Sixth Constitutional Amendment - 6th Amendment in Constitution

Sixth Constitutional Amendment - 6th Amendment in Constitution of India 1956:- This amendment made changes in Entry 92, List I and Entry 53, List II. Originally the general power of State in impose sales-tax or purchase tax under Entry 54 included also to impose sales tax on inter-State sale or purchase. In State of Bombay vs United Motors (India) Limited, the Supreme Court had held that the State have power to tax inter-State sales. The unrestricted power of State to tax inter-State sales resulted in double and multiple taxation of such sale altering trend, and economy of the Union. The Amendment made the subject-matter of taxation of inter-State sale a Union subject by  introducing new Entry 92-A. List I and making the Entry 54 of List II subject to Entry 92-A, List I. Parliament was empowered to define what is a sale 'outside' a State or in the course of import and export. [Article 286 (3)]. It added clause (3) to Article 286 which restricts State's power to tax important goods or commodities in the inter-State trade.

Sixth Constitutional Amendment - 6th Amendment in Constitution

[11th September, 1956.]

An Act further to amend the Constitution of India.

BE it enacted by Parliament in the Seventh Year of the Republic of India as follows:-

1. Short title.-This Act may be called the Constitution (Sixth Amendment) Act, 1956.

2. Amendment of the Seventh Schedule.-In the Seventh Schedule to the Constitution,-

(a) in the Union List, after entry 92, the following entry shall be inserted, namely:-

"92A. Taxes on the sale or purchase of goods other than newspapers, where such sale or purchase takes place in the course of inter-State trade or commerce."; and

(b) in the State List, for entry 54, the following entry shall be substituted, namely:-

"54. Taxes on the sale or purchase of goods other than newspapers, subject to the provisions of entry 92A of List I.".

3. Amendment of article 269.-In article 269 of the Constitution,-

(a) in clause (1), after sub-clause (f), the following sub-clause shall be inserted, namely:-

"(g) taxes on the sale or purchase of goods other than newspapers, where such sale or purchase takes place in the course of inter-State trade or commerce."; and

(b) after clause (2), the following clause shall be inserted, namely:-

"(3) Parliament may by law formulate principles for determining when a sale or purchase of goods takes place in the course of inter-State trade or commerce.".

4. Amendment of article 286.-In article 286 of the Constitution,-

(a) in clause (1), the Explanation shall be omitted; and

(b) for clauses (2) and (3), the following clauses shall be substituted, namely:-

"(2) Parliament may by law formulate principles for determining when a sale or purchase of goods takes place in any of the ways mentioned in clause (1).

(3) Any law of a State shall, in so far as it imposes or authorises the imposition of, a tax on the sale or purchase of goods declared by Parliament by law to be of special importance in inter-State trade or commerce, be subject to such restrictions and conditions in regard to the system of levy, rates and other incidents of the tax as Parliament may by law specify.".

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