Entry tax on imported goods held invalid for being non-compensatory and discriminatory; assessment quashed, refund left for consideration.

Entry tax on goods brought from other States under the Tamil Nadu Tax on Entry of Goods into Local Areas Act, 2001 was held to be covered by an earlier binding Division Bench ruling that treated such levy as non-compensatory, illegal, unauthorised, and violative of Articles 301 and 304(a) of the Constitution. On that basis, the assessment order could not stand and was quashed. The refund claim was not granted directly, but the petitioner's representation for refund was directed to be considered by the competent authority in accordance with law within a fixed time, leaving the monetary relief to administrative determination.

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Issues: Whether the entry tax order levying tax on goods brought from other States under the Tamil Nadu Tax on Entry of Goods into Local Areas Act, 2001 was liable to be set aside, and whether the petitioner was entitled to refund of the tax collected.

Analysis: The levy was held to be covered by the earlier Division Bench decision which had declared that entry tax on goods imported from other States was not compensatory in nature and that the demand and collection under the Act were illegal, unauthorised and violative of Articles 301 and 304(a) of the Constitution of India. In view of that binding ruling, the assessment order could not stand. As to refund, the Court did not grant the monetary relief directly, but directed consideration of the petitioner's representation for refund in accordance with law within a fixed time.

Conclusion: The impugned order was set aside, and the refund claim was left to be decided by the competent authority on merits.

Final Conclusion: The writ petition succeeded to the extent of quashing the assessment order, while the claim for refund was remitted for administrative consideration, resulting in only partial relief to the petitioner.

Ratio Decidendi: A levy of entry tax on goods imported from other States is invalid where the State fails to establish that it is compensatory in nature and where the levy operates in a discriminatory manner contrary to Articles 301 and 304(a) of the Constitution of India.

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