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of <h1>High Court upholds validity of Uttar Pradesh Tax On Entry of Goods Act 2007 & assessment orders</h1> <h3>M/s Gangesh Cement Pvt. Ltd. Versus State of UP. & Another</h3> M/s Gangesh Cement Pvt. Ltd. Versus State of UP. & Another - [2014] 74 VST 235 (All) Issues Involved:1. Constitutional validity of the Uttar Pradesh Tax On Entry of Goods Into Local Areas Act, 2007.2. Assessment orders and demand notices under the Act.3. Interim relief and stay orders by the Supreme Court.Detailed Analysis:Constitutional Validity of the Act:The petitioner challenged the constitutional validity of the Uttar Pradesh Tax On Entry of Goods Into Local Areas Act, 2007. The High Court had previously upheld the Act's validity in a batch of writ petitions led by Writ Tax No. 1484 of 2007 (ITC Ltd vs. State of UP and others). The Court found that:- The State of U.P. did not lack legislative competence in enacting the Act.- The Act's provisions ensure that the entry tax collected is used to facilitate trade, commerce, and industry.- The levy under the Act is not discriminatory, unreasonable, or against public interest.- The levy does not violate the freedom of trade, commerce, and intercourse guaranteed under Article 301 of the Constitution of India.- Section 7 of the Act, validating the entry tax levied under the U.P. Tax on Entry of Goods Act, 2000, is also valid.Assessment Orders and Demand Notices:The petitioner also challenged the assessment orders passed by the Competent Authorities under the Act. The High Court noted that:- The Supreme Court in various Special Leave Petitions (SLPs) has passed interim orders concerning the demand notices and assessment orders.- The Supreme Court has allowed the assessees to file monthly returns and has directed the assessing authority to complete the assessments for specific periods.- The Supreme Court has granted liberty to the State to issue demand notices after quantifying the tax liability based on the returns filed or best assessment orders.Interim Relief and Stay Orders by the Supreme Court:The Supreme Court has passed several interim orders in related SLPs, including:- Conditional stay orders requiring the appellants to deposit a percentage of the accrued tax liability and furnish bank guarantees for the balance amount.- Directions to the State not to resort to recovery proceedings until the disposal of the applications/petitions filed by the assessees.- Liberty granted to the respondents to file applications for modifying the interim orders if the tax burden is passed on to consumers.The High Court observed that:- The interim orders passed by the Supreme Court are confined to the demand raised against the appellants in the pending SLPs.- The interim orders are not precedents and can be modified based on the facts and circumstances of each case.- Entertaining writ petitions based on interim orders by the Supreme Court would be akin to entertaining an appeal against its own judgment.Conclusion:The High Court dismissed the writ petition challenging the constitutional validity of the Uttar Pradesh Tax On Entry of Goods Into Local Areas Act, 2007, and the assessment orders under the Act. The petitioner was granted liberty to pursue remedies against the notices or assessment orders in accordance with the law. The Court also noted that if appeals are filed within one month, they should be heard and decided promptly.
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