Report No. 61
7.10. Check-posts in inter-State transactions-Rule struck down as dealing with inter-State transactions.-
The second case Hansraj Bagrecha v. State of Bihar, (1971) 27 STC 4 (SC)., decided by the Supreme Court also relates to check-posts. But it must be noted that in that case a rule made by the Government of Bihar was struck down because it authorised restrictions on inter-State transactions,-a matter admittedly beyond the competence of the State Legislature. The rule in question1 was as follows:-
"(1) No person shall tender at any railway station, steamer station, air-port, post office or any other place, whether of similar nature or otherwise, notified under section 42, any consignment of such goods, exceeding such quantity, as may be specified in the notification, for transaction to any place outside the state of Bihar, unless such person has obtained a despatch permit in Form XXVIID from the appropriate authority referred to in the Explanation to rule 31 and no person shall accept such tender unless the said permit is surrendered to him."
It is plain that a State Legislature has no competence to make such rules regarding inter-State sales. But the position of the Union Parliament is obviously different, and the judgment in the above cases does not throw any doubt on the legislative power of the Union.
1. Rule 31B, Bihar Sales Tax Rules, 1959.
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