A CRITICAL ANALYSIS OF TAXATION PRINCIPLES IN LIGHT OF CONSTITUTIONAL MANDATES AND JUDICIAL INTERPRETATION

Taxation law constitutes the backbone of a modern welfare state, serving not only as a
mechanism for revenue generation but also as an instrument for socio-economic
transformation. In constitutional democracies like India, taxation is intrinsically linked with
governance, public welfare, and distributive justice. The legitimacy of any taxation system
depends on its adherence to established legal and economic principles that ensure fairness,
efficiency, and accountability.
The classical principles of taxation, first articulated by Adam Smith, continue to provide the
theoretical foundation for modalization, and digitalization have necessitated the
development of additional principles such as simplicity, transparency, and flexibility. This
study critically examines these principles and evaluates their application within the Indian
taxation framework.
In India, taxation assumes an even more significant role due to the country’s commitment to a
welfare state model. The State is entrusted with the responsibility of ensuring socio-economic
equity, which necessitates a robust and fair taxation system. However, the effectiveness of such
a system depends on its adherence to established principles of taxation.
This paper undertakes a critical examination of both classical and modern principles of taxation
and evaluates their implementation within the Indian legal framework. It further explores
the role of constitutional provisions and judicial interpretation in shaping taxation laws.