The government of West Bengal has recently imposed a tax on the entry of goods into the local areas of the State. According to the Finance Minister, this will help meet 'cost for facilitating trade and industry in the State'. Many States impose entry tax on goods coming into their areas of jurisdiction. Entry Tax is imposed by States under the provisions of Entry 52 of the State List and Article 304 of the Indian Constitution. These read as under: Entry 52, List II of the Seventh Schedule (State List) “Taxes on the entry of goods into a local area for consumption, use or sale therein.” Article 304: Restriction on trade, commerce and intercourse among States "Notwithstanding anything in article 301 or article 303, the Legislature of a State may by law – (a) impose on goods imported from other States or the Union territories any tax to which similar goods manufactured or produced in that State are subject, so, however, as not to discriminate between goods so imported and goods so manufactured or produced; and (b) impose such reasonable restrictions on the freedom of trade, commerce or intercourse with or within that State as may be required in the public interest: Provided that no Bill or amendment for the purposes of clause (b) shall be introduced or moved in the Legislature of a State without the previous sanction of the President." Are there any restrictions to the power of States to impose entry taxes? The use of the words 'so, however, as not to discriminate ' and 'reasonable restrictions' in the above articles constrain the power of States to some extent. Several petitions challenging the imposition of entry taxes have been filed before courts. In 2008, the Supreme Court has referred the entry tax issue to a larger bench. This case is currently pending. What are the arguments in favour and against the imposition of such taxes? Arguments in favour of entry tax
Arguments against entry tax
In addition to the above, it can also be said that an entry tax goes against the principle envisaged under the Goods and Services Tax (GST) regime. The GST aims to create a common market throughout India without any taxes on inter-state movement of goods. A Constitutional Amendment Bill to facilitate the implementation of GST is currently pending in Parliament.
There are indications that the Lok Pal Bill, 2011 is likely to be taken up for consideration and passing during the current Winter session of Parliament. The Bill was introduced on Aug 4, 2011 in the Lok Sabha after a prolonged agitation led by Anna Hazare (see PRS analysis of the Bill). It was referred to the Parliamentary Standing Committee on Personnel, Public Grievances, Law and Justice (see PRS note on Committee Systems). The Committee submitted its report on December 9, 2011. The report includes 10 dissent notes from 17 MPs. (a) Kirti Azad, Bal Apte, D.B. Chandre Gowda, Harin Pathak, Arjun Ram Meghwal, and Madhusudan Yadav. (b) Ram Jethmalani (c) Ram Vilas Paswan (d) Shailendra Kumar (e) Prasanta Kumar Majumdar (f) Pinaki Misra (g) A. Sampath (h) S. Semmalai (i) Meenakshi Natrajan, P.T. Thomas, and Deepa Dasmunshi (j) Vijay Bahadur Singh Presently, the government and the Opposition are in the process of formulating their stands on various key issues such as inclusion of the Prime Minister, the lower bureaucracy and the role of the Central Investigation Bureau. We provide a broad overview of the views of the members of the Committee on various key issues. Unanimity on issues On some issues, there was unanimity among the Committee members:
Dissent on issues Certain members of the Committee dissented on specific issues. In Table 1, we list the issues and the reason for the dissent. Table 1: Recommendation of Standing Committee and dissent by individual MPs
| Issues | Standing Committee recommendations | Points of dissent | Dissenting MPs |
| Inclusion of Prime Minister | Committee left the decision to Parliament stating that there are pros and cons to each view. | - PM should be included. - PM should be brought under the Lok Pal with some exceptions for national security, foreign policy, atomic energy etc. - The decision to investigate or prosecute the PM should be taken by the Lok Pal with 3/4th majority. | - Prasanta Kumar Majumdar, A. Sampath. - Kirti Azad etc, Shailendra Kumar, Pinaki Misra. |
| Grievance redressal mechanism | Enact separate law for a grievance redressal mechanism. | Include in the Lok Pal Bill. | Kirti Azad etc, Ram Jethmalani, Shailendra Kumar. |
| Inclusion of bureaucracy | Include Group B officers in addition to Group A. | - Include all groups of govt employees. - Include Group ‘C’. - Do not include bureaucrats. | - Kirti Azad etc, A. Sampath. - Meenakshi Natrajan etc, Shailendra Kumar, Prasanta Kumar. Majumdar, Pinaki Misra, Vijay Bahadur Singh. - Ram Vilas Paswan. |
| Lokayukta | Single, central law to deal with Lok Pal and state Lokayuktas to ensure uniformity in prosecution of public servants. | States should retain power to constitute Lokayuktas. | - S. Semmalai. |
| Private NGOs, media and corporate | Include all entities with specified level of govt control or which receive specified amount of public donations or foreign donations above Rs 10 lakh. | No private organsiations should be included. | - Kirti Azad etc., Ram Vilas Paswan. |
| Composition of search and selection committees | Selection Committee: In addition to PM and Speaker, it should include the Chief Justice of India, an eminent Indian unanimously nominated by the CAG, CEC and UPSC chairman and only Leader of Opposition of Lok Sabha. Search Committee: Mandatory to constitute. Minimum 7 members with 50% members from SC/ST, OBC, minorities and women. | Selection Committee: PM, Minister, LoPs of both Houses, two judges and CVC. Search Committee: CJI, CAG, CEC, Cabinet Secretary, judges of Supreme Court and High Courts. Selection Committee: PM, LoP in the Lok Sabha, one judge of SC and one Chief Justice of a HC, CVC, CEC and CAG. Search Committee: 10 members out of which 5 should be from civil society and 5 should be retired Chief Justice, CVC, CAG and CEC. Half the members to be from SC/STs, OBCs, minorities or women. | - Kirti Azad etc. - Shailendra Kumar. |
| Removal of Lok Pal | In addition to petitioning the President, a citizen should be allowed to approach the Supreme Court directly with a complaint. If admitted, it would be heard by a 5 judge bench. If President does not refer a citizen’s petition, he should give reasons. | Investigation should be conducted by an independent complaint authority. Heavy fines should be imposed in case of a false or frivolous complaint. Instead of the President, the Supreme Court should have power to suspend a member pending inquiry. | - Shailendra Kumar. |
| Role of CVC and CBI | CVC should investigate Group C and D employees. Instead of Lok Pal’s investigation wing, the CBI should investigate cases after inquiry by the Lok Pal. CBI to have autonomy over its investigation. Lok Pal shall exercise general supervision over CBI. | CBI should be under the control of the Lok Pal. The CBI Director should be appointed by the Lok Pal’s selection committee. The CVC should be under Lok Pal and the SVCs under the state Lokayuktas. | - Ram Jethmalani, Shailendra Kumar. - A. Sampath. - Meenakshi Natrajan etc. |
| False and frivolous complaints | Term of imprisonment should be maximum six months. Amount of fine should not exceed Rs 25,000. Specifically provide for complaints made in good faith in line with the Indian Penal Code. | The term of imprisonment should not exceed 30 days. | - Kirti Azad etc. |
| Article 311 | Article 311 of the Constitution should be amended or replaced with a statute. | The procedure adopted by the disciplinary authority should conform to Article 311. | - Kirti Azad etc, Meenakshi Natrajan etc. |
| Finance | Lok Pal Bill states that all expenses of the Lok Pal shall be charged to the Consolidated Fund of India (no need for Lok Sabha clearance). The Committee did not make any recommendation with regard to finances of the Lok Pal. | Lok Pal’s expenses should be cleared by the Parliament. Lok Pal should present its budget directly to Parliament rather than through a ministry. | - Kirti Azad etc. - Shailendra Kumar. |
| Sources: The Lok Pal Bill, 2011; the Department Related Standing Committee Report on the Lok Pal Bill, 2011 and PRS. | |||
