AYURVEDA PHARMACY & ANR. vs STATE OF TAMIL NADU

The Supreme Court held that the higher sales tax rate of 30% imposed on Ayurvedic preparations Arishtams and Asavas under the Tamil Nadu General Sales Tax Act, 1959, is discriminatory as it treats these medicinal preparations differently from others with lower rates. The Court emphasized that all medicinal preparations, regardless of alcohol content, should be treated uniformly for tax purposes. Consequently, the appellants are entitled to a refund of the excess sales tax paid, as the differentiation lacked a rational basis under the law.