S.Thangaraj, J. (Chairman) - (1.) ORIGINAL Petitions Nos. 813, 815, 817, 819, 822, 931, 959, 969, 996, 1006, 1081 of 2002 are filed by the petitioners for declaration, declaring that serial No. 8 of Part G to the First Schedule as introduced by Tamil Nadu Act No. 18 of 2002 as it stood between March 27, 2002 and June 30, 2002 as ab initio void and ultra vires articles 14, 265, 286, 301 and 304(a) of the Constitution of India.
(2.) ORIGINAL Petitions Nos. 814, 816, 818, 820, 902, 930, 942, 958, 970, 1007, 1080, 1103, 1115 of 2002 and 115 of 2003 are filed by the petitioners to issue declaration, declaring serial No. 9 of the Eleventh Schedule to the Tamil Nadu General Sales Tax Act, 1959 as introduced by Tamil Nadu Act No. 22 of 2002 with effect from July 1, 2002 ultra vires articles 14, 265, 286, 301 and 304(a) of the Constitution of India. As all these original petitions are filed challenging Tamil Nadu Acts Nos. 18 of 2002 and 22 of 2002, we state the relevant facts in Original Petitions Nos. 813 and 814 of 2002 as under : The petitioner who is a registered dealer under the Tamil Nadu General Sales Tax Act, 1959 and the Rules made thereunder files return and paying taxes. The petitioner is acting as authorised dealer from the year 1996 onwards to Ford cars. Initially, the petitioners used to effect purchases from Nasik factory of Ford Motors and subsequently, the sales were made by Ford from their Chennai stockyard at Maraimalai Nagar from 1999 onwards. Ford Mondeo cars are not manufactured by Ford India. They, acting on behalf of the petitioners, place orders with Ford Works AG, Belgium, the foreign supplier, who despatch the consignments of Ford Mondeo cars made, for the petitioners from Belgium. As and when the cars are arrived at JNPT Port at Navasheva, Mumbai, Ford clears the goods on behalf of the petitioners and on payment of customs duty despatches them to the petitioners, who pay the freight requirements for the movement. On such importation, the goods become part of the general mass of goods produced and traded within India. As and when the cars enter the State of Tamil Nadu, the petitioners pay 13 per cent entry tax under the provisions of the Tamil Nadu Act on Entry of Motor Vehicles into Local Areas Act, 1990. The petitioners, while making sales inside Tamil Nadu, collect 13 per cent entry tax from their customers and pay it over to the respondents. No sales tax is collected from the customers because of the reduction in liability under the Act, as provided for by Section 4(1) of the Entry Tax Act, 1990. Between December, 2001 and March 26, 2002, the rate of entry tax was 13 per cent whereas the rate of tax under the Act was 12 per cent. By Act No. 18 of 2002, the First Schedule to the Act was substituted. Entry 8 of Part G of the First Schedule imposes 20 per cent tax on cars imported from outside India but sold within. By Act No. 22 of 2002, further amendments were carried out and Section 3C2 -C) was introduced as a charging provision in the case of goods mentioned in the Eleventh Schedule. Part G of the First Schedule was omitted and Sl. No. 9 of the Eleventh Schedule was introduced which imposes a rate of 20 per cent on the sales of imported motor cars which fall under serial No. 22 of Part D to the First Schedule. In view of serial No. 9 of the Eleventh Schedule, Ford Mondeo cars sold by the petitioners attract tax at 20 per cent from March 27, 2002 onwards. The petitioners made representation seeking the rate of tax to be reduced to 12 per cent. Ford Mondeo cars sold by the petitioners are commercially known as "D" segment cars which normally includes the cars priced between Rs. 10 and Rs. 25 lakhs. However, there are other cars in the "D" segment such as Hyundai Sonata and Honda Accord cars, Hyundai Sonata cars are assembled in Hyundai Motor India Ltd., near Chennai and Honda Accord cars are assembled by Honda SIEL Cars India Ltd., in their factory at Noida, Uttar Pradesh. Those cars come to India in only semi -knocked down condition (SKD) and those manufacturers are fundamentally engaged only in assembling SKD kits in India. The sales tax levied against those cars presently stand only at 12 per cent whereas the petitioners have to pay higher rate of tax at 20 per cent. This has brought about a hostile discrimination between Ford Mondeo cars and other "D" segment cars.
(3.) ORIGINAL Petitions Nos. 813 of 2002, 815 of 2002, 817 of 2002 and 819 of 2002 are filed by the authorised dealers of Ford cars. Original petitions Nos. 931 of 2002, 959 of 2002 and 1006 of 2002 are filed by dealers in cellular phone, (ii) Original Petition No. 969 of 2002 is filed by dealers in VCD Player and Recorder and LCD Projector, Handy Camera and Computer Monitors, (iii) Original Petition No. 996 of 2001 is filed by dealers in Beauty Equipments (imported goods), (iv) Original Petition No. 1081 of 2002 is filed by dealers in Vinyl flooring and mineral fibre board, G.I. Channel, etc., and are also challenging similar provision of Act No. 18 of 2002. Though the petitioners in O.P. No. 822 of 2002 challenge G.O. Ms. No. 29, C.T., dated March 27, 2002, in substance and reality, they challenge Act No. 18 of 2002.;