9911796707
TMI Blog2011 (3) TMI 1509X X X X Extracts X X X X X X X X Extracts X X X X ..... the "dryer felts" were exempt from tax being covered under entry 30 of Schedule B which was a Schedule of tax-free goods. Though the contention of the petitioner that "dryer felts" were covered by entry "textiles" in item 30 of Schedule B was not accepted by the statutory authorities and by this Court, the honourable Supreme Court in Porritts & Spencer (Asia) Ltd. v. State of Haryana [1978] 42 STC 433 (SC) upheld the said plea. It observed (pages 438 and 439 in 42 STC): ". . . The uses of textiles in a fast developing economy are manifold and it is quite common now to find 'textiles' being used even for industrial purposes. If we look at the Customs Tariff Act, 1975, we find in Chapter 59 occurring in section XI of the First Schedule that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e could not give restricted definition to the "textiles" by excluding "dryer felts" therefrom in view of article 286 of the Constitution and thereby levy tax thereon at a higher rate. The petitioner has framed the following questions of law in the writ petition: "(1) Whether the impugned amendment of Haryana Act No. 10 of 1981 is ultra vires the power of State Legislature in entry 54 of List II of the Seventh Schedule to the Constitution of India read with article 245 of the Constitution of India? (2) Whether the impugned action of levy of tax at enhanced rate by the respondents contravenes the provisions of article 286 of the Constitution read with sections 14 and 15 of the Central Sales Tax Act since dryer felts manufactured and sold b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e legislative competence of State was subject to provisions of the ADE Act, 1957 under which no sales tax is to be levied on the items mentioned therein and the States were entitled to receive the amount collected by way of additional excise duty. The relevant observations are as under (pages 566-569 in 139 STC): "65. In December, 1956, the National Development Council, Planning Commission, Government of India, and the States agreed that the sales tax in respect of, inter alia, tobacco should be replaced by a surcharge on the Central excise duties, the income derived therefrom being distributed amongst States on the basis of consumption, subject to the income from the States being assured. Pursuant to this and the recommendation of the Fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India and on all such goods lying in stock within the precincts of any factory, warehouse other premises where the said goods were manufactured, stored or produced, or in any premises appurtenant thereto, duties of excise at the rate or rates specified in the First Schedule to this Act.' 67. No State can levy luxury tax on items covered by section 3 of the ADE Act in respect of goods for the same taxable event, i.e., goods stored on manufacture, just by describing the goods as luxury goods. The overlapping of the powers exercised under entry 84 of List I and entry 62 of List II would then be evident. Similarly storage or stocking of imported goods is covered by entry 83 of List I and cannot be made the subject of levy by the States. . . ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
