State purchase tax on industrial alcohol stands where taxing power is separate from central regulatory control and price orders.

State taxing power under Entry 54 of List II remains distinct and plenary, subject only to the constitutional limits that expressly apply to it. Central regulatory control under the Industries (Development and Regulation) Act, 1951 and price control orders operates in a separate field and does not curtail the State's power to levy purchase tax on industrial alcohol. The earlier observation that sales tax could not be charged on industrial alcohol was not treated as issue-based adjudication on Entry 54 and was regarded as accidental and per incuriam. The State levy was therefore upheld as within legislative competence.

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Issues: Whether the State had legislative competence under Entry 54 of List II to levy purchase tax on industrial alcohol despite central control under the Industries (Development and Regulation) Act, 1951 and the Price Control Orders; and whether the earlier observation that sales tax could not be charged on industrial alcohol was binding.

Analysis: The taxing power under Entry 54 of List II is a distinct and plenary power, subject only to Entry 92A of List I and the constitutional restrictions that expressly apply to it. The regulatory control exercised by Parliament under Entry 52 of List I and by the Central Government under Section 18G of the Industries (Development and Regulation) Act, 1951 operates in a separate field and does not cut down the State's power to levy taxes on the sale or purchase of goods. Price control orders govern the price at which goods may be sold, but they do not curtail a constitutionally valid taxing entry. The earlier reference to sales tax on industrial alcohol in the prior decision was not the result of any issue-based adjudication on Entry 54, and was treated as accidental and per incuriam.

Conclusion: The State could validly levy purchase tax on industrial alcohol under Entry 54 of List II, and the impugned levy was not invalid merely because industrial alcohol was subject to central regulation and price control.

Final Conclusion: The challenge to the tax levy failed, and the State's enactment was upheld as within legislative competence.

Ratio Decidendi: A State tax on the sale or purchase of goods under Entry 54 of List II is not curtailed by central regulatory control over the industry or by price control orders, because taxing power and regulatory power operate in separate constitutional fields.

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