The withdrawal of exemption for petrol and diesel from entry tax was permissible under Section 10 of the Entry Tax Act and did not violate article 14 of the Constitution of India.

Arun Mishra, J.

1. In W. P. No 12952 of 2008 prayer has been made to quash notification dated April 11, 2007 being ultra vires to the extent of exclusion of petrol and diesel from the purview of exemption granted under the said notification. Prayer has also been made to direct Respondents to grant exemption to the commodities petrol and diesel as specified in Schedule II of Entry Tax Act when such goods are entered by composition dealers covered under Section 11A of the Madhya Pradesh Value Added Tax Act, 2002 and the Respondents be restrained from demanding entry tax on the said commodities.

2. In W. P. No. 14160 of 2008 in addition, prayer has been made to hold that the aforesaid notification is not applicable to the Petitioner. The Petitioner is not liable to make payment of entry tax as he holds permission for composition under Section 11A of the Madhya Pradesh Value Added Tax Act, 2002. Prayer has also been made in the alternative that the Petitioner be held liable to pay tax at one per cent under Notification Nos. 79-80 dated September 30, 1997. Order (P7) dated October 6, 2008 passed by the Commissioner, Commercial Tax be quashed, and refund of the tax collected at 27 per cent be ordered along with the interest.

3. It is averred in W. P. No. 12952 of 2008 that the Petitioner is a joint venture between Italian-Thai Development Public Company Ltd., Thailand and ITD Cementation India Ltd. The Petitioner has undertaken the construction package EW-II (MP-2) Rehabilitation and upgrading of KM 15 to KM 50 on NH-25 including Ghat Road and Sindh Bridge. The said contract is liable to tax under the provisions of the Madhya Pradesh Value Added Tax Act. The Petitioner is a registered dealer under the provisions of the Madhya Pradesh VAT Act, 2002 and is also deemed to be a dealer for the purpose of provisions of Madhya Pradesh Entry Tax Act, 1976. It is further averred that the Petitioner has adopted a composition scheme in accordance with the provisions of Section 11A of the Madhya Pradesh VAT Act and his application for composition has already been accepted by the Commissioner of Commercial Tax, M. P. vide order (P2) dated March 20, 2006. The Petitioner has been granted the benefit of the composition amount on a lump sum basis in accordance with the said provisions and correspondingly the provisions of Sections 18, 20, 20A, 39 and 40 are not applicable to the Petitioner. The Petitioner has submitted that the similar provisions for composition in respect of the liability of the registered dealers engaged in the business of execution of works contract existed under the Madhya Pradesh Commercial Tax Act, 1994. Notification dated December 5,1995 was issued under Section 10 of the Entry Tax Act. The Petitioner has opted for composition of tax under Section 19 of the Madhya Pradesh Commercial Tax Act. Notification dated May 31, 1999 was issued under Section 10 of the Entry Tax Act. The said notification exempted all such dealers commonly known as composition dealer with effect from April 1, 1995 from the operation of the provisions of Section 3 of the Entry Tax Act. The Petitioner has submitted that the effect of aforesaid notifications was that the composition dealers were kept out side the purview of Entry Tax Act. No fresh notification regarding composition dealers was issued by the Government till impugned notification dated April 11, 2007 was issued. Constitutional validity of the Entry Tax Act was assailed which was upheld by this Court in W. P. No. 13547 of 2007 (Godfrey Philips India Ltd. v. State of M. P. (2008) 17 VST 465) as per order dated May 15, 2008. The special leave petition filed against the said decision is stated to be pending before the Supreme Court.

4. It is further submitted by the Petitioner that in notification dated April 11, 2007, the Government has now exempted the class of goods specified in the Schedule to the notification from payment of entry tax. Earlier the composition dealers as a class were exempte