GODFREY PHILIPS INDIA LTD Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) THE petitioners, by filing the present writ petition, assail the constitutional validity of the Rajasthan Tax on Entry of Goods into Local Areas Act, 1999 (hereinafter referred as "act No. 13 of 1999" (See [200] 120 STC Statutes 1)), together with notification dated October 15, 1999 and circular dated October 23, 1999, on the ground, inter alia, that tax levied under the aforesaid Act No. 13 of 1999; notification dated October 15, 1999 and circular dated October 23, 1999 impose restrictions on the freedom of trade, commerce and intercourse, guaranteed by article 301 of the Constitution of India and that as Act No. 13 of 1999 is not law passed after obtaining the previous sanction and thereafter assent of the President of India, within the meaning of article 304 (b), read with article 255 of the Constitution, hence, tax levied upon them is invalid. It is prayed that it may be declared that the petitioner No. 1 is not required to take dealership licence and also not required to pay any entry tax on the import of cigarettes, within the local area of the State of Rajasthan.

(2.) WE consider it expedient to narrate in brief the material facts, which have given rise to filing of the present petition, before itemising the contentious posers springing from the competing submissions advanced by the learned counsel for the parties.

(3.) IT is further averred in the writ petition by the petitioners that the tax imposed pursuant to entry No. 52 of List II of the Seventh Schedule to the Constitution, is popularly known as octroi. According to the averments made in the writ petition, an essential feature of octroi is that it is a tax on the entry of goods into a definite local area and the goods must enter for the purpose of consumption, use or sale therein. The entry tax referred to under the said entry No. 52 of State List of the Seventh Schedule is levied by a local authority, and the State Legislature cannot be allowed by enacting Act No. 13 of 1999 to empower State Government to arrogate the power to levy and collect the entry tax into the local areas.