A.K. Goel, J. - (1.) THIS matter has been placed for hearing before us in pursuance of order of the honourable Supreme Court dated July 14, 2006 in C. A. No. 3453 of 2002 and connected matters reported in Jindal Stainless Limited v. : (2006)7SCC271 [hereinafter referred to as "Jindal Stainless Limited (3)"].
(2.) APPEALS before the honourable Supreme Court arose from the judgment of this Court dated December 21, 2001, Jindal Strips Limited v. State of Haryana reported in, [2003] 129 STC 534 (P&H). When the appeal against judgment of this Court was placed for hearing before a Bench of the honourable Supreme Court, correctness of the view taken by the honourable Supreme Court in earlier judgment in Bhagatram Rajeev Kumar v. Commissioner of Sales Tax , which was followed in State of Bihar v. Bihar Chamber of Commerce : [1996]2SCR184 , was doubted and the matter was referred to a Constitution Bench to decide with certitude, the parameters of the judicially evolved concept of compensatory tax vis -a -vis Article 301 of the Constitution. The said order dated September 26, 2003 is Jindal Stripe Ltd. v. : (2003)8SCC60 , [hereafter referred to as" Jindal Stainless Limited (1)"]. The Constitution Bench decided the issue referred to it vide its judgment dated April 13, 2006, Jindal Stainless Limited v. : [2006]283ITR1(SC) [hereafter referred to as "Jindal Stainless Limited (2)"].
(3.) THE issue arose in the context of challenge to the constitutional validity of the Haryana Local Area Development Tax Act, 2000 (hereinafter referred to as, "the Act") on the anvil of Article 301 of the Constitution/Contention raised on behalf of the petitioners was that the impugned levy was hit by Article 301 as the same was not compensatory or regulatory but imposed for augmenting general revenue. On the other hand, the stand taken by the State was that the impugned tax was compensatory in character. It was also submitted that the tax did not directly or immediately affect the movement of trade. Facilities provided in the local area ultimately led to better trade and commerce and benefited the traders.;