Entry Tax in different states in India - Part 1 - Gujarat
The State Governments have introduced Entry Tax to be paid by actual users who bring goods from outside the state for use or consumption inside the State. The principal reason for this levy was that the States were losing revenue when goods were brought from other states.
However, in the recent past, these Acts have been challenged in various High Courts with varying results.
The Gujarat High Court in Eagle Corporation Pvt Ltd vs State of Gujarat and Others held that “Considering the various provisions of the Act, Statement of Objects, settled legal position and the facts stated hereinabove, it cannot be said that the provisions of the Act and the levy of the Entry Tax on the specified goods are violative of Article 304 of the Constitution of India. We hold that, levy of Entry Tax is neither discriminatory between the goods so imported and goods so manufactured or produced in a local area, the challenge to the constitutional validity of the Gujarat Tax on Entry of Specified Goods for the Local Areas Act, 2001 (Entry Tax Act) and the levy of Entry Tax therefore fails. The petition deserves dismissal and it is accordingly dismissed.”
Date of decision : 10 Oct 2006