1959 (11) TMI 46

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.... in Madhya Bharat. It was also a licensee under the Madhya Bharat Sales Tax Act, 1950 (No. 30 of 1950) for its business of selling "bura sugar" from places outside Madhya Bharat into Bhind and sold to various consumers in Bhind. The Sales Tax Authorities, Madhya Bharat, are claiming sales tax on the sales of imported "bura sugar" made by it in Bhind during the period 1956-57, under the Madhya Bharat Sales Tax Act (No. 30 of 1950). 3.. The relevant entry under which the sales tax is being charged is contained in item 31 of Schedule III of the Act. That item reads as follows: Naam Vasthu Madhyabharath mae vikraya ki vah sthithi Jispar kar theya hai Samasth prakar ki sakkar (Madhyabharath mae Aayatha ki Ordh ya Madhyabharath mae Nimirth ....

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....factured in the taxing State, although such taxation is undoubtedly calculated to fetter inter-State trade and commerce. In other words, the commercial unity of India is made to give way before the State-power of imposing 'any' non-discriminatory tax on goods imported from sister States." 6. By levying sales tax on imported "bura sugar" and not levying it on "bura sugar" manufactured locally, the imported "bura sugar" was discriminated against, and it would be in a very much less advantageous position as an article of commerce in the local market of the State. 7. Section 92 of the Constitution of Australia provided that  "On the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether....

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....nter-State free trade could be so hampered and restricted as to reduce the Constitution in that regard to mere futility."   "I must not for a moment be taken to cast any doubt on the capacity of a State to tax, together with its own products, goods produced in other States, when brought into it for sale or consumption. When the inter-State transit is over and they have become part of the mass of property within the State, any goods may be taxed, no matter whence they have come. But they must be taxed alike with all other such goods in the State. The tax must be general, and laid equally on all goods of the kind to be taxed, whether their State of origin be the taxing State or another. And what I say of tax applies to other imposts a....