Madras High Court
Mrs.Uma Ratnam Krishnan vs The State Of Tamilnadu on 22 December, 2014
Bench: R.Sudhakar, R.Karuppiah
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 22.12.2014
CORAM
THE HON'BLE MR.JUSTICE R.SUDHAKAR
AND
THE HON'BLE MR.JUSTICE R.KARUPPIAH
Writ Petition No.32478 of 2014
& M.P.No.1 of 2014
Mrs.Uma Ratnam Krishnan
.. Petitioner
Vs.
1. The State of Tamilnadu
represented by
The Secretary to Government,
Commercial Tax Department,
Fort St. George, Chennai.
2. The Assistant Commissioner,
Commercial Tax,
Thiruvanmiyur Assessment Circle,
Chennai.
3. The Regional Transport Officer,
Chennai South, Chennai.
4. The Motor Vehicle Inspector,
Chennai South, Chennai.
.. Respondents
PRAYER: PETITION filed under Article 226 of The Constitution of India praying for the issuance of Writ of Declaration declaring the provisions of Section 2(d), 2(g), 2(k), Section 3(1) and Section 4 and Sl.No.2 of the Schedule to the Tamil Nadu Tax on Entry of Motor Vehicles into Local Areas Act, 1990 as unconstitutional and violative of Article 14, 19(1)(g) and Article 265 of the Constitution of India.
For Petitioner : Mr.V.Srikrishnan
For Respondents : Mr.A.N.R.Jayaprathap, Spl.G.P.
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O R D E R
(Delivered by R.SUDHAKAR, J.) This Writ Petition has been filed by the petitioner to declare the provisions of Section 2(d), 2(g), 2(k), Section 3(1) and Section 4 and Sl.No.2 of the Schedule to the Tamil Nadu Tax on Entry of Motor Vehicles into Local Areas Act, 1990 as unconstitutional and violative of Article 14, 19(1)(g) and Article 265 of the Constitution of India.
2. The challenge to the above provision has already been considered by the First Bench of this Court reported in [2008] 13 VST 390 (R.Gandhi V. State of Tamil Nadu and others), wherein the issue under consideration was "whether the levy of entry tax under the Tamil Nadu Tax on Entry of Motor Vehicles into Local Areas Act, 1990 (Act 13 of 1990) can be justified as a compensatory tax?". This Court held that the said provision is not compensatory in nature. While dealing with the said provision, this Court held as follows:
"15. As per the Statement of Objects and Reasons, the Act has been enacted with a view to curb the tax evasion and the tax recovered under the impugned enactment is liable to be adjusted with the general sales tax payable under the Tamil Nadu General Sales Tax Act, 1959. The additional counter of the State merely gives the statistics with regard to the total cost of building of roads and bridges and on the maintenance of roads that is incurred from year to year by the State. This expenditure only represents the expenditure incurred by the State from its general total tax revenue and other receipts including the World Bank grants and loans. The said roads and bridges which are constructed or maintained by incurring this expenditure cannot possible be considered to be a facility or convenience of services, which is provided to a particular importer who imports the goods into a particular local area. In ITC Limited v. State of Tamil Nadu [2007] 7 VST 367 (Mad); [2007] 2 CTC 577, a Division Bench of this court (to which I am a party) has held that tax levied under the Tamil Nadu Tax on Entry of Goods into Local Areas Act, 2001, is not compensatory tax within the meaning of articles 301 and 304 of the Constitution. It was held that applying the principle of equivalence, as set forth by the Supreme Court in Jindal's case [2006] 145 STC 544 (SC); [2006] 7 SCC 241, it cannot be said that maintaining of roads, providing bridges, etc., is compensatory in nature so as to meet the outlay incurred for some special advantage to trade, commerce and intercourse. It was held that there is no connection or nexus with the collection of entry tax and its utilisation for the benefit of traders/manufacturers from whom such tax is collected and that consequently the levy of entry tax is unauthorised and violative of article 201 of the Constitution. To the same effect is the decision of the Division Bench of the Kerala High Court rendered on December 18, 2006 in O.P.No.434 of 1996 [Thressiamma L. Chirayil v. State of Kerala [2007] 7 VST 293 (Ker)] rep . by the Deputy Commissioner of Agricultural Income-tax and Sales Tax, Kottayam and another. This is again referred to in the recent decision rendered by a Division Bench of the Jharkhand High Court in Tata Iron & Steel Company Ltd., Jamshedpur v. State of Jharkhand [2007] 6 ST 587 [ W.P.(T) No.5354 of 2004, dated August 14, 2006]. A Division Bench of the Bombay High Court in Eurotex Industries and Exports Ltd. v. State of Maharashtra [2004] 135 STC 25 also took a similar view.
In view of the foregoing discussion, our finding on the issue is that the tax imposed under the Tamil Nadu Tax on Entry of Motor Vehicles into Local Areas Act, 1990 (Act No.13 of 1990) is not compensatory in nature."
3. In view of the above, there is no justification for the petitioner to challenge the same. If at all the petitioner has got some grievance, the petitioner can work out the remedy seeking appropriate relief and not by challenging the provisions, which has already suffered judicial scrutiny.
4. It is another matter that the State has taken the issue before the Supreme Court and is referred to the Larger Bench by the Supreme Court in the case of Jaiprakash Associaties Ltd. V. State of M.P. and others reported in [2009] 21 VST 1 (SC) and is stated to be still pending.
5. Therefore, the present Writ Petition challenging the above-said provision does not survive. Accordingly, this Writ Petition stands dismissed giving liberty to the petitioner to file appropriate Writ Petition. No costs. Consequently, M.P.No.1 of 2014 is also dismissed.
(R.S.J.) (R.K.J.)
22.12.2014
Index : No
Internet : Yes
sl
To
1. The State of Tamilnadu
represented by
The Secretary to Government,
Commercial Tax Department,
Fort St. George, Chennai.
2. The Assistant Commissioner,
Commercial Tax,
Thiruvanmiyur Assessment Circle,
Chennai.
3. The Regional Transport Officer,
Chennai South, Chennai.
4. The Motor Vehicle Inspector,
Chennai South, Chennai.
R.SUDHAKAR,J.
and
R.KARUPPIAH,J.
sl
W.P.No.32478 of 2014
and M.P.No.1 of 2014
22.12.2014