1995 (2) TMI 451 - SC - Indian Laws

Summary

Issues Involved:
1. Constitutionality of Section 178 of the Delhi Municipal Corporation Act, 1957.
2. Alleged discrimination between goods manufactured within and outside the Union Territory of Delhi.
3. Applicability of Articles 301 and 302 of the Constitution of India.

Summary:

1. Constitutionality of Section 178 of the Delhi Municipal Corporation Act, 1957:
The appellant challenged Section 178 of the Delhi Municipal Corporation Act, 1957, which levies terminal tax on goods carried by railway or road into the Union Territory of Delhi. The appellant argued that this section impedes the movement of goods and restricts trade, commerce, and intercourse, thus violating Article 301 of the Constitution of India. The High Court dismissed the writ petition, holding that while Section 178 contravenes Article 301, it is saved by Article 302.

2. Alleged discrimination between goods manufactured within and outside the Union Territory of Delhi:
The appellant contended that Section 178 discriminates against goods manufactured outside Delhi, as only these goods are subject to terminal tax. The respondents argued that there were no specific, clear, and unambiguous allegations or proof to support this claim. The Supreme Court reiterated that the burden of proving discrimination lies on the person challenging the statute and that there is a presumption in favor of the statute's constitutionality.

3. Applicability of Articles 301 and 302 of the Constitution of India:
The Supreme Court referred to several precedents, emphasizing that a tax law does not necessarily impede the freedom of trade, commerce, and intercourse guaranteed by Article 301. The Court noted that the impugned tax law, enacted by Parliament, is presumed to be in public interest, a presumption not offset by any contrary material. Consequently, Section 178 is saved by Article 302, which allows Parliament to impose restrictions on trade, commerce, or intercourse in the public interest.

Conclusion:
The Supreme Court found no sufficient or specific pleadings to prove that Section 178 violates Article 301 or is discriminatory. The appeal was dismissed, upholding the High Court's decision that Section 178 is saved by Article 302. There was no order as to costs.