7 publishers · first seen Wed, 04 Nov 2026 06:49 UTC · updated Wed, 04 Nov 2026 11:25 UTC
The Supreme Court of India has upheld the validity of a 1974 Constitution Bench ruling that allows states to impose additional sales tax or surcharge calculated as a percentage of the existing sales tax. A seven-judge Constitution Bench, led by Chief Justice of India Surya Kant, unanimously decided that the legal question referred to them nearly 27 years ago no longer required adjudication, as the statutory provisions under challenge had since been replaced or amended and the Goods and Services Tax (GST) law had come into force. The court clarified that the five-judge Constitution Bench ruling in S Kodar vs State of Kerala (1974) continues to hold the field, upholding additional sales tax and rejecting the argument that such a levy amounted to a tax on the income of dealers.
The reference arose from a challenge to Section 5A of the Orissa Sales Tax Act, 1947, which provided for additional tax at the rate of 10% on dealers with an annual turnover between ₹10 lakh and ₹1 crore, and 15% on dealers whose turnover exceeded ₹1 crore.
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