Entry tax on motor vehicles remains valid when entry is the taxable event and purchase value is only the measure of tax.

A levy of entry tax on motor vehicles entering a local area is valid where the taxable event is the entry of the goods, while purchase value is used only as the measure for computation and does not convert the impost into a purchase tax. The expression "local area" is construed in the constitutional sense of an area administered by a local body, and the levy does not fail merely because the State is treated as the taxing territory for administration. The tax is not invalid simply because it operates alongside octroi or creates an additional burden, and no violation of Articles 14, 286 or 301 is shown on that basis.

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Issues: (i) Whether the levy of entry tax on motor vehicles brought into the State under section 3 of the Maharashtra Tax on Entry of Motor Vehicles into Local Areas Act, 1987 was invalid because the tax was measured by the purchase value of the vehicle. (ii) Whether treating the whole State as the relevant area for levy, instead of a local area administered by a local authority, was beyond the scope of entry 52 of List II of the Seventh Schedule to the Constitution of India. (iii) Whether the levy was bad on the ground of double taxation because it was in addition to octroi and violated articles 14, 286 and 301 of the Constitution of India.

Issue (i): Whether the levy of entry tax on motor vehicles brought into the State under section 3 of the Maharashtra Tax on Entry of Motor Vehicles into Local Areas Act, 1987 was invalid because the tax was measured by the purchase value of the vehicle.

Analysis: The charging provision made the taxable event the entry of the motor vehicle into a local area for use or sale therein. The reference to purchase value was only the measure for computation of tax and formed part of the machinery for assessment and realisation. The incidence of tax and the measure of tax were distinct, and the use of purchase value did not convert the levy into a purchase tax.

Conclusion: The levy was not invalid on the ground that it was measured by the purchase value of the vehicle.

Issue (ii): Whether treating the whole State as the relevant area for levy, instead of a local area administered by a local authority, was beyond the scope of entry 52 of List II of the Seventh Schedule to the Constitution of India.

Analysis: The expression "local area" was understood in the constitutional sense as an area administered by a local body, such as a municipality or other local authority. The impugned levy operated only on entry into a local area within the State and not on entry into any part of the State generally. The provision did not treat the entire State as a local area, and therefore remained within the legislative field.

Conclusion: The levy was within entry 52 of List II and was not invalid on the ground that the whole State had been treated as a local area.

Issue (iii): Whether the levy was bad on the ground of double taxation because it was in addition to octroi and violated articles 14, 286 and 301 of the Constitution of India.

Analysis: A tax imposed under a different legislative power is not invalid merely because it results in a further burden. The taxable event for entry tax was not the same as that for octroi, nor was the levy imposed by the same authority for the same purpose and period. No constitutional infirmity was shown under articles 14, 286 or 301.

Conclusion: The challenge based on double taxation and constitutional violation failed.

Final Conclusion: The levy of entry tax on motor vehicles entering a local area in the State was upheld, and the appeals as well as the writ petition were dismissed.

Ratio Decidendi: A levy on entry of goods into a local area is valid where the taxable event is that entry, the value of the goods serves only as the measure of tax, the State is not treated as the local area, and a separate levy such as octroi does not invalidate the tax merely because it creates an additional burden.

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