In Brief
This landmark judgment addressed whether State legislatures can levy entry tax on goods imported from outside India into local areas. The Supreme Court held that entry tax legislation under Entry 52 of List II is constitutionally valid and does not encroach on Parliament's exclusive powers over import/export and customs duties. The import of goods terminates upon customs clearance, after which States may impose entry tax. The Original Package doctrine, evolved in US law to shield imported goods from taxation, is inapplicable in India. Entry tax laws validly apply to all goods—domestic or imported—entering local areas for consumption. The judgment dismissed appeals against Orissa and Patna High Courts, allowed the Jharkhand appeal, and allowed Kerala's appeals, setting aside judgments that exempted foreign-sourced goods.
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