State stamp duty on Delivery Order upheld as a distinct instrument outside the course of import.

State stamp duty on a Delivery Order was upheld because the levy operated on a distinct instrument, not on the import transaction itself. Applying pith and substance, the Bombay HC held that Maharashtra's power under the Stamp Act and Parliament's customs field occupy different spheres. A Delivery Order was treated as a separate document arising only after customs clearance, payment of customs duty, and settlement of carrier's charges, so it did not form part of the course of import. The constitutional challenge under Articles 246 and 286 therefore failed, and the levy was held valid.

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Issues: Whether the State of Maharashtra had legislative competence to levy stamp duty on a Delivery Order under Article 29 of Schedule I of the Maharashtra Stamp Act, 1958, and whether such levy was ultra vires Articles 246(1), 286(1)(b) and 286(2) of the Constitution of India.

Analysis: The levy of stamp duty under the Maharashtra Stamp Act was examined as a levy on an instrument and not on the import transaction itself. Applying the doctrine of pith and substance, the Court held that the State's taxing power under the Stamp Act and Parliament's power over customs duties occupy different fields. A Delivery Order was found to be a separate document that comes into existence after customs clearance, payment of customs duty, and settlement of the carrier's charges, and therefore it does not form part of the course of import. The customs frontier was treated as ending when customs assessment and clearance are complete, not as a physical boundary. The Court also held that a Delivery Order is not covered by the exclusion applicable to a bill of lading, and the Gujarat decisions on bill of entry did not control the present issue.

Conclusion: The State of Maharashtra was competent to levy stamp duty on a Delivery Order, and the challenge to the levy failed.

Ratio Decidendi: A State stamp duty on a Delivery Order is valid where the Delivery Order is a distinct instrument arising after customs clearance and is not itself a transaction in the course of import; such levy does not trench upon Parliament's exclusive customs field.

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