G. C. BHARUKA, J.

( 1 ) THE petitioners herein are engaged in the business of manufacturing various commodities. Their manufacturing units are situated within the jurisdictional limits of "local areas" as defined under section 2 (5) of the Karnataka Tax on Entry of Goods Act, 1979 (hereinafter "the Act" only ). For the purpose of their manufacturing process, they purchase the raw materials like chemicals, petro products, based oil, beedi leaves, bulk drugs and/or packing materials from outside the State of Karnataka and after causing entry thereof in the said local areas, consume the said goods in their manufacturing process or packing of finished products.

( 2 ) ACCORDING to the petitioners, though, under Notification No. FD 112 CET 93 (III) dated March 30, 1994 read with Notification No. FD 109 CET 97 (8) dated March 31, 1997 (hereinafter referred to as the "first" and "second" notification) issued under section 3 (1) of the Act, the raw materials brought by them in the local areas, which having been purchases from outside the State of Karnataka, have been made liable for levy of entry tax at 1 per cent but similar goods of karnataka and brought into those very local areas have been exempted from such the levy. Accordingly, they have impugned the validity of the said notifications by raising various contentions.

( 3 ) ON hearing the rival submissions made at the Bar, we find that the following contentions call for our consideration :

(a) the notifications have been issued in excess of the legislative power delegated to the State government under section 3 (1) of the Act inasmuch as the State Government as a delegatee was competent to only specify the rate or rates" in respect of different goods or different classes of goods or different classes of goods" as specified in the Schedule but it could not have specified the rate of tax by dividing the given commodity into further groups thereby levying tax on similar goods fulfilling certain condition and leaving the remaining out of the taxing net.

(b) the impugned notifications are also constitutionally invalid as offending article 304 (a) of the constitution since these have resulted in causing discrimination in the matter of levy of entry tax under the Act between similar goods manufactured or produced in the State of Karnataka and those imported from other States; (c) the second notification to the extent its operation has been retrospective with effect from april 1, 1994 is ultra vires the powers of the State Government since the expressions "retrospectively or prospectively" were inserted by Karnataka Act No. 8 of 1993 which never came into force for want of the President's assent as required under the proviso to article 304 (b) of the Constitution of India.

( 4 ) BEFORE deliberating on the contentions raised at the Bar, it will be of benefit to first refer to the relevant provisions of the Act as they stood from May 1, 1992. These Are : "section 2 (4a) : 'goods' means all kinds of movable property (other than newspapers, actionable claims, stocks and shares and securities) and includes livestock; section 2 (5) : 'local area' means an area within the limits of a city under the Karnataka Municipal corporations Act, 1976 (Karnataka Act 14 of 1977), a municipality under the Karnataka municipalities Act, 1964 (Karnataka Act 22 of 1964), a Notified Area Committee, a Town board, a Sanitary Board or a Cantonment Board constituted or continued under any law for the time being in force and a Mandal under the Karnataka Zilla Parishads. Taluk Panchayat samithis, Mandal Panchayats and Nyaya Panchayats Act, 1983 (Karnataka Act 20 of 1985) and panchayat area under the Karnataka Panchayat Raj Act, 1993 (Karnataka Act 14 of 1993 ). Section 3 (1) : There shall be levied and collected a tax on entry of any goods specified in the first Schedule into a local area for consumption, use or sale therein, at such rates not exceeding five per cent of the value of the goods as may be specified ret

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