Jharkhand High Court on Tuesday set aside the order of the state government to impose entry tax on as many as 63 goods which were brought into the state, citing the toll was unwarranted.
A division bench of Chief Justice Prakash Tatia and Justice Aparesh Kumar Singh ordered that the entry tax charged by the state be scrapped.
The state government had taken the decision to impose entry tax on goods as per the Jharkhand Entry Tax on Goods for Consumption or Use Act, enacted in 2011. The state had issued a notification in August last year declaring the entry tax would be charged 4 to 15 per cent on certain goods.
The notification of the government was challenged by a number of companies. The companies argued that the government move was detrimental to the interest of the business concerns.
The entry tax was imposed on several goods including cement, iron, electrcal equipment like air conditions, air coolers, cameras, ATM machines, batteries and asbestos sheets.
Arguing on behalf of the petitioner, senior advocate B Poddar and Darshana Poddar said that the state government decision was against the constitutional mandate of practicing free trade and commerce in the country. It violated the fundamental rights of an individual.
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The state government counsel had tried to impress upon the court that the tax collected would be used for development projects in the state.
But the state counsel could not explain to the court what development projects would be implemented through the revenue that would be collected through entry tax. The court observed that the government was not clear in its stand and ruled that the tax charged was uncalled for.