DALVEER BHANDARI, J.

Several petitioners have approached this Court for quashing the notification dated March 31, 1999 issued by respondent No. 1, Lt. Governor of Delhi, imposing levy of sales tax on imported fabrics with effect from April 1, 1999.

The petitioners have in the alternative prayed that a direction be issued declaring that the levy of additional duties of excise under the Additional Duties of Excise (Goods of Special Importance) Act, 1957, and/or any amount equivalent relatable to the said Act is ultra vires and unconstitutional.

The petitioners are importers or in the business of importing fabrics and they are aggrieved by the imposition of sales tax at the rate of 4 per cent on the imported fabrics under section 4(1)(d) of the Delhi Sales Tax Act, 1975.

It is alleged in the petition that the entire scheme of taxation of imported goods is designed to place the goods imported into India at par with the goods manufactured in India in so far as the taxes levied on goods manufactured in India.

The petitioners have drawn our attention to the Statement of Objects and Reasons of the Additional Duties of Excise (Goods of Special Importance) Act, 1957. The relevant portion of the said Objects and Reasons is as under :

"The object of this legislation is to impose additional duties of excise in replacement of sales tax levied by the Union and the States on sugar, tobacco and mill made textiles and to distribute the net proceeds of these taxes, except the proceeds attributable to Union territories, to the States. The distribution of the proceeds of the additional duties broadly followed the pattern recommended by the Second Finance Commission. Provision has been made that States which levy a tax on sale or purchase of these commodities after 1st April, 1958 do not participate in the net proceeds. Provision is made in this Act for including these goods in category of goods declared to be of special importance in inter-State trade or commerce so that, following the imposition of uniform duties of excise on them, the rates of sales tax, if levied by the State are subject from 1st April, 1958 to the restrictions in section 15 of the Central Sales Tax Act, 1956."

The petitioners have also drawn our attention to the speech of the then Finance Minister, who introduced the Bill in the Parliament to demonstrate that the additional duty of excise has been levied in replacement of sales tax levied by the Union and the States.

It is urged that the additional duty of excise is in replacement of sales tax and thus no sales tax is payable on the goods imported by the petitioners. It is also urged that the Additional Duties of Excise (Goods of Special Importance) Act, 1957 has been enacted by the Parliament under the provisions of article 286(3) of the Constitution of India. Article 286(3) expressly provides that any law of a State imposing tax on sale and purchase of goods of special importance would be subject to restrictions and conditions in regard to the system of levy, rates and other incidents of tax. In exercise of such powers the Parliament had already levied additional duty of excise in replacement of sales tax. Therefore, no sales tax can be levied on the same goods.

Mr. Kapur also submitted that the Statement of Objects and Reasons reflects the legislative intention. The Statement of Objects and Reasons intended to impose additional duties of excise in replacement of sales tax and this legislative intention of the Legislature must be carried out by the Centre and the States while enacting subsequent legislations and issuing notifications. Mr. Kapur, the learned counsel for the petitioners, laid particular emphasis on section 3A of the Customs Tariff Act, 1975. Section 3A reads as under :

"Section 3A : Special additional duty. - (1) Any article which is imported into India shall, in additional be liable to a duty (hereafter referred to in this section as the special additional duty), which shall be levied at a rate to be