BATA INDIA LTD Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) M/s. Bata India Limited, the petitioner in this writ petition, carries on business of manufacture of footwear at its factories situated in the States of West Bengal, Bihar, Haryana and Karnataka. By notification dated 8th March, 1988, issued in exercise of the powers conferred by sub-section (2) of section 4 of the Rajasthan Sales Tax Act, 1954 (hereinafter referred to as "the Act"), the State of Rajasthan exempted from tax under the Act the sale and purchase of all kinds of footwear up to the value of Rs. 20. By subsequent notification dated 23rd June, 1988, the notification dated 8th March, 1988 was modified and the exemption granted under the notification dated 8th March, 1988, was confined to all kinds of footwear manufactured by the small-scale industries up to the value of Rs. 20. Feeling aggrieved by the said notification dated 23rd June, 1988, the petitioner has filed this writ petition.

(2.) THE first contention that has been raised by the learned counsel for the petitioner is that the said notification is violative of article 14 of the Constitution of India inasmuch as it arbitrarily discriminates between the petitioner-company and small-scale industries which are carrying on the business of manufacture of footwear inasmuch as there is no reasonable basis for such a differentiation. We find no substance in the aforesaid contention. We are of the opinion that the small-scale industries carrying on the business of footwear cannot be equated with large manufacturers like the petitioner and such small-scale industries can be classified separately for the purpose of granting relief in the matter of sales tax. Such a relief to such small-scale industries helps them in competing with the big manufacturers like the petitioner-company inasmuch as on account of their large production the cost of production in the case of the petitioner-company is lesser then the cost of production in the cases of small-scale manufacturers.