Supreme Court: States Cannot Use Taxation To Discriminate Against Goods From Other States

The Supreme Court held that states cannot impose discriminatory taxation measures against goods imported from other states, as it violates Article 301 of the Constitution ensuring freedom of trade. The Court clarified that taxation powers cannot be misused to create trade barriers or protectionist regimes. Such actions disrupt economic unity and undermine the federal spirit of commerce. The ruling aligns with GST principles of uniform taxation and removes scope for arbitrary state-level levies. By curbing discriminatory fiscal practices, the judgment safeguards free movement of goods, promotes competitive markets, and strengthens cooperative federalism. It ensures that taxation serves revenue purposes, not economic discrimination.