9911796707
TMI Blog2007 (11) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... her and are being disposed of by this common judgment. West Bengal State Tax on Consumption or Use of Goods Act, 2001 (hereinafter referred to as, "the Consumption Tax Act") was enacted in order to (a) prevent diversion of trade, (b) to augment revenue and (c) to save the bona fide dealers in the State against unequal competition. By the aforesaid impugned Act a tax has been imposed if a person brings any goods into any local area from any place outside such local area for consumption or use of such imported goods in the said local area. For the purpose of the Act entire State has been divided into several local areas. Similar Acts were enacted by different States under different titles. State of Haryana enacted Haryana Local Area ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned Consumption Tax Act of West Bengal. The Kerala High Court by its judgment in Thressiamma L. Chirayil v. State of Kerala reported in [2007] 7 VST 293 declared that the Kerala Tax on Entry of Goods into Local Areas Act, 1994 is illegal, unauthorised and violative of article 301 of the Constitution of India. Similarly, the Madras High Court by its judgment in ITC Limited v. State of Tamil Nadu reported in [2007] 7 VST 367 and the Jharkhand High Court in Tata Iron & Steel Company Ltd. v. State of Jharkhand reported in [2007] 6 VST 587 struck down the Tamil Nadu Tax on Entry of Goods into Local Areas Act, 2001 and Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993, respectively. In view of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with law. It has already been settled that no State Legislature can levy a tax on goods imported from other States in a manner discriminating between such imported goods and similar goods manufactured and produced within the State. A judicially evolved exception is "compensatory tax". It is clear and apparent that the consumption tax under the Consumption Tax Act has subjected the goods imported from outside the State to heavier tax inasmuch as tax is being levied on those goods twice-once sales tax in the State where those are purchased and again consumption tax at the rate of sales tax when those imported goods enter into any local area within the State of West Bengal. Although the declared object seeks to end discrimination but in effec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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