TMI Blog2008 (12) TMI 398X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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 capabl ..... 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X X X X Extracts X X X X X X X X Extracts X X X X ..... 3398, C.A. Nos. 3399, C.A. Nos. 3400, C.A. Nos. 3592, C.A. Nos. 4651 of 1998, C.A. Nos. 918 of 1999, C.A. Nos. 2769, C.A. Nos. 4471, C.A. Nos. 4476 of 2000, C.A. Nos. 3314 of 2001, C.A. Nos. 3454, C.A. Nos. 3455, C.A. Nos. 3456, C.A. Nos. 3457, C.A. Nos. 3458, C.A. Nos. 3459, C.A. Nos. 3460, C.A. Nos. 3461, C.A. Nos. 3462, C.A. Nos. 3463, C.A. Nos. 3464, C.A. Nos. 3465, C.A. Nos. 3466, C.A. Nos. 3467, C.A. Nos. 3468, C.A. Nos. 3469, C.A. Nos. 3470, C.A. Nos. 3471, C.A. Nos. 4008, C.A. Nos. 5385, C.A. Nos. 5740, C.A. Nos. 5858 of 2002, C.A. Nos. 1956, C.A. Nos. 2608, C.A. Nos. 2633, C.A. Nos. 2637, C.A. Nos. 2638, C.A. Nos. 3720, C.A. Nos. 3721, C.A. Nos. 3722, C.A. Nos. 6331, C.A. Nos. 8241, C.A. Nos. 8242, C.A. Nos. 8243, C.A. Nos. 8244, C.A. Nos. 8245, C.A. Nos. 8246, C.A. Nos. 8247, C.A. Nos. 8248, C.A. Nos. 8249, C.A. Nos. 8250, C.A. Nos. 8251, C.A. Nos. 8252 of 2003, C.A. Nos. 997, C.A. Nos. 998, C.A. Nos. 3144, C.A. Nos. 3145, C.A. Nos. 3146, C.A. Nos. 4953, C.A. Nos. 4954, C.A. Nos. 5139, C.A. Nos. 5141, C.A. Nos. 5142, C.A. Nos. 5143, C.A. Nos. 5144, C.A. Nos. 5145, C.A. Nos. 5147, C.A. Nos. 5148, C.A. Nos. 5149, C.A. Nos. 5150, C.A. Nos. 5151, C.A. Nos. 5152, C.A. Nos. 51 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh, Sunny Chowdhary, Vairagya Vardhan Dubey, Aditya Singh, Upasana Nath, Puneet Bali, Hitten Nahra, Gourav Kejariwal, R. Nedumaran, Devvrat, Soumik Ghosal, Udit Kumar, Chanchal Biswal, Partha Sil, K. Chatterjee, Ghanshyam Joshi, Aarohi Bhalla, Manoj Kr. Dwivedi, Ms. Vandana Mishra, G.V. Rao, Praveen Kumar, Gopal Singh, Manish Kumar, Mohit Shah, Shamshad, Sanjay Jain, C. Mukund, Shashank Sharma, Avneesh Garg, Ms. Vandana Anand, Bijoy Kr. Jain, Parijit Singh, Ms. Reshmi Rea Sinha, S.C. Ghosh, A.K. Rao, Advocates for M/s Gagrat Co., Advocates, Ms. Kirit Renu Mishra, Rajiv Agnihotri, Rajesh Kumar, Ms. Indra Sawhney, K.L. Janjani, Ms. Kamakshi S. Mehlwal, Sanjeev Kr. Singh, Bhargava V. Desai, Rahul Gupta, Ms. Reema Sharma, H.K. Puri, L.N. Rao, Roy Abraham, Ms. Seema Jain, Himinder Lal, P. N. Puri, Tarun Johri, Ms. Shirin Khajuria, Surya Kant, Ms. B. Vijayalakshmi Menon, Vishwajit Singh, K.R. Sasiprabhu, M.P. Vinod, Ajay K. Jain, Dillep Pillai, C.N. Sree Kumar, Sanjay R. Hegde, Romy Chacko, A. Mariarputham, Ms. Aruna Mathur, Advocate for Arputham Aruna Co. Gopal Singh, Abhisth Kumar, Ravindra Narain, Ms. Sudha Malla, Aruneshwar Gupta, Sushil Kumar Jain, G.C. Bharuka, Ramesh Kumar Aga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en pressed into service by the parties. Stand of the appellants in the present cases essentially is that true nature of the levy of entry tax has to be seen and that has not been done. With reference to paragraphs 31 See para 28 at page 567 of 145 STC. and 42 See para 39 at page 571 of 145 STC. of Jindal's case [2006] 7 SCC 241 See [2006] 145 STC 544 (SC) it has been submitted by assessees-appellants that entry tax is really in essence not a tax in the classical sense, but a sub-class of fee. Some High Courts by the impugned judgment have held that clauses (a) and (b) of article 304 of the Constitution of India, 1950 (in short, "the Constitution") are independent of each other and if law is saved under article 304(a) then it need not be tested with reference to clause (b) of article 304 for determining its validity. It is to be noted that almost all the cases on which the parties have placed reliance did not relate to entry tax and related to levy in the context of tax on vehicles brought inside the local area. These are commonly known as transport cases. Those cases like Meenakshi's case [1984] Supp SCC 326 were decided because Presidential permission in terms of article 304 was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ara 43 at page 573 of 145 STC.. Applying the above tests/parameters, whenever a law is impugned as violative of article 301 of the Constitution, the court has to see whether the impugned enactment facially or patently indicates quantifiable data on the basis of which the compensatory tax is sought to be levied. The Act must facially indicate the benefit which is quantifiable or measurable. It must broadly indicate proportionality to the quantifiable benefit. If the provisions are ambiguous or even if the Act does not indicate facially the quantifiable benefit, the burden will be on the State as a service/facility provider to show by placing the material before the court, that the payment of compensatory tax is a reimbursement/recompense for the quantifiable/measurable benefit provided or to be provided to its payer(s). As soon as it is shown that the Act invades freedom of trade it is necessary to enquire whether the State has proved that the restrictions imposed by it by way of taxation are reasonable and in public interest within the meaning of article 304(b) (see para 35 of the decision in the case of Khyerbari Tea Co. Ltd. v. State of Assam reported in AIR 1964 SC 925)." Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h a local area within which they are not sold, used or consumed. (7) Whether interpretation of articles 301 to 304 in the context of tax on vehicles (commonly known as "transport") cases in Atiabari's case [1961] 1 SCR 809 and Automobile Transport's case [1963] 1 SCR 491 applies to entry tax cases and if so, to what extent. (8) 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. (9) 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. (10) 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 Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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