The Supreme Court of India has dismissed an appeal filed by M/s Bharat International in 2010 against the Assistant Commissioner of Commercial Tax & Ors. in question of levy of entry tax. The appeal revolved around the levy of entry tax, and the dismissal comes in the wake of the decision by a nine-judge Bench of the Supreme Court in the case of Jindal Stainless Limited and Anr. vs. State of Haryana and Ors. (2017).
The Nine Judge bench of the Supreme Court of India had then upheld the Constitutional validity of the various State Government legislations to levy Entry Tax for goods coming outside from its territory.
The bench led by the then Chief Justice of India ruled that the tax legislation by the state does not require the consent of the President under Article 304 B of the Constitution of India. Entry Tax is not violative of the constitutionally recognised right to free trade commerce and intercourse guaranteed under Article 301 of the Constitution of India. The bench also observed that, Taxes simpliciter are not within the contemplation of Part XIII of the Constitution of India.
The word ‘Free’ used in Article 301 does not mean “free from taxation”. Only such taxes as are discriminatory in nature are prohibited by Article 304(a). It follows that levy of a non-discriminatory tax would not constitute an infraction of Article 301.
The present appeal was directed against the order dated 12.10.2009, passed by a division bench of the High Court of Madhya Pradesh (Indore Bench) in W.P. No.5874 of 2008.
S. Hariharan, counsel for the appellant, argued that the issues in this appeal are covered by the aforementioned decision. Notably, when issuing notice in this appeal, the Supreme Court had limited the consideration to the question of the levy of entry tax. Given that the controversy aligns with the judgment in Jindal Stainless Limited, the appellant requested appropriate orders in this matter.
The Deputy Advocate General representing the respondent department concurred, stating that nothing further would survive in this appeal in light of the Apex Court Nine-Judge Bench’s judgment in Jindal Stainless Limited.
The Supreme Court, recording the submissions of both parties, dismissed the appeal, emphasizing that notice in this case was restricted only to the question of the levy of entry tax. As a result, no other issues were considered in the appeal.
The order, dated November 09, 2023, by Justice B.V. Nagarathna and Justice Prashant Kumar Mishra, noted that pending applications, if any, shall also stand disposed of.
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