PART XIII TRADE, COMMERCE AND INTERCOURSE WITHIN THE TERRITORY OF INDIA

Article 304: Restrictions 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 ¹[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.

Footnotes in the official text

1.Ins. by the Constitution (Seventh Amendment) Act, 1956, s. 29 and Sch. (w.e.f 1-11-1956).

Leading cases

Dhulabhai v. State of Madhya Pradesh (1968)A civil suit lay to recover sales tax collected under notifications void under Article 301, despite the bar in Section 17 of the Madhya Bharat Sales Tax Act; the Court stated seven principles on exclusion of civil court jurisdiction.

Questions on this article

4 questions in 12 of our papers cite Article 304. Try these from the free papers:

1. A State law levies a tax of 10 per cent on certain goods imported from other States, while similar goods manufactured within the State are taxed at 4 per cent. The Bill for the law was introduced in the State Legislature without the previous sanction of the President. The law is challenged under Part XIII. The tax is:

Practise questions on Constitutional Law