Entry tax on denatured spirit could not arise without a valid levy notification; clarification treating it as ethyl alcohol failed.

Entry tax on denatured spirit could not be imposed for the relevant period because Section 3 of the Karnataka Tax on Entry of Goods Act, 1979 requires a State notification to levy tax on specified goods, and no valid notification was in force for 2007-08 and 2008-09. The statutory schedule separately identifies denatured spirit, rectified spirit and ethyl alcohol as distinct commodities, so a clarification treating denatured spirit as ethyl alcohol contradicted the tariff entry and could not itself create tax liability. The clarification was therefore invalid, and no entry tax was payable on denatured spirit for that period.

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Issues: Whether denatured spirit was liable to entry tax for the period 2007-08 and 2008-09 in the absence of a notification under Section 3(1) of the Karnataka Tax on Entry of Goods Act, 1979, and whether the clarification treating denatured spirit as ethyl alcohol was valid.

Analysis: Section 3 of the Karnataka Tax on Entry of Goods Act, 1979 permits levy and collection of entry tax on specified goods only through a notification issued by the State Government. The notifications referred to in the judgment showed that denatured spirit had earlier been taxed and later exempted, and for the relevant period no notification levying tax on denatured spirit was in force. Entry 86 of the First Schedule separately refers to denatured spirit, rectified spirit and ethyl alcohol, indicating that denatured spirit and ethyl alcohol are distinct commodities. The impugned clarification therefore contradicted the statutory entry and could not create liability in the absence of a valid levy notification.

Conclusion: The clarification was invalid and the petitioner was not liable to pay entry tax on denatured spirit for the relevant period.

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