STEEL LIMITED Vs. STATE OF JHARKHAND

JUDGEMENT

(1.) ln all these Writ petitions, the petitioners have challenged the vires of Section 11 of the Jharkhand Valued Added Tax Act, 2005 as ultra vires and violative of Article 301 read with Article 304(a) of the Constitution of India since the provision is not saved by Article 304(b) of the Constitution of India and further for a direction restraining the respondents from enforcement of the provisions of Section 11 of the Jharkhand Valued Added Tax Act, 2005 whereby entry tax is liable to be collected on entry of goods mentioned in Schedule -Ill of the said Act. The petitioners further sought a declaration that the entry tax is not compensatory in nature falling under Article 304 of the Constitution of India. As such, the said provision is violative of Article 301 of the Constitution of India.

(2.) THE respondents -State filed counter affidavit taking various defences available in law in support of their case that provisions of the Act is compensatory in nature and, therefore, not violative of the provisions of Article 301 and Article 304(b) of the Constitution of India. A supplementary counter affidavit was filed by the respondents on 17.3.2008. During the pendency of the writ applications, the respondents filed aforementioned supplementary counter affidavit stating inter alia that respondent NO.3 -Additional Commissioner of Commercial Taxes, Jharkhand vide letter dated 8.3.2007 wrote to the Ministry of Home Affairs, Government of India requesting for grant of post facto assent/approval of the President of India. In response thereof. the Home Ministry, Government of India, vide letter dated 11.8.2007 informed the department that the Value Added Tax Act, 2005 is valid and no post facto assent is to be required.

(3.) AFTER the creation of the State of Jharkhand, a fresh Ordinance was issued in 2001, namely, Jharkhand Tax on Entry of Goods into Local Areas for Consumption. Use and Sale Thereof (Amendment) Ordinance 2001. In 2005 the State of Jharkhand came with a new legislation. namely, Jharkhand Value Added Tax Act. 2005. By the said Act, the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use and Sale Therein Act, 1993 as adopted in the State of Jharkhand was repealed. By the said Act. 2005 (VAT Act), the provision of imposition of entry tax on entry of goods into a local area in the State of Jharkhand has been introduced.