9911796707
TMI Blog1961 (4) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... to restate them. The appellants in the two appeals and in the two petitions under Art. 32 are challenging the constitutionality of the octroi duty on cotton and wool imposed by the respondent Corporation within its octroi limits. The procedure for levying municipal taxes and the power of control of Government in regard to those taxes is laid down in s. 98 of the City of Bangalore Municipal Corporation Act (Act 69 of 1949) hereinafter termed the Act. The procedure is that a resolution intending to impose a tax has to be passed by the Corporation and that resolution is required to be published in the Official Gazette and in the local newspapers. The rate payers can then submit objections and after considering such objections received during the specified time the Corporation may by resolution determine to levy the tax or duty. When such a resolution has been passed the Commissioner is required to publish forthwith a notification in the Official Gazette and in the newspapers as set out in sub-s. (1) of s. 98 of the Act. This notification is to specify the date from which, the rate at which and the period of levy, if any, for which such tax is levied. As has been stated in the order o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... situation and that there was internal evidence in the section itself to show that it has no relevance to the objection taken by the appellants. The section, it was argued, is in Chapter 11 dealing with Municipal Authorities and this particular provision is in that Part of the Chapter which deals with provisions common to the Corporation and its Standing Committees and the marginal note shows that the object of enacting it was the validation of proceedings of the Corporation and its Standing Committees and that the whole section should be read in that context. So read, it was submitted, the section must be taken to be.,% saving provision for the validity of proceedings of the Municipal Authorities which was clear from cl. (a) of sub-s. (1) which deals with defects on the B ground of vacancy or defect in the constitution of the Corporation or of any Standing Committee and subs. (2) of that section also has reference to the meetings of the Corporation and therefore, it was contended, I the defect or irregularity mentioned in cl. (b) of sub,section (1) in any act done or proceeding taken also must have reference to that kind of defect which is referred to in other parts of the section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition of the impugned tax contravenes the provision of Art. 276(2) as it is of a sum more than Rs. 250 and is therefore unconstitutional. This contention is not well founded. There 'was a similar provision in the Government of India Act, 1935, i.e., s. 142-A but there the amount mentioned in sub-s. (2) was Rs. 50 per annum and this limitation was placed as from after the 31st day of March, 1939. A reference to the legislative lists will show that neither the Article 276 nor s. 142-A of the Government of India Act, 1935, has any reference to the tax now impugned. In the Devolution Rules under the Government of India Act, 1915, taxes which could be levied for the purpose of local bodies were the following:- " Item No. 7. An octroi. Item No. 8. A terminal tax on goods imported into or exported from, a local area save where such tax is first imposed in a local area in which an octroi was not levied on or before the 6th July 1917. Item No. 9. A tax on trades, professions and callings. " In the Government of India Act, 1935, the relevant entries in the Legislative List--List II-were 46 and 49 which were as f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, commerce and intercourse throughout the territory of India shall be free." It was contended that the tax imposed directly affected the movement of goods and therefore violates Art. 301 which guarantees the freedom of trade throughout the territory of India. In Atiabari Tea Co. Ltd. v. State of Assam ([1961] S.C.R. 809), Gajendragadkar, J., giving the opinion of the majority said :- "that the content of freedom provided for by Art. 301 was larger than the freedom contemplated by s. 297 of the Constitution Act of 1935, and whatever else it may or may not include, it certainly includes movement of trade which is of the very essence of all trade and is its integral part. If the transport or the movement of goods is taxed solely on the basis that the goods are thus carried or transported that, in our opinion, directly affects the freedom of trade as contemplated by Art. 301. If the movement, transport or the carrying of goods is allowed to be impeded, obstructed or hampered by taxation without satisfying the requirements of Part XIII the freedom of trade on which so much emphasis is laid by Art. 301 would turn to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under Art. 305 but that would operate on and save the taxes on articles specified in Schedule III of Part V, item 18, i.e., octroi on animals and goods set out in Classes I to VII of that Part but would not save the octroi on other articles under Class VIII imposed after the Constitution because that would be an addition of a bye-law, rule or order and would not fall within the term " existing law ". The impugned tax was levied under class VIII set out in part V which is as follows :- Octori Maximum rate Class VIII-Other articles which are not specified above and which may be approved by the Corporation by an Rs. 2-0-0 percent. order in this behalf............ ad valorem. Octroi is to be levied by referenceto s. 130 of the Act which provides:- S. 130. " If the corporation by a resolution deter. mines that an octroi should be levied on animals or goods brought within the octroi limits of the city, such octroi shall be levied on such articles or goods specified in Part V of Schedule III at such rates not exceeding those laid down in the said Part in such manner as may be determined by the corporation." Therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
