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Issues Involved:
1. Non-compliance with procedural requirements under the U.P. Municipalities Act. 2. Validity of Section 135(3) of the U.P. Municipalities Act under the Constitution. 3. Alleged violation of Articles 14 and 19 of the Constitution. 4. Excessive delegation of legislative functions. Issue-Wise Detailed Analysis: 1. Non-compliance with procedural requirements under the U.P. Municipalities Act: The appellant Board passed a special resolution imposing a water tax, which was notified by the Government of Uttar Pradesh. However, the High Court found that the Board did not comply with the mandatory requirements of the Municipalities Act. Specifically, the resolution was not published in a local Hindi newspaper as required by Section 94(3), and the rules accompanying the resolution were not exhibited. The High Court held that these procedural lapses rendered the tax imposition illegal. 2. Validity of Section 135(3) of the U.P. Municipalities Act under the Constitution: Section 135(3) of the Act states that a notification of the imposition of a tax shall be conclusive proof that the tax has been imposed in accordance with the provisions of the Act. The High Court declared this provision ultra vires Article 14 of the Constitution, as it created a bar against proof and left no remedy to the taxpayers, thereby discriminating between them and other litigants. The High Court also held that this subsection conferred judicial power on the Government contrary to the Constitution's intendment. The Supreme Court, however, interpreted Section 135(3) as a rule of conclusive evidence that only puts beyond question the procedure by which the tax is imposed, not the tax itself. The Court held that the provision does not shut out all judicial inquiry but rather ensures that minor procedural lapses do not invalidate the tax. 3. Alleged violation of Articles 14 and 19 of the Constitution: The respondents contended that Section 135(3) was discriminatory as it did not allow taxpayers to challenge the imposition of the tax, unlike other litigants. The High Court agreed, finding it violative of Article 14. The Supreme Court, however, found that the provision does not create any unconstitutional discrimination. The Court noted that the taxpayers are allowed to object to the proposal and rules before they are finalized and that the finality of the Government's notification is a necessary step to conclude the imposition process. 4. Excessive delegation of legislative functions: The respondents argued that Section 135(3) represented an excessive delegation of legislative functions, as it allowed the Government to validate the imposition of a tax without ensuring compliance with procedural requirements. The Supreme Court rejected this argument, stating that the delegation was not excessive. The Court emphasized that the essential legislative functions were performed by the State Legislature, and only minor functions necessary for the imposition and collection of the tax were delegated to the Municipal Boards and the State Government. Separate Judgment by Wanchoo J.: Wanchoo J. dissented, arguing that Section 135(3) effectively nullifies the procedural safeguards provided in Sections 131 to 135(1) of the Act. He contended that the provision was a substantive rule that gave a complete go-by to the procedural requirements, thereby constituting excessive delegation. Wanchoo J. would have struck down Section 135(3) as ultra vires, maintaining that the procedural safeguards were essential to the valid imposition of the tax. Conclusion: The Supreme Court, by majority opinion, set aside the High Court's judgment and upheld the validity of Section 135(3) of the U.P. Municipalities Act. The Court held that the provision did not violate Articles 14 and 19 of the Constitution and did not constitute excessive delegation. The appeal was allowed, and the petition under Articles 226 and 227 was dismissed. No order as to costs was made.
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