Case: Amrit Banaspati Co. Ltd Vs. Union Of India And Ors

to be allowed to the legislature. The Court should feel more inclined to give judicial deference to legislative judgment in the field of economic regulation than in other areas where fundamental human rights are involved... 8. It is settled law that the allegations regarding the violation of constitutional provision should be specific, clear and unambiguous and should give relevant particulars, and the burden is on the person who impeaches the law as violative of constitutional guarantee to show that the particular provision is infirm for all or any or the reasons stated by him. In the recent decision of this Court Gauri Shankar and Ors. v. Union of India and Ors. etc. (1994 (6) SCC 349 ), to which both of us were parties, it was reiterated that- (a) there is always a presumption in favour of the constitutionality of an enactment and the burden is upon him who attacks is to show that there has been a clear transgression of the constitutional principles; (b) it must be presumed that the Legislature understands and correctly appreciates the need of its own people, that its laws are directed to problems made manifest by experience and that its discriminations are based on adequate grounds; (c) in order to sustain the presumption of constitutionality the Court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation. 9. We scanned the entire pleadings in this case. Tested in the light of the above principles, we are of opinion that there is no sufficient or specific or definite pleadings with particulars, to state that section 178 of the Act violates Art. 301 of the Constitution or is discriminatory. Moreover, on facts, the presumptions which are applicable in the instant case as stated above, have not been rebutted. On this short ground, the writ petition filed in the High Court by the appellant should fail. 10. The scope and content of Article 301 of the Constitution of India has been laid down in innumerable decisions of this Court beginning from Atiabari Tea Co. Ltd. v. The State of Assam & Anr. (AIR 1961 SC 232 = 1961 (1) SCR 809 ). Suffice it to say that it is only when the intra-State or inter-State movement of the persons or goods are impeded directly and immediately as distinct from creating some indirect or inconsequential impediment, by any legislative or executive action, infringement of the freedom envisaged by Article 301 can arise. Without anything more, a tax law, per se, may not impair the said freedom. At the same time, it should be stated that a fiscal measure is not outside the purview of Article 301 of the Constitution. It is unnecessary to refer to all the decisions on the point. We shall only refer to a few important decisions of this Court on this aspect - Automobile Transport Ltd. etc. v. State of Rajasthan & Ors. (AIR 1962 SC 1406 ), Andhra Sugars Ltd. & Anr. vs. State of Andhra Pradesh and Ors. (AIR 1968 SC 599 , State of Madras vs. N.K. Nataraja Mudaliar (AIR 1969 SC 147 ) and a recent decision which as surveyed the entire case law on the subject -M/s. Video Electronics Pvt. Ltd. v. State of Punjab & Anr. (AIR 1990 SC 820 ). 11. Even proceeding on the basis that section 178 of the Act directly immediately impedes the movement of the goods (vanaspati) from the State of Haryana into the Union Territory of Delhi, we are of the view that the statutory provision aforesaid is saved by Article 302 of the Constitution of India. It is true that a tax may in certain cases, directly and immediately impede the movement of flow of trade, but the imposition of a tax does not do so in every case. It depends upon the context and circumstances. Shah, J., on behalf of the Constitution Bench, in the State of Madras v. N.K. Nataraja Mudaliar (AIR 1969 SC 147 ), at p.155, stated thus: There is also no doubt that exercise of the power to tax may normally be presumed to be in the public interest. 12. In this case the impugned tax law is enacted by Parliament. There is a presumption that the imposition of the tax is in public interest. That has not been off-set by any contra material. So viewed, section 178 of the Act is saved by Art. 302 of the Constitution of India. It was so held by the High Court and we concur with the said view. In this connection it is only appropriate to quote what Mathew, J. observed on behalf of the bench in G.K. Krishnan v. State of Tamil Nadu (AIR 1975 SC 583 ), in paragraph 39: 39. Judicial deference to legislature in instances of economic regulation is sometimes explained by the argument that rationality of a classification may depend upon `local conditions about which local legislative or administrative body would be better informed than a court. Consequently, lacking the capacity to inform itself fully about the peculiarities of a particular local situation, a court should hesitate to dub the legislative classification irrational (see Carmichael v. Southern Coal & Coak Co., (1936) 301 US 495) Tax Laws, for example, may respond closely to local needs and courts familiarity with these needs is likely to be limited. Therefore, the Court must be aware of its own remoteness and lack of familiarity with the local problems. Classification is dependent on peculiar needs and specific difficulties of the community. The needs and the difficulties of a community are constituted out of facts and information beyond the easy ken of the court. The above perspective has been restated by the Constitution Bench in R.K. Garg v. Union of India and Ors. (AIR 1981 SC 2138 ), at paragraph 2147, paragraph 8, which we have adverted to, in the earlier portion of this Judgment.

Court's decision (1 = petition accepted / positive for appellant, 0 = rejected / negative): 0

Reasoning from the judgment:
0[ds]8. It is settled law that the allegations regarding the violation of constitutional provision should be specific, clear and unambiguous and should give relevant particulars, and the burden is on the person who impeaches the law as violative of constitutional guarantee to show that the particular provision is infirm for all or any or the reasons stated by him9. We scanned the entire pleadings in this case. Tested in the light of the above principles, we are of opinion that there is no sufficient or specific or definite pleadings with particulars, to state that section 178 of the Act violates Art. 301 of the Constitution or is discriminatory. Moreover, on facts, the presumptions which are applicable in the instant case as stated above, have not been rebutted. On this short ground, the writ petition filed in the High Court by the appellant should fail10. The scope and content of Article 301 of the Constitution of India has been laid down in innumerable decisions of this Court beginning from Atiabari Tea Co. Ltd. v. The State of Assam & Anr. (AIR 1961 SC 232 = 1961 (1) SCR 809 ). Suffice it to say that it is only when the intra-State or inter-State movement of the persons or goods are impeded directly and immediately as distinct from creating some indirect or inconsequential impediment, by any legislative or executive action, infringement of the freedom envisaged by Article 301 can arise. Without anything more, a tax law, per se, may not impair the said freedom. At the same time, it should be stated that a fiscal measure is not outside the purview of Article 301 of the Constitution. It is unnecessary to refer to all the decisions on the point11. Even proceeding on the basis that section 178 of the Act directly immediately impedes the movement of the goods (vanaspati) from the State of Haryana into the Union Territory of Delhi, we are of the view that the statutory provision aforesaid is saved by Article 302 of the Constitution of India. It is true that a tax may in certain cases, directly and immediately impede the movement of flow of trade, but the imposition of a tax does not do so in every case. It depends upon the context and circumstances12. In this case the impugned tax law is enacted by Parliament. There is a presumption that the imposition of the tax is in public interest. That has not been off-set by any contra material. So viewed, section 178 of the Act is saved by Art. 302 of the Constitution of India. It was so held by the High Court and we concur with the said view.