R. ABDUL QUADER AND CO. vs SALES TAX OFFICER, HYDERABAD

The Supreme Court held that Section 11(2) of the Hyderabad General Sales Tax Act, 1950, which allows the government to recover taxes collected without authority, is beyond the competence of the State Legislature as it does not pertain to a tax levied under law. The Court clarified that while legislative powers under Entry 54 of List II can be interpreted broadly, they cannot extend to provisions that allow recovery of amounts not exigible as tax. Furthermore, Section 11(2) cannot be justified under Entry 26 of List II as it does not regulate trade and commerce. The appeal was allowed, overturning the High Court's dismissal of the writ petition.