Judgment

KANIA, J. :- This writ petition is filed under Article 32 of the Constitution of India by the West Bengal Hosiery Association and certain Hosiery manufacturers and dealers in the State of West Bengal against the State of Bihar and the Commissioner of Commercial Taxes-cum-Special Secretary, Bihar praying for a direction to the Respondents to forbear from levying or imposing or collecting any sales tax on the sale of hosiery goods imported into the State of Bihar from other States for sale during the tenure of Circular no. SO 934 dated 1st August 1984, exempting from such tax sales of hosiery goods manufactured or produced in the State of Bihar and to refund the amount of sales tax levied and collected on the sale of hosiery goods imported into the State of Bihar from other States in India from 1st August, 1984. The Petitioners have also prayed for a writ of mandamus commanding the Respondents to cancel, withdraw or rescind Notification No. SO 934 dated August 1, 1984 by which exemption was granted to hosiery industries of Bihar from the levy of sales tax as set out earlier and the Petitioners have also prayed that the Respondents should be directed to refrain from making any discrimination between hosiery goods imported into the State of Bihar and hosiery goods manufactured in the State of Bihar in the levy of Bihar Sales Tax. The writ petition can be very shortly disposed of because the point raised in the writ petition is directly covered by decisions of this Court.

2. By a Notification dated 30th September, 1983, on and from October 1, 1983, Bihar Sales Tax at the rate of 5 per cent ad valorem was imposed on all hosiery goods sold within the State of Bihar irrespective of the place whether the hosiery goods were manufactured. On August 1, 1984. a Notification bearing No. SO 934 was issued whereby the hosiery goods manufactured by hosiery industries in Bihar were exempted from the levy of sales tax. The said Notification stated that it would remain valid for a period of five years. The reason given for this exemption was the grant of incentives to hosiery industries in Bihar.

3. The contention raised before us by Mr. Sorabji, learned Counsel for the Petitioners, is that by reason of the said Notification all the sales of hosiery goods in Bihar manufactured by hosiery industries outside the State of Bihar are subjected to the levy of sales tax at the rate of 5 per cent whereas the sales of hosiery goods manufactured by hosiery industries in Bihar are exempted from such levy and thus the hosiery industries outside the State of Bihar are clearly discriminated against. It is submitted by learned Counsel that this discrimination violates the provisions of Article 301 of the Constitution of India.

4. The relevant Articles to consider in order to appreciate the contention of the Petitioners are Articles 301 & 304 of the Constitution of India. The said Articles run as follows :

"301. Subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of India shall be free.

304. Notwithstanding anything in article 301 or article 303, the Legislature of a State may by law

(a) impose on goods imported from other States or the Union territories any tax to which similar goods manufactured or produced in that State are subject, so, however, as not to discriminate between goods so imported and goods so manufactured or produced; and

(b) impose such reasonable restrictions on the freedom of trade. commerce or intercourse with or within that State as may be required in the public interest :

Provided that no Bill or amendment for the purposes of clause (b) shall be introduced or moved in the Legislature of a State without the previous sanction of the President."

5. A plain reading of these Articles would show that it is not open to any State to levy any tax on goods imported from other States or Union territories so as to discriminate between goods so imported and goods manufactured and produced in that State