SC upholds validity of entry tax
New Delhi,Nov 12, 2016, DHNS:
The apex court on Friday upheld the Constitutional validity of entry tax imposed by states on goods coming from other states.
A nine-judge Constitution bench, presided over by Chief Justice T S Thakur, by a majority of 7:2, ruled in favour of the validity of a separate entry taxes on goods as mandated by statutes of different state governments.
“States are well within their right to design their fiscal legislations to ensure that the tax burden on goods imported from other states and goods produced within the state fall equally. Such measures, if taken, would not contravene Article 304(a) of the Constitution,” the bench said.
Justices A K Sikri, S A Bobde, Shiva Kirti Singh, N V Ramana, R Banumathi and A M Khanwilkar upheld the validity of entry tax..
Dissenting judgements
Justices D Y Chandrachud and Ashok Bhushan, however, passed separate dissenting judgements.
Several companies led by Jindal Stainless Steel Ltd had challenged the entry tax provisions of various states on the ground that they are against the concept of free trade and commerce under Article 301 (Freedom of trade commerce and intercourse) of the Constitution.
The decision to refer the case to the larger bench came in May during the hearing of matters filed by companies including Vedanta Aluminium Ltd, Essar Steel Ltd, Tata Steel Ltd, Adani Enterprises Ltd and the Odisha government.
In its judgement, the majority view held that the question whether the levies in the present case indeed would apply in the instant case was to be determined by the regular benches hearing the matters.
A nine-judge Constitution bench, presided over by Chief Justice T S Thakur, by a majority of 7:2, ruled in favour of the validity of a separate entry taxes on goods as mandated by statutes of different state governments.
“States are well within their right to design their fiscal legislations to ensure that the tax burden on goods imported from other states and goods produced within the state fall equally. Such measures, if taken, would not contravene Article 304(a) of the Constitution,” the bench said.
Justices A K Sikri, S A Bobde, Shiva Kirti Singh, N V Ramana, R Banumathi and A M Khanwilkar upheld the validity of entry tax..
Dissenting judgements
Justices D Y Chandrachud and Ashok Bhushan, however, passed separate dissenting judgements.
Several companies led by Jindal Stainless Steel Ltd had challenged the entry tax provisions of various states on the ground that they are against the concept of free trade and commerce under Article 301 (Freedom of trade commerce and intercourse) of the Constitution.
The decision to refer the case to the larger bench came in May during the hearing of matters filed by companies including Vedanta Aluminium Ltd, Essar Steel Ltd, Tata Steel Ltd, Adani Enterprises Ltd and the Odisha government.
In its judgement, the majority view held that the question whether the levies in the present case indeed would apply in the instant case was to be determined by the regular benches hearing the matters.
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