Supreme Court Upholds National Trade Balance in Natural Gas Levy Case

In a landmark decision, the Supreme Court dismissed the Uttar Pradesh government's pleas to impose local VAT on natural gas transported from Andhra Pradesh, upholding its status as an interstate sale under the Central Sales Tax Act.

The ruling affirms the 2012 Allahabad High Court judgment quashing state attempts to levy VAT on gas transactions involving major buyers like Reliance Industries, Tata Chemicals, and IFFCO, ensuring that constitutional trade provisions are upheld.

The court reiterated the importance of maintaining a balance in interstate commerce, noting that tax statute interpretation must be strict to preserve the federation as intended by the Constitution's framers.

(With inputs from agencies.)