NOOTY RAMAMOHANA RAO, J.

Constitutional validity of sections 3 and 4 of the Andhra Pradesh Tax on Entry of Goods into Local Areas Act of 2001, together with the notifications issued thereunder, has been questioned in this batch of cases.

The State of Andhra Pradesh enacted the Andhra Pradesh Tax on Entry of Goods into Local Areas Act of 2001; Act No. 39 of 2001 (henceforth referred to as "the Entry Tax Act" for brevity). Section 3 of the Entry Tax Act is the charging provision, which enabled the levy and collection of tax on the entry of notified goods into any local area for sale, consumption or use therein. This levy of entry tax is characterised as unconstitutional principally for the reason that it is discriminatory and it also impedes and restricts the free movement of trade and commerce, guaranteed across the Federal Polity under article 301 of our Constitution and for that reason also it is bad. It is further contended that the Presidential consent, which is so essentially to be obtained prior to the introduction of the Bill, needed in terms of clause (b) of article 304 of our Constitution having not been obtained, the impugned Entry Tax Act which seeks to impose restrictions on the freedom of trade and commerce, should be declared as invalid.

Before we further elaborate the contentions canvassed on both sides, it will be relevant to notice the salient features of the Entry Tax Act.

Prior to enacting the present Entry Tax Act, the Governor of Andhra Pradesh has promulgated the Andhra Pradesh Tax on Entry of Goods into Local Areas Ordinance, 2001; Ordinance No. 1 of 2001. Present Entry Tax Act replaces the said Ordinance No. 1 of 2001. The statement of objects and reasons set out in the Bill indicates that in order to protect the interests and revenues of the State as some of the neighbouring States are found indulging in trade diversion by reducing the rates of taxes for certain goods than those levied in the State of Andhra Pradesh for such goods.

Various expressions found in the Entry Tax Act are defined in section 2. The expressions "entry of goods into a local area" and "importer" are defined in sub-sections (e) and (h) of section 2 in the following manner :

"Section 2(e) 'Entry of goods into a local area' with all its grammatical variations and cognate expressions, means entry of notified goods into a local area from any place outside the State for consumption, use or sale therein;

Section 2(h) 'Imported' means a person who brings or causes to be brought any notified goods whether on his own account or on account of a principal or any other person, into a local area, from any place outside the State for consumption, use or sale therein or who owns the notified goods at the time of entry into the local area from any place outside the State."

The charging provision, section 3, reads as under :

"Section 3. Levy and collection of tax. - (1)(a) There shall be levied and collected a tax on the 'entry of the notified goods into any local area' for sale, consumption or use therein. The goods and the rates at which, the same shall be subjected to tax shall be notified by the Government. The tax shall be on the value of the goods as defined in clause (n) of sub-section (1) of section 2 and different rates may be prescribed for different goods or different classes of goods or different categories of persons in the local area;

(b) the tax shall be payable by the importer in such manner and within such time as may be prescribed;

(c) the rate of tax to be notified by the Government in respect of any commodity shall not exceed the rate specified for that commodity under the Andhra Pradesh Value Added Tax Act, 2005 or the notifications issued thereunder :

Provided that the tax payable by the importer under this Act shall be reduced by the amount of tax paid, if any, under the law relating to general sales tax in force in the Union Territory or State in which the goods are purchased.

(2) Notwithstanding anything contained in