LexINTERNATIONAL TOURIST CORPORATION ETC. ETC. versus STATE OF HARYANA & ORS. AND MANMOHAN VIG & ORS. V. STATE OF HARYANA & ORS.
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A B c D E F G H 364 INTERNATIONAL TOURIST CORPORATION ETC. ETC. v. STATE OF HARYANA & ORS. AND MANMOHAN VIG & ORS. v. STATE OF HARYANA & ORS. December 15, 1980/ January 13, 1981 [R. S. SARKARIA AND 0. CHINNAPPA REDDY, JJ.] Haryana Passengers and Goods Taxation Act, 1952-Whether section 3(3) interferes with the freedom of Inter-state Trade, Commerce and Intercourse and is therefore violative of Article 301 of the Constitution-Interpretation of Entri~s in the C'onstitution-Exclusive competence of Parliarnent, when can be clain1ed-Levy of tax at 60% of fare, whether regulatory and compensatory in nature-Entry 56, List II of Seventh Schedule to the Constitution, scope of. [J.P. Motor Vehicles Taxation_ Act, scope of sections 4 and SA---..'iection 9 of the U.P. Motor Gadi (Malkar) Adhiniyam, 1964 is not violative of Article 14 of the Constitution. Bihar Taxation of Passengers and Goods (Carried by Public Service Motor Vehicles) Act, 1961, section 3(6), scope of. -Dismissing the Appeals, S.L.Ps. and Writ Petitions the Court HELD : ( 1) Where the competing entries arc an Entry in List II and Entry 97 in List I the Entry in the State list must be given a broad and plentiful inter· pretation. In a Federal Constitution like ours where there is a division of legis- Ialivc subjects but the residuary power is vested in Parliament, such residuary power cannot be so expansively interpreted as to whittle down the power of the Slate legislature. That might affect and jeopardise the very federal principle. The federal nature of the constitution demands that an interpretation which \\·ouJd allow the exercise of legislative power by Parliament pursuant to the residuary powers vested in it to trench upon State legislation and which '"ould thereby destroy or belittle state autonomy must be rejected. Before exclusive legislative competence can be claimed for Parliament by resort to the residuary power, the legislative incompetence of the State legislative must be clearly established. Entry 97 itself is specific that a matter can be brought under that entry only if it is not enumerated in List II or List m and in the case of a tax if it is not mentioned in either of those lists. [372 A-D, 373C-D] The Haryana Passengers and Goods Taxation Act is a law made pursuant to the power given to the State Legislature by Entry 56 of List II. The omis- sion of reference to National Highways in Entry 30 and Entry 89 is of signifi- • • • • INTERNATIONAL TOURIST CORPN. V. HARYANA 365 caitce and indicates that the subject of "passengers and goods" carrieo .in A National High'\\nys is reserved for inclusion in the State List. A consideration of Entries 22, 23, 24, 29, 39 and 89 of List I and Entry 56 of List II makes it clear that taxes on passengers and goods carried on National Highways also fall directly and squarely within and are included in Entry 56 of List II. [373 D-G & 374 CJ Attorney-rJeneral for Ontario v. Attorney-General for the 1>01ni11ion, 1896 B A.C. 348 @ 360-361; A. L. S. P. L. Subrahmanyan Chettiar v. Mutlu.swami Goundan, A.I.R. 1941 Federal Court 47 @ 55 and Manikkasundara Bhattar & Ors. v. R. S. Nayudu & Ors., [1946] F.C.R. 67 @ 88, quoted with approval. (2) The power exercisable under Entry 56 of List II is the power to im- pose taxes which are in the nature of regulatory and compensatory measures. The Court is not bound by any statement made by or on behalf of the Exe- cutive Government on a question of the legislative intent or nature of an enact- ment. What the legislature intended an enactment to be need not necessarily be what the Government says it is. It is a matter of construction, in the light of several attendant circumstances including the source of the legislative power under the Constitution to make the particular law. [374 B-C, n·-E] Aliabari Yea Co. Ltd. v. State af Assam & Ors., [1961] 1 S.C.R. 809; The D Automobile Ttansport (Rajasthan) Ltd. v. State of Rajasthan & Ors. [1963] 1 S.C.R. 491 and Boiani Ores Ltd. etc. v. State of Orissa etc., fl975] 2 SCR 138, followed. (3) To say that the nature of a tax is of a compensatory and regulatory nature is not to say that the measure of the tax should be proportionate to the expenditure incurred on the regulation provided and the services rendered. If the tax were to be proportionate to the expenditure on regulation and service it would not be a tax but a fee. While in the case of a fee
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