JUDGMENT K. Balakrishnan Nair, J. – The point that arises for decision in this writ petition is whether the inclusion of silk fabrics and sarees made of natural silk as item No. 116 in the Third Schedule to the Kerala Value Added Tax Act, 2003, is unconstitutional. The first petitioner is an association of textile and garments dealers of Kerala. The second petitioner is one of its members. All textile fabrics were excluded from the levy of sales tax and subsequently from the value added tax also. While so, the Kerala Value Added Tax Act, 2003, was amended by the Kerala Value Added Tax (Amendment) Act, 2005 and silk fabrics and sarees made of natural silk were included as serial No. 116 in the Third Schedule to the KVAT Act. The result was that with effect from August 28, 2005, VAT at the rate of four per cent was payable on silk fabrics and sarees made of natural silk. The petitioners, aggrieved by the inclusion of the said item, as a taxable item under the KVAT Act, have filed this writ petition, seeking a declaration that the said amendment is unconstitutional and void. Normally, it is for the Government to decide which are the goods to be subjected to tax. The State is conceded freedom to pick and choose any goods. But, the petitioner submits that in view of the provisions of the Additional Duties of Excise (Goods of Special Importance) Act, 1957, the State is incompetent to levy any sales tax on silk fabrics or natural silk. Their contention in this regard is expatiated, relying on article 286(3) of the Constitution of India, which reads as follows : "286. Restrictions as to imposition of tax on the sale or purchase of goods : (1) ... (2) ... Their contention in this regard is expatiated, relying on article 286(3) of the Constitution of India, which reads as follows : "286. Restrictions as to imposition of tax on the sale or purchase of goods : (1) ... (2) ... (3) Any law of a State shall, insofar as it imposes, or authorizes the imposition of, - (a) a tax on the sale or purchase of goods declared by Parliament by law to be of special importance in inter-State trade or commerce; or (b) a tax on the sale or purchase of goods, being a tax of the nature referred to in sub-clause (b), sub-clause (c) or sub-clause (d) of clause (29A) of article 366; be subject to such restrictions and conditions in regard to the system of levy, rates and other incidents of the tax as Parliament may by law specify." Woven fabrics of silk or of silk waste is included in the First Schedule to the abovesaid Act and the rate of levy is nil. When the above-quoted article is read with the provisions of the abovesaid Act, hereinafter referred to as the ADE Act, if any State imposes any sales tax or VAT on woven fabrics of silk/silk waste, the said State will not get any share of the additional duty collected by the Central Government under the said Act on the said goods. The same is evident from Second Schedule to the said Act. The relevant sections in the ADE Act are sections 3 and 4. They are quoted below for convenient reference : "3. Levy and collection of additional duties. - (1) There shall be levied and collected in respect of the goods described in column (3) of the First Schedule produced or manufactured in India and on all such goods lying in stock within the precincts of any factory, warehouse or other premises where the said goods were manufactured, stored or produced, or in any premises appurtenant thereto, duties of excise at the rate or rates specified in column (4) of the said Schedule. (2) The duties of excise referred to in sub-section (1) in respect of the goods specified therein shall be in addition to the duties of excise chargeable on such goods under the Central Excises and Salt Act, 1944, or any other law for the time being in force. (2) The duties of excise referred to in sub-section (1) in respect of the goods specified therein shall be in addition to the duties of excise chargeable on such goods under the Central Excises and Salt Act, 1944, or any other law for the time being in force. (3) The provisions of the Central Excises and Salt Act, 1944, and the Rules made thereunder, including those relating to refunds and exemptions from duty, offences and penalties, shall, so far as may be, apply in relation to the levy and collection of the additional duties as they apply in relation to the levy and collection of the duties of excise on the goods specified in sub-section (1). 4. Distribution of additional duties among States. - During each financial year, there shall be paid out of the Consolidated Fund of India to the States in accordance with the provisions of the Second Schedule such sums, representating a part of the net proceeds of the additional duties levied and collected during that financial year, as are specified in that Schedule." The petitioners submit that in view of the decisions of the apex court in Godfrey Phillips India Ltd. v. State of U.P. [2005] 139 STC 537 and Reliance Trading Company v. State of Kerala [2006] 147 STC 211; [2006] 3 KLT 532 there is absolute prohibition of levy of any sales tax in relation to an item included in the First Schedule to the ADE Act. The learned counsel for the petitioners made special emphasis on paragraphs 65 and 72 of the decision in Godfrey Phillips India Ltd. [2005] 139 STC 537 (SC). The said paragraphs are quoted below : "65. In December, 1956, the National Development Council, Planning Commission, Government of India, and the States agreed that the sales tax in respect of, inter alia, tobacco should be replaced by a surcharge on the Central excise duties, the income derived therefrom being distributed amongst States on the basis of consumption, subject to the income from the States being assured. Pursuant to this and the recommendation of the Finance Commission in its report dated September 30, 1957, the Additional Duties of Excise (Goods of Special Importance) Act, 1957, was passed by Parliament. Pursuant to this and the recommendation of the Finance Commission in its report dated September 30, 1957, the Additional Duties of Excise (Goods of Special Importance) Act, 1957, was passed by Parliament. The object of the Act was to impose additional duties of excise in replacement of the sales tax levied by the Union and the States on sugar, tobacco and mill-made textiles and to distribute the net proceeds of these taxes, except the proceeds attributable to Union Territories, to the States. Provision was made that the State which levy a tax on the sale or purchase of these commodities after the April 1, 1958, could not participate in the distribution of the net proceeds of the additional levy under the ADE Act. Provision was also being made in the Act for including specified goods in the category of goods declared to be of special importance in inter-State trade or commerce so that, following the imposition of uniform duties of excise on them, the rates of sales tax if levied by any State were subject from April 1, 1958 to the restrictions in Section 15 of the Central Sales Tax Act, 1956. .... 72. So even if tobacco is an article of luxury, a tax on its supply is within the exclusive competence of the State but subject to the constitutional curbs prescribed under article 286 read with sections 14 and 15 of the Central Sales Tax Act, 1956, and most importantly the ADE Act of 1957 under which no sales tax can be levied on tobacco at all if the State was to take the benefits under that Act." The learned counsel for the petitioners also heavily relied on the following observations of the apex court in Reliance Trading Company [2006] 147 STC 211; [2006] 3 KLT 532. "Further, admittedly, under the ADEA, additional duty is leviable on cotton-based tarpaulin under the First Schedule to the aforesaid Act. Having regard to the objective behind enacting the ADEA, it is apparent that cotton-based tarpaulin on which additional duty is levied under the ADEA was and continues to be exempt from sales tax. At this stage, it would be pertinent to refer to the exclusion clause in entry 11 in the Third Schedule to the KGST Act. Having regard to the objective behind enacting the ADEA, it is apparent that cotton-based tarpaulin on which additional duty is levied under the ADEA was and continues to be exempt from sales tax. At this stage, it would be pertinent to refer to the exclusion clause in entry 11 in the Third Schedule to the KGST Act. The exclusion clause means that where duty has not been levied under the ADEA such goods would be excluded from the purview of entry 11; to put it simply, the goods would lose their exemption under the KGST Act. For this reason also, we hold that cotton-based tarpaulin is exempted from sales tax under the KGST Act." The counsel further added, admittedly, fabrics of silk and other related products are included in the First Schedule, though the rate of levy is nil. Thereafter, the State is denuded of the power to impose any sales tax for those products. Therefore, the petitioners pray for declaring that no tax can be levied or collected, though silk fabrics and sarees made of natural silk are included as item No. 116 in the Third Schedule to the KVAT Act. The respondents have filed a detailed counter-affidavit, supporting the impugned levy. The learned Senior Government Pleader (Taxes) appearing for the respondents would submit that the only consequence of levying tax in relation to an item included in the First Schedule to the ADE Act is that the State cannot claim any share of the duty collected, as provided in the Second Schedule to the said Act. The power to levy tax on sale of goods is a power flowing from entry 54, List II of the Seventh Schedule to the Constitution of India. It is further pointed out that going by article 286(3) also, the power of the State Government to tax an item which is included in the First Schedule to the ADE Act, is not abrogated. As stated earlier, the only consequence is the loss of revenue for the relevant year, as provided in the Second Schedule to the ADE Act. The learned Government Pleader distinguished the decisions relied on by the learned counsel for the petitioners and further, in support of his submission, relied on the decision of this court in Khataisons v. Addl. Sales Tax Officer [1994] 95 STC 197. The learned Government Pleader distinguished the decisions relied on by the learned counsel for the petitioners and further, in support of his submission, relied on the decision of this court in Khataisons v. Addl. Sales Tax Officer [1994] 95 STC 197. Going by the relevant provisions of the ADE Act and article 286(3) of the Constitution of India, I feel that the contention of the petitioners is plainly untenable. The only point to be considered is whether the apex court has made any binding declaration, which compels this court to take a contrary view. Going by the decision in Godfrey Phillips India Ltd. [2005] 139 STC 537 (SC), relied on by the learned counsel for the petitioners, I feel that the same does not, in any way, support the case of the petitioners. On the contrary, the observations in paras 65 and 72 of the said judgment, wherein the apex court observed that if the State wants to take the benefit of the ADE Act, it should not impose any other levy on the goods concerned, support the respondents. The point that arose in Reliance Trading Company [2006] 147 STC 211 (SC); [2006] 3 KLT 532 (SC) was entirely different. The goods concerned in that case, namely, cotton-based tarpaulin, was exempted under entry 11 in the Third Schedule to the KGST Act. While so, the First Schedule to the Act was amended, making cotton-based tarpaulin a taxable item. The apex court was called upon to decide whether even thereafter the exemption under entry 11 of the Third Schedule remained in force for the said goods. The court answered the question in the affirmative. The observations of the apex court in that decision will not, in any way, advance the contentions of the petitioners that the State Legislature lacks power to levy tax once a particular commodity finds a place in the First Schedule to the ADE Act. In the result, the writ petition fails and it is dismissed. W.P. (C) Nos. 36386 of 2005, 90, 332, 4824, 5152, 6676, 8638 and 8818 of 2006 : In view of the judgment in W.P. (C) No. 33568 of 2005, these writ petitions are also dismissed. In the circumstances of the case, there will be no order as to costs.