Transport verification for sales tax assessment is a valid regulatory safeguard, not a direct restraint on inter-State trade.

A transport verification requirement under a sales tax regime does not violate Articles 301 and 304 merely because it requires goods carriers to furnish particulars for assessment. A measure offends the constitutional freedom of inter-State trade only if it directly and immediately restricts movement of goods or creates a substantial trade barrier; mere verification, inconvenience, or stoppage for checking is insufficient. Where the notification applies generally, does not prohibit transport, and serves anti-evasion and assessment purposes, it is a valid regulatory safeguard incidental to the power of levy and assessment. The notification and prescribed forms were therefore upheld as constitutionally valid.

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Issues: (i) Whether the impugned notification and prescribed permit forms imposed a direct and immediate restriction on inter-State trade, commerce and intercourse in violation of Articles 301 and 304 of the Constitution of India; (ii) Whether the notification and forms were a valid regulatory measure incidental to the power of levy and assessment of sales tax, intended to prevent evasion and facilitate assessment.

Issue (i): Whether the impugned notification and prescribed permit forms imposed a direct and immediate restriction on inter-State trade, commerce and intercourse in violation of Articles 301 and 304 of the Constitution of India.

Analysis: A measure offends the freedom guaranteed by Article 301 only when it directly and immediately restricts the movement of goods or creates a trade barrier of substance. Mere inconvenience, stoppage for verification, or a requirement to produce particulars for assessment does not by itself amount to a constitutional prohibition. The notification did not prohibit transport of goods and applied to goods moving within Bihar as well as goods brought into or sent out of the State. The required particulars were not shown to be impossible or unduly onerous to furnish.

Conclusion: The notification did not violate Article 301 or Article 304 on the ground of direct and immediate restriction.

Issue (ii): Whether the notification and forms were a valid regulatory measure incidental to the power of levy and assessment of sales tax, intended to prevent evasion and facilitate assessment.

Analysis: The impugned measure was adopted under the statutory power to prescribe declarations for transport of goods and was directed to verification and assessment of tax payable. A State law aimed at making tax administration effective may include ancillary and incidental safeguards against evasion. The forms did not impose tax, did not create a discriminatory burden, and were designed to assist lawful assessment. In substance, the measure was regulatory rather than prohibitory and was not a colourable exercise of power.

Conclusion: The notification and adoption of the forms were valid regulatory measures incidental to the sales tax power and were protected by the constitutional scheme.

Final Conclusion: The constitutional challenge failed, the High Court's judgment was set aside, and the impugned notification and forms were upheld as valid.

Ratio Decidendi: A transport verification requirement that does not prohibit movement of goods and operates only as a reasonable, non-discriminatory regulatory safeguard for tax assessment and anti-evasion purposes does not directly and immediately restrict inter-State trade within the meaning of Part XIII of the Constitution.

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