Cal HC extends stay on entry tax

The Calcutta High Court today extended till disposal of appeal a stay on a trial court order that had held the entry tax introduced in the 2012-2013 budget by West Bengal government as unconstitutional.
Taking up an appeal by the state government, a division bench comprising Chief Justice Arun Mishra and Justice Joymalyo Bagchi extended the stay on the order of Justice Indira Banerjee, who had held the imposition of the West Bengal Tax on Entry of Goods into Local Areas Act, 2012, as unconstitutional.
The division bench fixed the date for hearing the appeal on September 12.
Justice Banerjee, while passing the order on June 24, had stayed operation of the order for six weeks on a plea by the state counsel so as to appeal against the order.

The order referred to a Supreme Court direction which said that imposition of such taxes have to be compensatory in nature and observed that this was not followed in case of the act introduced by the West Bengal government.
It was also noted that the President's assent was not taken for the act.

The petition, challenging the constitutional validity of the act, was filed in 2012 by several companies, including Tata Steel, Hindalco and Bharti Airtel.
The government had last year passed the act to create a compulsory entry tax fund in a bid to fill the state's empty coffers.

The Left Front government had abolished a similar tax in 1995.
The government had said during introduction of the tax in March, 2012 in the Assembly that the tax was aimed at facilitating trade and industry by creating infrastructure like roads, bridges and cold storage chains.