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TMI Blog2023 (9) TMI 1082X X X X Extracts X X X X X X X X Extracts X X X X ..... pollution , which, according to the petitioners, is not covered by any of the fields in Lists II and III, Seventh Schedule to the Constitution but falls exclusively within the residuary Entry i.e. Entry 97 of List I of the Seventh Schedule to the Constitution? HELD THAT:- Since the levy and the object of the levy is to augment resources to reduce the carbon footprint generated by the petitioners involved in handling etc. specified products and substances, the impugned Act has a direct nexus with subjects like public health, sanitation, water, gas or land. Greater effective means to combat increased carbon footprint or even disincentivising increased carbon footprint would clearly promote public health. The entries in the State list cannot be narrowly or pedantically construed. They have to be liberally and generously construed. Upon their meaningful construction, it would be difficult to agree with the Petitioner s argument that in pith and substance, the impugned Act is an enactment not with respect to the entries in the State List. The Constitution Bench in State of West Bengal V/s. Kesoram Industries Ltd. Ors. [ 2004 (1) TMI 71 - SUPREME COURT] , held that ample a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... int or since the impugned Act imposes a levy on the handling or consumption or, utilization or combustion or, movement or transportation of products and substance, which upon their handling, etc. causes pollution of the lithosphere, atmosphere, biosphere, hydrosphere and other environmental resources of the State of Goa, the same legitimately relates to the domain covered by Entry 6, 14, 17, 18, 21 and 25, particularly since these entries have to be construed liberally and broadly and not pedantically. Once any legislation is found to substantially relate to the entries in the State or Concurrent lists, even some incidental or marginal overlap is of no consequence. In any case, once a field or subject is found to be reasonably related to the entries in the State or Concurrent lists, the Courts must be slow to place such fields or subjects in the residuary entry 97 of the Union list. Residuary typically means what is left out. Clean Energy Cess - HELD THAT:- The clean energy cess, which is nothing but an excise duty, was imposed by the Parliament because the subject of environment or environmental pollution relates to the residuary Entry 97 of List I. Instead, it is cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ative competence to enact the impugned Act, it is not proposed to examine the issue as to whether the impugned levy can be justified as a tax relatable to Entry 49 List Il, Seventh Schedule to the Constitution. Petition dismissed. - M.S. SONAK BHARAT P. DESHPANDE, JJ. For the Petitioners : Mr Darius Khambata, Senior Advocate with Mr Ninad Laud, Mr Nitesh Jain, Mr Abhijit Gosavi, Mr Athnain Naik, Mr Guruprasad Naik, Ms Krupa Naik, and Mr Darshan P. Gosavi, Advocates. Mr Abhijit Gosavi, with Mr Amey Phadte, Mr S. S. Kantak, Senior Advocate with Mr Abhijit Gosavi, Ms Saicha Desai, Mr S. D. Lotlikar, Senior Advocate with Mr C. Padgaonkar, Mr T. Sequeira, and Ms V. Mahato, Advocates Ms A.A. Agni, Senior Advocate, with Ms Surabhi Kuvelkar, Ms Rajlaxmi Bhatkar, Ms C. Dias, and Ms Afrin Khanm Harihar, Advocates For the Respondents : Mr D. J. Pangam, Advocate General with Mr Shubham Priolkar, Addl. Govt. Advocate. JUDGMENT : (PER M.S. SONAK, J.) 1. Heard the learned Counsel for the parties. 2. The learned Counsel for the parties agree that a common judgment and order can dispose of all these Petitions. However, the learned Counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t High Court, Division Bench)., in support of their contentions. 8. Mr Khambatta submitted that though the original Constitution contained a directive principle dealing with public health in Article 47, the Parliament thought it fit in 1976 to introduce Article 48A to deal with environment specifically. He, therefore, submitted that the Constitution treats public health and environment separately. He presented that the impugned Act, in pith and substance, was concerned with the field of environment and not public health . He submitted that since the State has no legislative competence to legislate on the field of environment , the impugned Act is ultra vires, unconstitutional and null and void. 9. Mr Khambatta submitted that even if it is assumed that the impugned Act relates to field of public health and air or air pollution , then the impugned Act would relate, inter alia, to Entry 6, of List II and Entry 97 of List I because there is no entry comparable to Entry 17 (concerning water) with respect to air or air pollution . He submitted that it is only the Parliament which has legislative competence to enact hybrid legislation of subjects covered under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 removes legislative competence from all the States and entrusts only the Parliament with the power to make such legislation for implementing international treaties. 13. Mr Khambatta submitted that the expression for implementing appearing in Article 253 of the Constitution must be given a purposive interpretation that confers exclusive power on the Parliament to legislate on the entire subject matter of the international convention/treaty. The learned Counsel for the Petitioners referred to the provisions of the Air Act, Environment Protection Act and the NGT Act to point out that such legislations make specific reference to Article 253 of the Constitution apart from Entry 13 of the Union List, Seventh Schedule to the Constitution. 14. Mr Khambatta submitted that the international conventions /treaties are akin to the directive principles of State Policy, while the legislations like Air Act, the EPA and the NGT Act are means for implementing such principles. Accordingly, the learned Counsel submitted that the expression implementation would mean adopting legislative steps towards the goals and objectives of international conventions/treaties. Based upon this argument, h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the impugned levy was a personal tax and not a tax on property. He pointed out that the impugned levy was a tax on an activity or service rendered on or in connection with lands and buildings but not a tax on lands and buildings. He pointed out that Section 4 of the impugned Act levied a tax on the handling, utilisation, consumption, combustion, transportation or movement of products and substances which were subject to the levy. But the levy was not on lands or buildings. 18. For all these reasons, Mr Khambatta submitted that the impugned Act was ultra vires and could not be saved by reference to Entry 49, List II, Seventh Schedule of the Constitution. He relied on H.S. Dhillon (supra), Retailers Association of India (Rai) V/s. Union of India (2011) 5 Mah L.J. 660 and Jalkal Vibhag Nagar Nigam (supra), amongst others, in support of his contentions. 19. Mr Lotlikar, the learned senior Advocate for the Petitioners in WP No. 939/2019, adopted the submissions of Mr Khambatta. He submitted that the Petitioners contributed nothing to the increase in the carbon footprint. He submitted that the impugned Act was beyond the legislative competence of the State. In any case, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and Co. and Anr. etc. V/s. The Assessing Authority, Patiala and Anr. etc. AIR 1970 SC 1742 Belgaum District Co- operative Milk Producers Societies Union Ltd. V/s. State of Goa and Anr. 2017 SCC OnLine Bom 7780 in support of her contentions. 25. Ms Agni also relied upon Kewal Krishan Puri and Anr. V/s. State of Punjab and Anr., 1980 (1) SCC 416, Dewan Chand Builders and Contractors V/s. Union of India and Ors., 2012 (1) SCC 101, The Corporation of Calcutta and Anr. V/s. Liberty Cinema AIR 1965 SC 1107, P.M. Ashwathanarayana Setty and Ors. (supra), Om Prakash Agarwal etc. V/s. Giri Raj Kishori and Ors. etc. AIR 1986 SC 726., Krishi Upaj Mandi Samiti Orient Paper and Industries Ltd. (1995) 1 SCC 655, Union of India and Anr. V/s. Mohit Minerals P. Ltd. (2022) 10 SCC 700 , Calcutta Municipal Corp. and Ors. V/s. Shrey Mercantile (P) Ltd. and Ors. (2005) 4 SCC 245 and B.S.E Brokers Forum, Bombay and Ors. V/s. Securities and Exchange Board of Indian and Ors. (2001) 3 SCC 482 mainly, in the context of the distinction between tax and fee . 26. Mr Gosavi, learned Counsel for the Petitioners in WP No. 436/2016, also adopted Mr Khambatta s submissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that legislation with respect to pollution of rivers and streams is relatable to Entries 6 and 17 of List III, Seventh Schedule. However, the Water (Prevention and Control of Pollution) Act was enacted by the Parliament by taking recourse to Article 252 of the Constitution of India and not by referring to Entry 97 of List I, i.e. the residuary entry in the union list. 32. Learned AG submitted that a comparison of entries in List I and List II of the Seventh Schedule would indicate that List I contains no entries relatable to the field of environment or environmental pollution. However, he referred to several entries in List III relatable to land, water, agriculture, fisheries, health, etc., which, according to him, relate to the fields of nature, environment, pollution, sanitation, etc. Learned AG submitted that from this scheme, it is apparent that the Constitution makers intended to leave the field of environment and environmental pollution of the State. He, therefore, submitted that it would not be correct to rely on the residuary clause in Entry 97 of List I, Seventh Schedule of the Constitution of India. 33. Learned AG submitted that the impugned Act neither seeks to im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y relatable to Entry 83 of List I, i.e. duties of customs, including export duties. He submitted that the levy under the impugned Act was a levy relatable to Entry 66 read with Entries 6, 14, 17, 18, 21 and 25 of List II, Seventh Schedule. 36. Learned AG submitted that in any case, it was always permissible to levy different fiscal levies, even on the same transaction, based on different entries, different causes and different purposes. Learned AG, therefore, submitted that there was no constitutional bar on the State to levy the impugned cess simply because the Central Government had levied an excise duty upon the same or similar transaction. He submitted that the impugned cess, in any case, was not on the manufacture of the products and substances. He relied on State of West Bengal Ors. V/s. Purvi Communication (P) Ltd. (2005) 3 SCC 711 in support of this contention. 37. Learned AG submitted that the impugned cess was a fee but urged that even if it were to be a tax, the same was within the legislative competence of the State. He submitted that the fee levied by the impugned Act was relatable to Entry 66, r/w Entries 6, 14, 17, 18, 21 and 25 of List II, Seventh Sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndustries Limited (supra), where it was held that the word land cannot be assigned a narrow meaning and that it included all strata above and below. 42. The learned Advocate General contended that the word land includes not only the face of the Earth but also includes within it, the lithosphere, atmosphere, biosphere, hydrosphere and other environmental resources, that the levy upon the use of land on account of handling or consumption or utilisation or combustion or movement or transportation of products and substances, including hazardous substances would amount to a Tax on the land. He further submitted that the levy is not imposed on a product per se but that it is a levy upon activities being carried on by the petitioners, that the particular use of the land in the management of particular commodities, causing a polluting impact on the land, and was there for not a tax on those commodities. 43. The learned Advocate General submitted that the Act identifies the persons from whom such Cess has to be collected but that it is not to say that is the tax on any person, that the measure, manner, and the point at which the tax has to be collected is not indicative of the tru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ufactured outside the state of Goa. 47. For all the above reasons, learned Advocate General submitted that these petitions may be dismissed and the interim orders granted may be vacated. 48. The rival contentions now fall for our determination. MAIN ISSUES 49. Based on the rival contentions, one of the main issues which arises for determination in all these matters is whether the impugned Act, in pith and substance, relates to the fields enumerated in Entries 6, 14, 17, 18, 21 and 25 of List II, Seventh Schedule to the Constitution or whether the same relates to the field of environment or environmental pollution , which, according to the petitioners, is not covered by any of the fields in Lists II and III, Seventh Schedule to the Constitution but falls exclusively within the residuary Entry i.e. Entry 97 of List I of the Seventh Schedule to the Constitution. The petitioners contend that the impugned Act, in pith and substance, falls within the residuary Entry in List I, and, therefore, the same is ultra vires the legislative competence of the State. 50. The petitioners also contend that the levy under the impugned Act is not a fee as contemplated by Entry 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Official Gazette, specify for the purpose of this Act. 54. Under Section 3 of the said Act, the Government is empowered to appoint a Competent Authority, or Competent Authorities as may be required and assign to them such areas as may be specified in such notification. The Competent Authorities shall perform such functions and discharge such duties as may be prescribed. 55. Section 4 of the impugned Act, is a charging section and the same is transcribed below for the convenience of reference: 4. Levy and collection of cess. (1) There shall be levied and collected a cess at such rates as may be specified by the Government by a notification in the Official Gazette, not exceeding two percent of the sale value of the products and/or substances, the handling, utilization, consumption, combustion, transportation or movement, of which, by any means, causes pollution within the State of Goa, from every person carrying out any of the above activities. (2) The cess shall be assessed, levied and collected in such manner, as may be prescribed. (3) The cess levied under this Act shall be in addition to any other cess, taxes, charges, duties, permission fees, licen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espect of matters not provided for in the impugned Act and not inconsistent therewith. Section 14 empowers the Government to make rules. Section 15 empowers the Government to remove difficulties arising in giving effect to the provisions of the impugned Act as may appear to be necessary or expedient for removing such difficulties. This power, however, has to be exercised within two years from the date of commencement of the impugned Act. BROAD PRINCIPLES FOR INTERPRETATION OF LEGISLATIVE ENTRIES IN THE LISTS IN SCHEDULE VII. 60. In the context of determining whether legislation, in pith and substance, falls within the residuary Entry 97, List I, Seventh Schedule to the Constitution, reference has to inevitably be made to the Constitution Bench judgment (Bench strength of seven) in Union of India V/s. H.S. Dhillon (supra). The Hon ble Supreme Court held that in any matter, including tax, which has not been allotted exclusively to the State Legislatures under List II or to both, the State and the Union Legislatures in List III, fall within List I, including Entry 97 of that List read with Article 248 of the Constitution. The Court held that it would be unthinkable that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... road and liberal. The entries only demarcate the legislative field of the respective legislature. If it is found that some of the entries overlap or conflict with the other, an attempt to reconcile such entries and bring about a harmonious construction is the duty of the Court. When reconciliation is not possible, then the Court will have to examine the entries in relation to legislative power in the Constitution. The legislature is supreme in its own sphere under the Constitution, subject to limitations provided for in the Constitution itself. It is for the legislature to decide as to when and in what respect and on what subject matter the laws are to be made. If the State Legislature was competent to pass the Act, the question of motive with which the Act was imposed is immaterial, and there can be no plea of a colourable exercise of power to tax if the government had the authority to impose a tax. If the government had the authority to impose a tax, the fact that it gave a wrong reason for exercising the power would not derogate from the validity of the tax. There is a distinction between the object of tax, the incidence of tax and the machinery for the collection of tax. Legisl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rticularly familiar in taxation. 66. In State of Rajasthan V/s. Shri G. Chawla and Dr Pohumal 1959 Supp (1) SCR 904, in the context of the challenge to the Ajmer (Sound Amplifiers Control) Act, 1952 as being beyond the legislative competence of the State legislature, the Hon ble Supreme Court explained that after Lord Selborne s oft-quoted and applied dictum in Queen V/s. Burah (1878) 3 App Cas 889 , it must be held as settled that the legislatures in our Country possess plenary powers of legislation. This is so even after the division of legislative powers, subject to this, that the supremacy of the legislatures is confined to the topics mentioned as Entries in the Lists conferring respective powers on them. These Entries, it has been ruled on many an occasion, though meant to be mutually exclusive, are sometimes not really so. They occasionally overlap and are to be regarded as enumeratio simplex of broad categories. Where in an organic instrument, such enumerated powers of legislation exist and there is a conflict between rival Lists, it is necessary to examine the impugned legislation in its pith and substance, and only if that pith and substance falls substantially w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nage and embankments, water storage and water power subject to the provisions of entry 56 of List I. 18. Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonization 21. Fisheries 25. Gas and gas-works. 66. Fees in respect of any of the matters in this List, but not including fees taken in any court. 70. Going by the preamble to the impugned Act, it does appear that the object and purpose of the impugned Act is to augment the State s revenue for having programmes and schemes to reduce the carbon footprint. The impugned Act provides for levy and collection of cess on the products and substances including hazardous substances, which upon their handling or consumption or utilization or combustion or movement or transportation cause pollution of the lithosphere, atmosphere, biosphere, hydrosphere and other environmental resources of the State of Goa, under the concept of polluter pays principle , and also to provide for measures to reduce the carbon footprint left due to such activities an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ludes all strata above or below. In other words, the word land includes not only the surface of the earth but everything under or over it, and has in its legal significance an indefinite extent upward and downward. 75. The Constitution Bench in State of West Bengal V/s. Kesoram Industries Ltd. Ors. (supra), held that ample authority is available for the concept that under Entry 49 in List II the land remains a land without regard to the use to which it is being subjected. It is open for the Legislature to ignore the nature of the user and tax the land. At the same time, it is also permissible to identify, for the purpose of classification, the land by reference to its user. 76. The Constitution Bench also approved the law in Ajoy Kumar Mukherjee V/s. Local Board of Barpeta AIR 1965 SC 1561, where the local Board levied a license fee upon the land owner for holding a market on his own land. It was urged that the impost was unconstitutional, inter alia, on the ground that the tax was actually imposed on the market, which infringed Article 14 of the Constitution, and also because the State Legislature had no legislative competence to tax a market. The Local Board rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , even though these expressions may not have been specifically used in the entries in any of the List I of the Seventh Schedule to the Constitution. ENVIRONMENT OR ENVIRONMENT POLLUTION- FIELDS RELATABLE EXCLUSIVELY TO RESIDUARY ENTRY 97, UNION LIST? 79. Even if the petitioners contention about the impugned Act being relatable to environment or environmental pollution is accepted, still, the further contention that these topics or fields, because of they not being specifically mentioned in Lists II or III of the Seventh Schedule, falling within the residuary entry, that is Entry 97 of List I, Seventh Schedule, cannot be readily accepted. The tag which the Petitioners give to a field or a subject is not decisive in such matters. If the impugned Act, on its reasonable construction, is a law with regard to an entry or even several entries in the State List, the legislative competence of the State must not be doubted. The entries must be construed liberally and meaningfully but not narrowly or pedantically. Besides, in such matters, the attempt must be to first examine the entries in the State or Concurrent lists and not rush to conclude that the field or subject finds a p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as accordingly prepared and put up for consideration at a joint session of the Central Council of Local Self- Government and the Fifth Conference of the State Ministers of Town and Country Planning held in 1965. In pursuance of the decision of the joint session, the draft Bill was considered subsequently in detail by a Committee of Ministers of Local Self-Government from the States of Bihar, Madras, Maharashtra, Rajasthan, Haryana and West Bengal. 82. The SOR records that having considered the relevant local provisions existing in the country and the recommendation of the aforesaid Committees, the Government concluded that the existing local provisions are neither adequate nor satisfactory. There was, therefore, an urgent need for introducing comprehensive legislation which would establish unitary agencies in the Centre and States to provide for the prevention, abatement and control of pollution of rivers and streams, for maintaining or restoring the wholesomeness of such water courses and for controlling the existing and new discharges of domestic and industrial wastes. 83. The SOR significantly recorded that the legislation in respect of the aforesaid subject matter, that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioners, then the Parliament would not have felt the necessity to go by the Article 252 route or the SOR to the Water Pollution Act would not have stated so in express terms that the legislation in respect of water pollution was relatable to Entry 17 read with List II of Seventh Schedule and that the Parliament had no power to make law in the States (apart from the provisions of Article 249 and 250 of the Constitution). 86. The Counsel for the Petitioners attempted to explain the SOR to the Water Pollution Act by simple reference to entry 17 in the State list relating to water . But the SOR also refers to entry 6 of the State list, which concerns public health . Water pollution directly impacts public health. So also land or air pollution directly impacts public health. To say that water pollution is a subject within the legislative competence of the State but air pollution is not, may not be a proper construction either of the legislative entries or the expression environmental pollution . The absence of the entry Air in specific terms in the State list is insufficient to conclude that the State lacks legislative competence to enact the impugned Act. The Constituti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) a road, street or way, whether a thoroughfare or not or a landing place) to which the public is granted access or has a right to resort or over which they have a right to pass. The Hon ble Supreme Court noted that the gist of the prohibition is the use of an external sound amplifier, not a component part of a wireless apparatus, whether in a public place or otherwise, without the sanction in writing of the designated authority and in disregard of the conditions imposed on the use thereof. 90. Finally, the Hon ble Supreme Court significantly held that there can be little doubt that the growing nuisance of blaring loudspeakers powered by amplifiers of great output needed control, and the short question was whether this salutary measure can be said to fall within one or more of the entries in the State List. The Court admitted that amplifiers are instruments of broadcasting and even of communication, and in that view of the matter, they fall within Entry 31 of the Union List. The manufacture, or the licensing of amplifiers or the control of their ownership or possession, including the regulating of the trade in such apparatus is one matter, but the Court held that the control o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Hon ble Supreme Court on the view of the Ajmer Act as a whole, held that the substance of the legislation was within the powers conferred by Entries 1 and 6 of the State List and the Ajmer Act did not encroach upon the field of Entry 31, though it incidentally touched upon the matter provided there. The end and purpose of the legislation furnished the key to connect it with the State List. Accordingly, the Judicial Commissioner s order was set aside and the Ajmer Act was held to be within the legislative competence of the State. 95. The Ajmer Act, as noted above, was an Act which, in effect, dealt with the issue of noise pollution and its deleterious impact on health. Still, the Hon ble Supreme Court, held that such an Act was well within the legislative competence of the State by referring to Entries 1 and 6 of the State List. Once the Act relates to a field in List II or List III, there is no question of reference to the residuary Entry 97 in List I. 96. Thus, in the context of the Water Pollution Act or the Ajmer Act dealing with noise pollution, there are legislative and judicial precedents suggesting that subjects like water pollution or noise pollution relate to the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... air pollution is relatable to the residuary Entry 97 of List I. The learned Counsel for the petitioners accordingly contended that hybrid legislation relatable to subjects that may not squarely fall in any specific entry of List I or III, has to be enacted by the Parliament, given the provisions of Article 248 of the Constitution read with Entry 97 of List I, Seventh Schedule to the Constitution. The learned Counsel relied upon M/s. Sat Pal Co. and Ors. V/s. Lt. Governor of Delhi and Ors. (1979) 4 SCC 232. 100. There is no warrant for the broad proposition that all issues relatable to air pollution necessarily fall within the residuary Entry 97 of List I. In any case, since the impugned Act is aimed at augmenting the State s revenues for having programmes and schemes to reduce the carbon footprint or since the impugned Act imposes a levy on the handling or consumption or, utilization or combustion or, movement or transportation of products and substance, which upon their handling, etc. causes pollution of the lithosphere, atmosphere, biosphere, hydrosphere and other environmental resources of the State of Goa, the same legitimately relates to the domain covered by Entr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f such cess must be judged in the same way as the validity of the tax to which it is an increment. Therefore, even the validity of the Clean Energy Cess Act will have to be considered in the context of legislation imposing excise duty. This is because the clean energy cess is nothing but a duty of excise and, therefore, the same must be judged as an increment to the existing duty of excise on the manufacture of the specified products. The learned Advocate General referred to the Central Government Circular dated 24.06.2010, in which it was clarified that the impost of clean energy cess was a duty of excise . 105. As such, considering the provisions of Section 83 of the Finance Act, 2010, by which such clean energy cess was imposed, and the clarificatory circular dated 24.06.2010, it would be legitimate to hold that the clean energy cess is a levy relatable to entries in List I, Seventh Schedule to the Constitution. For example, Entry 84 of List I prior to the 2016 amendment referred to duties of excise on tobacco and other goods manufactured or produced in India except alcoholic liquors for human consumption and opium, Indian hemp and other narcotic drugs and narcotic but inclu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deration of Hotel Restaurant Association of India, etc. (1989) 3 SCC 364, where it was held that the law with respect to a subject might incidentally affect another subject in some way, but that is not the same thing as the law being on the latter subject. There might be overlapping, but the overlapping must be in law. The same transaction may involve two or more taxable events in its different aspects. Therefore, if the taxes are separated and distinct imposts and levied on different aspects, then there is no overlapping in law. Accordingly, there is nothing like the vice of double taxation , based upon which the impugned Act or the levy imposed thereby can be struck down as ultra vires the State s legislative competence. 111. In Avinder Singh V/s. State of Punjab Anr. 1979 1 SCC 137, the Hon ble Supreme Court rejected the feeble plea that the levy was bad because of the vice of the double taxation or that the impost was unreasonable because there were heavy prior levies. The Court held that some of these contentions hardly merit consideration but have been mentioned out of courtesy to the counsel. The Court pointed out that there was nothing in Article 265 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y entry 97 in the union list or because it regarded the field of environment or environment pollution to relate to the residuary entry. 116. The learned Counsel for the petitioner then argued that these legislations were relatable to Article 253 of the Constitution, which is an Article which begins with a non-obstante clause. They pointed out that the entire field relating to environment or environmental pollution was completely covered by the three legislations they referred to and given the peremptory provisions of Article 253 of the Constitution, the State Legislatures were completely denuded of their powers of enacting any legislations concerned with environment or environmental pollution . The learned Counsel for the petitioners also referred to Entry 13 of List I, Seventh Schedule to the Constitution, which is concerned with participation in international conferences, Associations and other bodies and implementing of decisions made thereat. 117. Again, we are unable to agree with this line of argument. In State of West Bengal Ors. V/s. Purvi Communication (P) Ltd. Ors. (2005) 3 SCC 711, the Hon ble Supreme Court rejected the contention about West Bengal E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Constitution Bench held that the doctrine of occupied field does not totally deprive the State Legislature from the capacity to make any law incidentally referable to a subject in the Union List. But in the event of a plain conflict, the State law must step down unless Article 254(2) comes to the rescue. 121. The Environment Protection Act, 1986 and the Air Pollution Act, 1981 indeed refer to the United Nations Conference on Human Environment held in Stockholm in June, 1972, in which India participated, and where it was decided to take appropriate steps for the protection and improvement of the human environment. The preamble to both these enactments speaks about the necessity to implement the decisions taken at the United National Conference at Stockholm in June 1972. Similarly, the National Green Tribunal Act, 2010, apart from referring to the United Nations Conference on Human Environment held in Stockholm in June 1972 also refers to the decisions taken at the United Nations Conference held in June 1992 in which India participated. The preamble to this Act also speaks about the implementation of the decision taken at aforesaid conferences and to have a National Green Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on made at an International Association or other body, then such legislation, even if it relates to a subject in the State List, will have to be held as within the legislative competence of the Parliament given the provisions of Article 253 read with Entry 13 of the State List of Seventh Schedule to the Constitution. This would be the proper import of Article 253 of the Constitution. However, this does not mean that State Legislation on a field relatable to the entries in the State List, which does not even remotely conflict with Parliamentary legislation, made in the exercise of the powers under Article 253 read with Entry 13 of List I, would fall foul of the State s legislative competence. 125. If the broad and sweeping contention raised on behalf of the petitioner is to be accepted, then based on Parliamentary legislation, as distinct from a constitutional amendment under Article 368, entries in the State List would be deemed to have been amended. Therefore, we find it difficult to accept or endorse the sweeping and broad contention about the State being denuded of its legislative competence to enact upon a subject in List II or List III, even though such enactment does not e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has held that it has always been the law that International law must be respected. Further, the Court, in the context of Article 253 of the Constitution and by referring to several judgments, held that in the absence of any specific prohibition in municipal law, International law forms a part of Indian law and consequently, must be read into or as part of our fundamental rights. Accordingly, based upon this judgment, we cannot hold that the State is denuded of legislative competence to enact any law on a subject within the State List and not conflicting with any law made by the Parliament in exercise of its powers under Article 253 of the Constitution. 130. In Maganbhai Ishwarbhai Patel (supra) also holds that the Parliament has exclusive legislative competence to enact any law for the implementation of an international treaty or an international agreement. But, this decision is not an authority for the broad proposition that the State is denuded of its legislative competence to enact a law which is unconcerned with the implementation of an international treaty or an international agreement or enact a law on the subject within its legislative competence which does not even re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stantial and significant powers in the legislative and executive fields so that States enjoy their share of autonomy and sovereignty in their sphere of governance. The Court held that this can be done by interpreting the provisions of the Constitution, including those found in Part XIII, in a manner that preserves and promotes the federal set-up instead of diluting or undermining the same. 134. In ITC Limited vs Agriculture Produce Market Committee and ors (2002) 9 SCC 232 the Hon ble Supreme Court held that the Constitution must be interpreted in a manner that does not whittle down the powers of the State legislature. An interpretation that supports and promotes federalism while upholding the Central supremacy as contemplated by some of the Articles of the Constitution must be preferred. 135. In S.R. Bommai ors vs. Union of India and ors. (1994) 3 SCC 1 the Hon ble Supreme Court held that the fact that under the scheme of our Constitution, greater power is conferred upon the Center vis-a- vis the States, does not mean that States are mere appendages of the Center. Within the sphere allotted to them, States are supreme. The Center cannot tamper with their powers. Mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the distinction between a tax and a fee on a conceptual level has been the subject matter of several decisions of this Court. Because of this consistent line of authority, the practical and even constitutional distinction between a tax and a fee has been weathered down. 140. In Municipal Corporation of Delhi vs Mohd. Yasin Etc. 1983 SCC (3) 229 the Hon'ble Supreme Court held that the precedents show that there is no generic difference between a tax and a fee, though broadly a tax is a compulsory exaction as part of a common burden, without promise of any special advantages to classes of taxpayers; whereas a fee is a payment for services rendered, benefit provided or privilege conferred. Compulsion is not the hallmark of the distinction between a tax and a fee. That the money collected does not go into a separate fund but goes into the consolidated fund does not also necessarily make a levy a tax. Though a fee must have relation to the services rendered, or the advantages conferred, such relation need not be direct, a mere causal relation may be enough. Further, neither the incidence of the fee nor the service rendered need be uniform. That others besides those payin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Union List would not prevent the State Legislature from dealing with any matter within List Il, though it may incidentally affect any item in List I. 143. The Division Bench held that legislation in the field of taxation and economic activities needs special consideration and is to be viewed with more flexibility in approach. Greater latitude is to be allowed to the Legislature in such matters because it has to deal with complex problems. In the matters of utilities, tax and economic regulation the legislature has the affirmative responsibility and further given the complexity of economic regulation, self-limitation on the part of the Court in testing the constitutional validity of such Legislature should be observed and the Courts ought to adopt a pragmatic approach. The measure employed for assessing a tax must not be confused with the nature of the tax. Even crudities and inequities have to be accommodated in taxation and economic legislation. The Legislation should therefore, receive an interpretation as far as possible to make the legislation operative unless the legislation unequivocally travelled beyond the bounds set out in the Constitution, the legislation should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... environment. Heavy traffic has led to dust pollution and traffic congestion. The transportation of the material in the Schedule of the impugned Act resulted in pollution of the natural water resources, dumping of garbage, spillage of materials, and use of plastic. The transportation of such materials referred to in the Schedule affected the health of people. Massive dumps of garbage and pollution to rivers, water bodies, and wells, air pollution, spillage, dust, and plastic were some of the common problems. The Court noted that the scheduled items included not only minerals, but also debris, garbage, and plastic waste. 147. The Division Bench observed that the Goa Cess Act made it clear that the State wanted to augment revenue for infrastructures and health facilities to the people who had suffered the ill consequence of transportation of the materials. The Court noted that neither the measure of levy nor the method of collection was important in such matters. 148. The Court held that the small land mass of Goa makes the effect of transportation activity more acute, and the benefit of improved road conditions cascades to the travellers and consequent to the mining lease holde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gulation, development or control of the subject, under MMDR Act, 1957 enacted by the Parliament. The Division Bench of Rajasthan High Court also held that so long as a tax or fee on mineral rights remains in pith and substance a tax for augmenting the revenue resources of the State or a fee for rendering services by the State and it does not encroach upon regulation of mines and mineral development or control of industry by the Union Government, it is not unconstitutional. 151. In Sociedade de Fomento Industrial Pvt. Ltd., (supra) the Division Bench of this Court cited with approval the decision of the Rajasthan High Court in the case of Madhyabharat Phosphate Pvt. Ltd. (supra). Thus, a coordinate Bench approved the view taken by the Division Bench of Rajasthan High Court in Madhyabharat Phosphate Pvt. Ltd. (supra). 152. The legislature has determined that handling, etc. of certain products and substances increases carbon footprint and the state revenues have to be augmented to prevent the increase of carbon footprint or, in any case, to combat the deleterious effects of such increase. The affidavit filed by the State Government refers to several measures that the State is co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This is not a case where the benefit derived by the Petitioners is relatable to the general service provided to the members of the public of which the Petitioners may be a part. Here, the Petitioners are legislatively deemed to be responsible for undertaking activities that increase the carbon footprint. The State's affidavit refers to the measures that the State is required to take and takes to reduce the carbon footprint. There is a reference to setting up monitoring agencies and several other measures. Obviously, therefore, this is not a case where the benefits that the Petitioners receive are relatable to the general service provided to the members of the public. Instead, this is a case where benefits are provided to the Petitioners or to a distinct group or a class of which the Petitioners are a part. In any case, the precedents on the subject hold that the State need not even provide direct service to a person, and it would be sufficient if service is provided to a group of persons/entities of which such person is a part. The Petitioners and others are involved in activities which increase the carbon footprint; therefore, the levy cannot be questioned based on the tax v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of the impugned Act. However, from the perusal of the said communication, it cannot be said the Captain of Ports has usurped the powers of the competent authority under the impugned Act or that the functions and duties of the competent authority and the assessment, levy and collection of cess have been undertaken by the Captain of Ports. The communication dated 22nd March 2016, as noted earlier, merely called upon the Petitioner to comply with the provisions of the impugned Act and provides the Petitioner with details of coal imported or that the Petitioner can assess and pay the levy under the impugned Act. 162. The communication dated 22nd March 2016 also calls upon the Petitioner to furnish documentary proof of payments, if already made by the Petitioner. Such a communication cannot be elevated to the status of a demand notice under the impugned Act. Accordingly, no case is made out by the Petitioner in Writ Petition for grant of any relief in the context of the communication dated 22nd March 2016. 163. In Writ Petition No. 206/2021, the impugned Act is challenged as violative of Articles 14 and 304(a) of the Constitution. Ms Agni's argument was that cess was levi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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