Ranchi: The Jharkahnd High Court on Tuesday has reserved its order on the PILs filed by several private companies challenging the Jharkhand Entry Tax.

Terming the state government’s move ‘undemocratic’ and ‘against the law of the land’, a division bench comprising Justices Prakash Tatiya and PP Bhatt, has reserved its verdict.

PILs filed by 86 companies, including Tata Steel, had challenged the state government’s entry tax and demanded to scrap it.

According to the PILs, all companies in the state pay all kinds of levy and therefore asking them to pay entry tax is ‘undemocratic’.
The state government has announced to re-introduce the Jharkhand Entry Tax on Consumption or Use of Goods Act 2011 (Jharkhand Act No. 11 of 2011) with an intention to create a fund for the purpose of development of trade, and other sectors of the state.

With effect from 15th July 2011, goods entering into the state will be subjected to Entry tax. There are about 63 items under the schedule which attract entry tax at a rate which varies from 4 percent to 15 percent.

The constitutional validity of Entry Tax by states is still a sub judice matter in many states as it is considered as a violation of the freedom of trade and commerce. The various High Courts have delivered conflicting judgments forcing the Supreme Court to refer the matter to a larger bench.