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B.L.HANSARIA, KULDIP SINGH, R.M.SAHAI
Shaktikumar M. Sancheti – Appellant
Versus
State Of Maharashtra – Respondent
The legal document indicates that the Court initially interpreted the term "local area" broadly, emphasizing that the legislation's definition did not encompass the entire state but rather specific local areas within the state. The judgment clarified that the taxable event was the entry of a vehicle into a designated local area, not the entire state, and provided an illustrative example to support this interpretation (!) .
However, the recent dissent by Justice Chandrachud in the Jindal case (2016) introduces a contrasting perspective, asserting that a "local area" must be understood as a sub-unit of a state. This interpretation emphasizes a more restricted and precise understanding of "local area," aligning with the constitutional conception of local authorities and administrative boundaries rather than a broad or arbitrary delineation.
Given this divergence, the Court's previous acceptance of a broad interpretation faces significant contestation. The dissenting view suggests that the concept of "local area" should be confined to smaller administrative units within the state, which may impact the validity and scope of legislation that relies on a broader interpretation. This shift underscores a more restrictive understanding of the constitutional and legislative boundaries concerning the definition of "local area," potentially affecting the legitimacy of laws based on a wider interpretation.
JUDGMENT
R.M. SAHAI, J.- These appeals are directed against judgment and order of the High Court of Bombay. The appellants are either contractors or dealers of motor vehicles who have purchased vehicles from outside the State and have brought them into the State of Maharashtra. They are aggrieved by levy of entry tax on such motor vehicles under Maharashtra Tax on Entry of Motor Vehicles into Local Areas Act, 1987. They challenged it by way of writ petitions in the High Court. It was claimed that the levy was colourable exercise of the legislative power of the State as Entry 52 of List II of Seventh Schedule of the Constitution of India did not permit imposition of such tax. It was also urged that the legislation impeded freedom of the appellants under Article 301 of the Constitution. Another ground of challenge was that the imposition was double burden on the appellants and in absence of any rational nexus between the levy of tax and the constitutional objective it was violative of Articles 14 and 286 of the Constitution of India. The High Court did not find any merit in any of these submissions and held that the impugned Act was a valid piece of legislation as various entries in
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