government has amended its earlier notification dated 29.1.2001 and imposed tax in pursuance to power conferred by Clause (b) of Sub Section 1 of Section 3A of the Act at the point of sale to the extent of 20 per cent on yarn imported from outside India and 4 per cent on yarn of other kind - Jurisdiction of State Government - Held that:- Tax has been imposed providing therein that imported goods brought into the State of U.P., shall be liable to tax at the rate of 20%. Virtually, it is the entry fees over the foreign items brought into the State of U.P. It has got no relationship with either the sale or purchase or the import or export. - There appears to be no ambiguity in the letter and spirit of Article 286 of the Constitution of India. It should be interpreted as a whole right from the head note i.e., beginning which indicates that it relates to imposition of tax on sale and purchase of goods. Thus, if the sale and purchase of goods take place outside the country and brought into the territory of India, no tax may be imposed but when it is brought into the State like in the present case, the State of U.P., sub-clause (b) of Article 286 does not seem to come in the way. A collective reading of the three entries; 53, 56 and 60 seem to confer power on State Government to impose tax in case goods are brought into the State of U.P. for consumption, use or sale therein or it is carried into the State of U.P. through road or on inland waterways. Entry No.60 is wider and empowers the State Government to impose tax on trades. - Thus, the case relied upon by the learned counsel for the petitioners as well as other cases referred to hereinabove, negate the State power to impose tax where transaction of sale and purchase took place outside the country. Article 286 of the Constitution does not debar the State to impose tax when an item is brought into the State. Article 286 should be read in reference to context i.e., imposition of tax on sale or purchase of goods. Subject to condition of sub-clause (a) and sub-clause (b), sale and purchase of goods is condition precedent to ascertain the right of State to impose tax at its end. Imposition of tax at entry level where sale or purchase of goods are not involved, does not seem to come within the purview of sub-clause (b) of clause (1) of Article 286. Case relied upon by the petitioners' counsel does not seem to be applicable to the facts and circumstances of the present controversy. 35 In view of the above, these writ petitions lack merit and fail - Decided against assessee.
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