Pleas against border tax: SC gives liberty to petitioners to approach jurisdictional HCs

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New Delhi, Jul 9 (PTI) The Supreme Court on Tuesday disposed of a batch of pleas assailing the legality of different state governments collecting authorisation fee/border tax and gave liberty to the petitioners to approach the jurisdictional high courts for relief.

A bench of Justices Vikram Nath and Satish Chandra Sharma passed the verdict on the pleas filed by several transporters and tour operators who said authorisation fee/border tax was being collected in alleged violation of the All India Tourist Vehicles (Permit) Rules, 2023.

Some of the petitioners also prayed for refund of such levy already realised by states.

"The state enactments, rules and regulations being not under challenge, it cannot be said that the demand of border tax/authorisation fee at the borders by the respective state governments is bad under law. The petitioners, in order to succeed, have to consider challenging the state provision contained in the Act," the bench said.

"There is another reason why we are not entertaining the matters on merit is that the petitioners ought to have first approached their jurisdictional high courts to challenge their respective state enactments," it said.

The bench disposed of the petitions without interfering with the demands being raised by states. The apex court made it clear it has neither entered into the merits of the matter nor examined the same.

It said the tax already recovered would be subject to the final outcome of the petitions that may be filed before the high courts.

The bench noted that while issuing notices in these matters earlier, interim relief was granted and states were restrained from making any further realisation of border tax/authorization fee.

"Although counsel for the parties have raised their arguments on merits, we are not inclined to go into the merits of the matter at this stage as, apparently, the fundamental question to be decided would be whether levy and realisation of taxes by the respective states is covered by the Act and Rules framed by the respective states under Entries 56 and 57 of List II of Schedule VII of the Constitution or not," it said.

The bench said, "Insofar as the period of interim order passed by this court is concerned, the petitioners would give undertakings before the high courts that, in case they fail, they will make good on demands which would have been raised for the period for which the stay has been enjoyed." PTI ABA ABA SK SK