HC terms Rajasthan's entry tax law as illegal

Jodhpur, Aug 22 (UNI) Terming the state government's entry tax law enacted in 1999 as illegal, Rajasthan High Court has asked the government to return the amount collected as entry tax to petitioner.

A bench of High Court comprising Chief Justice Manak Mohta and Justice Rajesh Baliya passed this verdict yesterday on a petition filed by Dinesh Pouches Limited in Jodhpur.

The bench said if the state government enacts any tax law,it has to be done constitutionally under Section 304 B and needs the approval of the President of India. And not doing so is against Para 255 and 265 of the Constitution. And it is also mandatory to use the tax amount collected for the benefit of the business from which it has been collected.

Petitioner's counsel Dinesh Mehta said in his statement according to Para 301 of Constitution, the state government cannot enact such a law which can infringe on the business rights of a person while conducting business within states or inside one state. He said according to the Constitution, the state government can impose such a tax for revenue earning but it has to be approved by the President.

This significant decision will mean the state government will have to return the crores of rupees levied as entry tax on products entering the state.

The High Court has more than 150 other pending petitions in connection with the entry tax.

It is to be noted that the petitioner had challenged this law in the High Court in 2001 but the court had rejected the petition in 2002.

Later the petitioner approached the Supreme Court which directed the High Court to reopen the case and hear it in July 2006.

The state government has been levying entry tax ranging from one to 12 percent on 58 products coming from outside the state.

UNI