2017 INSC 0812 1 REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTGION  CIVIL APPEAL NOS.3381­3400 OF 1998 STATE OF KERALA AND OTHERS ...APPELLANTS VERSUS FR. WILLIAM FERNANDEZ  ETC.ETC. ...RESPONDENTS WITH T.C.(C) No. 149/2013, C.A. No. 3720-3722/2003, C.A.No. 15957 of 2017 @ SLP(C) No. 6831/2008, C.A.No.15958 of 2017 @ SLP(C) No.7914/2008, C.A.No.15959 of 2017 @ SLP(C) No.8204/2008, C.A.No. 15960 of 2017 @ SLP(C) No.9227/2008, C.A.Nos. 15961-62 of 2017 @ SLP(C) No.12424-12425/2008, C.A. No. 15963 of 2017 @ SLP(C) No.15161/2008, C.A.No. 15964 of 2017 @ SLP(C) No.15540/2008, C.A.No. 15965 of 2017 @ SLP(C) No.15369/2008, C.A.No. 15966 of 2017 @ SLP(C) No.15551/2008, C.A.No. 15967 of 2017 @ SLP(C) No.17204/2008, C.A.No. 15969 of 2017 @ SLP(C) No. 19030/2008, C.A.No. 15971 of 2017 @ SLP(C) No.15579/2008, C.A.No. 15973 of 2017 @ SLP(C) No.15357/2008, C.A. No. 15974 of 2017 @ SLP(C) No.15700/2008, C.A. No. 15975 of 2017 @ SLP(C) No.16772/2008, C.A. No. 15976 of 2017 @ SLP(C) No. 17865/2008, C.A. No. 15977 of 2017 @ SLP(C) No.15623/2008, C.A. No. 15978 of 2017 @ SLP(C) No.15495/2008, C.A. No. 15979 of 2017 @ SLP(C) No.15934/2008, C.A. No. 15980 of 2017 @ SLP(C) No.15647/2008, C.A. No. 15981 of 2017 @ SLP(C) No. 16930/2008, C.A. No. 15982 of 2017 @ SLP(C) No.15496/2008, C.A. No. 15983 of 2017 @ SLP(C) No.15491/2008, C.A. No. 15984 of 2017 @ SLP(C) No.16865/2008, C.A. No. 15985 of 2017 @ SLP(C) No.18346/2008, C.A. No. 15986 of 2017 @ SLP(C) No.15356/2008, C.A. No. 2 15988 of 2017 @ SLP(C) No.15492/2008, C.A. No. 15989 of 2017 @ SLP(C) No.15845/2008, C.A. No. 15990 of 2017 @SLP(C) No.16926/2008, C.A. No. 15991 of 2017 @ SLP(C) No.15405/2008, C.A. No. 15992 of 2017 @ SLP(C) No.15684/2008, C.A. No. 15993 of 2017 @SLP(C) No.16832/2008, C.A. No. 15994 of 2017 @ SLP(C) No.15666/2008, C.A. No. 15995 of 2017 @ SLP(C) No.15636/2008, C.A. No. 15996 of 2017 @SLP(C) No.15498/2008, C.A. No. 15997 of 2017 @ SLP(C) No.15493/2008, C.A. No. 15998 of 2017 @ SLP(C) No.16754/2008, C.A. No. 15999 of 2017 @SLP(C) No.16733/2008, C.A. No. 16000 of 2017 @ SLP(C) No.16689/2008, C.A. No. 16001 of 2017 @ SLP(C) No.17193/2008, C.A. No. 16002 of 2017 @SLP(C) No.18379/2008, C.A. No. 16003 of 2017 @ SLP(C) No.18344/2008, C.A. No. 16004 of 2017 @ SLP(C) No.16667/2008, C.A. No. 16005 of 2017 @SLP(C) No.18354/2008, C.A. No. 16006 of 2017 @ SLP(C) No.17233/2008, C.A. No. 16007 of 2017 @ SLP(C) No.17203/2008, C.A. No. 16008 of 2017 @SLP(C) No.15711/2008, C.A. No. 16009 of 2017 @ SLP(C) No.15618/2008, C.A. No. 16010 of 2017 @SLP(C) No.16664/2008, C.A. No. 16011 of 2017 @SLP(C) No.16885/2008, C.A. No. 16012 of 2017 @SLP(C) No. 17892/2008, C.A. No. 16014 of 2017 @ SLP(C) No.17192/2008, C.A. No. 16015 of 2017 @ SLP(C) No.20795/2008, C.A. No. 16018 of 2017 @SLP(C) No.15643/2008, C.A. No. 16019 of 2017 @ SLP(C) No.19141/2008, C.A. No. 16021 of 2017 @ SLP(C) No.18857/2008, C.A. No. 16023 of 2017 @SLP(C) No.19849/2008, C.A. No. 16026 of 2017 @ SLP(C) No.19847/2008, C.A. No. 16027 of 2017 @ SLP(C) No.19867/2008, C.A. No. 16035 of 2017 @SLP(C) No.18865/2008, C.A. No. 16029-33 of 2017 @ SLP(C) NOs.18360-64/2008, C.A. No. 16037 of 2017 @ SLP(C) No. 22083/2008, C.A. No. 16038 of 2017 @SLP(C) No.22735/2008, C.A. No. 16040 of 2017 @ SLP(C) No.22086/2008, 16039 @ SLP(C) No.21819/2008, C.A. No. 16042 of 2017 @ SLP(C) No.18405/2008, C.A. No. 16043 of 2017 @SLP(C) No.23075/2008, C.A. No. 16045 of 2017 @ SLP(C) No.23609/2008, C.A. No. 16047 of 2017 @ SLP(C) No.22707/2008, C.A. No. 16049 of 2017 @SLP(C) 3 No.21107/2008, C.A. No. 16050 of 2017 @SLP(C) No.22931/2008, C.A. No. 16051 of 2017 @ SLP(C) No.23623/2008, C.A. No. 16052 of 2017 @SLP(C) No.20766/2008, C.A. No. 16053 of 2017 @ SLP(C) No.20165/2008, C.A. No. 16054 of 2017 @ SLP(C) No.22081/2008, C.A. No. 16055 of 2017 @SLP(C) No.23277/2008, C.A. No. 16057 of 2017 @ SLP(C) No.22084/2008, C.A. No. 16059-60 of 2017 @ SLP(C) Nos.22100-22101/2008, C.A. No. 16063 of 2017 @SLP(C) No.23270/2008, C.A. No. 16065 of 2017 @ SLP(C) No.26750/2008, C.A. No. 16069 of 2017 @ SLP(C) No.19986/2008, C.A. No. 16070 of 2017 @ SLP(C) No.23077/2008, C.A. No. 16073 of 2017 @SLP(C) No.26377/2008, C.A. No. 16075 of 2017 @ SLP(C) No.26593/2008, C.A. No. 16080 of 2017 @ SLP(C) No.29764/2008, C.A. No. 16082 of 2017 @SLP(C) No.29763/2008, C.A. No. 16084 of 2017 @ SLP(C) No.3276/2009, C.A. No. 16085 of 2017 @ SLP(C) No.29194/2008, C.A. No. 16087 of 2017 @SLP(C) No.29196/2008, C.A. No. 16089 of 2017 @ SLP(C) No.9548/2009, C.A. No. 16092 of 2017 @ SLP(C) No. 25467/2009,C.A. No.2042/2011, C.A. No. 16094 of 2017 @ SLP(C) No.6762/2010, C.A. No.2041/2011, C.A. No. 16095 of 2017 @SLP(C) No.2459/2010, C.A. No. 16096 of 2017 @ SLP(C) No.12690/2010, C.A. No. 16097 of 2017 @ SLP(C) No.4390/2010, C.A. No. 16098 of 2017 @ SLP(C) No.4389/2010, C.A. No. 16099 of 2017 @SLP(C) No.4388/2010, C.A. No. 16100 of 2017 @ SLP(C) No.6763/2010, C.A. No. 16101 of 2017 @ SLP(C) No.6765/2010, C.A. No. 16102 of 2017 @SLP(C) No.4362/2010, C.A. No. 16103 of 2017 @ SLP(C) No.5309/2010, C.A. No. 16104 of 2017 @ SLP(C) No.4511/2010, C.A. No. 16105 of 2017 @SLP(C) No.3387/2010, C.A. No. 16106 of 2017 @ SLP(C) No.4572/2010, C.A. No. 16107 of 2017 @ SLP(C) No.7929/2010, C.A. No. 16108 of 2017 @SLP(C) No.9022/2010, C.A. No. 16109 of 2017 @ SLP(C) No.9077/2010, C.A. No. 16110 of 2017 @ SLP(C) No.9723/2010, C.A. No. 16120 of 2017 @SLP(C) No.36486/2010, C.A. No. 16112 of 2017 @ SLP(C) No.9702/2010, C.A. No. 16113 of 2017 @ SLP(C) No.10361/2010, C.A. No. 16114 of 2017 @SLP(C) No.14886/2010, C.A. No. 16115 of 2017 @ SLP(C) No.16694/2010, C.A. No. 16116 of 2017 @ SLP(C) 4 No.16720/2010, C.A. No. 16117 of 2017 @SLP(C) No.18318/2010, C.A. No. 16119 of 2017 @ SLP(C) No.19199/2010, C.A. No.5860/2012,C.A. No. 5861/2012,C.A. No.4210/2012,C.A. No.8734/2012, C.A. No. 15968 @ SLP(C) No.33923/2012,C.A. No.8738/2012,C.A. No.8737/2012,C.A. No.8736/2012, C.A. No. 8740/2012, C.A. No.8739/2012, C.A. No.8735/2012, C.A. No.8741/2012, C.A. No. 8744/2012, C.A. No. 9292/2012, C.A. No. 16056 of 2017 @ SLP(C) No.37712/2012,C.A. No. 8745/2012, C.A. No. 16013 of 2017@ SLP(C) No.40147/2012, C.A. No. 16016 of 2017@ SLP(C) No.36187/2012, C.A. No. 16017 of 2017@SLP(C) No.40146/2012, C.A. No. 16020 of 2017@ SLP(C) No.37455/2012,C.A. No. 9293/2012, C.A. No. 16022 of 2017@ SLP(C) No.37728/2012, C.A. No. 16024-25 of 2017@ SLP(C) No.37708-37709/2012, C.A. No. 16028 of 2017@SLP(C) No.38304/2012, C.A. No. 16034 of 2017@ SLP(C) No.38919/2012, C.A. No. 16036 of 2017@ SLP(C) No.449/2013, C.A. No. 16041 of 2017@ SLP(C) No.1426/2013, C.A. No. 16044 of 2017@ SLP(C) No.8939/2013, C.A. No. 16046 of 2017@ SLP(C) No. 9844/2013, C.A. No. 16048 of 2017@ SLP(C) No. 16867/2013, C.A. No. 16058 of 2017@SLP(C) No.16869/2013, C.A. No. 16061 of 2017@ SLP(C) No. 16870/2013, C.A. No. 16062 of 2017@ SLP(C) No. 11060/2013, C.A. No. 16064 of 2017@SLP(C) No.10516/2013, C.A. No. 16071-72 of 2017@SLP(C) No. 27001-27002/2013, C.A. No. 16074 of 2017@ SLP(C) No. 32256/2013, C.A. No. 16076 of 2017@ SLP(C) No.30986/2013, C.A. No. 16081 of 2017@SLP(C) No.33600/2013, C.A. No. 15970 of 2017@ SLP(C) No.33954/2012, C.A. No. 16083 of 2017@ SLP(C) No.29119/2014, C.A. No. 16086 of 2017@SLP(C) No.22349/2015, C.A. No. 16088 of 2017@SLP(C) No.72/2016, C.A. No. 16090 of 2017@ SLP(C) No.2057/2016, C.A. No. 16091 of 2017@SLP(C) No.86/2016, C.A. No. 16093 of 2017@SLP(C) No.16820/2016, C.A. No. 16029-33 of 2017@ SLP(C) No.18360-18364/2008, C.A. No. 16077-79 of 2017@SLP(C) Nos.27442-27444/2008, C.A. No. 16066-68 of 2017@SLP(C) Nos. 16744-16746/2013, C.A. No. 16111 @SLP(C) No.11419/2010, C.A. No.3026 of 2012 , C.A. No. 3592/1998, C.A. No. 4651/1998, C.A. NO. 918/1999, W.P(C) No. 574/2003, C.A. NO. 5 6177/2010, C.A. NO. 6178/2010, C.A. No. 6179/2010, C.A. No. 15523 of 2017@SLP(C) No.18088/2007, C.A. NO. 6180/2010, C.A. No. 15524 of 2017@SLP(C) No.18044/2007, C.A. No. 15518-20 of 2017@ SLP(C) Nos. 17394-17396/2009, C.A. No. 15522 of 2017@SLP(C) No.25390/2009, C.A. No. 15525 of 2017 @SLP(C) No.1820/2010, C.A. No. 15521 of 2017@SLP(C) No.19194/2010,C.A. No. 16157 of 2017 @SLP(C) No.26543/2008, C.A. No. 16156 of 2017@SLP(C) No.11646/2009 & C.A. No. 16155 of 2017@SLP(C) No.7356/2010 & C.A. No. 16163 of 2017@SLP(C) No.1101/2007. J U D G M E N T ASHOK BHUSHAN, J. Leave granted. 2. These   appeals   relate   to   entry   tax   levied   on   goods imported from different countries and brought into local area of   a   State.   The   legislative   competence   of   the   State Legislature   to   impose   entry   tax   on   the   goods   imported   from outside   the   country   entering   into   local   area   of   the   State   is questioned. The State legislations are also questioned on the ground that the entry tax legislations do not contemplate levy of an entry tax on goods imported from outside the country. In this   batch   of   appeals   we   are   concerned   only   with   entry   tax legislations   of   States,   namely,   State   of   Orissa,   State   of Bihar,   State   of   Kerala   and   State   of   Jharkhand,   the   relevant provisions of which statutes shall be noticed hereinafter. 6 3. A   nine­Judge   constitution   Bench   in   Jindal   Stainless     vs. State of Haryana and another, 2016 (11) Scale 1,   had answered several   questions   pertaining   to   entry   tax   legislations   of different   States,   which   has   largely   settled   various   issues relating   to   entry   tax.   However,   the   issue   pertaining   to levibility of entry tax on the imported/foreign goods was left to   be   answered   by   regular   Bench.   Answering   the   reference following was stated in answer No.10: " The   questions   whether   the   entire   State   can   be notified as a local area and   whether entry tax can be levied on goods entering landmass of India from another   country   are   left   to   be   determined   in appropriate proceedings.”      (emphasis by us)     4. As   noted   above   this   batch   of   appeals   consists   of   appeals from   the   judgments   of   Orissa   High   Court,   Patna   High   Court, Kerala   High   Court   and   Jharkhand   High   Court.   Large   number   of appeals   have   been   filed   questioning   the   different   judgments rendered by different High Courts. For deciding this batch of appeals it is sufficient to notice facts of few of the appeals of   each   State.   The   parties   shall   be   referred   to   as   described in the High Courts. State of Orissa 5. In   the   appeals   arising   out   of   the   judgments   of   the   High 7 Court   of   Orissa,   most   of   the   appeals   have   been   filed   against judgments   dated   18.02.2008   and   09.10.2012.   Judgments   of different   dates   were   also   delivered   by   the   Orissa   High   Court following its judgments dated 18.02.2008 and 09.10.2012. There are appeals containing different facts and grounds which shall separately be noticed.  6. With   regard   to   judgment   dated   18.02.2008   delivered   in bunch   of   writ   petitions,   we   take   up   Civil   Appeal   arising   out of   SLP(C)No.18405   of   2008   –   M/s.   Steel   Authority   of   India Ltd.   vs.   State   of   Orissa   &   Anr.   The   State   of   Orissa   enacted Orissa   Entry   Tax   Act,   1999   (hereinafter   referred   to   as   “1999 Act”)   to   provide   for   levy   of   tax   on   entry   of   the   scheduled goods   into   a   local   area   for   consumption,   use   or   sale   therein and matters incidental thereto and connected therewith. 7. The Steel Authority of India, a public sector undertaking of Government of India filed the writ petition challenging the legality and constitutional validity of Orissa Entry Tax Act, 1999 and Orissa Entry Tax Rules, 2000 in so far as it seeks to levy   and   collect   entry   tax   on   imported   goods   including scheduled   goods   when   brought   into   the   mines   premises   of   the writ   petitioner   No.1   Company   at   Purunapani,   Kalta,   Barsua   in the   District   of   Sundergarh   and   Bolani   in   the   District Keonjhar.   The   validity   of   the   Act   was   challenged   on   various 8 grounds   including   the   ground   that   1999   Act   is   ultra   vires   to the   Constitution.   It   was   further   pleaded   that   provisions   of 1999   Act   do   not   provide   for   levying   of   tax   on     imported   raw materials   for   its   plants   and   machineries   which   is used/consumed   at   its   factory   for   the   manufacture   of   its finished products.   The grounds were also raised that levy is not compensatory. 8. The  writ  petition  was  heard  along  with  the   bunch   of  writ petitions raising some similar and some different grounds. The Division   Bench   vide   its   judgment   dated   18.02.2008   upheld   the vires of 1999 Act. Civil Appeals arising out of SLP(C) Nos.12424­12425 of 2008 – M/s.   Simples   Infrastructures   Limited   vs.   State   of   Orissa   & Ors. also needs to be noted : 9. The   writ   petitioner   is   a   company   which   carries   on business on works contract for construction of different types of   civil   and   piling   works   outside   at     various   places   in   the State   of   Orissa.   While   executing   the   aforesaid   work   the   writ petitioner   purchases   Sand,   Bricks   and   Cements   chips   and boulders for civil constructions and are transported from the petitioner's   construction   site,   either   inside   or   outside   the State   of   Orissa   for   being   used   in   the   work.   The   writ petitioner   was   directed   to   file   returns   by   the   Entry   Tax 9 Officer.   Writ   petitioner   has   challenged   the   constitutionality of Orissa Act, 1999  and prayed for restraining the respondent from   realising   any   entry   tax.   The   writ   petition   was   also decided   along   with   the   bunch   of   writ   petitions   vide   High Court's judgment dated 18.02.2008 as stated above. 10. Large number of civil appeals have been filed against the judgment dated 18.02.2008. It is not necessary to notice facts of   different   cases.   The   writ   petitioners   were   using raw­material   brought   from   different   places   including   foreign countries, Coal was also used by the various writ petitioners and   levy   on   it   of   entry   tax   was   questioned   therein.   Several subsequent   judgments   were   also   delivered   by   the   Orissa   High Court following the judgment dated 18.02.2008 which have also been questioned in different appeals. 11. A   subsequent   judgment   dated   9.10.2012   delivered   by   the Orissa High Court in Writ Petition No.15519 of 2010 and other connected   writ   petitions   have     given   rise   to   large   number   of civil   appeals.   The   leading   writ   petition   in   which   judgment dated   09.10.2012   was   delivered   was   writ   petition   No.15519   of 2010   ­Tata   Steel   Limited   vs.   State   of   Orissa   &   Ors.   We   now proceed   to   notice   the   facts   and   pleadings   in   the   aforesaid writ   petition.     The   writ   petitioner,   Tata   Steel   is   company which has its branches, divisions across the State of Orissa. 10 The   writ   petitioner   carries   on   business   in   mining   as   well   as manufacturing of Ferro­Chrome and Ferro­Manganese at different plants   in   the   State   of   Orissa.   For   the   ready   reference   the pleadings   in   paragraph   3   of   the   writ   petition   needs   to   be extracted which is to the following effect: “3. That the relevant facts giving rise to the present writ application are inter alia are:­ (a)   The   petitioner   in   order   to   carry   out   its manufacturing   activity   both   inside   the   state   of Orissa as well as in factories located outside the state   imports   various   raw   materials   from   outside India. (b) That  for   importing   the  said  goods  from   outside India,   the   petitioner   has   obtained   has   obtained necessary licenses and permissions from appropriate authorities. (c) That   the   petitioner   is   registered   under   OVAT Act,   CST   Act   and   Orissa   Entry   Tax   Act,   1999,   and has   been   allotted   TIN   number   by   the   Sales   Tax Officers   of   the   State.   The   petitioner   brings   in various   goods   including   scheduled   goods   for   its plants, from within the state and also from outside the   territory   of   India   by   way   of   import.   The materials   so   purchased   from   various   countries   are duly supported by Bill of Entry and other documents which   have   duly   been   incorporated   in   the   accounts of the petitioner company. A specimen copy of a few Commercial Bills/Bills of Entry representing import of materials is annexed hereto as Annexure­1.” 12. The   writ   petitioner   pleads   that   Legislature   never intended to levy entry tax on the value of the goods imported from   outside   the   country   by   Entry   Tax   Act,   1999.   Article 286(1)(b) prevents a State from     levying Sales Tax so as not 11 to   interfere   with   the   Union's   Legislative   power   with   respect to the import and export across Customs Frontiers (Entry 41 of List I) and the duties of Customs including Export Duty (Entry 83 of List I). 13. The States never intended to levy entry tax on goods from outside the country. Referring to the definition of 'purchase value', it is submitted that the omission of “Customs Duty” in Section 2(j) was deliberate. It is impermissible for the State to enact a legislation purported to be under Entry 52 of List II, the incidence of which is on import of goods from outside India which is exclusively a matter for the Union under Entry 41 and 83 of    List I. 14. Counter­affidavit   was   filed   on   behalf   of   the   respondents justifying the entry tax. The State pleaded that levy of entry tax  by  the   State   is  under  Entry  52  of  list  II  of   the  Seventh Schedule.   The   provision   of   Article   286   is   available   only   in the case of sale of goods and not against the entry tax. 15. It   is   incorrect   to   suggest   that   the   Legislature   never intended to levy tax on imported goods coming from outside the country.   The   charge   under   Section   3   of   the   Orissa   Act,   1999 would   suggest   that   levy   is   on   the   basis   of   destination   of scheduled goods. It is not the transaction of import which is 12 sought   to   be   levied   with   entry   tax.   The   Division   Bench   vide its judgment dated 09.10.2012 dismissed all the writ petitions except writ petition No.7 of 2008 of M/s. IFGL Refractories.  Civil   Appeal   No.32256   of   2013   –   M/s.   National   Aluminium Company Limited vs. State of Orissa & Ors. 16. The   writ   petitioner   is   the   public   sector   undertaking   and is   running   three   units,   namely,   Aluminium   Refinery   Plant   at Damanjodi in the District of Koraput, Aluminium Smelter Plant at   Angul   in   the   District   of   Angul   and   Captive   Thermal Power Plant at Angul. The writ petitioner in order to carry   out   its   manufacturing/mining   activity   imports   various material   and   equipments   including   spares   from   outside   India. For   importing   the   said   goods   from   outside   India,   the petitioner has obtained necessary licences and permission from appropriate   authorities.   The   petitioner   brings   in   various goods   including   scheduled   goods   for   its   business   operation from   within   the   State   and   also   from   outside   the   territory   of India by way of import. The writ petitioner has filed the writ petition   challenging   the   Orissa   Entry   Tax   Act,   1999   and levibility   of   entry   tax   on   petitioner.   By   a   common   judgment dated   09.10.2012   the   writ   petition   has   been   dismissed. Aggrieved by which this appeal has been filed.  Civil   Appeal   arising   out   of   SLP(C)   No.1426   of   2013   –   Emami 13 Paper Mills Limited vs. State of Orissa & Ors. 17. The   petitioner   has   set   up   a   large   scale   industry   for manufacture   of   Paper,   paper   Board   and   newsprint   in   Orissa   in the   Industrial   Estate   of   Balgopalpur,   District   Balasore.   The petitioner had entered into an agreement with Global Equipment and   Machinery   Sales   Inc.,   Montgomeryville,   Pennsylvania, United   States   of   America   and   placed   orders   for   a   Paper   Plant and   other   machineries   to   be   supplied   by   the   said   company   to the   petitioner.   The   petitioner   imported   into   India   a disassembled paper manufacturing plant in knock down condition with   spares.   The   petitioner   also   imports   other   machineries from   other   countries   and   the   said   imported   machineries   and spare parts enter the Country through different ports and are cleared by the petitioner on payment of the import duty levied under   the   Customs   Act,   1962.   Once   the   said   plants   and machineries   are   unloaded   and   cleared   upon   payment   of   the Customs Duty the said plant and machineries are transported to the   petitioner's   factory   at   Balgopalpur,   Orissa.   Besides importing   machinery   from   other   countries   the   petitioner   also has   to   purchase   various   machineries   and   spare   parts   from different   manufacturers   in   other   States   in   India.   The petitioner   was   called   upon   to   submit   a   statement   showing   the names of the goods imported by the petitioner. The respondent 14 further   threatened   to   resort   to   coercive   measures   if   the petitioner   failed   to   make   payment   of   the   entry   tax   on   the import   of   plant   and   machinery.   The   petitioner   made   ad   hoc payment   under   protest.   Petitioner   protested   against   the   levy of entry tax on the plant and machinery imported from USA. The petitioner filed a writ petition No. 13978 of 2008 Orissa Act, 1999  questioning the levy of entry tax on import from outside the   country,   the   constitutional   validity   of   the   Orissa   Act, 1999   was   also   challenged.   Counter­affidavit   and rejoinder­affidavits were filed to the writ petitions and vide judgment   dated   9.10.2012   the   High   Court   dismissed   the   writ petition. Civil Appeal arising out of SLP(C)No.11060 of 2013­   M/s. IFGL Refractories vs. State of Orissa and ors. 18. The   writ   petitioner   has   set   up   a   factory   at   Sector   'B', Kalunga   Industrial   Estate   as   an   100%   import   substitution project.   The   petitioner   commenced   commercial   production   of special   refractories   and   operating   systems   used   by   the producers   of   iron   and   steel.   The   petitioner   has   continually been   expanding   its   production   capacity   by   installing   and erecting plant and machinery both indigenous and imported. For the   manufacture   of   the   refractory   products,   the   petitioner requires   imported   raw   materials,   stores   and   spares,   trading 15 items  and  capital  goods.   Petitioner  imports  various  materials from different countries. The materials are fused silica, lime stabilize   fused   zirconia,   fused   magnesia,   sintered   magnesia, silicon   metal,   natural   PVC,   refractory   glaze,   furfural alcolhol and micro silica. Generally, these goods are imported from either the Kolkata Port or the Kolkata Airport where from they are transported to the factory. Besides the raw materials imported   from   other   countries,   the   petitioner   also   uses   raw materials available in other States within the Union of India. The petitioner was under the bona fide belief that it was not required   to   pay   entry   tax   on   the   goods   imported   from   abroad. Further,   the   petitioner   effected   a   payment   under   protest   of Rs.37,08,682/­   towards   entry   tax.   The   petitioner   filed   writ petitioner   No.7   of   2008   challenging   the   Entry   Tax   Act,   1999. The   writ   petition   was   filed   basically   on   the   following   three grounds: a. Entry tax is not leviable on goods imported  from   outside India as being violative of  Article   286   read   with   Article 246 of the  Constitution;  b. Entry tax is not leviable on goods purchased  from   other States when the same goods are not  manufactured   within   the State of Orissa in  terms   of   Article   304(a)   of   the Constitution. c. In   any   case,   the   goods   imported   from   outside   India/purchased from other States by the  petitioner are not specified in the schedule  appended   to   the   Act   and therefore not exigible  to entry tax. 16 19. The writ petition filed by the petitioner has been partly allowed by a common judgment dated 09.10.2012. The High Court although   upheld   the   levy   of   entry   tax   on   goods   imported   from outside   the   country   but   invalidated   the   levy   of   entry   tax   on certain  goods  purchased/imported  by  the  petitioner  which  were not   mentioned   in   the   schedule   appended   to   the   1999   Act. Aggrieved by the said judgment, this appeal has been filed. Transferred   Case   No.149   of   2013   –   M/s.   Paradeep   Phosphates Ltd. vs. State of Orissa and ors. 20. The Transfer Petition (C) No.530 of 2012 was filed by the petitioner,   M/s.   Paradeep   Phosphates   Ltd.   praying   for   the transfer of Writ Petition No.16541 of 2007 pending in the High Court of Orissa  at Cuttack. The transfer petition was allowed by this Court on 23.07.2013 on which this T.C. No.149 of 2013 has been registered. The petitioner is engaged in manufacture of different types of chemical fertilizers like DAP, MOP, NPK. The   petitioner   has   been   importing   raw   materials   through Paradeep   Port   wherein   it   has   its   Conveyor   facility   and   the said   raw   materials   are   unloaded   from   the   Ships   and   directly dispatched   to   petitioner's   factory   without   using   any infrastructure   facility  provided  by  the  Government  of  Orissa. Petitioner has a plant at Paradeep under the Revenue District 17 of   Jagatsinghpur,   Orissa.   The   petitioner   has   an   adjoining township   at   Paradeep.   The   petitioner   constructed   its   own approach roads from the State Highway, developed the plant and township   site.   The   petitioner   procures   about   98%   of   its   raw materials from outside the country. Petitioner has been paying entry   tax   on   imported   scheduled   goods   'under   protest'. Petitioner   filed   writ   petition   No.16541   of   2007   challenging the notice for assessment and payment of entry tax. Petitioner also   prayed   for   a   writ   of   mandamus   directing   the   State   of Orissa   not   to   impose   levy   of   entry   tax   on   the   goods   imported from outside the territory of India. 21. There   are   few   other   appeals   which   are   different   from   the above mentioned common judgment of the Orissa High Court. Civil   Appeal   Nos.3720­3722   of   2003   –   National   Aluminium Co.Ltd. vs. State of Orissa & Ors. 22. The writ petitioner is a Government of India Undertaking, engaged   in   production   of   alumina   and   aluminium.   It   has   its captive   Bauxite   Mines   and   Alumina   refinery   factory   at Damanjodi   in   the   District   of   Koraput.   The   major   raw   material is bauxite. Petitioner has set up its own Captive Power Plant at   Angul   near   its   Smelter   Plant.   For   production   of electricity,   the   basic   raw   material   is   coal,   which   obtained from   Mahanadi   Coal   Fields.   The   petitioner   filed   Original 18 Jurisdiction   Case   No.72   of     2001   challenging   the   validity   of 1999   Act   on   several   grounds.   The   Division   Bench   of   the   High Court   vide   its   judgment   dated   13.11.2002   declined   to   strike down   the   1999   Act.   However,   while   declining   to   strike   down the 1999 Act following directions were  issued: “ 44.   In   the   result,   while   declining   to   strike   down the   Orissa   Entry   Tax   Act,   1999   as   ultra   vires,   we direct that:­ 1.   Unless   the   basic   ingredients,   i.e.   Entry   of Scheduled goods for the purpose of Consumption, Use or   Sale   into   a   local   area   of   the   State   are satisfied,   the   provisions   of   the   Orissa   Entry   Tax Act, 1999 shall not be attracted; 2. The goods which enter into local area/areas only for   the   purpose   of   transit   will   not   be   subject   to Entry Tax; and 3.   Every   manufacture   of   scheduled   goods   under Section 26 shall collect by way of Entry Tax amount equal   to   the   tax   payable   on   the   value   of   the finished   products   under   Section   3   of   the   Act   from the   buying   dealer   either   directly   or   through   an intermediary   only   if   the   scheduled   goods   sold   are intended for ENTRY into any local area of the State for the purpose of Consumption, Use or Sale.” 23. Aggrieved   by   the   said   judgment,   these   civil   appeals   have been filed. Civil Appeals arising out of SLP(C) Nos.16744­46 of 2013 – BRG Iron   &   Steel   Co.   Pvt.   Ltd.   vs.   Joint   Commissioner   of   Sales Tax, Angul, Orissa. 24. The   petitioner   company   during   the   course   of   its   business 19 was required to purchase plants and parts of plants, machinery and   parts   &   spares   of   all   kinds   of   machinery   for   the   purpose of   setting   up   a   manufacturing   unit   at   Dhenkanal,   Orissa.   The petitioner was also required to purchase raw materials such as stainless   steel   and   iron   &   steel   goods.   The   company   was   also required   to   import   and   export   goods   particularly   import   of capital goods such as its plant and machinery from outside the country.   The   petitioner   has   been   regularly   filing     return under   the   Orissa   Entry   Tax   Act,   1999.   However,   vide   letter dated   30.03.2010   entry   tax   was   demanded.   The   judgment   was delivered   by   the   High   Court   on   09.10.2012   in   Writ   Petition No.15519   of   2010   holding   that   levy   of   entry   tax   on   imported goods   was   within   the   purview   of   Orissa   Act,   1999.   An   order dated   20.10.2010   has   been   passed   by   the   Joint   Commission   of Sales   Tax   holding   the   petitioner   liable   to   pay   entry   tax   on the   imported   goods   besides   penalty.   Petitioner   has   directly come to this Court against the assessment order passed by the Joint Commissioner of Sales Tax dated 20.10.2012. Civil   Appeal   arising   out   of   SLP(C)No.36486   of   2010   –   M/s. Bajrangbali   Alloys   Pvt.   Ltd.   vs.   Commissioner,   Sales   Tax   & Anr. 25. The   petitioner   carries   on   the   business   of   manufacturing and sale of M.S. Ingots and M.S. Rod ITMT Bars) at Manguli in the District of Cuttack. The petitioner directly imports goods 20 brought   from   outside   the   country   into   the   local   area. Petitioner   filed   Writ   Petition   No.16650   of   2010.   In   the   writ petition,   petitioner   has   attacked   the   correctness   of   the assessment   order   dated   23.02.2010   on   the   ground   that assessment   order   under   Section   9C   of   the   1999   Act   has   been made   by   way   of   Orissa   Entry   Tax   (Amendment)   Act,   2005   which came into force with effect from 19.05.2005. The writ petition has been dismissed by the Division Bench by its judgment dated 08.11.2010 on the ground that the petitioner is at liberty to seek   its   alternative   remedy   by   filing   an   appeal   within   a period of two weeks, the writ petition was disposed of. CIVIL APPEALS OF STATE OF KERALA 26.   The   civil   appeals   relating   to   State   of   Kerala   have   been filed   both   by   State   of   Kerala   as   well   as   by   its   officers. State   of   Kerala   has   filed   appeals   against   judgment   dated 06.01.1998   and   several   others   subsequent   judgments   following the   judgment   dated   06.01.1998.   Another   judgment   has   been passed   by   High   Court   of   Kerala   on   18.12.2006.   There   is   one writ   petition   filed   by   a   company.   It   is   sufficient   to   notice facts   of   few   cases   to   decide   the   group   of   cases   relating   to Kerala. 21 Civil   Appeal   Nos.   3381­3400   of   1998   ­   State   Of   Kerala   &   Ors Vs. FR. William Fernandez & Ors. 27. The   State   is   in   appeal   against   the   Division   Bench judgment dated 06.01.1998 of Kerala High Court delivered in a batch   of   writ   appeals   including   Writ   Petition   No.   770/1997; Father William Fernandez & Ors. vs State of Kerala & Ors. The various  petitioners  imported  motor  vehicles  from   abroad  after obtaining   custom   clearance   and   payment   of   custom   duties   and thereafter   brought   the   vehicles   in   the   State   of   Kerala.   Some of   the   petitioners   have   also   got   their   vehicles   registered under   the   Motor   Vehicles   Act   which   have   been   given   notice demanding   entry   tax   under   Kerala   Tax   on   Entry   of   Goods   into Local Areas Act, 1994 (hereinafter referred to as ‘1994 Act’). The   writ   petition   was   heard   by   learned   Single   Judge   who   vide its   common   judgment   dated   20.2.1997   dismissed   all   the   writ petitions   holding   that   entry   tax   can   be   collected   from   the owners   of   the   vehicles   who   brought   them   from   abroad   before granting   them   registration   in   the   State   for   consumption,   use or   sale.   Writ   Appeals   were   filed   against   judgment   dated 20.2.1997   which   have   been   decided   vide   common   judgment   dated 06.01.1998. Although, the Division Bench held that there is no limitation upon the State's powers to legislate under Entry 52 List   II   of   the   VII th   Schedule   of   the   Constitution   but   in   case 22 of   goods,   brought   from   abroad   their   entry   into   local   area   is outside   the   scope   of   1994   Act,   which   Act   is   confined   only   to those   goods   brought   from   outside   the   State,   that   would   not include the outside borders of the country. The Division Bench declared that vehicles bought from outside the country are not liable to pay entry tax. Civil   Appeal   No.   6178   of   2010   ­   State   of   Kerala   &   Ors.   vs. Idea Cellular Ltd. 28. This   appeal   has   been   filed   against   the   judgment   dated 18.12.2006   of   Division   Bench   of   Kerala   High   Court   by   which judgment   a   bunch   of   writ   petitions   have   been   decided   holding that   the   levy   of   entry   tax   under   1994,   Act   as   discriminatory and   violative   of   Article   14,   301   and   304   of   the   Constitution of   India.   The   Division   Bench   followed   the   earlier   Division Bench   judgment   of   the   Kerala   High   Court   in   Father   William Fernandez case decided on 06.01.1998. Writ petition was filed by various assesses challenging the constitutional validity of 1994, Act and also questioning the entry tax on goods brought from   outside   the   State   or   and   goods   brought   from   outside   the country   to   the   State   of   Kerala.   The   Division   Bench   held   that levy   of   entry   tax   on   goods   imported   from   other   States   to   the State of Kerala and from abroad is not compensatory in nature and   such   demand   is   illegal,   unauthorised   and   violative   of 23 Article 301. Application for intervention has also been filed by various petitioners which applicants have also been heard. State has filed other appeals questioning subsequent judgments which have followed judgment dated 06.01.1998 and 18.12.2006. Writ   Petition   (C)   No.   574   of   2003   ­Parisons   Agrotech   Private Ltd. & Anr vs. State of Kerala & Ors.   29. This writ petition has been filed under Article 32 of the Constitution   praying   for   declaration   that   1994,   Act   is   ultra vires   and unconstitutional and the Act also does not apply to the entry of goods imported in India from foreign country. The petitioner company is engaged in the import of crude palmolin, refining the same to make it edible and thereafter selling of palmolin   oil.   The   petitioner   imports   crude   palmolin   oil   in bulk from Malaysia, Indonesia and Singapore. Purchase of crude by   the   petitioner   is   in   the   course   of   import   from   foreign countries and imported through Cochin Port within the State of Kerala.   The   said   sale   &   purchase   in   the   course   of   import   is exempted   from   the   levy   of   tax   under   Article   286   of   the Constitution   of   India   read   with   Section   5(2)   of   the   Central Sales   Tax   Act,   1956.     The   respondent   directed   the   first petitioner   to   remit   the   entry   tax   of   purchase   price   of   crude palmolin   imported   by   the   petitioner.   Petitioner   has   also relied   on   Division   Bench   judgment   of   the   Kerala   High   Court 24 delivered   in   bunch   of   writ   appeals   including   Writ   Appeal   770 of 1997 against which SLP/Civil Appeal has been filed being CA 3381 – 3400 of 1998 and is pending. Civil Appeals relating to State of Bihar   Civil   Appeal   arising   out   of   SLP(C)   No.   26543   of   2008   M/s   ITC Ltd. vs. State of Bihar   30. This   appeal   has   been   filed   against   Division   Bench judgment   of   Patna   High   Court   dated   27.08.2008   by   which   the writ petition has been disposed of in terms of Para 69 Page 70 of   the   earlier   decision   in   the   case   of   M/s   Indian   Oil Corporation Ltd. (dated 09.1.2007 reported in 2007 10 BST 140 Patna). The petitioner is a company engaged in the business of manufacturing  and  selling  of   cigarettes  and  smoking  mixtures. Company   carrying   on   business   of   manufacturing   paper,   paper board,   packaging   materials   and   printing,   thereon   for   said purpose Company has factories at different places all over the country   including   in   Munger   in   the   State   of   Bihar.   For manufacturing   of   cigarettes   smoking   mixtures,   the   company causes entry of tobacco and other raw materials purchased from outside the State of Bihar into the local area of Munger. The State   of   Bihar   has   enacted   the   Bihar   Tax   on   Entry   of   Goods into   Local   Areas   Act   1993(hereinafter   referred   to   as   1993, Act). The 1993, Act has been amended by Bihar Act, 9 of 2003, 25 Bihar  Act,  11  of   2003  and  Bihar  Act  19   of  2006.  By  Bihar  Act 11   of   2003,   an   explanation   has   been   added   to   the   effect   that entry   of   goods   into   local   area   for   consumption,   use   or   sale therein   from   any   place   outside   the   territory   of   India   shall also be deemed to be an entry of goods for the purposes of the Act.     Petitioner   challenged   the   vires   of   the   Act,   as   amended in   2003.   Petitioner   prayed   for   direction   to   remove,   withdraw and cancel the collection of entry tax under the impugned Act. Civil   Appeal   arising   out   of   SLP(C)   No.   11646   of   2009­   VST Distribution Storage v.The State of Bihar & Ors. 31. This   appeal   has   been   filed   against   judgment   dated 28.08.2008   by   which   judgment   the   writ   petition   filed   by   the appellant has been disposed of in terms of the para 69 of the Division   Bench   judgment   of   Patna   High   Court,   M/s   Indian   Oil Corporation Ltd. (supra) . Civil Appeal arising out of SLP(C) No. 7356 of 2010 ­   ITC Ltd vs State of Bihar 32. This   appeal   has   been   filed   against   judgment   and   order dated 15.02.2010 of the Division Bench of the Patna High Court by   which   writ   petition   filed   by   the   petitioner   has   been dismissed.   Petitioner   has   challenged   the   constitutional validity   of   1993,   Act   thereby   challenging   the   Section   4   of 1993,   Act   as   inserted   by   Amendment   Act   19   of   2006.   It   was 26 prayed   that   Amendment   Act   be   declared   as   ultra   vires   to   the power of State Legislature. Petitioner has also challenged the demand   notice   dated   20.6.2009   issued   by   Joint   Commissioner, Commercial   Tax   Bhagalpur   and   demand   notice   dated   03.07.2009 under   the   Amendment   Act,   19   of   2006.   It   was   noticed   in   the writ petition that in view of the judgment dated 09.01.2007 of the   Patna   High   Court   in   Indian   Oil   Corporation   Ltd.   (supra) after the amendment by amending Act, 19 of 2006 the entry tax sought   to   be   levied   with   effect   from   29.08.2006,   has   become compensatory and constitutionally valid. Civil Appeal of State of Jharkhand Civil Appeal arising out of SLP (C) 1101 OF 2007­  State of Jharkhand & Ors.v.Tata Iron & SteelCo. Ltd. 33. State   of   Jharkhand   filed   an   appeal   against   the   Division Bench  judgment  dated  14.08.2006  delivered  in   Writ  Petition(T) No.   5354   of   2004,   Tata   Iron   &   Steel   Co.   Ltd.   Jamshedpur, Sinhbhumi vs. State of Jharkhand. The petitioner is engaged in manufacturing   the   iron   &   steel   products   by   its   integrated steel   plant   at   Jamshedpur   in   the   State   of   Jharkhand.   For   the purpose of manufacturing activities, company is importing coal from   Australia   and   Newzealand   in   pursuant   to   several   foreign contracts executed with foreign parties which comes to Haldia and   Paradeep   Ports   in   India   and   from   there   said   coal   is 27 transported either by rail or road to Jamshedpur in the State of Jharkhand. 1993, Act was adopted in the State of Jharkhand after   its   creation   from   15.11.2000.   A   Notification   dated 23.03.2002   was   issued   under   Sub   section   1   of   Section   2   by adding   10   new   items   to   the   schedule.     Notification   dated 23.03.2002 was issued levying the entry tax on imported coal. A   memorandum   was   issued   by   Commissioner   of   Commercial   Tax. Petitioner   prayed   for   quashing   a   part   of   the   Notification dated 23.3.2002 by which entry tax was sought to be levied by the   State   of   Jharkhand   on   imported   coal   and   other consequential reliefs have been claimed. 34. The   Division   Bench   vide   its   judgment   and   order   dated 14.08.2006   allowed   the   writ   petition   holding   that   provisions of   1993,   Act   as   adopted   by   the   State   of   Jharkhand   do   not satisfy the requirement of Article 301 read with Article 304. State   Aggrieved   by   the   said   judgment   have   come   up   in   the appeal.   This   appeal   was   heard   by   this   Court   on   29.08.2017   by which   proceeding   the   impugned   judgment   of   the   Jharkhand   of High   Court   which   rested   on   the   Compensatory   Theory   has   been set   aside.   It   is   useful   to   quote   the   last   two   paras   of   the proceeding dated 29.08.2017 which is to the following effect:  “ We   need   not   comment   upon   this   argument. Suffice   is   to   state   that   insofar   as   the impugned   judgment   which   is   rested   on   the compensatory   theory   stands   set   aside,   if   any 28 rights   accrue   in   favour   of   the respondent/assessee   or   the   respondent   has   any right   to   challenge   the   levy   on   the   aforesaid ground   which   was   taken   before   the   High   Court it would be open to the respondent/asseesee to pursue the same.  The   respondent/assessee   had   also   raised   the contention   that   coal   was   imported   on   which   no entry   tax   was   paid.   On   this   aspect,   we   have heard  the arguments and the judgment is reserved.” 35. Thus   in   the   present   appeal,   we   have   permitted   the assessee   to   raise   the   only   issue   as   to   whether   on   imported coal entry tax could be levied. 36. We   have   heard   large   number   of   learned   counsel   for   the writ   petitioners   including   Shri   Arvind   P.   Datar,   Shri   A.K. Ganguli,   Shri   S.K.Bagaria,   Shri   Jagdeep   Dhankar,   Dr.   G.C. Bharuka, Shri Ashok Kumar Panda, Senior Advocates. Shri Rakesh Dwivedi, Senior Advocate has been heard on behalf of the State of Orissa and State of Bihar. Shri V.Giri, Senior Advocate has appeared   on   behalf   of   the   State   of   Kerala.   Shri   Ajit   Kumar Sinha, Senior Advocate has also been heard. Submissions 37. The following are the substances of submissions raised by different   learned   counsel   for   writ   petitioners   relating   to State of Orissa attacking the provisions of 1999, Act: 29 i. The   legislature   has   not   created   any   chargeability for levy of entry tax on goods imported from outside the country in Orissa Entry Tax Act, 1999.   Entry of goods   has   been   defined   in   Section   2(d)   which contemplates   entry   of   goods   into   a   local   area   from any   place   (i)   outside   that   local   area   or   (ii)   any place   outside   the   State.   The   provision   does   not contemplate   goods   entering   from   any   place   outside the country. Putting a literal interpretation of the 1999,   Act,   it   is   clear   that   legislature   never intended   to   cover   the   goods   imported   from   outside the   country.   It   is   submitted   that   wherever legislature   intended   to   impose   entry   tax   on   the imported   goods   coming   from   outside   the   country,   the entry   tax   legislation   specifically   mentioned   so   in the   legislation.   The   reference   has   been   made   to   the provisions   of   the   Bihar   Tax   on   Entry   of   Goods   into Local   Areas   for   Consumption,   Use   or   Sale   Act,   1993 (as   Amended   by   Bihar   Act   11   of   2003   and   19   of   2006) wherein an explanation and a new Section 2(c) to the following   effect   was   inserted:­   “(iii)   into   a   local area from any place outside the territory of India.” 30 Further   in   Uttar   Pradesh   Tax   on   Entry   of   Goods   into Local Area Act, 2007 under Section 2(1)(c) following is   specifically   provided   for   “(iii)   into   a   local area from any place outside the territory of India.” Similar   is   the   provision   of   Section   2(1)(c)   of Uttarakhand   Tax   on   Entry   of   Goods   into   Local   Areas Act,   2009   and   further   Section   2(1)(h)   of   the   West Bengal   Tax   on   Entry   of   Goods   into   Local   Area   Act, 2012   where   any   place   outside   India   is   specifically mentioned. ii. It is only Parliament which is empowered to make any law   with   regard   to   trade   &   commerce   with   foreign countries   as   well   as   with   regard   to   levy   of   duties of   customs   thereon.   Entry   41   covers   “trade   & commerce   with   foreign   countries,   import   and   export across   custom   frontiers;   definition   of   custom frontiers”   ‘Entry   83   of   List   I   covers   “duties   of custom   including   export   duties”.   Entire   field connected   or   related   to   trade   &   commerce   with foreign   countries   is   within   the   exclusive   domain   of the   Union   and   beyond   the   legislative   competence   of the   State   Legislature.   Entry   52   of   List   II   can   have no   application   in   respect   of   goods,   imported   from 31 outside   India   which   continues   to   be   imported   goods in   the   course   of   import.   The   import   movement   in respect   of   imports   continues   till   the   goods   reach the   factory,   which   movement   is   an   integral   and inexplicable   part   of   the   import   movement.     From   the above   single   taxing   event   and   single   import movement, the State Legislature cannot carve out any taxing   event   by   seeking   to   term   it   as   a   tax   from entry   into   local   area   for   consumption,   use   or   sale therein.   The   entry   tax   legislation   imposing   entry tax   on   the   imported   goods   is   thus   beyond   the competence   of   State   Legislation.   Article   286(1)(b) of the Constitution excludes the taxing power of the State in respect of goods in the course of import.  iii. The goods imported by actual users for their captive consumption   and   own   use   continues   to   remain   in   the course   of   import   and   continues   to   retain   the character   of   imported   goods.   The   Doctrine   of Unbroken   Package   evolved   by   American   Courts   do supports   the   petitioners’   case.   The   judgment   of   the US   Supreme   Court   in   Brown   versus   Maryland   6   L.Ed. 678   which   laid   down   that   the   constitutional prohibition   of   State   to   tax   the   goods   imported 32 survives   even   after   they   have   landed   and   cleared from   custom,   after   payment   of   duties   the   protection continues   till   they   are   sold   by   importer,   is   still good law and has been followed subsequently.  iv. The   impugned   entry   tax   is   not   an   entry   under   Entry 52   of   List   II   of   the   VII th   Schedule   of   the Constitution. The tax covered by Entry 52 is nothing but the levy that is known as octroi, which is a tax levied   by   a   local   self   authority   on   the   entry   of goods   into   the   area   administered   by   such   local government.   The   expression   ‘local   area’   in   Entry   52 signifies that tax in this entry is a local tax. The local   authority   into   whose   local   area,   the   goods enters for consumption, use or sale therein can levy and collect the said tax. The tax refers to in Entry 49   of   Provincial   List   under   the   Government   of   India Act,   1935   and   Entry   52   of   List   II   under   the Constitution   is   ‘octroi’,   which   have   been   prior thereto,   was   levied   by   and   for   the   benefit   of   local authorities   and   usurpation   of   this   levy   by   State would   thus   be   beyond   the   legislative   power   of   the State under Entry 52.  v. The   imported   machineries   which   are   imported   in 33 completely   knocked   out   condition   are   not   covered   by Schedule   of   1999,   Act.     A   plant   imported   in   knocked out condition is neither machinery nor equipment and is   not   covered   by   Part   II   of   Schedule.   Hence,   no entry   tax   could   have   been   levied   on   imported   plants which are received in knocked out condition.   vi. Section 4 Of Bihar Act 1993 as inserted by Bihar Act 19   of   2006   is   violative   of   Article   266   of   the Constitution of India. 38. Shri Rakesh Dwivedi, learned senior counsel appearing for the   State   of   Orissa   and   Bihar   has   refuted   the   above submissions. He submits that Section 3 of 1999, Act covers tax on imported goods. The definition section has two phrases (i) from   any   place   outside   that   local   area,   (ii)   or   any   place outside   the   State.   Both   the   phrases   on   a   plain   and   literal consideration would include the goods which are entering from outside the country. Foreign territory would be a place which is not only outside the local area but also outside the State.   39. The   State   Legislature   is   fully   competent   to   levy   entry tax under Entry 52 List II. The legislative field as included in Entry 52 List II has nothing to do with Entry 41 and Entry 83 of List I. Under the Indian Constitution, the distribution 34 of   powers   with   regard   to   tax   has   been   done   in   a   mutually exclusive   manner   in   great   detail   and   there   is   no   overlapping in taxing power of the State and the Union. Duty of custom in Entry   83   List   II   is   on   import   or   export.   The   prohibition contained   under   Article   286   on   the   State   Legislature   are   in reference   to   sale   of   goods   and   has   nothing   to   do   with   entry tax   on   entry   of   goods   for   consumption,   use   or   sale.   Article 286   as   well   as   Central   Sales   Tax,   1956   has   no   relevance   with regard to Entry 52 List II. 40. The   word   ‘import’   means   to   bring   in.   The   word   ‘imported goods’ are defined in Customs Act, 1962. The above definitions clearly   indicate   that   ones   the   goods   have   been   cleared   for home   consumption   then   they   ceased   to   be   imported   goods.   The importation  happens  before   clearance   for  home  consumption  and after   clearance   the   character   as   import   ceases.   The   Doctrine of Unbroken Package as evolved by the US Supreme Court is not attracted   in   this   country.   The   judgment   of   the   US   Supreme Court   in   Brown   versus   State   of   Maryland,   6   LED   678   has   been discredited   even   in   USA.   In   the   subsequent   judgments   of   US Supreme Court, the judgment of  Brown vs. State of Maryland  has been   considerably   diluted.   The   Federal   Court   as   well   as   this Court   has   specifically   held   that   the   judgment   of   US   Supreme 35 Court in  Brown vs. State of Maryland  is not applicable in this country.  41. The   submissions   raised   by   one   learned   counsel     of   the petitioners that entry tax is not covered by Entry 52 List II is wholly fallacious.   In the Constitution of India, there is clear demarcation of taxing power of Union and the State. When by   Entry   52   List   II,   entry   of   goods   in   the   local   area   for consumption,   use   or   sale   has   been   specifically   provided   the said entry has to be given its full meaning and content.  42. Learned counsel appearing for the writ petitioners in the State   of   Bihar   in   civil   appeal   arising   out   of   judgment   of Patna   High   Court   as   well   as   Jharkhand   High   Court   has   also adopted   the     above   submissions   raised   on   behalf   of   the petitioners.   In   reply   thereto,   learned   counsel   for   the   State of Bihar and Jharkhand has reiterated the same submissions as noted above. 43. Shri   V.   Giri,   learned   senior   counsel   appearing   on   behalf of the State of Kerala adopting the submission of Shri Rakesh Dwivedi   contends   that   the   judgment   of   Kerala   High   Court holding   that   entry   tax   cannot   be   levied   on   imported   motor vehicles   is   fallacious.     It   is   submitted   that   definition clause and charging section in the 1994, Act are clear enough to include goods entering from any place outside the State for 36 consumption,   use   or   sale   therein   including   outside   territory of   India.   Learned   counsel   appearing   for   the   respondent   in civil   appeals   of   State   of   Kerala   has   reiterated   the submissions   raised   on   behalf   of   the   writ   petitioners   in appeals arising out of judgment of Orissa High Court.  44. From   the   submission   raised   by   learned   counsel   for   the parties   and   material   on   record   following   issues   arise   for consideration in this batch of appeals:­ i. Whether   Section   2(d)   read   with   Section   3   of   Orissa Entry   Tax   Act,   1999,   Section   2(d)   read   with   Section 2(d) of Kerala Act, 1994 and Bihar Act, 1993 (before its   amendment   in   2003),   never   intended   to   levy   any entry   tax   on   the   goods,   entering   into   local   area   of State from any place outside the territory of India. ii. Whether   Entry   Tax   Legislations   in   question   intrude into   exclusive   legislative   domain   of   Parliament   as reserved under Entry 41 and Entry 83 List I. iii. Whether   levy   of   entry   tax   on   goods   imported   from outside   territory   of   India   is   legislation   trenching the field of “import and export”, “duties of custom” reserved to Parliament. iv. Whether   the   importation   of   goods,   imported   from   a territory outside the India continues till the goods 37 reach   in   the   premises/factory   of   the   importer, during   which   period   State   at   no   point   of   time   is legislative competence to impose any tax. v. Whether   doctrine   of   unbroken   package   as   evolved   by the   American   Court   are   to   apply   with   regard   to imported   goods   of   the   petitioners   prohibiting   the State   from   levying   any   tax   till   the   goods   are   first sold/dealt by the importer. vi. Whether   in   the   definition   of   purchase   value   as contained   in   Entry   Tax   Legislations   in   question, non­inclusion   of   custom   duty   is   indicator   of   fact that   the   legislature   never   intended   to   levy   entry tax on imported goods.  vii. Whether   Entry   Tax   Legislations   are   not   covered   by Entry   52   List   II   since   the   Entry   52   is   in   essence entry   of   levying   octroi   which   can   be   levied   only   by local   authorities   and   the   State   has   no   legislative competence   to   impose   entry   tax   under   Entry   52   List II.  viii. Whether   a   plant,   imported   in   knocked   out   condition is   covered   by   the   Part   II   of   the   Schedule   of   Orissa Act, 1999.  45. Before we proceed to consider the various issues as noted 38 above,   it   is   relevant   to   notice   the   statutory   provisions relating   to   entry   tax   applicable   in   the   above   mentioned States.  46. The   Orissa   Entry   Tax   Act,   1999   (hereinafter   referred   to as “Orissa Act, 1999”) was enacted to provide for the levy and collection of tax on the entry of goods into a local area for consumption,   use   or   sale   therein   and   matters   incidental thereto   and   connected   therewith.   Section   2   contains definitions.   Section   2(d)   defines   “entry   of   goods”,   Section 2(e) defines “importer”, Section 2(f) defines “local area” as follows : “ 2.   In   this   Act,   unless   the   context   otherwise requires,­  xxx xxx xxx (d) "Entry of goods”   with all its grammatical variations and cognate expressions, means entry of goods into a local area from any place that local   area   or   any   place   outside   the   State   for consumption, use or sale therein; (e)   "Importer"   means   a   dealer   or   any   other person who in any capacity brings or causes to be brought any scheduled goods into a 1mal area for consumption, use or sale therein; (f)   "Local   area”   means   the   areas   within   the limits of any­  (i) Municipal Corporation, (ii) Municipality, (iii) Notified Area Council, (iv) Grama Panchayat, and (v)   Other   loca1   authority   by   whatever   name 39 called, constituted or continued in any law for the time being in force and shall also include an   Orissa   Act   industrial   township   constituted under   section   4   of   the   Orissa   23     of     1930, Municipal Act, 1950;”    47. Section   3   relates   to   levy   of   tax.   Section   3   sub­section (1) is as follows: “ 3.Levy of Tax. (1)   There   shall   be   levied   and   collected   a   tax on   entry   of   the   scheduled   goods   into   a   local area   for   consumption,   use   or   sale   therein   at such rate not exceeding twelve percentum of the purchase   value   of   such   goods   from   such   date   as may   be   specified   by   the   State   Government   and different   dates   and   different   rates   may   be specified   for   different   goods   and   local   areas subject   to   such   conditions   as   may   be prescribed.” The Orissa Act, 1999 has been amended from time to time. 48. The   Kerala   Tax   on   Entry   of   Goods   into   Local   Areas   Act, 1994   (hereinafter   referred   to   as   'Kerala   Act,   1994)   was enacted to provide for levy of tax on the entry of goods into the local area for consumption, use or sale therein.   Section (2)(d)   defines   'entry   of   goods',   Section   2(g)   defines 'importer', Section 2(h) defines 'local area' and 2(n) defines 'purchase value' are as follows: “ 2.(d) "entry of   goods into a local area" with all its grammatical variations and cognate expressions, 40 means   entry   of   (Substituted   by   Act   23   of   1996 w.e.f. 29­7­1996.) goods into a local area from any place outside the State for use (Inserted by Act 12 of   2003   w.e.f.   1­4­2003.)   consumption   or   sale therein; (g)   "Importer"   means   a   person   who   brings   or   cause to   be   brought   any   goods   whether   for   himself   or   on behalf of his principal or any other person, into a local   area,   from   any   place   outside   the   State   for use, consumption, or sales therein or who owns the goods at the time of entry into the local area. (h) "Local area" means the area of jurisdiction of a local authority; (n)   "purchase   value"   means   the   value   of   the   goods as   ascertained   from   the   original   invoice   and includes   insurance,   excise   duties,   countervailing duties,   sales   tax,   transport   fee,   freight   charges and   all   other   charges   incidentally   levied   on   the purchase   of   goods   and   in   the   case   of   a   motor vehicle includes the value of accessories fitted to the vehicle; Provided   that,   where   the   purchase   value   of   the goods   is   not   ascertainable   on   account   of non­availability   or   non­production   of   the   original invoice   or   when   the   invoice   produced   is   proved   to be   false   or   if   the   goods   are   acquired   or   obtained otherwise   than   by   way   of   purchase,   then   the purchase   value   shall   be   the   value   or   price   at, which the goods of like kind or quality is sold or is capable of being sold, in open market” 49. Section 3 is a charging Section which is as follows: “ Section 3 ­ Levy of Tax 41 Substituted   by   Act   23   of   1996   w.e.f.   29­7­1996.) (1)   Subject   to   the   provisions   of   this   Act,   tax shall be levied and collected a tax on the entry of any goods into any local area for consumption, use or sale therein. (Inserted by Act 10 of 2005.) The Tax on such goods shall be at such rate or rates as may be fixed by Government by notification, on the purchase   value   of   goods   not   exceeding   the   tax payable   for   the   goods   as   per   the   (Substituted   by Act 23 of 1996 w.e.f. 29­7­1996.) [Schedule to the Kerala   General   Sales   Tax   Act,   1963   or   the   Kerala Value Added Tax Act, 2003. Provided that no tax shall be levied and collected in   respect   of   any   motor   vehicle   which   was registered   in   any   Union   Territory   or   any   other State   under   the   provisions   of   Motor   Vehicles   Act, 1988   (Central   Act,   59   of   1988),   prior   to   a   period of fifteen months or more from the date on which it is registered in the State: Provided   further   that   no   tax   shall   be   levied   and collected in respect of any (Substituted by Act 23 of   1996   w.e.f.   29­7­1996.)   goods   which   is   the property of the Central Government or which is used exclusively for purposes relating to the defence of India. (2)   The   tax   shall   be   payable   by   the   importer   in such   manner   and   within   such   time   as   may   be prescribed.” 50. Bihar   Act,   1993   also   defines   entry   of   goods   in   Section 2(c),   importer   in   Section   2(d),   import   value   in   Section   2(e) and local area has been defined in Section 2(f)   which are as follows: 42 “ 2(d)   “Importer”   means   a   dealer   or   any   other person who is any capacity effects or causes to be effected   t  he  entry  of  any   scheduled   goods   into  a local area for consumption, use or sale therein.”  (e)   “Import   Value”   means   the   value   of   scheduled goods   as   ascertained   from   the   purchase invoice/bills   and   includes   insurance   charges, [import   duty,   marine   insurance   charges,   landing and   whatfage   and   port   charges]   excise   duties, countervailing   duties,   sales   tax,   transport charges,   freight   charges   and   all   other   charges incidental   to   the   import   of   scheduled   goods: Provided that where the purchase invoice/bills are not   produced   or   when   the   invoice/bills   produced are   proved   to   be   false   or   if,   the   scheduled   good are   acquired   or   obtained   otherwise   than   by   way   of purchase the import value shall be the value price at   which   the   scheduled   goods   of   like   kind   or quality   is   sold   or   capable   of   being   sold   in   open market. (f)   “Local   Areas”   means   the   areas   within   the limits   of   a–   (i)   Municipal   Corporation;   (ii) Municipality;   (iii)   Notified   Area   Committee;   (iv) Cantonment   Board;   (v)   Town   Board;   (vi)   Mines Board;   (vii)   Municipal   Board;   (viii)   Gram Panchayat;   (ix)   Any   other   local   authority   by whatever   nomenclature   called,   constituted   or continued in any law for the time being in force.” 51. Section   3   is   a   charging   Section.   Section   sub­section   (1) is as follows: “3. Charge of Tax–“(I) There shall be  levied   and collected a tax on entry of  scheduled goods  into a local area for consumption,   use   or sale  therein for the   purpose   of   development   of   trade,  commerce   and   industry   in   the   State,   at   such rate, not exceeding twenty percent,  of the  import value of such goods, as  may   be   specified   by the State Government  in   a   notification   43 published in a official  gazette   subject   to   such conditions as  may be prescribed: Provided different rates for different scheduled goods may  be specified by the State Government.  Provided further, that if an importer  claims that he imported goods notified  under   sub­section (1) not for the  purpose   of   consumption,   use   or   sale,   the burden of proving that the  import was  for purposes other than for  consumption,   use   or   sale shall be on  importer  importing   such   goods   and   making   such claim.” [“Provided further, that if  an importer claims that he imported goods  notified   under sub­section (1) not for  the   purpose   of   consumption, use or sale,  the   burden   of   providing   that   the   import   was for purposes other than for  consumption, use or sale, shall be on  importer importing such goods and making  such claim.”  “(1A) The tax under sub­section (1)  shall   be   continued to be levied till such  time   as   is   required to improve  infrastructure   within   the   State such as  power,   road,   market,   condition etc. with  a   view   to   facilitate   better   market   condition for trade, commerce and  industry   and to bring it to the level of,  National average.” 52. The   definition   as   given   in   Section   2(c)   was   amended   by Bihar   Act   19   of   2006.   It   was   published   on   9 th   August,   2006. Section 2(c) was substituted by the amendment to the following effect: “ 2(c)”Entry   of   goods,   with   all   its   grammatical variations and cognate expressions, means, entry of goods; (i)   into   a   local   area   from   any   place   outside   such area, (ii) into   a   local   area   from   any   place   outside   the territory   of   India,   for   consumption,   use   or   sale therein.”  44 53. In   the   State   of   Jharkhand,   Bihar   Act,   1993   was   adopted vide notification dated 18 th   December, 2000. The amendment has been   made   vide   Jharkhand   Act   2     of     2002   in   Bihar   Act   16   of 1993.   In   exercise   of   powers   conferred   by   sub­section   (1)   of Section   3   of   the   Tax   Act   1993   (Bihar   Act   16'   1993) notification   dated   23 rd   March,   2002   was   issued   specifying   the conditions and rates of tax on the entry of scheduled goods.  Whether Entry Tax Legislations contemplated levy of Entry Tax on Imported goods 54. We   now   proceed   to   consider   ISSUE   NOS.1,   relating   to   the three States' enactments as noted. For answering the issue we notice the provisions of Orissa Act, 1999.  55. The   submission   which   has   been   pressed   by   the   learned counsel   for   the   writ   petitioners   is   that   the   definition   of entry   of   goods   in   Section   2(d)   read   with   Section   3   levy   of charge covers only the following: (i) Entry   of   goods   into   a   local   area   from   any   place   outside that local area; (ii) Entry   of   goods   from   local   area   or   any   place   outside   the State. It   is   submitted   that   entry   of   goods   into   local   area   can be any of the following places: 45 (i) from any place outside that local area that is  from other local area within the State of  Orissa itself; (ii) from any place outside the State that is from  any place outside the State of Orissa. The expression State here can only be the    State of Orissa and cannot mean the country as   a whole.  (iii) from any place outside the country. 56. The   definition   of   Section   2(d)   on   its   own   term   does   not cover   entry   of   goods   into   a     local   area   from   any   place “outside   the   country”.   It   is,   however,   submitted   that expression “any place outside the local area” by itself would have   been   enough   to   cover   the   goods   imported   from   anywhere outside the local area. Outside the local area would have been outside the State or outside the country but Legislature never intended to levy entry tax on goods imported from outside the country   that   is   why   entry   of   goods   from   local   area,   from outside the State was provided for. Reference of various other States' enactments have been made where any place outside the country has been expressly mentioned. Reference has been made to   West   Bengal   Tax   on   Entry   of   Goods   into   Local   Area   Act, 2012, Section 2(h) which is to the following effect: “ (h)   “entry   of   goods”,   with   all   its   grammatical variations   and   cognate   expressions,   means   bringing of   goods   into   a   local   area   from   any   place   outside 46 that   local   area   or   any   place   outside   the   State   or from   outside   India,   for   consumption,   use   or   sale therein,   whether   by   a   dealer   or   an   importer   other than a dealer himself or by any other person;” 57. Section   2(1)(h)   of   Uttar   Pradesh   Tax   on   Entry   of   Goods into   Local   Area   Act,   2007   and   Section   2(1)(c)   of   the Uttarakhand   Tax   on   Entry   of   Goods   into   Local   Area   Act,   2009 has  been   mentioned   wherein  the   definition  clause  specifically includes   “into   a   local   area   from   any   place   outside   the territory of India'.  58. The   plain   and   literal   construction   when   put   to   Section   3 read with Section 2(d) clearly means that goods entering into local   area   from   any   place   outside   the   local   area   or   outside the State are to be charged with entry tax. Foreign territory would be a place which is not only outside the local area but also   outside   the   State.   The   writ   petitioners   are   trying   to introduce   words   of   limitation   in   the   definition   clause.   The interpretation   which   is   sought   to   be   put   up   is   that   both   the phrases be read as: (1) “from   any   place   outside   that   local   area   but   within   that State”; (2) any place outside the State but within India. 59. It is well known rule of statutory interpretation that by process   of   interpretation   the   provision   cannot   be   re­written 47 nor   any   word   can   be   introduced.   The   expression   “any   place” before   the   words   “outside   the   State”   is   also   indicative   of vide   extent.   The   words   'any   place'   cannot   be   limited   to   a place within the territory of India when no such indication is discernible from the provisions of the Act.  60. The   Entry   tax   legislations   are   referable   to   Entry   52   of List II of Seventh Schedule of the Constitution. Entry 52 also provided a legislative field, namely, 'taxes on the entries of goods into a local area for consumption, use or sale therein'. Legislation is thus concerned only with entry of goods into a local   area   for   consumption,   use   or   sale.   The   origin   of   goods has   no   relevance   with   regard   to   chargeability     of   entry   tax. In this context reference is made to judgment of Federal Court reported   in   Miss   Kishori   Shetty   v.   The   King,   AIR   1950   FC   69 (1950 RLW 46) . The question which was considered in the above case   was   as   to   whether   Item   No.31   of   List   II   in   the   Seventh Schedule   of   Government   of   India   Act,   1935   which   provided “intoxicated   liquor   and   narcotic   drugs”   whether   included foreign liquors. The arguments that provincial legislature has no   power   to   restrict   or   prevent   the   goods   imported   from foreign country, was repelled. In paragraph 4 of the judgment following has been held: “ 4.   Now,   under   S.   100   of   the   Constitution   Act the Provincial Legislature has, subject to the 48 other   sub­sections   of   that   section,   the exclusive   power   to   make   laws   with   respect   to matters enumerated in List II in the sch. VII. Item   31   of   that   List   comprises   "Intoxicating liquor and narcotic drugs, that is to say, the production,   manufacture,   possession, transport,   purchase   and   sale   of   intoxicating liquors,   opium   and   other   narcotic   drugs" subject   to   certain   reservations   not   material here.   Prima   facie,   the   offending   provisions are within this legislative power. But counsel for the appellant drew attention to Item 19 of List   1   which   covers   "Import   and   export   across customs   frontier   as   defined   by   the   Dominion Government",   and   argued   that   if   "intoxicating liquors"   in   Item   31   of   List   II   were   held   to include   also   liquors   imported,   from   abroad, then   the   Provincial   Legislature,   by prohibiting   possession   of   such   liquors   by   all persons,   whether   private   consumers,   common carriers,   or   warehouse­men,   could   defeat   the power   of   the   Federal   Legislature   to   regulate imports   of   foreign   liquors   across   the   sea   or land   frontiers   of   British   India   which   are customs   frontiers   as   defined   by   the   Central Government   and   thus   seriously   jeopardize   an important   source   of   central   customs   revenue. As   under   S.   100,   Constitution   Act,   the Provincial   legislative   powers   under   List   II were   subject   to   the   exclusive   powers   of   the Federal   Legislature   in   List   I,   the   Bombay   Act to   the   extent   to   which   it   trenched   upon   the subject of Item 19 of the latter List must, it was   submitted,   be   regarded   as   a   nullity.   We are   unable   to   accede   to   this   contention.   As pointed   out   by   this   Court   in   Bhola   Prasad   v. Emperor,  1942 F.C.R. 17 : (A.I.R 1912 F.C. 17 :   43   Cr.   L.J.   481   F.C.)   the   legislative   power given   to   the   Provinces   under   Item   81   of   List II   is   expressed   in   wide   and   unqualified   teems which   in   their   natural   and   ordinary   sense   are apt   to   cover   such   an   enactment   as   S.   14­B   in its   amended   form,   and   we   see   nothing   in   the Federal Legislative List and more particularly in   Item   19   to   lead   us   to   out   down   the   fall meaning   of   the   Provincial   entry   by   excluding 49 foreign liquors from its purview. There is, in our view, no irreconcilable conflict here such as would necessitate recourse to the principia of   Federal   supremacy   laid   down   in   S.   100, Constitution   Act.   Section   14­B   does   not purport   to   restrict   or   prohibit   dealings   in liquor   in   respect   of   its   importation   or exportation   across   the   sea   or   land   frontiers of British India. It purports to deal with the possession   of   intoxicating   liquors   which,   in the   absence   of   limiting   words,   must   include foreign   liquor.   It   is   far   fetched,   in   our opinion,   to   suggest   that,   in   so   far   as   the provision   covers   foreign   liquors,   it   is legislation   with   respect   to   import   of   liquors into British India by sea or land.” 61. To   the   same   effect   judgment   of   this   Court   in   State   of Bombay   vs.   S.F.N.   Balsara,   AIR   1951   SC   318   is   referred.   The submission   which   has   been   pressed   by   the   learned   counsel   for the   writ   petitioners   is   that   in   a   taxing   statute   one   has   to merely   look   into   the   text   and   there   is   no   room   for   any intentment in deciding liability of the subject to tax regard must   be   had   to   plain   and   strict   letter   of   law.   Reliance   has been   placed   on   the   judgment   CIT   v.   Vatika   Township   (P)   Ltd., (2015) 1 SCC 1 . In paragraph 41.2 and paragraph 41.3 following has been held: “ 41.2.   At   the   same   time,   it   is   also   mandated that   there   cannot   be   imposition   of   any   tax without the authority of law. Such a law has to be   unambiguous   and   should   prescribe   the liability   to   pay   taxes   in   clear   terms.   If   the provision   concerned   of   the   taxing   statute   is ambiguous   and   vague   and   is   susceptible   to   two interpretations,   the   interpretation   which 50 favours   the   subjects,   as   against   the   Revenue, has to be preferred. This is a well­established principle   of   statutory   interpretation,   to   help finding   out   as   to   whether   particular   category of assessee is to pay a particular tax or not. No   doubt,   with   the   application   of   this principle,   the   courts   make   endeavour   to   find out   the   intention   of   the   legislature.   At   the same   time,   this   very   principle   is   based   on “fairness” doctrine as it lays down that if it is   not   very   clear   from   the   provisions   of   the Act   as   to   whether   the   particular   tax   is   to   be levied to a particular class of persons or not, the   subject   should   not   be   fastened   with   any liability to pay tax. This principle also acts as   a   balancing   factor   between   the   two jurisprudential   theories   of   justice   — Libertarian theory on the one hand and Kantian theory along with Egalitarian theory propounded by John Rawls on the other hand. 41.3.   Tax   laws   are   clearly   in   derogation   of personal rights and property interests and are, therefore,   subject   to   strict   construction,   and any   ambiguity   must   be   resolved   against imposition   of   the   tax.   In   Billings   v.   United States ,   the   Supreme   Court   clearly   acknowledged this   basic   and   long­standing   rule   of   statutory construction: (L Ed p. 598) “ Tax   statutes   …   should   be   strictly construed;  and   if  any  ambiguity  be   found   to exist, it must be resolved in favour of the citizen.” 62. Further,   in   Mathuram   Agrawal   v.   State   of   M.P.,   1999(8) SCC 667 , in paragraph 12 following has been stated: “ 12. ...The   intention   of   the   legislature   in   a taxation   statute   is   to   be   gathered   from   the language   of   the   provisions   particularly   where   the language   is   plain   and   unambiguous.   In   a   taxing   Act it   is   not   possible   to   assume   any   intention   or 51 governing   purpose   of   the   statute   more   than   what   is stated   in   the   plain   language.   It   is   not   the economic   results   sought   to   be   obtained   by   making the   provision   which   is   relevant   in   interpreting   a fiscal   statute.   Equally   impermissible   is   an interpretation   which   does   not   follow   from   the plain,   unambiguous   language   of   the   statute.   Words cannot   be   added   to   or   substituted   so   as   to   give   a meaning   to   the   statute   which   will   serve   the   spirit and   intention   of   the   legislature.   The   statute should   clearly   and   unambiguously   convey   the   three components   of   the   tax   law   i.e.   the   subject   of   the tax,   the   person   who   is   liable   to   pay   the   tax   and the   rate   at   which   the   tax   is   to   be   paid.   If   there is any ambiguity regarding any of these ingredients in   a  taxation  statute  then   there   is  no  tax   in  law. Then it is for the legislature to do the needful in the matter.” 63. There   cannot   be   any   dispute   to   the   proposition   as   laid down   by   this   Court   in   the   above   noted   cases.   Statutes   which are   in   consideration   are   the   statutes   where   clear   charging provision   has   been   enacted   and   charging   of   entry   tax   is   on entry   of   the   scheduled   goods   into   a   local   area   for consumption,   use   or   sale.   Thus,   the   charging   event   arises   on entry   of   scheduled   goods   into   a   local   area.   Any   goods   which are entering into a local area of a State whether coming from another   local   area   of   State,   any   other   State   or   outside   the country,   the   charging   event   is   same   for   all   goods   entering into local area. We, thus, are of the clear view that charging Section   is   clear,   unambiguous   and   the   provisions   cannot   be read   to   mean   that   the   imported   goods   coming   from   outside   the 52 country   are   excluded   from   charge   of   entry   tax.   No   such indication   is   discernible   from   any   provision   of   the   Act. Charging event is complete as and when goods enter into local area for use, sale or consumption irrespective of its origin. We, thus, are of the view that definition clause, Section 2(d) read with Section 3 does not exclude the charging of the entry tax on goods entering into local area for consumption, use or sale from outside the country. 64. In so far as reference of Section 2(c) of the Bihar Act, 1993   as   amended   in   2003   by   adding   an   explanation   and   as amended in 2006 by inserting a new Section 2(c), Section 2(1) (c)   of   Uttar   Pradesh   Tax   on   Entry   of   Goods   into   Local   Area Act, 2007, Section 2(1)(c) of the Uttarakhand Tax on Entry of Goods into Local Areas Act, 2009 as well as Section 2(1)(c) of the   West   Bengal   Tax   on   Entry   of   Goods   into   Local   Areas   Act, 2012   which   expressly   includes   entering   into   local   area   from any place outside the territory of India, we only say that the said   inclusion   of   words   'from   outside   the   India'   is   a provision made by way of abundant caution. 65. The   Bihar   Amendment   Act,   2006   by   which   Section   2(c)   was inserted by including clause (iii) is also by way of abundant caution and to provide it expressly which was already included 53 in the definition of Section 2(c) read with Section 3. 66. Similarly   when   by   Bihar   Act   11   of   2003   Section   2   was amended in following manner:­ "2.   Amendment   of   Section­2   of   Bihar   Act   16, 1993­ i)After   the   proviso   to   sub­section(e)   of section­2   of   the   Act,   the   following   explanation shall   be   inserted   and   shall   be   deemed   always   to have been so inserted­ "Explanation­   Entry   of   goods   into   a   local area   for   consumption,   use   or   sale   therein   from any   place   outside   the   territory   of   India   shall also   be   deemed   to   be   an   entry   of   goods   for   the purposes of this Act. ..................................” the   intent   and   purpose   of   amendment   was   clear   that   it   was clarificatory and explanatory. It did not introduce a concept which was not already there. 67. In  Section   2(d)  the  word   used  is   'any  place  outside  that local area or outside the State'. The word 'any' is a word of very   wide   meaning   and   use   of   word   'any'   excludes   any limitation.   We,   thus,   are   of   the   view   that   all   the   three legislations clearly did not exclude goods coming from outside the   territory   of   India   and   the   definition   of   entry   of   goods read with charging section clearly included all goods entering into   a   local   area.   Thus,   the   submissions   of   learned   counsel 54 for the petitioners that entry tax legislation did not include imported goods cannot be accepted. Entry 41 & 83 of List I and Entry 52 of List II 68. Issue   Nos.   2   and   3   being   interrelated   are   being   taken together.   Entry   tax   legislation   by   the   State   Legislature   are referable   to   Entry   52   List   II   as   it   exist   prior   to   101 st Amendment Act, 2016, which was as follows:­ “ Taxes on the entry of goods into a local area for consumption, use or sale therein.” 69. The   submission,   which   has   been   pressed   to   impugn   the State   legislation   is   that   the   entry   tax   legislation   intrude into the field which is reserved to Parliament under Entry 41 and Entry 83 of List I, which are as follows:­ Entry   41–   “Trade   and   commerce   with   foreign   countries; import   and   export   across   customs   frontiers; definition of customs frontiers.”     Entry 83 – “Duties of customs including export duties.”    70. In   so   far   as   trade   and   commerce   with   foreign   countries, import and export across the customs frontiers and definition of customs frontiers, it is the Parliament which has exclusive legislative competence to make a law under Entry 41 and under Entry 83 on duties of customs including export duties.  71. The   Constitution   of   India,   Part   XI,   Chapter   I   deals   with legislative   relations,   legislative   powers   of   Parliament   and 55 State Legislatures are clearly demarcated. Power to tax is an incidence   of   sovereignty   and   there   is   a   clear   demarcation   of taxing   field,   which   has   been   earmarked   to   the   Parliament   as well as to the State Legislatures. Taxing power of both Union and   State   Legislatures   are   mutually   exclusive   and   has   been clearly demarcated. This is further clear by the fact that in List   III,   i.e.   Concurrent   List,   no   taxing   entry   is   included except the entry of stamp duty & levying of fee in respect of any of the matters in List III but not including fees taken in any Court.  72. Constitution   Bench   of   this   Court   in   Godfrey   Phillips India Ltd. & Anr. Vs. State of U.P. & Ors., (2005) 2 SCC 515, had elaborately considered the entries in Seventh Schedule of the   Constitution   of   India.     Following   was   laid   down   in Paragraphs 44 and 45:­ “ 44.  The Indian Constitution is unique in that it   contains   an   exhaustive   enumeration   and division   of   legislative   powers   of   taxation between the Centre and the States. This mutual exclusivity is reflected in Article 246(1) and has   been   noted   in   H.M.   Seervai’s Constitutional   Law   of   India,   4th   Edn.,   Vol.   1 at   p.   166   in   para   1A.25   where,   after commenting   on   the   problems   created   by   the overlapping powers of taxation provided for in other   countries   with   federal   structures   such as   the   United   States,   Canada   and   Australia, the learned author opined: “ The   lists   contained   in   Schedule   VII   to 56 the   Government   of   India   Act,   1935, provided   for   distinct   and   separate   fields of   taxation,   and   it   is   not   without significance   that   the   concurrent legislative   list   contains   no   entry relating   to   taxation   but   provides   only for   ‘fees’   in   respect   of   matters contained   in   the   list   but   not   including fees   taken   in   any   court.   List   I   and   List II of Schedule VII thus avoid overlapping powers   of   taxation   and   proceed   on   the basis   of   allocating   adequate   sources   of taxation   for   the   federation   and   the provinces,   with   the   result   that   few problems   of   conflicting   or   competing taxing   powers   have   arisen   under   the Government   of   India   Act,   1935.   This scheme   of   the   legislative   lists   as regards   taxation   has   been   taken   over   by the   Constitution   of   India   with   like beneficial results.” 45.   This   view   has   also   been   reiterated   in Hoechst   Pharmaceuticals   Ltd.   v.   State   of Bihar,   (1983)   4   SCC   45:   (SCC   pp.   92­93,   paras 75 & 76) “ A   scrutiny   of   Lists   I   and   II   of   the Seventh   Schedule   would   show   that   there is   no   overlapping   anywhere   in   the taxing power and the Constitution gives independent   sources   of   taxation   to   the Union   and   the   States.   Following   the scheme   of   the   Government   of   India   Act, 1935,   the   Constitution   has   made   the taxing   power   of   the   Union   and   of   the States   mutually   exclusive   and   thus avoided   the   difficulties   which   have arisen   in   some   other   Federal Constitutions   from   overlapping   powers of taxation. …   Thus,   in   our   Constitution,   a   conflict   of the   taxing   power   of   the   Union   and   of   the States cannot arise.” 57 (See also State of W.B. v. Kesoram Industries Ltd., (2004) 10 SCC 201.)” 73. This   Court   further   held   that   in   construction   of   a   taxing entry, an interpretation which may lead to overlapping must be eschewed.   If   the   taxing   power   is   within   a   particular legislative   field,   it   would   follow   that   other   fields   in   the legislative lists must be construed to exclude this field.  In Para 46,following was held : “ 46.   Therefore,   taxing   entries   must   be construed   with   clarity   and   precision   so   as   to maintain   such   exclusivity,   and   a   construction of   a   taxation   entry   which   may   lead   to overlapping   must   be   eschewed.   If   the   taxing power   is   within   a   particular   legislative field,   it   would   follow   that   other   fields   in the   legislative   lists   must   be   construed   to exclude   this   field   so   that   there   is   no possibility of legislative trespass.” 74. Entries   in   VII th   Schedule   are   not   powers   but   fields   of legislation.  It is  also well  settled  that  in  deciding  whether any   particular   enactment   is   within   the   purview   of   one Legislature   or   the   other,   it   is   pith   and   substance   of   the legislation   that   has   to   be   looked   into.   Whenever   a   State legislation is challenged as being under the competence of the State Legislature, the test, which has been laid down by this Court   is   that   one   must   find   out   by   applying   the   rule   of   pith and substance that whether the legislation falls within any of 58 the List II, if it does, no further question arises. Attack on the ground  of  legislative  competence  must  fail. This  Court  in State   of   A.P.   &   Ors.   Vs.   Mcdowell   &   Co.   &   Ors.,   (1996)   3   SCC 709  laid down following in Paragraph 36:­ “ 36.   In   view   of   our   finding   that   the   impugned enactment   is   perfectly   within   the   legislative competence   of   the   State   Legislature   and   is fully   covered   by   Entry   8   read   with   Entry   6   of List   II,   it   is   not   necessary   for   us   to   deal with   the   arguments   based   upon   clause   (3)   of Article   246   of   the   Constitution   except   to   say the   following:   once   the   impugned   enactment   is within   the   four   corners   of   Entry   8   read   with Entry   6,   no   Central   law   whether   made   with reference   to   an   entry   in   List   I   or   with reference   to   an   entry   in   List   III   can   affect the   validity   of   such   State   enactment.   The argument   of   occupied   field   is   totally   out   of place in such a context. If a particular matter is within the exclusive competence of the State Legislature,   i.e.,   in   List   II   that   represents the  prohibited   field   for   the   Union.  Similarly, if   any   matter   is   within   the   exclusive competence   of   the   Union,   it   becomes   a prohibited field for the States. The concept of occupied   field   is   really   relevant   in   the   case of laws made with reference to entries in List III.   In   other   words,   whenever   a   piece   of legislation   is   said   to   be   beyond   the legislative   competence   of   a   State   Legislature, what   one   must   do   is   to   find   out,   by   applying the   rule   of   pith   and   substance,   whether   that legislation falls within any of the entries in List   II.   If   it   does,   no   further   question arises;   the   attack   upon   the   ground   of legislative competence shall fail....” 75. The   distribution   of   power   between   Union   and   States   is done in a mutually exclusive manner as is reflected by precise 59 and   clear   field   of   legislation   as   allocated   under   different list   under   the   Seventh   Schedule.   No   assumption   of   any overlapping   between   a   subject   allocated   to   Union   and   State arises. When the field of legislation falls in one or other in Union  or  State  Lists,  the  legislation  falling  under the State entry   has   always   been   upheld.   The   Scheme   of   distribution   of legislative power between Union and States in the Constitution of   India   relies   on   the   distribution   of   legislative   power between   the   Federal   Government   and   Provincial   Government   as contained  in  Seventh  Schedule  of  the  Government of  India  Act, 1935.   The   Government   of   India   Act,   1935   has   been   referred   to as   Constitution   Act   by   the   Privy   Council.   In   this   context, reference   is   made   to   a   judgment   of   Federal   Court   reported   in AIR   1942   FC   33,   The   Province   of   Madras   Vs.   Messrs.   Boddu Paidanna   and   Sons.(1942   FCR   90),   the   Madras   Legislature   has enacted   Madras   General   Sales   Tax   Act,   1939.     The   respondent was carrying  on business  which  consists of  purchase of  ground nuts for the purpose of extracting oil from the kernels of the nuts   and   the   making   of   groundnut   cake   out   of   the   residue   was assessed   to   tax   under   the   1939   Act.     The   levy   of   tax   was challenged   by   the   respondent   before   the   District   Munsif   and the   High   Court   of   Madras   on   the   ground   that   first   sale   of goods manufactured in the Province was a duty of excise, which 60 is   not   within   the   competence   of   Provincial   Legislature.     The High   Court   accepted   the   challenge   and   held   that   State Legislature   was   not   competent   to   tax.   In   the   Government   of India   Act,   1935,   the   Federal   Legislature,   under   List   I   Entry 45, has an exclusive power to impose duties of excise whereas the   Provincial   Legislature,   under   List   II   Entry   48,   has   an exclusive   power   to   impose   taxes   on   the   sale   of   goods.   CHIEF JUSTICE   GWYER   reversing   the   judgment   of   the   High   Court   held that   duties   are   levied   upon   the   manufacturer   or   producer   in respect   of   manufacturer   or   production   of   the   commodity   taxed whereas   tax   on   the   sale   of   goods   is   levied   as   qua   seller   and not   qua   manufacturer.     Federal   Court   held   that   there   is   no overlapping in law. Following observations were made:­ “ The   duties   of   excise   which   the   Constitution Act   assigns   exclusively   to   the   Central Legislature   are,   according   to   the   Central Provinces   Case,   duties   levied   upon   the manufactory   or   producer   in   respect   of   the manufacture   or   production   of   the   commodity taxed. The tax on the sale of goods, which the Act   assigns   exclusively   to   the   Provincial Legislatures,   is   a   tax   levied   on   the   occasion of the sale of the goods. Plainly a tax levied on the first sale must in the nature of things be   a   tax   on   the   sale   by   the   manufacturer   or producer   ;   but   it   is   levied   upon   him   qua seller   and   not   qua   manufacturer   or   producer. It may well be that a manufacturer or producer is   sometimes   doubly   hit   ;   but   so   is   the taxpayer   in   Canada   who   has   to   pay   income­tax levied   by   the   Province   for   provincial purposes,   and   also   income­tax   levied   by   the Dominion   for   Dominion   purposes:   see   Caron   v. 61 The   King   [1924]   A.C.   999;   Forbes   v.   Att.­Gen. for   Manitoba   [1937]   A.C.   260.   If   the   taxpayer who pays a sales tax is also a manufacturer or producer   of   commodities   subject   to   a   central duty   of   excise,   there   may   no   doubt   be   an overlapping   in   one   sense   ;   but   there   is   no overlapping   in   law.   The   two   taxes   which   he   is called on to pay are economically two separate and distinct imposts ....”  76. Federal Court further laid down that manufacture and sale has no necessary connection and both are independent.   It was further held that :­ “ ....It   is   the   fact   of   manufacture   which attracts   the   duty,   even   though   it   may   be collected later; and we may draw attention to the Sugar Excise Act in which it is specially provided that the duty is payable not only in respect   of   sugar   which   is   issued   from   the factory but also in respect of sugar which is consumed within the factory.   In the case of a sales tax, the liability to tax arises on the occasion   of   a   sale,   and   a   sale   has   No. necessary   connexion   with   manufacture   or production.   The   manufacturer   or   producer cannot of course sell his commodity unless he has   first   manufactured   or   produced   it   ;   but he   is   liable,   if   at   all,   to   a   sales   tax because   he   sells   and   not   because   he manufactures   or   produces;   and   he   would   be free   from   liability   if   he   chose   to   give   away everything which came from his factory. In   our   opinion   the   power   of   the   Provincial Legislatures   to   levy   a   tax   on   the   sale   of goods   extends   to   sales   of   every   kind,   whether first  sales  or   not;  and  we  regret  that  we  are unable   to   agree   with   the   contrary   opinion which   has   been   expressed   by   the   High Court....”  62 77. The   above   judgment   of   Federal   Court   was   upheld   by   Privy Council in  The   Governor General in Council Vs. The Province of Madras,   reported   in   58   L.W.   228.     LORD   SIMONDS   held   that   in event   a   controversy     should   arise   whether   one   or   other Legislature   is   not   exceeding   its   own,   and   encroaching   on   the other's,   constitutional   legislative   power,   and   in   such   a controversy it is a principle, that it is not the name of the tax but its real nature, its "pith and substance", which must determine into what category it falls.  After referring to the provisions   of   Madras   General   Sales   Tax   Act,   1939,   Lordship opined that its real nature, its pith and substance is that it imposes a tax on the sale of goods.  The Privy Council further observed that the Indian Constitution (The Government of India Act,   1935)   contains   what   purports   to   be   an   exhaustive enumeration   and   division   of   legislative   powers   between   the Federal   and   the     Provincial   Legislatures.   Upholding   the Legislative   power   of   the   Provincial   Legislature,   the   Privy Council laid down following:­ “ ....An exhaustive discussion of this subject, from   which   their   Lordships   have   obtained valuable   assistance,   is   to   be   found   in   the judgment   of   the   Federal   Court   in   re   the Central   Provinces   and   Berar   Sales   of   Motor Spirit   and   Lubricants   Taxation   Act   No.   14   of 1938 ('39) 26 A.I.R. 1939 F.C. 1. Consistently with   this   decision,   their   Lordships   are   of opinion   that   a   duty   of   excise   is   primarily   a duty levied upon a manufacturer or producer in 63 respect   of   the   commodity   manufactured   or produced.   It   is   a   tax   upon   goods   not   upon sales   or   the   proceeds   of   sale   of   goods.   Here again   their   Lordships   find   themselves   in complete   accord   with   the   reasoning   and conclusions   of   the   Federal   Court   in   the   Boddu Paidanna   case.   Province   of   Madras   v.   Boddu Paidanna and Sons. Reported in ('42) 29 A.I.R. 1942   F.C.   33   The   two   taxes,   the   one   levied upon   a   manufacturer   in   respect   of   his   goods, the   other   upon   a   vendor   in   respect   of   his sales,   may,   as   is   there   pointed   out,   in   one sense   overlap.   But   in   law   there   is   no overlapping.   The   taxes   are   separate   and distinct   imposts.   If   in   fact   they   overlap, that   may   be   because   the   taxing   authority, imposing a duty of excise, finds it convenient to   impose   that   duty   at   the   moment   when   the exercisable   article   leaves   the   factory   or workshop   for   the   first   time   upon   the   occasion of its sale. But that method of collecting the tax   is   an   accident   of   administration:   it   is not of the essence of the duty of excise which is attracted by the manufacture itself....” 78. This   Court   in   the   case   of   Ram   Krishna   Ramnath   Agarwal   of Kamptee   Vs.   Secretary,   Municipal   Committee,   Kamptee,   AIR   1950 SC 11  had occasion to consider the levy of octroi on the entry of   excisable   goods.     The   appellant,   on   30.11.1945   brought   to Kamptee,   from   outside   tobacco   to   make   bidis.     Municipality directed   for   recovery   of   the   octroi   duty   under   Section   66(1) (e)   of   the   Central   Province   Municipalities   Act,   1922.     The appellant   challenged   the   leviability   of   octroi   on   the   ground that tobacco is excisable goods under Central Excises and Salt Act, 1944.   It is only Central Government, who is entitled to 64 recover   the   excise   duty   and   the   octroi   is   not   payable.     The High   Court   had   rejected   the   contention   and   the   appeal   was dismissed   by   this   Court   holding   that   levy   of   excise   duty   is not in conflict with the levy of an impost on the entry of the goods. In Para 10 of the judgment following has been held:­ “ 10.   This   discussion   clearly   shows   that   the relevant question is what is the nature of the tax.   Excise   duty   is   a   tax   on   manufactured goods.   Octroi   duty   is   a   tax   levied   on   the entry of goods within a particular area. Under the   Excise   Act,   tobacco   becomes   excisable goods   within   the   meaning   of   Item   9   in   the Schedule.   The   subsequent   use   of   such manufactured   goods   in   making   different articles   only   affects   the   rate   of   tax. Therefore,   tobacco   becomes   subject   to   excise duty   when   it   reaches   the   stage   of   manufacture mentioned   in   Item   9   of   the   Schedule   to   the Excise   Act.   Even   before   it   is   converted   into bidis   or   any   other   article   mentioned   in   the entry it has become excisable goods and liable to   pay   excise   duty.   The   levy   of   such   duty   is therefore   not   in   conflict   with   the   levy   of   an impost   on   the   entry   of   the   goods   within   a certain area.” 79. Another   judgment   which   needs   to   be   noticed   is   Jiyajeerao Cotton   Mills   Ltd.,   Birlanagar,   Gwalior   Vs.   State   of   Madhya Pradesh,   AIR   1963   SC   414.     The   appellant   was   a   textile   mill generating   electricity   for   the   purpose   of   running   its   mills. State of Madhya Pradesh imposed electricity duty under Central Provinces   and   Berar   Electricity   Duty   Act,   1949.     The 65 imposition   of   duty   was   challenged   on   the   ground   that Provincial Legislature has no competence to impose electricity duty   since   on   manufacture   of   electricity,   it   is   Central Legislature   under   Entry   84   List   I   has   competence.   This   Court repelling the contention laid down following in Paragraph 6:­ “ 6.   It   is   difficult   to   see   how   the   levy   of duty upon consumption of electrical energy can be   regarded   as   duty   of   excise   falling   within Entry   84   of   List   I.   Under   that   Entry   what   is permitted   to   Parliament   is   levy   of   duty   of excise   on   manufacture   or   production   of   goods (other   than   those   excepted   expressly   by   that entry).   The   taxable   event   with   respect   to   a duty   of   excise   is   “manufacture”   or “production”.   Here   the   taxable   event   is   not production generation of electrical energy but its   consumption.   If   a   producer   generates electrical   energy   and   stores   it   up,   he   would not be required to pay any duty under the Act. It   is   only   when   he   sells   it   or   consumes   it that   he   would   be   rendered   liable   to   pay   the duty   prescribed   by   the   Act.   The   Central Provinces   and   Berar   Electricity   Act   was enacted   under   Entry   48­B   of   List   II   of   the Government   of   India   Act,   1935.   The   relevant portion of that Entry read thus: “ Taxes   on   the   consumption   or   sale   of electricity” Entry  53   of  List   II  of  the   Constitution  is   to the   same   effect............The   language   used in the legislative entries in the Constitution must   be   interpreted   in   a   broad   way   so   as   to give   the   widest   amplitude   of   power   to   the legislature   to   legislate   and   not   in   a   narrow and   pedantic   sense.   We   cannot,   therefore, accept   either   of   the   two   grounds   urged   by   Mr Viswanatha Sastri challenging the vires of the 66 Act.” 80. This   Court   in   the   above   case   further   held   that   language used   in   the   legislative   entries   in   the   Constitution   must   be interpreted in a broad way so as to give the widest amplitude of   power   to   the   legislature   to   legislate   and   not   in   a   narrow and pedantic sense.   Constitution bench judgment in   D.G. Gose and Co. (Agents) Pvt. Ltd. Vs. State of Kerala & Anr., (1980) 2   SCC   410   also   need   to   be   noticed.     The   Kerala   Building   Tax Act, 1975 imposing tax on building under List II Entry 49 “tax on   land   and   buildings”   whereas   List   I   Entry   86   “Taxes   on   the capital   value   of   assets,   exclusive   of   agricultural   land,   of individuals and companies; taxes on the capital of companies.” 81. Referring   to   the   aforesaid   two   taxes   under   List   I   and List II, this Court laid down that two taxes are separate and distinct   imposts   and   they   cannot   be   said   to   be   over­lap   each other   and   shall   be   within   the   competence   of   the   Legislatures concerned.     In   Para   9   of   the   judgment,   following   has   been held:­ “ 9.  It has to be appreciated that in almost all cases,   a   tax   has   two   elements   which   have   been precisely   stated   by   Seervai   in   his “Constitutional   Law   of   India”,   2nd   Edn.,   Vol. 2, as follows, at p. 1258: “ Another   principle   for   reconciling 67 apparently   conflicting   tax   entries follows   from   the   fact   that   a   tax   has   two elements:   the   person,   thing   or   activity on   which   the   tax   is   imposed,   and   the amount   of   the   tax.   The   amount   may   be measured   in   many   ways;   but   decided   cases establish   a  clear   distinction   between   the subject­matter   of   a   tax   and   the   standard by   which   the   amount   of   tax   is   measured. These   two   elements   are   described   as   the subject   of   a   tax   and   the   measure   of   a tax.” It   may   well   be   that   one’s   building   may imperceptibly be the subject­matter of tax, say the   wealth   tax,   as   a   component   of   his   assets, under   Entry   86   (List   I);   and   it   may   also   be subjected to tax, say a direct tax under Entry 46 (sic 49)(List II), but as the two taxes are separate   and   distinct   imposts,   they   cannot   be said to overlap each other, and would be within the competence of the legislatures concerned.”  82. Nine Judges Constitution Bench in   Jindal Stainless Ltd. & Ors.   Vs.   State   of   Haryana   &   Ors.,   (2016)   11   SCALE   1   has   also held   that   taxing   power   of   the   Union   and   the   States   are mutually   exclusive.     Approving   the   findings   expressed   by   H.M. Seervai in its treatise Constitutional Law of India, following was observed:­ “ ......The   celebrated   author,   in   our   opinion, was right in saying so for the taxing power of the   Union   and   the   States   are   mutually exclusive.   While   the   Parliament   cannot legislate   on   the   subjects   reserved   for   the States,   the   States   cannot   similarly   trespass onto   the   taxing   powers   of   the   Union.   If   the Constitutional   scheme   does   not   allow   the Parliament   to   usurp   the   taxing   powers   of   the State Legislatures, such process of usurpation 68 cannot   also   be   permitted   to   take   place   in   the garb   of   making   Union   executive's   concurrence an   essential   pre­requisite   for   any   taxing legislation.   The   following   passage   from Seervai's   book   (Vol.   3,   Page   2607)   is   in   this regard instructive: 23.43. Thirdly, the whole scheme of taxation in our Constitution would be completely dislocated if   Article   304(b)   included   a   tax.   The   taxing powers   of   the   Union   and   the   States   have   been made   mutually   exclusive   so   that   Parliament cannot   deprive   the   States   of   their   taxing powers   as   has   happened   in   countries   where   the powers of taxation are concurrent. It would be surprising   if   the   Union   legislature,   i.e. Parliament   could   not   take   away   the   taxing powers   of   the   State   legislatures   and   yet   it would   be   open   to   the   Union   executive   Under Article   304(b)   to   deprive   the   State legislatures of their taxing powers.” 83. As   noted   above,   although,   Nine   Judges   Constitution   Bench had   left   the   question   open   of   validity   of   entry   tax   on   goods imported   from   countries   outside   the   territories   of   India,   the two Hon’ble Judges, i.e.  Justice  R. Banumathi  and  Justice  Dr. D.Y.   Chandrachud   while   delivering   separate   judgment   have considered   the   leviability   of   entry   tax   on   imported   goods   in detail.   Both   Hon’ble   Judges   have   held   that   there   is   no clash/overlap between entry levied by the State under Entry 52 List II and the custom duty levied by the Union under Entry 83 List I. We have also arrived at the same conclusion in view of the   foregoing   discussions.   We   thus   hold   that   entry   tax 69 legislations   do   not   intrude   in   the   legislative   field   reserved for   Parliament   under   Entry   41   and   under   Entry   83   of   List   I. The State Legislature is fully competent to impose tax on the entry   of   goods   into   a   local   area   for   consumption,   sale   and use.     We   thus   repel   the   submission   of   petitioner   that   entry tax   legislation   of   the   State   encroaches   in   the   Parliament’s field. Concept & Extent of Import 84. Now,   we   come   to   Issue   No.IV   relating   to   import   and   its extent.     Import   and   export   are   concepts   which   denote   trade between   different   countries.     The   term   “import”   signifies etymologically   “to   bring   in”.     To   import   goods   into   the territory   of   India   means   to   bring   them   into   the   territory   of India   from   abroad.     Black’s   Law   Dictionary,   Tenth   Edition, defines import as follows:­ “ 1.   A   product   brought   into   a   country   from   a foreign   country   where   it   originated   imports declined   in   the   third   quarter.   See   parallel imports.   2.   The process or activity of bringing foreign   goods   into   a   country   the   import   of products   affects   the   domestic   economy   in significant   ways.   Cf.   Export,   n.   3.   Meaning; esp., implied meaning the court must decide the import   of   that   obscure   provision.   4. Importance;   significance   time   will   tell   the relative   import   of   Judge   Kozinski’s   decisions in American law.” 70 85. In   Advanced   Law   Lexicon,   by   P.   Ramanatha   Aiyar,   3 rd Edition, import has been defined in following words:­ “ The   term   “import”   means   to   bring   into   a country   merchandise   from   abroad,   and   is   the direct   converse   of   the   term   “export”   which means   to   carry   from   a   state   or   country,   as wares in commerce.” 86. The   Customs   Act,   1962   defines   the   terms   “import”, “imported  goods”   and  “importer”  in Sections  2(23), 2(25)  and 2(26) respectively, which are as follows;­ “ 2(23)   “import”   with   its   grammatical variations   and   cognate   expressions,   means bringing   into   India   from   a   place   outside India;”  2(25) “Imported goods” means any goods brought into India from a place outside India but does not   include   goods   which   have   been   cleared   for home consumption; 2(26)   “importer”,   in   relation   to   any   goods   at any time between their importation and the time when   they   are   cleared   for   home   consumption, includes   [any   owner,   beneficial   owner]   or   any person holding himself out to be the importer;” 87. This Court had occasion to consider the concept of import and   export   in   context   of   Article   286   of   the   Constitution   of India in  State of Travancore­Cochin & Ors. Vs. Shanmugha Vilas Cashewnut Factory, Quilon, AIR 1953 SC 333.   Travancore­Cochin General Sales Tax Act, Section 3 provided for levy of a tax on the   total   turnover   of   every   dealer   for   each   year.     Facts   of 71 the case have been noted in Para 3 of the judgment, which are as follows:­ “ 3.   The   respondents   are   dealers   in   cashewnuts in   the   State,   and   their   business   consists   in importing   raw   cashewnuts   from   abroad   and   the neighbouring   districts   in   the   State   of   Madras in   addition   to   purchases   made   in   the   local market, and, after converting them by means of certain   processes   into   edible   kernels, exporting   the   kernels   to   other   countries, mainly   America.   The   oil   pressed   from   the shells   removed   from   the   cashewnuts   was   also exported.   The   Constitution   having   come   into force   on   January   26,   1950,   the   respondent   in each   appeal   claimed   exemption   under   Article 286(l)(b)   in   respect   of   the   purchases   made from   that   date   till   May   29,   1950,   the   end   of the   account   year.   The   Sales   Tax   authorities having   rejected   the   claim,   the   respondents applied   to   the   High   Court   under   Article   226, and   that   court   upheld   the   claim   and   quashed the   assessments   in   so   far   as   they   related   to the   said   period.   The   State   has   preferred   the appeals.” 88. This   Court   while   considering   the   exemption   under   Article 286(1)(b) has laid down the following in Para 10:­ “ As   regards   the   first   mentioned   category,   we are   of   opinion   that   the   transactions   are   not within   the   protection   of   clause   (1)(b).   What is   exempted   under   the   clause   is   the   sale   or purchase   of   goods   taking   place   in   the   course of   the   import   of   the   goods   into   or   export   of the goods out of the territory of India. It is obvious   that   the   words   “import   into”   and “export   out   of”   in   this   context   do   not   mean the article or commodity imported or exported. The   reference   to   “the   goods”   and   to   “the territory   of   India”   make   it   clear   that   the words   “export   out   of”   and   “import   into”   mean 72 the   exportation   out   of   the   country   and importation into the country respectively. The word   “course”   etymologically   denotes   movement from   one   point   to   another,   and   the   expression “in   the   course   of”   not   only   implies   a   period of   time   during   which   the   movement   is   in progress   but   postulates   also   a   connected relation....”  89. The purchase for the purpose of import and similarly, the sale after import were held to be distinct legal transactions, it was held:­   “ 10.   The   phrase   “integrated   activities”   was used   in   the   previous   decision   to   denote   that “such a sale” (i.e. a sale which occasions the export)  “cannot  be   dissociated   from  the  export without which it cannot be effectuated, and the sale   and   the   resultant   export   form   parts   of   a single   transaction”.   It   is   in   that   sense   that the two activities — the sale and the export — were said to be integrated. A purchase for the purpose   of   export   like   production   or manufacture   for   export,   is   only   an   act preparatory   to   export   and   cannot,   in   our opinion,   be   regarded   as   an   act   done   “in   the course   of   the   export   of   the   goods   out   of   the territory   of   India”,   any   more   than   the   other two   activities   can   be   so   regarded.   As   pointed out by a recent writer: “ From the legal point of view it is essential to distinguish the contract of sale which has as   its   object   the   exportation   of   goods   from this   country   from   other   contracts   of   sale relating to the same goods, but not being the direct   and   immediate   cause   for   the   shipment of the goods.… When a merchant shipper in the United Kingdom buys for the purpose of export goods from a manufacturer in the same country 73 the   contract   of   sale   is   a   home   transaction; but   when   he   resells   these   goods   to   a   buyer abroad   that   contract   of   sale   has   to   be classified as an export transaction.”  This   passage   shows   that,   in   view   of   the distinct   character   and   quality   of   the   two transactions,   it   is   not   correct   to   speak   of   a purchase   for   export,   as   an   activity   so integrated with the exportation that the former could   be   regarded   as   done   “in   the   course   of” the   latter.   The   same   reasoning   applies   to   the first   sale   after   import   which   is   a   distinct local   transaction   effected   after   the importation   of   the   goods   into   the   country   has been completed, and having no integral relation with   it.   Any   attempt   therefore   to   invoke   the authority   of   the   previous   decision   in   support of the suggested extension of the protection of clause   (1)(b)   to   the   last   purchase   for   the purpose   of   export   and   the   first   sale   after import   on   the   ground   of   integrated   activities must fail.” 90. The   writ   petitioners   have   also   placed   reliance   on   the contents of Article 286 of the Constitution especially Article 286(1)(b) read with Article 286(2). Article 286(1) and (b) are as follows:     "Article   286.   Restrictions   as   to   imposition of tax on the sale or purchase of goods:­ (1)No law of a State shall impose, or authorise the imposition of, a tax on the supply of goods or of services or both, where such supply takes place­ (a)...  ... ... (b) in   the   course   of   the   import   of   the   goods or   services   or   both   into,   or   export   of   the goods or services or both out of, the territory 74 of India.”  91. It   is   supported   that   though   Article   286   deals   with   the restriction   on   the   State   legislative   power   qua   imposition   of tax   on   the   sale   or   purchase   of   goods   nevertheless   the formulation of  the  principle  by the Parliament  with regard  to “in the course of the import or export” clearly shows that the legislative   domain   in   this   regard   is   with   Parliament   and   not with States. In point of fact, any legislation relating to the “course   of   import   or   export”   has   to   relate   to   Entry   41   read with   Entry   83   of   List   I   and   it   cannot   relate   to   any   other Entry and definitely not to any Entry in State List. Reliance was also placed on Section 5(3) of the Central Sales Tax Act, 1956.   On   the   strength   of   Section   5,   it   is   sought   to   be contended   that   on   parity   of   logic   the   first   sale   after   the import be treated as in the course of import. 92. Article 286 of the Constitution provides for restrictions as   to   the   imposition   of   the   tax   on   the   sale   or   purchase   of goods.   The   subject­matter   of   laws   made   by   Parliament   and legislatures   of   the   States   as   per   Article   246   read   with Seventh Schedule and Article 245 are subject to the provisions of the Constitution. Legislative power as contained in List II is  thus subject to  express  restrictions as  imposed  by  Article 286.   Article   286   sub­clause   (1)   uses   the   expression   “in   the 75 course of the import of the goods”. The concept “in the course of import of goods” as used in Article 286(1) can very well be implied while  considering  the  concept  of  the  import of  goods. In   so   far   as   Section   5   sub­section   (3)   of   Central   Sales   Tax Act,   1956,   the   said   provision     provides   that   last   sale   or purchase   of   any   goods   preceding   the   sale   or   purchase occasioning the export of those goods out of the territory of India shall also be deemed to be in the course of such export. Section 5(3) is with regard to the export of the goods out of the   territory   of   India   and   has   not   been   used   with   regard   to the   concept   of   import.     Section   5(1),   (2),   (3)   are   relevant which are to the following effect: “ Section   5.   When   is   a   sale   or   purchase   of goods said to take place in the course of import or export .­   (1)   A   sale   or   purchase   of   goods   shall   be deemed to take place in the course of the export of the goods out of the territory of India only if the sale or purchase either occasions such export or is effected by a transfer of documents of title to the goods   after   the   goods   have   crossed   the   customs frontiers of India.  (2) A sale or purchase of good shall be deemed to   take   place   in   the   course   of   the   import   of   the goods into the territory of India only if the sale or   purchase   either   occasions   such   import   or   is effected by a transfer of documents of title to the goods   before   the   goods   have   crossed   the   customs frontiers of India. (3)   Not   withstanding   anything   contained   in sub­section   (1),   the   last   sale   or   purchase   of   any goods   preceding   the   sale   or   purchase   occasioning the   export   of   those   goods   out   of   the   territory   of 76 India   shall   also   be   deemed   to   be   in   the   course   of such   export,   if   such   last   sale   or   purchase   took place   after,   and   was   for   the   purpose   of   complying with, the agreement or order for or in relation to such export.” 93. The   submissions   of   the   writ   petitioners   on   the   strength of   Section   5(3)   that   even   first   sale   after   the   import   should be treated during the course of the import is not supported by the concept as contained in Section 5 of the 1956 Act and the reliance on the said provision is wholly  misplaced. 94. As   noted   above,   the   restriction   in   the   legislative   power of   the   State   as   contained   in   Article   286   is   with   regard   to taxing on sale or purchase of goods which takes place outside the State or in the course of import of the goods or services or export of goods or services. The restriction of Article 286 does   not   ipso   facto   can   be   placed   while   considering   the legislative field of the State under Entry 52 and by virtue of Article   286   no   restriction   can   be   put   on   the   legislative competence   of   the   State   in   the   field   as   defined   under   Entry 52.   However,   the   concept   underlined   in   “the   course   of   import of the goods” as in Article 286(1)(b) can very well be applied to find out as to when the import of goods come to an end. We thus   proceed   to   examine   certain   cases/judgments   of   this   Court which were delivered in the context of Article 286. 95. The   term   import   again   came   for   consideration   before   this 77 Court   in   J.V.   Gokal   &   Co.   (Private)   Ltd.   Vs.   Assistant Collector   of   Sales   Tax   (Inspection)   &   Ors.,   AIR   1960   SC   595. This   Court   explained   the   word   import   and   the   phrase   “in   the course   of   the   import   of   the   goods   into   the   territory   of India”.  In paragraphs 9 and 11, following has been held:­   “ 9.   What does the phrase “in the course of the import   of   the   goods   into   the   territory   of India” convey? The crucial words of the phrase are   “import”   and   “in   the   course   of”.   The   term “import”   signifies   etymologically   “to   bring in”.   To   import   goods   into   the   territory   of India   therefore   means   to   bring   into   the territory of India goods from abroad. The words “course”   means   “progress   from   point  to   point”. The   course   of   import,   therefore,   starts   from one   point   and   ends   at   another.   It   starts   when the goods cross the customs barrier in foreign country   and   ends   when   they   cross   the   customs barrier   in   the   importing   country.   These   words were subject of judicial scrutiny by this Court in   State   of   Travancore­Cochin   v.   Shanmugha Vilas   Cashew   Nut   Factory1.   Construing   these words,   Patanjali   Sastri,   C.J.,   observed   at   p. 62: “ The   word   ‘course’   etymologically denotes   movement   from   one   point   to another,   and   the   expression   ‘in   the course  of’  not  only implies a  period  of time   during   which   the   movement   is   in progress but postulates also a connected relation.” As   regards   the   limits   of   the   course,   the learned Chief Justice observed at p. 68: “ It   would   seem,   therefore,   logical   to hold   that   the   course   of   the   export   out of,   or   of   the   import   into   the   territory of   India   does   not   commence   or   terminate 78 until   the   goods   cross   the   customs barrier.” Das,   J.,   as   he   then   was,   in   his   dissenting judgment   practically   agreed   with   Patanjali Sastri, C.J., on the interpretation of the said words. The learned Judge expressed his view at p. 92 thus: “ The   word   ‘course’   conveys   to   my   mind the   idea   of   a   gradual   and   continuous flow,   an   advance,   a   journey,   a   passage or   progress   from   one   place   to   another. Etymologically   it   means   and   implies motion,   a   forward   movement.   The   phrase ‘in the course of’ clearly has reference to   a   period   of   time   during   which   the movement   is   in   progress.   Therefore,   the words   “in   the   course   of   the   import   of the   goods   into   and   the   export   of   the goods   out   of   the   territory   of   India ‘obviously   cover   the   period   of   time during   which   the   goods   are   on   their import or export journey’.” We   respectfully   agree   with   the   aforesaid observations   of  the  learned  Judges.  The  course of the import of the goods may be said to begin when the goods enter their import journey i.e. when   they   cross   the   customs   barrier   of   the foreign   country   and   end   when   they   cross   the customs barrier of the importing country.” “ 11.   The   legal   position   vis­a­vis   the import­sale   can   be   summarised   thus:   (1)   The course   of   import   of   goods   starts   at   a   point when the goods cross the customs barrier of the foreign   country   and   ends   at   a   point   in   the importing   country   after   the   goods   cross   the customs   barrier;   (2)   the   sale   which   occasions the   import   is   a   sale   in   the   course   of   import; (3)   a   purchase   by   an   importer   of   goods   when they   are   on   the   high   seas   by   payment   against shipping   documents   is   also   a   purchase   in   the course of import, and (4) a sale by an importer 79 of   goods,   after   the   property   in   the   goods passed   to   him   either   after   the   receipt   of   the documents   of   title   against   payment   or otherwise,   to   a   third   party   by   a   similar process   is   also   a   sale   in   the   course   of import.” 96. Learned   counsel   for   the   petitioners   has   placed   much reliance   on   Nine   Judges   Constitution   Bench   in   re   Sea   Customs Act Case,   AIR 1963 SC 1760 .   This Court in the aforesaid case had   answered   a   reference   made   under   Article   143(1).   Three questions to be answered were as follows:­ “ (1)   Do   the   provisions   of   Article   289   of   the Constitution   preclude   the   Union   from   imposing, or   authorising   the   imposition   of,   customs duties on the import or export of the property of   a   State   used   for   purposes   other   than   those specified in clause (2) of that article? (2)   Do   the   provisions   of   Article   289   of   the Constitution   of   India   preclude   the   Union   from imposing,   or   authorising   the   imposition   of, excise   duties   on   the   production  or   manufacture in   India   of   the   property   of   a   State   used   for purposes   other   than   those   specified   in   clause (2) of that article? (3)   Will   sub­section   (2)   of   Section   20   of   the Sea   Customs   Act,   1878   (Act   8   of   1878),   and sub­section   (1­A)   of   Section   3   of   the   Central Excises  and  Salt  Act,  1944   (Act  1  of   1944)   as amended by the Bill set out in the annexure be inconsistent   with   the   provisions   of   Article 289 of the Constitution of India?” 97. In   the   above   context,   this   Court   had   examined   the 80 distribution   of   legislative   power   between   the   Union   and   the States.     This   Court   held   that   there   is   no   overlapping   in   the matter   of   taxation   between   the   two   Lists,   i.e.,   List   I   and List   II.   This   Court   held   that   all   customs   duties   including export   duties   are   within   the   powers   of   Parliament   with   which States   are   not   concerned.     In   Para   9   of   the   judgment, following observations are made:­ “ .....All   customs   duties,   including   export duties, relating as they do to transactions of import   into   or   export   out   of   the   country   are within the powers of Parliament. The States are not   concerned   with   those.   They   are   only concerned   with   taxes   on   the   entry   of   goods   in local   areas   for   consumption,   use   or   sale therein, covered by entry 52 in the State List. Except   for   duties   of   excise   on   alcoholic liquors and opium and other narcotic drugs, all duties   of   exercise   are   leviable  by   Parliament. Hence, it can be said that by and large, taxes on   income,   duties   of   customs   and   duties   of excise   are   within   the   exclusive   power   of legislation by Parliament.” 98. It   is   relevant   to   notice   that   this   Court   clearly   noticed the   power   of   States   to   levy   entry   tax   on   entry   of   goods   in local   area   for   consumption,   sale   or   use.     The   above observations   made   by   the   Constitution   Bench   clearly   support the submission of learned counsel for the State that power of State   under   Entry   52   was   recognised   while   considering   the Union’s   power   to   levy   the   customs   duty.     This   Court   further laid   down   that   in   the   case   of   levy   of   customs   duty,   the 81 taxable   event   is   the   import   of   goods   within   the   customs barriers.     In   paragraph   26   of   the   judgment,   following   was stated:­ “ ( 26)   Similarly   in   the   case   of   duties   of customs   including   export   duties   though   they are   levied   with   reference   to   goods,   the taxable   event   is   either   the   import   of   goods within   the   customs   barriers   or   their   export outside   the   customs   barriers.   They   are   also indirect   taxes   like   excise   and   cannot   in   our opinion   be   equated   with   direct   taxes   on   goods themselves. Now, what is the true nature of an import   or   export   duty?   Truly   speaking,   the imposition   of   an   import   duty,   by   and   large, results in a condition which must be fulfilled before   the   goods   can   be   brought   inside   the customs barriers i.e. before they form part of the   mass   of   goods   within   the   country.   Such   a condition is imposed by way of the exercise of the   power   of   the   Union   to   regulate   the   manner and   terms   on   which   goods   may   be   brought   into the country from a foreign land....” 99. Learned   counsel   for   the   writ   petitioners   has   laid   much emphasis   on   the   observations   made   by   nine­Judge   Constitution Bench  in  paragraph  26  as  quoted above.  The  above  observations were   made   by   the   nine­Judge   Constitution   Bench   while considering the nature of import and export. It was held that the   imposition   of   import   duty   results   in   a   condition   which must   be   fulfilled   before   the   goods   can   be   brought   inside   the customs   barriers   i.e.   before   they   form   part   of   mass   of   goods 82 within the country. When the goods land in the custom area of the Indian territory and released for the home consumption, it forms   part   of   the   mass   of   goods   within   the   country   and   the importation   is   complete.   We,   thus,   do   not   find   any inconsistency   in   the   constitutional   concept   of   import   as envisaged in Article 286(1)(b) and the concept of import as is contained in Customs Act, 1962. 100.  This Court had also occasion to consider the issue as to when   import   would   be   completed   in   the   case   of   Kiran   Spinning Mills   Vs.   Collector   of   Customs,   (2000)   10   SCC   228,   following was held in paragraph 6:­ “ ....The   import   would   be   completed   only   when the   goods   are   to   cross   the   customs   barriers and  that   is  the  time  when  the  import   duty  has to be paid and that is what has been termed by this Court in Sea Customs case (SCR at p. 823) as being the taxable event. The taxable event, therefore,   being   the   day   of   crossing   of customs   barrier,   and   not   on   the   date   when   the goods   had   landed   in   India   or   had   entered   the territorial   waters,   we   find   that   on   the   date of   the   taxable   event   the   additional   duty   of excise   was   leviable   under   the   said   Ordinance and,   therefore,   additional   duty   under   Section 3   of   the   Tariff   Act   was   rightly   demanded   from the appellants.” 101.   Similar   view   was   expressed   in   the   case   of   Garden   Silk Mills Ltd. & Anr. Vs. Union of India & Ors., (1999) 8 SCC 744, in paragraph 18, which is to the following effect:­ 83 “ 18.   It  would  appear  to  us   that  the  import  of goods   into   India   would   commence   when   the   same cross   into   the   territorial   waters   but continues   and   is   completed   when   the   goods become   part   of   the   mass   of   goods   within   the country;   the   taxable   event   being   reached   at the   time   when   the   goods   reach   the   customs barriers   and   the   bill   of   entry   for   home consumption is filed.” 102. The   law   relating   to   customs   has   been   consolidated   by   the Customs   Act,   1962.     The   definitions   of   “import”,   “imported goods”   and   “importer”   have   already   been   noticed   above.     The definition   of   imported   goods   as   given   in   Section   2(25)   is   ­ any goods brought into India from the place outside India   but does   not   include   goods,   which   have   been   cleared   for   home consumption.    The provision clearly contemplates that once the goods   are   released   for   home   consumption,   the   character   of imported   goods   is   lost   and   thereafter   no   longer   the   goods could be called as imported goods.  The import transit is only till the goods are released for home consumption.   The taxing event   for   entry   tax   under   Entry   52   List   II   is   entirely different   and   has   nothing   to   do   with   the   customs   duty.     The State   by   imposing   entry   tax   in   any   manner   is   not   entrenching in   the   power   of   the   Parliament   to   impose   customs   duty.   The goods  are  released  for  home consumption only  after  payment  of the   customs   duty   due   to   the   Central   Government.   The   goods 84 which are imported cannot be held to be insulated so as to not subject to any State tax, any such insulation of the imported goods   shall   be   a   protectionist   measure   which   will   be discriminatory   and   invalid.     When   all   normal   goods   are subjected   to   State   tax   no   exemption   can   be   claimed   by   goods, which have been imported from payment of entry tax. To take a common   example,   all   goods,   which   pass   through   a   toll   bridge are   liable   to   pay   toll   tax,   can   it   be   said   that   the   imported goods   which   after   having   been   released   from   customs   barriers and   are   passing   through   a   toll   bridge,   are   not   liable   to   pay the toll tax, the answer has to be in No.  Thus, the event for levy   of   customs   duty,   which   is   in   the   domain   of   the Parliament, is  entirely different  from  that of  event  of entry tax.     The   liability   to   pay   State   entry   tax   arises   only   when goods   enter   into   a   local   area   for   consumption,   use   and   sale, which   event   is   entirely   different   and   separate   from   the   levy of a customs duty, which is on import.     103.   Learned   counsel   for   the   petitioner   has   contended   that the   definition   given   in   the   provisions   of   the   Customs   Act, 1962  cannot control the scope  and  ambit of  the  Constitutional entries.   It  is submitted  that  Constitutional  entries  have  to be read giving widest possible amplitude and have to be given wide meaning and their scope and ambit cannot be controlled by 85 a   Parliamentary   Legislation   or   by   the   definitions   given   in   a Parliamentary   Legislation.     In   the   case   of   ITC   Ltd.   Vs. Agricultural   Produce   Market   Committee   &   Ors.(2002)   9   SCC   232, the Constitutional Bench in paragraph 32 laid down as under:­ “ 32.  In State of A.P. v. McDowell & Co. also it was   held   that   the   ambit   and   scope   of   a constitutional   entry   cannot   be   determined   with reference   to   a   parliamentary   enactment.   If   it is   otherwise,   it   would   result   in   Parliament enacting   and/or   amending   an   enactment   thereby controlling   the   ambit   and   scope   of   the constitutional   provision.   That   cannot   be   the law.   The   power   to   legislate   with   which   we   are concerned   is   contained   in   Article   246.   The fields   are   demarcated   in   the   various   entries. On   reading   both,   it   has   to   be   decided   whether the   legislature   concerned   is   competent   to legislate   when   its   validity  is   questioned.   The ambit   and   scope   of   an   entry   cannot   be determined   with   reference   to   a   parliamentary enactment.” 104.   There   cannot   be   any   dispute   to   the   proposition   as   laid down by this Court in the above case that the scope and ambit of the Constitutional entries have to be given a wide meaning and   scope.     There   is   no   inhibition   on   the   Parliament   in exercising   its   legislative   power   under   Entry   41   List   I   to define   customs   frontiers   and   further   legislate   with   regard   to duties of customs. Even if we do not confine to the definition of   imported   goods   as   given   in   the   Customs   Act,   1962,   the generally   accepted   meaning   and   definition   of   import   as   has been   laid   down   in   cases   as   noted   above   is   that   import 86 commences   when   the   goods   leave   the   customs   frontiers   of   the country   from   where   the   goods   are   imported   and   continue   when the   goods   enters   into   the   customs   frontiers   of   imported country and ends when goods are released for home consumption. Till   the   event   of   import   is   over,   Parliamentary   Legislation, the control of Union continues for ensuring the realisation of the customs duties.   105.   In   view   of   the   foregoing   discussions,   we   are   of   the clear opinion that taxing event with regard to levy of customs duty by Parliament and levy of entry tax by States under Entry 52   List   II   are   entirely   different   and   separate.     The   taxing event   pertaining   to   levy   of   entry   tax   occurs   only   after   the taxing event of levy of customs duty is over. Thus, the State Legislation   imposing   entry   tax   in   no   manner   encroaches   upon the   Parliamentary   Legislation   under   Entry   41   and   Entry   83. There is no invalidity in levy of entry tax by the States.  Original/Unbroken Package Theory 106.   The Original Package/ Unbroken Package is a theory which was evolved by U.S. Supreme Court in reference to the imported goods.     The   genesis   of   the   theory   is   from   the   Chief   Justice Marshall,   in   the   case   of   Brown   Vs.   The   State   of   Maryland,   6 87 L.Ed.   678.   State   of   Maryland   has   enacted   a   law   that   all importers   of   foreign   articles   or   commodities   shall,   before they are authorized to sell, take out a license for which they shall pay fifty dollars.   The above provision of the State of Maryland   was   challenged   by   Brown   on   the   ground   that   the provision   is   repugnant   to   following   two   provisions   in   the Constitution of the United States:­ “ 1.   To   that   which   declares   that   'no   State shall, without the consent of Congress, lay any imposts,   or   duties   on   imports   or   exports, except   what   may   be   absolutely   necessary   for executing its inspection laws.' 2.   To   that   which   declares   that   Congress   shall have   power   'to   regulate   commerce   with   foreign nations, and among the several States, and with the Indian tribes.'” 107.   Chief   Justice   Marshall   in   above   context   has   laid   down following:­ “ .....It is sufficient for the present to say, generally, that when the importer has so acted upon   the   thing   imported,   that   it   has   become incorporated   and   mixed   up   with   the   mass   of property in the country, it has, perhaps, lost its distinctive character as an import, and has become   subject   to   the   taxing   power   of   the State; but while remaining the property of the importer,   in   his   warehouse,   in   the   original form or package in which it was imported, a tax upon   it   is   too   plainly   a   duty   on   imports   to escape the prohibition in the constitution. 108.   The   Original   Package   theory   is   propounded   from   the 88 aforesaid   judgment.     Another   judgment   of   the   U.S.   Supreme Court,   which   relied   on   the   case   of   Brown   Vs.   The   State   of Maryland   and further formulated the doctrine is   C. Adolph Low V. Alexander Austin, 20 L.Ed. 517 .   The facts and issue which arose in the aforesaid case had been noted in the beginning of the judgment, which is to the following effect:­ “ The   plaintiffs   have   been   for   several   years past,   and   still   are,   importing,   shipping   and commission   merchants,   in   the   city   of   San Francisco,   in   the   state   of   California.     In 1868,   they   received,   on   consignment   from parties   in   France,   certain   champagne   wines   of the value of $10,000, upon which they paid the duties   and   charges   at   the   custom­house.     They then stored the wine in their warehouse in San Francisco,   in   the   original   cases   in   which   the wines   were   imported,   where   they   remained   for sale.     While   in   this   condition   they   were assessed as the property of the plaintiff, for state,   city   and   country   taxes,   under   the general   revenue   law   of   California,   which subjects   all   property,   real   or   personal,   in the   state,   with   certain   exceptions   to   an   ad valorem   tax.     The   defendant   was   at   the   time the   tax   collector   of   the   city   and   country   of San Francisco, and as such officer levied upon the cases of wines thus stored, for the amount of   the   tax   assessed   and   was   about   to   sell them,   when   the   plaintiffs   paid   the   amount   and the   charges   incurred,   under   protest,   and   then brought   the   present   action   in   one   of   the district   courts   of   the   state,   to   recover   back money   paid.     The   district   court   gave   judgment for   the   plaintiffs;   the   supreme   court   of   the state   reversed   the   judgment   and   the   case   is brought here on writ of error. The simple question presented in this case for our   consideration   is   whether   imported merchandise,   upon   which  the  duties   and   charges 89 at the custom­house have been paid, is subject to   state   taxation,   whilst   remaining   in   the original   cases,   unbroken   and   unsold,   in   the hands of the importer”    109.   Justice   Field   relied   on   the   statement   made   by   Chief Justice   Marshall   in   the   case   of   Brown   Vs.   The   State   of Maryland   as   quoted   above.   Relying   on   the   said   judgment, Justice Field laid down following:­ “ ....But the obvious answer to this position is found   in   the   fact,   which   is   in   substance, expressed   in   the   citations   made   from   the opinions   of   Marshal   and   Taney,   that   the   goods imported   do   not   lose   their   character   as imports,   and   become  incorporated   into   the   mass of   property   of   the   State,   until   they   have passed from the control of the importer or been broken   up   by   him   from   their   original   cases. Whilst   retaining   their   character   as  imports,   a tax   upon   them   in   any   shape,   is   within   the constitutional prohibition......” 110.   The  law  laid down  in the above  two  cases is  relied  upon by   the   counsel   for   the   petitioner   to   contend   that   original import   package   continues   till   the   goods   reaches   to   the premises/factory of the petitioner and during such continuance of import under original package, State has no jurisdiction or authority to levy any tax including the impugned entry tax.   111.   We now proceed to first examine the subsequent judgments of the United States Supreme Court, which deal with the above mentioned   two   decisions   of   the   United   States   Supreme   Court. 90 Michelin Tire Corporation Vs. W.L. Wages, Tax Commissioner, 46 L.Ed.   2d   495   is   the   case   which   is   relied   upon   by   the   counsel for   the   State.   In   the   above   case,   respondent   has   imported tires   and   tubes   from   France   and   Nova   Scotia.   Thus,   articles were   included   in   an   inventory   maintained   in   a   wholesale distribution   warehouse   in   the   county.     The   Tax   Commissioner and   Tax   Assessors   of   Gwinnett   County   assessed   ad   valorem property   taxes   against   inventory   of   imported   tires   and   tubes. The   petitioner   challenged   it   on   the   ground   that   State   taxes were   prohibited   by   Art.   I,   §   10,   cl.   2,   of   the   Constitution. The State  Supreme  Court held  against  the  respondents  that  the tyres were subject to ad valorem property tax.  The appeal was taken   to   the   U.S.   Supreme   Court   questioning   the   decision   of the   Georgia   Supreme   Court.   Referring   to   the   judgment   of   Low Vs.   Austin   as   well   as   Brown   Vs.   The   State   of   Maryland ,   the U.S. Supreme Court observed as under:­ “ Low v. Austin, supra, is the leading decision of   this   Court   holding   that   the   States   are prohibited   by   the   Import­Export   Clause   from imposing   a   nondiscriminatory   ad   valorem property tax on imported goods until they lose their   character   as   imports   and   become incorporated   into   the   mass   of   property   in   the State.   The   Court   there   reviewed   a   decision   of the California Supreme Court that had sustained the   constitutionality   of   California's nondiscriminatory   ad   valorem   tax   on  the  ground that   the   Import­Export   Clause   only   prohibited taxes   upon   the   character   of   the   goods   as imports   and   therefore   did   not   prohibit 91 nondiscriminatory   taxes   upon   the   goods   as property.   See   13   Wall.,   at   30­31   20   L   Ed   517. This   Court   reversed   on   its   reading   of   the seminal   opinion   construing   the   Import­Export Clause,   Brown   v.   Maryland,   12   Wheat.   419,   6 L.Ed.   678   (1827),   as   holding   that   "(w)hilst retaining   their   character   as   imports,   a   tax upon   them,   in   any   shape,   is   within   the constitutional prohibition." 13 Wall., at 34 20 L Ed 517. Scholarly analysis has been uniformly critical of   Low   v.   Austin.   It   is   true   that   Mr.   Chief Justice   Marshall,   speaking   for   the   Court   in Brown   v.   Maryland,   supra,   at   442,   6   L   Ed   678 said   that   "while   (the   thing   imported   remains) the   property   of   the   importer,   in   his warehouse,   in   the   original   form   or   package   in which   it   was   imported,   a   tax   upon   it   is   too plainly   a   duty   on   imports   to   escape   the prohibition in the constitution." Commentators have   uniformly   agreed   that   Low   v.   Austin misread   this   dictum   in   holding   that   the   Court in Brown included nondiscriminatory ad valorem property   taxes   among   prohibited   "imposts"   or "duties,"   for   the   contrary   conclusion   is plainly   to   be   inferred   from   consideration   of the   specific   abuses   which   led   the   Framers   to include   the   Import­Export   Clause   in   the Constitution.   See,   e.   g.,   Powell,   State Taxation   of   Imports   When   Does   an   Import   Cease to   Be   an   Import?,   58   Harv   L   Rev   858   (1945); Note,   The   Supreme   Court,   1958   Term,   73   Harv   L Rev   126,   176   (1959);   Early   &   Weitzman,   A Century   of   Dissent:   The   Immunity   of   Goods Imported   for   Resale   From   Nondiscriminatory State   Personal   Property   Taxes,   7   Sw   U   L   Rev 247 (1975); Dakin, The Protective Cloak of the Export­Import   Clause:   Immunity   for   the   Goods or   Immunity  for  the  Process?,  19   La  L  Rev  747 (1959). Our   independent   study   persuades   us   that   a nondiscriminatory   ad   valorem   property   tax   is not   the   type   of   state   exaction   which   the Framers   of   the   Constitution   or   the   Court   in 92 Brown   had   in   mind   as   being   an   "impost"   or "duty"   and   that   Low   v.   Austin's   reliance   upon the   Brown   dictum   to   reach   the   contrary conclusion was misplaced.” 112.  U.S. Supreme Court further held:­ “ Nothing   in   the   history   of   the   Import­Export Clause   even   remotely   suggests   that   a nondiscriminatory   ad   valorem   property   tax which   is   also   imposed   on   imported   goods   that are   no   longer   in   import   transit   was   the   type of exaction that was regarded as objectionable by   the   Framers   of   the   Constitution.   For   such an   exaction,   unlike   discriminatory   state taxation   against   imported   goods   as   imports, was   not   regarded   as   an   impediment   that severely   hampered   commerce   or   constituted   a form   of   tribute   by   seaboard   States   to   the disadvantage of the inferior States. It   is   obvious   that   such   nondiscriminatory property   taxation   can   have   no   impact whatsoever   on   the   Federal   Government's exclusive   regulation   of   foreign   commerce, probably   the   most   important   purpose   of   the Clause's   prohibition.   By   definition,   such   a tax   does   not   fall   on   imports   as   such   because of their place of origin. It cannot be used to create   special   protective   tariffs   or particular   preferences   for   certain   domestic goods, and it cannot be applied selectively to encourage   or   discourage   any   importation   in   a manner inconsistent with federal regulation.” 113.  It was further held: “ ....The Import­Export Clause clearly prohibits state   taxation   based   on   the   foreign   origin   of the   imported   goods,   but   it   cannot   be   read   to accord   imported   goods   preferential   treatment that   permits   escape  from   uniform   taxes   imposed without   regard   to   foreign   origin   for   services which the State supplies.....” 93 114.   Referring   to   Brown   Vs.   The   State   of   Maryland ,   it   was further held:­ “ The   Court   stated   that   there   were   two situations   in   which   the   prohibition   would   not apply.   One   was   the   case   of   a   state   tax   levied after the imported goods had lost their status as   imports.   The   Court   devised   an   evidentiary tool,   the   "original   package"   test,   for   use   in making that determination. The formula was: "It is   sufficient   for   the   present   to   say, generally, that when the importer has so acted upon   the   thing   imported,   that   it   has   become incorporated   and   mixed   up   with   the   mass   of property in the country, it has, perhaps, lost its distinctive character as an import, and has become   subject   to   the   taxing   power   of   the State; but while remaining the property of the importer,   in   his   warehouse,   in   the   original form or package in which it was imported, a tax upon   it   is   too   plainly   a   duty   on   imports   to escape   the   prohibition   in   the   constitution." Id., at 441­442 6 L Ed 678. "It is a matter of hornbook   knowledge   that   the   original   package statement   of   Justice   Marshall   was   an illustration,   rather   than   a   formula,   and   that its   application   is   evidentiary,   and   not substantive   .   .   .   .   Galveston   v.   Mexican Petroleum Corp., 15 F2d 208 (SD Tex 1926).” 115.   The U.S. Supreme Court concluded by holding:­ “ Thus,   it   is   clear   that   the   Court's   view   in Brown   was   that   merely   because   certain   actions taken   by   the   importer   on   his   imported   goods would   so   mingle   them   with   the   common   property within the State as to "lose their distinctive character   as   imports"   and   render   them   subject to the taxing power of the State, did not mean that in the absence of such action, no exaction could   be   imposed   on   the   goods.   Rather,   the Court   clearly   implied   that   the   prohibition 94 would   not   apply   to   a   state   tax   that   treated imported   goods   in   their   original   packages   no differently   from   the   "common   mass   of   property in   the   country";   that   is,   treated   it   in   a manner   that   did   not   depend   on   the   foreign origins of the goods.” 116.  Only one more judgment of U.S. Supreme Court needs to be noticed   is   Joanne   Limbach   Tax   Commissioner   of   Ohio   Vs.   The Hooven   &   Allison   Company,   80   L.Ed.   2d   356.     This   Court referring   to   C.   Adolph   Low   Vs.   Austin   (supra),   Brown   Vs.   The State   of   Maryland   (supra)   and   Michelin   Tire   Corporation   Vs. W.L.   Wages   Tax   Commissioner   (supra)   made   following observations:­ “ In   Low   v.   Austin,   supra,   this   Court,   in   an opinion   by   Justice   Field,   unanimously enunciated   the   "original­package"   doctrine, although   perhaps   not   for   the   first   time,   see Brown   v.   Maryland,   12   Wheat   419,   442,   6   L   Ed 678   (1827).   It   held   that,   under   the Import­Export   Clause,   goods   imported   from   a foreign   country   are   not   subject   to   state   ad valorem   property   taxation   while   remaining   in their   original   packages,   unbroken   and   unsold, in the hands of the importer. In   Michelin   Tire   Corp.   v.   Wages,   supra,   an importer challenged the assessment of Georgia's nondiscriminatory   ad   valorem   property   tax   upon an   inventory   of   imported   tires   and   tubes maintained   at   a   wholesale   distribution warehouse. This Court rejected the challenge to the state tax on the imported tires.1 It found that   in   the   history   of   the   Import­Export Clause, there was nothing to suggest that a tax of   the   kind   imposed   on   goods   that   were   no longer   in   import   transit   was   the   type   of exaction   that   was   regarded   as   objectionable  by 95 the   Framers.   The   tax   could   not   affect   the Federal   Government's   exclusive   regulation   of foreign   commerce   since   it   did   not   fall   on imports as such. Neither did the tax interfere with the free flow of imported goods among the States.   The   Clause,   while   not   specifically excepting nondiscriminatory taxes that had some impact on imports, was not couched in terms of a   broad   prohibition   of   every   tax,   but prohibited   States   only   from  laying   "Imposts  or Duties,"   which   historically   connoted   exactions directed   only   at   imports   or   commercial activities   as   such.   The   Court   concluded   that its reliance a century earlier in Low v. Austin "upon   the   Brown   dictum   .   .   .   was   misplaced." 423   US,   at   283,   46   L   Ed   2d   495,   96   S   Ct   535. Chief   Justice   Taney's   opinion   in   the   License Cases,   5   How   504,   12   L   Ed   256   (1847),   was carefully   analyzed,   with   the   Court   concluding that   that   opinion   had   been   misread   in   Low. "Precisely   contrary"   to   the   reading   it   was given   in   Low,   Chief   Justice   Taney's   License Cases   opinion   was   authority   "that nondiscriminatory ad valorem property taxes are not   prohibited   by   the   Import­Export   Clause." 423 US, at 301, 46 L Ed 2d 495, 96 S Ct 535. It followed,   this   Court   concluded,   that   "Low   v Austin was wrongly decided" and "therefore must be and is, overruled.”.....” 117.   Justice   Blackmun   delivering   the   judgment   in   the   above case   clearly   noticed   the   departure   in   the   opinion   of   U.S. Supreme Court and abandonment of Original Package Doctrine, it is useful to quote following observations of the Court:­  “ To   repeat:   we   think   it   clear   that   this   Court in   Michelin   specifically   abandoned   the   concept that   the   Import­Export   Clause   constituted   a broad   prohibition   against   all   forms   of   state taxation that fell on imports. Michelin changed the   focus   of   Import­Export   Clause   cases   from the   nature   of   the   goods   as   imports   to   the 96 nature   of   the   tax   at   issue.   The   new   focus   is not on whether the goods have lost their status as imports but is, instead, on whether the tax sought   to   be   imposed   is   an   "Impost   or   Duty." See   P.   Hartman,   Federal   Limitations   on   State and  Local   Taxation,  §   5:4   (1981);   Hellerstein, State Taxation and the Supreme Court: Toward a More   Unified   Approach   to   Constitutional Adjudication?,   75   Mich   L   Rev   1426,   1427­1434 (1977). Cf. Montana v. United States, 440 U.S. 147, 59 L Ed 2d 210, 99 S Ct 970 (1979). Hooven   I   held   that,   under   the   Clause,   a nondiscriminatory   state   ad   valorem   personal property   tax   could   not   be   imposed   until   the imported goods had lost their status as imports by   being   removed   from   their  original   packages. This   decision   was   among   the   progeny   of   Low   v. Austin   for   it,   too,   was   decided   on   the original­package   doctrine.   Thus,   Hooven   I   is inconsistent   with   the   later  ruling   in   Michelin that such a tax is not an "Impost or Duty" and therefore   is   not   prohibited   by   the   Clause. Although   Hooven   I   was   not   expressly   overruled in   Michelin,   it   must   be   regarded   as   retaining no   vitality   since   the   Michelin   decision.   The conclusion   of   the   Supreme   Court   of   Ohio   that Hooven   I   retains   current   validity   in   this respect   is   therefore   in   error.   A   contrary ruling   would   return  us   to   the   original­package doctrine.   So   that   there   may   be   no misunderstanding,   Hooven   I,   to   the   extent   it espouses   that   doctrine,   is   not   to   be   regarded as authority and is overruled.” 118.   From   the   above,   it   is   clear   that   the   U.S.   Supreme   Court itself   has   abandoned   the   Original   Package   theory   and   it   has been   held   that   imported   goods   are   not   immuned   from non­discriminatory ad valorem taxes imposed by the State.   119.   Now,   we   come   to   the   judgment   of   Federal   Court   and   this 97 Court   wherein   the   aforesaid   doctrine   has   been   considered   and specifically departed with.   120.   Federal  Court  in the case  of   The Province  of Madras  Vs. Messrs.   Boddu   Paidanna   and   Sons.(supra)   has   noticed   the   case of  Brown Vs. The State of Maryland (supra).   The Federal Court held that in our Constitution no such question arises and made the following observations:­ “ ....In   the   Indian   Constitution   Act   no   such question   arises;   and   the   right   of   the Provincial Legislatures to levy a tax on sales can   be   considered   without   any   reference   to   so formidable   a   power   vested   in   the   Central Government.   Lastly,   the   prohibition   in   the American   Constitution   is   against   the   laying  of "any imposts or duties on imports or exports"; the   prohibition   is   not   merely   against   the laying   of   duties   of   customs,   but   is   expressed in what we conceive to be far wiser terms ; and it   does   not   appear   to   us   that   it   would necessarily   follow   from   the   principle   of   the Maryland decision that in India the payment of customs   duty   on   goods   imported   from   abroad   or the   payment   of   an   excise   duty   on   goods manufactured   or   produced   in   India   can   be regarded as conferring some kind of licence or title   on   the   importer   or   manufacturer   to   sell his goods to any purchaser without incurring a further   liability   to   tax.   That   was   the   view which   commended   itself   to   the   Court   in   the Maryland   Case   and   it   was   a   view   adopted   and argued before us. The analogy with the American case is an attractive one; but for ­the reasons which   we   have   given   we   are   wholly   unable   to accept it.” 121.   In   State of Bombay & Anr. Vs. F.N. Balsara, AIR 1951 SC 318,   this  Court  has  clearly  held  that  Original Package Theory 98 has   no   application   in   this   country.     In   Paragraph   23, following has been held:­ “ 23.   I   find   considerable   force   in   the   opinion thus   expressed   by   Gwyer,   C.J.   and   agree   that the   “original   package”   doctrine   has   no application   to   this   country.   In   the   United States,   the   widest   meaning   could   be   given   to the Commerce clause, for there was no question of reconciling that clause with another clause containing the legislative power of the State. Under   the   provisions   of   the   Government   of India   Act,   a   limited   meaning   must   be   given   to the   word   “import”   in   Entry   19   of   List   I   in order to give effect to the very general words used in Entry 31 of List II.” 122.   One   more   judgment   of   this   Court,   which   needs   to   be noticed   is   Gramophone   Company   of   India   Ltd.   Vs.   Birendra Bahadur   Pandey   &   Ors. ,   (1984)   2   SCC   534 ,in   which   again Original   Package   doctrine   has   been   disapproved.     In   Paragraph 30, following has been laid down:­ “ .....We   must   however   say   that   the   “original package   doctrine”   as   enunciated   by   Chief Justice   Marshall   on   which   reliance   was   placed was  expressly   disapproved   first  by   the   Federal Court   in   the   Province   of   Madras   v.   Boddu Paidanna   and   again   by   the   Supreme   Court   in State of Bombay v. F.N. Balsara.....” 123.   In   view   of   the   foregoing   discussions,   we   conclude   that goods   imported   after   having   been   released   from   customs barriers   are   not   immuned   from   any   kind   of   State   taxation, which   fall   equally   on   other   similar   goods   and   the   submission 99 of   the   learned   counsel   for   the   petitioner   that   immunity   from State  taxation  shall  continue  till  it  reaches  in  the  premises where   it   is   to   be   taken   for   consumption,   sale   and   use   cannot be accepted.   NON­INCLUSION OF CUSTOM DUTY IN PURCHASE VALUE 124.     The   petitioners   referring   to   definition   of   purchase value   as   given   in   Section   2(j)   of   the   Orissa   Act,   1999   and other   entry   tax   enactments   contends   that   the   definition   of purchase   value   having   not   included   “custom   duty”   legislature intended   that   no   entry   tax   be   levied   on   the   purchase   value. For ready reference Section 2(j) is reproduced below: ­ “ 2(j).   “Purchase   value"   means   the   value   of scheduled   goods   as   ascertained,   from   original invoice   or   bill   and   includes   insurance charges, excise duties countervailing charges, sales   tax,   transport   charges,   freight   charges and   all   other   charges   incidental   to   the purchase of such goods:  Provided   that   where   purchase   value   of   any scheduled   goods   ­is   not   ascertainable   on account   of   non­availability   or   non­production of   the   original   invoice   or   bill   or   when   the, invoice or bill produced is proved to be false or   if   the   scheduled   goods   are   required   or obtained   otherwise   than   by   way   of   purchase, then   the   purchase   value   shall   be   the   value   or the price at which the scheduled goods of like kind or quality is sold or is capable of being sold in open market;” 125.   From   the   definition   of   purchase   value   given   in   2(j) 100 three   aspects   are   noticeable.   Firstly,   purchase   value   means the   value   of   scheduled   goods   as   ascertained   from   original invoice   or   bill.   Secondly,   it   includes   insurance   charges excise duty and other charges mentioned therein. And thirdly, other   charges   incidental   to   the   purchase   of   such   goods.   The original invoice or bill of scheduled goods, generally include the entire value including the import duty or custom duty and in any event the inclusion of 'all other charges incidental to the   purchase   of   such   goods'   has   to   necessarily   mean   all charges   including   custom   duty   which   is   incidental   to   the purchase.   Thus,   non­inclusion   of   custom   duty   specifically   in definition   of   purchase   value   in   2(j)   is   inconsequential   and cannot   lead   to   mean   that   the   legislature   never   intended   to include   the   imported   goods   under   the   entry   tax   legislation. This Court had occasion to consider a provision in Maharashtra Municipalities   (Octroi)   Rules,   1968   which   contained   provision to   determine   the   value   on   which   octroi   is   leviable.   In Garware Nylons Ltd. vs. Pimpri Chinchwad Mahanagar Palika and Ors,   (1995)   3   SCC   345   Rule   17   came   for   consideration.   The facts   were   given   in   para   2   of   the   judgment   in   following manner: "2. The   appellant   is   a   public   limited   company. It   manufactured   nylon   and   polyester   yarn. Between   September   1983   and   August   1984   it imported   goods   liable   to   octroi.   The 101 Corporation   authorities   claimed   that   the appellant   was   liable   to   include   the   customs duty  paid  by  it  in   the  valuation  of  the  goods as it was a component of the value of the said goods   for   the   purpose   of   Rule   17(a).   The appeal filed by the appellant before  the Civil Judge   failed.   The   order   was   challenged   by   way of   writ   petition   under   Article   226   of   the Constitution.   The   High   Court   negatived   the claim. Rule 17(a) is extracted below : "17:   Provisions   to   determine   value   where octroi   is   leviable   ad­valorem.   ­   (a)   If the   original   invoice   is   produced   by   the importer   and   accepted   by   the   Octroi Officer   the   value   of   the   goods   means   the value   made   up   of   the   cost   price   of   the goods   as   ascertained   from   that   invoice plus   freight   charges,   carrier   charges, shipping   dues,   insurance,   excise   duties, sales   tax,   vend   fee   and   all   other incidental   charges   incurred   by   the importer   till   the   arrival   of   the   goods within the octroi limits". Since   the   words   “custom   duty”   are   not mentioned   in   the   rule,   it   gave   rise   to   an argument   before   the   High   Court   and   in   this Court   whether   it   could   be   included   while determining   the   value   under   Rule   17.   The   High Court   relying   basi cally   on   the   decision   of this   Court   in   Shroff   &   Co.   v.   Municipal   Corpn of   Greater   Bombay ,   1989   Supp(1)   SCC   347   held that   even   though   the   customs   duty   was   not mentioned  in   the  rule  yet  it   was  liable  to   be included   while   determining   the   value   under Rule 17. The learned counsel for the appellant urged   that   since   the   words   “custom   duty”   do not   find   place   in   Rule   17,   they   could   not   be included   for   determining   valuation   under   the rule.   Reliance   was   also   placed   on   Goodyear In dia   Ltd.   v.   State   of   Haryana,   (1990)   2   SCC 71   and     McDowell   &   Co.   Ltd.   v.   CT O,   (1977)   1 SCC   441   and   it   was   urged   that   in   case   the provision in taxing statute was susceptible to 102 two   constructions,   then   the   one   favouring   the assessee should be accepted. ” 126.   Similar   argument   was   raised   before   Court   that   custom duty   having   not   mentioned   in   Rule   17,   no   octroi   is   leviable on   import   of   goods.   The   argument   was   repelled   by   this   Court in para 4 of the judgment which is to the following effect:  "4.  Rule 17 provides for determination of value of   goods   brought   inside   the   Corporation   or Municipal   Board   for   consumption,   use   or   sale. The use of various words in the rule widens its scope. It provides for inclusion of cost price, charges   such   as   freight,   carrier,   customs duties   and   then   all   other   incidental   charges, dues   etc.   The   mention   of   various   charges   and duties is more illustrative than exhaustive. It only indicates that it is not only the expenses which are usually incurred in normal course of commercial   activity,   but   any   incidental expenditure   shall   constitute   the   value   of   the goods.   The   rule   has   to   be   understood   in   broad sense.   No   goods   can   be   imported   from   outside without   payment   of   customs   duty   unless   it   is exempt.   There   appears   to   be   no   reason   to exclude   it   while   determining   the   value   of   the goods.   In   any   case,   if   duty   countervailing could   be   considered   to   be   incidental   charges for   importation,   there   is   no   valid   reason   to exclude custom duty from it. ” 127.   We   thus   do   not   find   any   substance   in   the   submission   of petitioner that non­inclusion of custom duty in definition of purchase   value   leads   to   conclusion   that   entry   tax   is   not payable on entry tax.  Whether   entry   tax   legislations   are   not   covered   by   Entry 103 52 List II? 128.     Shri   Ajay   Agarwal   one   of   the   learned   counsel   for   the writ petitioners has emphatically submitted that entry tax is ultra   vires   of   Entry   52.   Elaborating   his   submission,   he contended   that   on   proper   interpretation   of   Entry   52,   the   tax described  therein  is  to be  levied  only  by  a local  authority. The tax leviable in Entry 52 is nothing but octroi. The entry tax   was   imposed   by   the   several   States   in   1990,   up   to   which date local bodies continued to impose octroi. He submits that tax   is   not   covered   by   Entry   52.   Learned   counsel   for   the petitioner   referring   to   a   definition   of   tax   in     Article 366(28)   contends   that   Constitution   itself   contemplates   local taxes   and   tax   under   Entry   52   is   nothing   but   local   tax   to   be levied   by   local   authorities   for   purpose   of   local   area.   The history   of   entry   tax   and   legislative   practice   also   leads   to the   same   conclusion.   The   Government   of   India   Act,   1935 included   in   the   Provincial   List   Item   No.   49   to   the   effect that   'Cesses   on   the   entry   of   goods   into   a   local   area   for consumption, use or sale'.  129.   Neither   the   Government   of   India   Act,   1935   nor   the Constitution   of   India   has   used   'octroi'.   Constitution   of India   consciously   avoided   to   use   the   term   'Octroi'.   List   II Item No. 52 provided tax on the entry of goods in local area 104 for   consumption,   use   or   sale.   List   I   Entry   89   contained another   tax,   namely,   'terminal   tax   on   goods   and   passengers carried   by   railway,   sea   or   air,   tax   on   railway   fair   and freight'.   This   court   in   B urmah­Shell   Oil   Storage   and Distributing   co.   of     India   Ltd.   Belgaum   vs.   The   Belgaum Borough Municipality, Belgaum, AIR  1963 SC 906 , had addressed the   history   of   octroi   and   the   constitutional   entry   regarding entry   of   goods.   This   Court   has   stated   that   Constitution   has avoided   the   word   'octroi',   in   para   15   following   has   been mentioned:  "15. It will be noticed that in the Government of   India   Act   'octroi'   was   named   but   not described   and   now   the   Constitution   avoids   the word   'octroi',   as   did   the   Government   of   India Act 1935 before, and gives a description.... ” 1 30.  In para 17 & 18 following has been  held:  “ 17.  Octrois and terminal taxes were different taxes   though   they   resembled   in   one   respect, namely,   that   they   were   leviable   in   respect   of goods   brought   into   a   local   area.   While terminal   taxes   were   leviable   on   goods 'imported   or   exported'   from   the   Municipal limits   denoting   thereby   that   they   were connected   with   the   traffic   of   goods,   octrois, according   to   the   legislative   practice   then obtaining   were,   leviable   in   respect   of   goods 105 brought   into   a   Municipal   area   for   consumption or   use   or   sale.   It   is   not   necessary   to   cite the   Municipal   Acts   prior   to   1935   but   a reference   to   them   will   amply   prove   that   such was the tax which was contemplated as octroi.” “ 18. When  the Government of  India  Act 1935 was enacted   terminal   taxes   became   a   central subject,   vide   entry   No.   58   of   List   I,   which reads as follows:­ "58.   Terminal   taxes   on   goods   or passengers carried by railway or air." At   that   time,   it   was   suggested   by   Sir   Walter Leyton   that   both   octrois   and   terminal   taxes should be provincial subjects and that it would perhaps be possible to fuse the two. The Joint Committee,   however,   recommended otherwise   and   terminal   taxes   were   separated from  octrois and  included in  the central  list. The   proceeds   of   the   terminal   taxes,   however, were  to be distributed  among  the provinces. In allocating 'octrois' to the Provinces, the word itself   was   avoided   because   terminal   taxes   are also   octroi   in   a   sense   and   instead   a description   of   the   tax   was   mentioned   in   entry No.   49,   which   has   been   quoted   already,   and which read "Cesses on the entry of goods into a local area  for consumption, use or  sale”. This scheme   has   been   repeated   in   the   Constitution with  the difference that the  entry  relative to terminal tax now reads "terminal taxes on goods and passengers carried by railway, sea or air", and the word "taxes" replaced the word "cesses" in the entry relative to octrois.” 131.   The   distribution   of   legislative   power   between   Union   and State is a Constitutional Scheme included in the Constitution of   India   after   great   deliberation.   Different   tax   entries   in List I and List II are fields of legislation which have to be 106 widely   interpreted   and   no   restricted   meaning   of   an   entry   has to   be   taken   to   fetter   the   legislative   power   of   the   Union   or State. 132. It is well settled that the nomenclature or form of a tax is not a decisive factor to find out the nature of the tax. It is the matter of legislative policy as to how the tax is to be collected. The definition of taxation as given in Article 266 (28)   that   tax   includes   general   or   local   tax   does   not   in   any manner support the contention of the petitioner that tax under Entry   52   is   only   a   local   tax   which   ought   to   be   collected through   local   bodies.   It   is   the   matter   of   legislative   policy that   whether   a   tax   is   collected   as   a   general   tax   or   a   local tax.   The   nature   of   tax,   measure   of   tax   and   machinery   for   tax collection   are   all   different   aspects.     The   submission   of   the petitioner   that   tax   in   Entry   52   should   be   collected   by   local authorities   and   State   has   no   legislative   competence   to   levy such tax is fallacious. It is well within the jurisdiction of the legislature to formulate its policy regarding levy of tax and   its   collection.   Entry   52   of   List   II   has   to   be   given   its wide   and   full   meaning   and   no   limitation   in   the   legislative power of the State can be read as contended by counsel for the petitioner.  133.   The   Constitution   framers   have   abandoned   the   use   of   word 107 'octroi'   which   has   to   be   given   a   meaning   and   purpose.   While interpreting a taxing entry no shackles can be put nor use of any   expression   in   the   Constitution   of   India,   referring   to   a tax   can   be   tied   up   to   any   pre­constitutional   tax   or   levy. Further,   any   pre­constitutional   tax   practice   cannot   put   any fetter on Constitution farmers to define any tax, to elaborate the concept of tax or to move away or forward from any kind of earlier levy. This Court in   Municipal Corporation of   Delhi v. Birla Cotton, Spinning and Weaving Mills, Delhi and Anr, 1968 (3) SCR 251  has laid down the following:  " To   insist   that   the   legislature     should provide   for   every   matter   connected     with municipal     taxation     would     make municipalities     mere       tax   collecting departments   of   Government   and   not self­governing bodies   which   they   are   intended   to   be. Government might as well collect the taxes and make   them   available   to   the   municipalities. That   is   not   a   correct   reading   of   the   history of   Municipal   Corporations   and   other   self governing institutions in our country.” 134.   Thus,   taxes   which   are   to   be   used   by   the   local authorities can be collected by the local authorities as well as   by   the   State   Government.   It   is   the   matter   of   legislative policy   as   to   how   the   tax   is   collected   and   distributed.   Under List   II   Entry   5 ,   the   State   has   legislative   power   to   lay   down powers   of   the   Municipal   Corporation   by   legislation.   It   is 108 again   legislative   policy   that   as   what   machinery   is   to   be provided   by   the   State   legislature   regarding   collection   of taxes on the entry of goods into a local area for consumption, use   or   sale.   No   capital   can   be   made   on   the   submission   that since   tax   is   not   being   collected   by   local   authorities   it   is beyond the power of the State under Entry 52 List  I I. 135.   We thus do not find any substance in the submission of the   learned   counsel   for   the   petitioner   that   entry   tax legislation is not covered by Entry 52 List II.  EXPRESSION “MACHINERY AND EQUIPMENT” AS USED IN THE SCHEDULE OF ORISSA ACT 1999 136.     Part   II   of   the   Schedule   to   the   Orissa   Act,   1999 provides Item 9 as follows:  “ Item   9.   Machinery   and   equipments   [including earthmovers,   excavators,   bulldozers   and road­rollers] [and spare parts and components] used   in   manufacture,   mining,   generation   of electricity,   or   for   execution   of   works contract or for any other purposes.” 137.   The   submission   which   has   been   pressed   by   learned counsel   for   the   petitioner   is   that   the   plant   which   is imported   by   petitioners   in   completely   knocked   out   condition is not covered by expression machinery and equipments. It is submitted that plant and machinery are two different concept 109 and   when   plant   is   imported   in   a   knocked   out   condition   Item No. 9 of Part II of Schedule is not applicable.  138. The Advance Law Lexicon of P Ramanatha Aiyar 3 rd  Edition defines 'Plant' as follows:  "Plant”   means   the   fixtures,   machinery,   tools, apparatus, appliances etc., necessary to carry on   any   trade   or   mechanical   business,   or   any mechanical operation or process. Webster   defines   the   word   “plant”   to   be   “the fixtures   and   tools   necessary   to   carry   on   any trade   or   mechanical   business.”   The   word   is defined   by   Worcester   to   be   “The   machinery, apparatus   or   fixtures   by   which   a   business   is carried on”. The word is not equivalent to the word   “undertaking”,   which   is   defined   by Webster   as     “any   business,   work   or   project which   a   person   engages   in   or   attempts   to perform; enterprise”.” 139.   The   Plant   in   a   knocked   out   condition   is   nothing   but   a collection   of   machineries.   The   plant   being   a   wide   term including   machinery   also,   we   fail   to   see   how   a   knocked   out plant   shall   not   be   covered   by   Item   No.   9   of   Part   II   of   the Schedule. Machinery and equipments are wide words which shall also   cover   plant   in   a   knocked   out   condition.   We   thus   reject the contention of the counsel for the petitioner that a plant which  is  imported  in   knocked out condition  is  not  covered  by the Part II of Schedule of Orissa Act, 1999.  140. One more submission raised by one of the learned counsel 110 for the writ petitioners also needs to be noted. Section 4 of Bihar Act, 1993 as inserted by Bihar Act 19 of 2006 was also challenged   on   the   ground   that   it   violates   constitutional provision   of   Article   266.   Section   4   deals   with   “utilization of   the   proceeds   of   the   levy   under   the   Act”.   Section   4 sub­section   (1)   provides   that   the   proceeds   of   the   levy   under the   Act   shall   be   appropriated   to   the   fund   and   shall   be utilised   exclusively   for   the   development   of   trade,   commerce and   industry   in   the   State   of   Bihar.   Presumably,   the   said amendment was brought by the State Legislature to support the State's   claim   that   levy   is   compensatory   in   nature.   The submission   of   the   writ   petitioners   is   that   Section   4 indicates   that   the   tax   levied   under   the   Act   would   be collected  and  kept  in  a separate  fund  which according  to  the writ petitioners is contrary to the constitutional mandate of Article   266   of   the   Constitution,   which   specifically   mandates that   all   public   money   must   be   credited   to   the   Consolidated Fund of respective States. There are two reasons due to which the   above   submissions   cannot   be   accepted.   Firstly,   Section   4 relates to creation of fund and utilisation of funds received from   the   collection   of   entry   tax.   The   creation   of   fund   and its utilisation can in no manner effect the levy of the entry tax and the compensatory tax theory having already negated by 111 nine­Judge   Constitution   Bench   of   this   Court   in   Jindal Stainless   (supra) ,   the   inquiry   as   to   whether   tax   is compensatory   or   not   is             not   relevant.   Secondly,   this Court in  Jaora Sugar Mills(P) Ltd. v. State of Madhya Pradesh and   Ors.,   1996   (1)   SCR   523   while   considering   Article   266   of the   Constitution   of   India   has   already   held   that   it   is difficult to understand how the Act can be said to be invalid because   the   cesses   recovered   under   it   are   not   dealt   with   in the   manner   provided   by   the   Constitution.   Following observations were made by the Court: "It   is   doubtful   whether   a   plea   can   be   raised by   a   citizen   in   support   of   his   case   that   the Central   Act   is   invalid   because   the   moneys raised   by   it   are   not   dealt   with   in   accordance with   the   provisions   of   Part   XII   generally   or particularly the provisions of Article 266. We will,   however,   assume   that   such   a   plea   can   be raised   by   a   citizen   for   the   purpose   of   this appeal. Even so, it is difficult to understand how  the  Act  can  be   said  to   be  invalid  because the   cesses   recovered   under   it   are   not   dealt with   in   the   manner   provided   by   the   the Constitution.   The   validity   of   the   Act   must   be judged   in   the   light   of   the   legislative competence of the Legislature which passes the Act   and   may   have   to   be   examined   in   certain cases   by   reference   to   the   question   as   to whether   fundamental   rights   of   citizens   have been   improperly   contravened,   or   other considerations   which   may   be   relevant   in   that behalf.   Normally,   it   would   be   inappropriate and   indeed   illegitimate   to   hold   an   enquiry into   the   manner   in   which   the   funds   raised   by an   Act   would   be   dealt   with   when   the   Court   is considering the question about the validity of 112 the Act itself.” 141.  Although learned counsel for the writ petitioners sought to distinguish the above decision on the ground that the said observations   were   made   while   the   Court   was   considering   the entirely   different   issue   that   is   an   issue   relating   to inter­se   transfer   of   money   from   Consolidated   Funds   of respective   States   to   Consolidated   Fund   of   India.   As   per aforesaid   judgment   the   challenge   to   the   validity   of   the   Act on   the   ground   that   it   is   violative   of   Article   266   was repelled. What was held by this Court as quoted above clearly negates the submissions raised by the learned counsel for the writ petitioners on the basis of Article 266. In any view of the   matter,   the   said   ground   has   no   relevance   with   regard   to levy of entry tax on imported goods.  142.   Learned   counsel   appearing   for   the   various   petitioners relating to civil appeals from State of Orissa in the end has sought   for   liberty   from   this   Court   to   urge   grounds   of discrimination   under   Article   304(a)   of   the   Constitution   of India.   Learned   counsel   for   the   petitioners   have   relied   on order   of   this   Court   in   Civil   Appeal   No.   4756   of   2017,   M/s Bharati Airtel Ltd vs. Assessing Authority Orissa Entry Tax & Anr   dated 29.03.2017 as well as order of this Court in Civil 113 Appeal   Nos.   997­998   of   2004,   State   of   UP   and   Ors   vs.   M/s Indian   Oil   Corporation   Ltd.   &   Etc   dated   21.03.2017.   It   is submitted   that   this   Court   has   granted   liberty   to   petitioner to   file   fresh   writ   petition   in   order   dated   29.03.2017   to raise   question   of   discrimination   under   Article   304(a)   as   per law laid down by Nine Judges Bench in   Jindal Stainless Ltd & Anr vs. State of Haryana & ors. 143.   Learned   counsel   appearing   for   the   State   of   Orissa   has opposed the prayer of the petitioner seeking liberty to raise the   issue.   It   is   contended   that   petitioners   have   not   raised the   relevant   issues   nor   pleaded   in   support   of   the   plea   of discrimination   under   Article   304(a).   The   parameters   under which   entry   tax   can   violate   the   Article   304(a)   has   now   been conclusively   laid   down   by   Nine   Judges   Bench   in   Jindal Stainless   Ltd.(supra).   We   are   thus   of   the   view   that   liberty be   given   to   petitioners   to   raise   the   plea   of   discrimination under  Article  304(a)  in accordance  with the law as  laid down by   Nine   Judges   Bench   in   Jindal   Stainless   Ltd.(supra) .   We, however,   are   of   the   view   that   for   the   above   purposes,   it   is not   necessary   to   grant   any   liberty   to   file   a   fresh   writ petition at this stage and at this distance of time. The ends of   justice   shall   be   served,   if   liberty   is   granted   to   the petitioners to revive their writ petitions by making a proper 114 application   before   the   High   Court.   In   the   writ   petitions which   have   been   dismissed   by   the   Orissa   High   court   against which present appeals are decided, the liberty to revive such petition   and   to   urge   ground   under   Article   304(a)   is   granted which   can   be   availed   only   within   the   period   of   30   days   from the date of this judgment.  144.   In   view   of   foregoing   discussion,   we   arrive   at   the following  CONCLUSIONS :  (i) Orissa Entry Tax Act, 1999, Kerala Tax Act, 1994 and Bihar   Tax   on   Entry   of   Goods   in   Local   Area   for Consumption,   Use   or   Sale,   1993   (before   its   amendment   by Bihar   Act,   2003   and   2006)   do   not   exclude   levy   of   entry tax   on   the   goods   imported   from   any   place   outside territories   of   India   into   a   local   area   for   consumption, use or sale. (ii) All   the   Entry   Tax   Legislations   questioned   in   these appeals are legislations which are within the legislative competence   of   the   State   legislatures   and   do   not   intrude the legislative domain of Parliament as reserved in Entry 41 & Entry 83 of List I.  (iii) The import of goods from any territory outside India 115 comes   to   an   end   when   the   goods   enter   into   the   custom frontiers of India and are released for home consumption. (iv) After   import   of   goods   comes   to   an   end   the   State legislature has full legislative competence to levy entry tax under Entry 52 List II. (v)   The   Original   Package   Theory   as   developed   by   the American   Supreme   Court   in   case   of   Brown   vs.   State   of Maryland(supra)  is not applicable in this country and the imported   goods   are   not   exempted   from   entry   tax   till   it reaches   to   the   factory   premises/destination   of   its consumption, use or sale. (vi) Non   inclusion   of   custom   duty   in   the   definition   of purchase   value   in   the   statute   of   entry   tax   is   not   an indicator   of   the   fact   that   legislature   never   intended   to levy entry tax on imported goods.  (vii) Entry tax legislation are fully covered by Entry 52 List II and the submission that essence of Entry 52 is octroi   which   can   be  levied   only  by   local   authorities   and State   has   no   legislative   competence   to   impose   entry   tax under Entry 52 List II is fallacious. (viii) A plant imported in knocked out  condition  is fully covered with the  definition of  machinery   and 116 equipment under  Part II of  Schedule  of   the   Orissa   Act, 1999.  145.   In   view   of   our   foregoing   discussion   and   conclusion,   we decide   all   the   appeals   in   this   batch   of   appeals   in   following manner:  (i) All the appeals filed against the judgments of Orissa High   Court   are   dismissed.   The   Transfer   case   is   also dismissed. (ii) All   the   appeals   filed   against   the   judgment   of   Patna High Court are dismissed.  (iii)   The   civil   appeal   filed   against   the   judgment   of   Jharkhand High Court stands allowed. (iv) The appeals filed by the State of Kerala are allowed. The  judgment   of  the  Division   Bench   holding   that  no   entry tax was leviable on the vehicle imported from territories outside   the   country   is   set   aside,   restoring   the   judgment of the learned Single Judge. (v) Writ Petition 574 of 2003, Parisons Agrotech Pvt. Ltd vs. State of Kerala & Ors. is dismissed. (vi).In   Civil   Appeals   filed   against   judgment   of   Orissa High   Court,   appellants   who   were   writ   petitioners   before the   High   Court   are   given   liberty   to   file   an   application 117 within   30   days   from  today   to   revive  their   writ   petitions and urge ground of discrimination under Article 304(a) as per   law   laid   down   by   Nine   Judges   Bench   in   Jindal Stainless Ltd.(supra). 146.  Parties shall bear their own costs. 147. Before we close, we record our deep appreciation for the valuable   assistance   rendered   by   various   learned   counsel appearing   in   this   batch   of   Civil   Appeals   which   has   immensely benefited us in coming to correct conclusion on various issues involved in these cases. ..........................J.     ( A.K. SIKRI ) ..........................J.     ( ASHOK BHUSHAN ) NEW DELHI, OCTOBER 09, 2017.