2016 (12) TMI 1256 - HC - VAT and Sales Tax

Levy of Entry Tax - goods purchased by individual consumers through electronic commerce portals for their personal use and consumption - Held that - reliance placed on the decision of the case of 2016 (11) TMI 545 - SUPREME COURT OF INDIA , where it was held that seeking to levy Entry Tax on goods purchased by individual consumers through electronic commerce portals for their personal use and consumption, the constitutional validity which are challenged in the present writ petitions and the levy of Entry Tax on such goods purchased within the State of Gujarat are required to be held intra vires and constitutionally valid - petition fails - dismissed. The specified goods brought into the State of Gujarat by the respective petitioners, it has already suffered Central Sales Tax, and therefore, CST paid on such specified goods brought by the petitioners into the State of Gujarat, either there shall be set off to the extent the amount of tax/CST already paid and/or amount of tax leviable under the Entry Tax Act, 2001 is required to be reduced to the extent of amount of tax paid; if any, under the CST on the purchase of specified goods in the course of inter-state trade or commerce is concerned - the concerned importers have to make appropriate claim before the appropriate authority claiming the benefit under subsection (2) of Section 4 of the Entry Tax Act, 2001 as required under Rule 5 of the Entry Tax Rules and as and when such claims are made, the appropriate authority is required to consider the same in accordance with subsection (2) of Section 4 of the Entry Tax Act, 2001, however, subject to concern person to prove by producing necessary Challan, the payment of CST in other State on such goods brought/imported within the State of Gujarat and having followed the procedure as required under Rule 5 of the Entry Tax Rules, 2001 - Appeal disposed of.

Summary

Issues:
Challenge to the vires of the provisions of the Gujarat Tax on Entry of Specified Goods into Local Areas [Amendment] Act, 2016; Entitlement to reduction under the Entry Tax Act, 2001 and set off for Central Sales Tax paid; Benefit under sub-section (2) of Section 4 of the Entry Tax Act, 2001.

Analysis:
The judgment addressed the challenge to the constitutional validity of the Gujarat Tax on Entry of Specified Goods into Local Areas [Amendment] Act, 2016, which sought to levy Entry Tax on goods purchased by individual consumers through electronic commerce portals. The court held that the provisions were intra vires and constitutionally valid, upholding the levy of Entry Tax on such goods. The petitioners' challenge failed, and their petitions were dismissed accordingly.

Regarding the entitlement to reduction under the Entry Tax Act, 2001 and set off for Central Sales Tax paid, the court emphasized the clarity of sub-section (2) of Section 4 of the Act. The petitioners were directed to approach the appropriate authority to claim the benefit by proving the payment of Central Sales Tax in other states on the specified goods brought into Gujarat. The authority was instructed to consider such claims in accordance with the law, including Rule 5 of the Entry Tax Rules, 2001.

For the benefit under sub-section (2) of Section 4 of the Entry Tax Act, 2001, the court reiterated that the petitioner in a specific application needed to make a claim before the appropriate authority. If the specified goods imported into Gujarat had suffered Central Sales Tax, the claim could be considered in accordance with the law. The petitioner was instructed to follow the procedure outlined in the Act and Rules for such claims.

The judgment concluded by dismissing the petitions and applications concerning these issues, with notice issued in each case discharged and no separate order as to costs. The court's decision was based on the recent Supreme Court ruling in the case of Jindal Stainless Limited, which was cited throughout the judgment to support the legal analysis and conclusions reached by the High Court of Gujarat.