SEZ Entry Tax Issue Pending Before SC: Calcutta HC Refuses to Give Direction to Issue Clarificatory Circular [Read Order]

The Calcutta High Court, in its recent ruling refused to give direction to the state to issue a clarificatory circular on the entry tax on SEZ units for procurements of goods. The court noted the issue was already in consideration with the Supreme Court.

The Petitioner, Vikram Solar Limited, vide the writ petition sought to issue direction to the State to consider its representation dated October 13, 2025 and to issue a circular clarifying that entry tax is not payable on import or procurement of goods by an SEZ unit under West Bengal State tax laws.

Vikram Solar’s counsel, Adv. VVV Sastry and Adv. Anirudh Goyal submitted that, being an SEZ unit, it is entitled to exemption from taxes, duties, levies and cess under State laws for goods imported into or exported from the SEZ.

The company filed a detailed representation to the authorities and requested to issue a clarificatory instruction confirming that entry tax would not apply to SEZ units. The petitioner claimed that clarification was required urgently as then they could avail the Settlement of Dispute Scheme, 2025. The same is valid only till December 31, 2025

However, no decision was taken on the representation by the authorities, thus making the petitioner to approach the high court.

The state opposed the writ and asserted that no mandamus can be issued compelling the Government to issue a circular or instruction of the nature sought.

The counsel for the state, Adv. Nilotpal Chatterjee and Adv. TanayChakraborty with others pointed out that the issue of exemption from entry tax on the grounds of SEZ status had already been raised by the petitioner before the Taxation Tribunal. The assessment orders had been passed, and the matter was now sub judice before the Supreme Court, where the assessment orders had been stayed.

Therefore, submitting the Supreme Court situation, the State said that it would be impermissible to issue a clarificatory circular. According to the state, it will conflict with the proceedings pending before the apex court.

However, the Petitioner submitted that the Supreme Court had merely stayed coercive action in connected matters and had not restrained the State from issuing clarificatory circulars. It was added that a clarification would only settle uncertainty and would not prejudice the pending litigation.

c concurred with the submissions of the state. The judge said that when the issue is already pending before the Supreme Court, no mandatory direction can be issued to the State authorities to issue a clarificatory circular.

However, the court granted liberty to the authorities to consider and dispose of the representation without violating any order passed by the apex court as soon as possible.

The High Court abstained from giving any opinion on the merits of the SEZ exemption claim or on the representation itself. The writ petition was disposed of directing the parties to wait for a decision of the Supreme Court.

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