AMRIT BANASPATI COMPANY LTD Vs. STATE OF PUNJAB

JUDGEMENT

(1.) Whether the amendment made in Section 14-B of the Punjab General Sales Tax Act, 1948 (for short, the 1948 Act) vide notification dated 29.9.1999 to check the evasion of tax by the dealers in connivance with the transporters are ultra vires to these legislative powers of the State under Article 246(3) read with Entry 54 of List-II of the Seventh Schedule of the Constitution and are violative to the petitioners' fundamental right to trade and business guaranteed under Article 19(1)(g) of the Constitution of India or infringe their right to freedom of trade, commerce and intercourse guaranteed under Article 301 of the Constitution, is the main question that arises for consideration in these petitions filed for grant of a declaration that sub- sections (6)(ii) and 7(iii) of Section 14-B of the 1948 Act are unconstitutional and also for quashing of the action taken by the authorities of the Excise and Taxation Department, Punjab, to detain their goods/vehicles.

(2.) The respondents have controverted the petitioners' assertion that the State does not have the power to take the legislative measures like those contained in the notification dated 29.9.1999 by stating that the power conferred upon the State to legislate on the subject of levy and collection of sales tax includes the power to legislate on ancillary and incidental matters and the provisions made for plugging the evasion of tax by unscrupulous traders falls within the ambit of Entry 54 of List-II of the Seventh Schedule read with Article 246(3) of the Constitution.

(3.) According to the respondents, the amended provisions are meant for checking the evasion of sales tax by collecting information through electronic network installed at information Collection Centres established at major and strategic places on the Inter-State Borders with the neighbouring States. These centres collect data of goods transported in and out of the State of Punjab and such datas are verified from the account books of dealers of Punjab in order to establish their accountability at the time of assessment. The respondents have also pleaded that the impugned provisions do not encroach upon the right of the petitioners to carry on trade and business or their freedom of trade and commerce.