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TMI Blog2011 (3) TMI 1509X X X X Extracts X X X X X X X X Extracts X X X X ..... that Act are fully applicable to the case of textiles which is one of the item mentioned in the ADE Act, 1957. This petition is allowed and the impugned levy is held to be unconstitutional. - 2291 of 1994 - - - Dated:- 22-3-2011 - ADARSH KUMAR GOEL AND AJAY KUMAR MITTAL, JJ. JUDGMENT:- The judgment of the court was delivered by ADARSH KUMAR GOEL J. This petition seeks striking down of Haryana Act No. 10 of 1981 levying sales tax on dryer felts retrospectively from April 26, 1971 to September 6, 1978. The case of the petitioner is that it is a registered dealer under the provisions of the Haryana General Sales Tax Act, 1973 and the Central Sales Tax Act, 1956. During the relevant period the dryer felts were exem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above judgment, the Haryana Legislature enacted the Haryana General Sales Tax (Amendment and Validation) Act No. 10 of 1981 amending entry 14 of Schedule B retrospectively excluding the expression dryer felts from textiles . In view of the said amendment, the statutory revisional authority created demand of tax which was upheld by the Tribunal. The contentions raised in the writ petition, inter alia, are that the State Legislature lacks legislative competence to make the goods in question taxable in view of the provisions of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 ( the ADE Act, 1957 ). Alternatively, textiles being declared goods under the Central Sales Tax Act, 1956, the State could not give rest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ponse to the contention raised with reference to the ADE Act, 1957. We have heard learned counsel for the parties. Main contention on behalf of the petitioner is that the goods are covered by the ADE Act, 1957 and section 3 thereof provides for levy of additional excise duty. The Statement of Objects and Reasons of the said Act specifically mentions that additional duty of excise levied thereunder was in replacement of sales tax levied by the States on the items mentioned therein which included textiles . The above matter was gone into by the honourable Supreme Court in Godfrey Phillips India Ltd. v. State of U.P. [2005] 139 STC 537 (SC); AIR 2005 SC 1103 and after considering the legislative background, it was held that the legislat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gory of goods declared to be of special importance in inter-State trade or commerce so that, following the imposition of uniform duties of excise on them, the rates of sales tax if levied by any State were subject from April 1, 1958, to the restrictions in section 15 of the Central Sales Tax Act, 1956. 66. Section 3 of the ADE Act is the charging section under which additional excise duties are leviable on specified goods manufactured or lying in stock. Sub-section (1) of section 3 reads: 3. Levy and collection of additional duties. (1) There shall be levied and collected in respect of the following goods, namely, sugar, tobacco, cotton fabrics, rayon or artificial silk fabrics and woollen fabrics produced or manufactured in India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fer, supply or delivery, which is referred to in clause (29A) of article 366, the sales tax law of a State which provides for levy of sales tax thereon will have to comply with the restrictions mentioned in section 15 of the Central Sales Tax Act, 1956. . . . 72. So even if tobacco is an article of luxury, a tax on its supply is within the exclusive competence of the State but subject to the constitutional curbs prescribed under article 286 read with sections 14 and 15 of the Central Sales Tax Act, 1956, and most importantly the ADE Act of 1957 under which no sales tax can be levied on tobacco at all if the State was to take the benefits under that Act. The above observations made in the context of tobacco are fully applicable to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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