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TMI Blog1953 (2) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Municipality as a theatre tax. The tax was not, however, a tax which could be levied by the Municipality under the power conferred upon it under Section 59, Sub-section (1), Clauses (i) to (x). It was a tax which could be levied by the Municipality if at all under the provisions of Sub-clause (xi) which at that time ran as follows: (xi) any other tax to the nature and object of which the approval of the Governor-in-Council shall have been obtained prior to the selection contemplated in Sub-clause (i) of Clause (a) of Section 60. 3. The Municipality thereupon approached the Governor-in-Council, and it is not in dispute that the Governor-in-Council first of all gave the approval necessary under Section 59(1), Clause (xi), for the Municipality to select the tax and after the proper procedure was followed ultimately the tax was approved by the Governor-in-Council in July 1920. The tax was at first levied at the rate of ₹ 2 per day, but subsequently in the year 1941 the Bombay Municipal Boroughs Act having been passed in the meanwhile in 1925, the Municipality followed the procedure provided by the provisions of the 1925 Act for imposition of a new tax, and the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xes leviable by the Provincial Legislature under the Government of India Act. In the second instance, they contended that assuming that there was power in the Provincial Legislature and consequently in the Municipality and the Poona Cantonment Board to levy a tax on shows there was no power in them to levy an entertainment tax so as to throw any liability upon the exhibitor instead of upon the persons who obtained admission to the entertainments upon payment for admission. So far as the tax has been levied upon cinemas situated within the local limits of the Poona Municipality, it was assumed that at the time when the tax was increased in 1941 and again in 1948 the Poona Municipality was acting under the power conferred upon it by Clause (xiv) of Section 73 of the Municipal Boroughs Act. The learned trial Judge who came to the conclusion that it was not permissible for the Municipality to levy the tax under that provision consequently went into the question as to whether it could not be held that the tax was a legal tax inasmuch as it was levied within the Municipal limits of Poona from before the enactment of the Bombay Municipal Boroughs Act of 1925. It is not in dispute that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 50 in the Provincial Legislative List (List II). 9. Now, the first thing to be noticed when interpreting the words tax on entertainments which occur in Entry No. 50 in the Provincial Legislative List is that the word entertainments there is used in the plural, it is impossible to accept a contention therefore that entertainment means the receipt of entertainment. The plural necessarily indicates that the word is used as a common noun and not an abstract one. The entertainment as a common noun must necessarily mean in the case of a cinema a show, in the case of a drama a performance, in the case of cricket a match. The learned counsel who appears on behalf of the plaintiffs in both the appeals being faced with this difficulty has raised another question before us. That is that even assuming that we come to the conclusion that the tax which has been levied in this case is a tax upon entertainments, there was no power in the Provincial Legislature and consequently in the Municipality or in the Cantonment Board to levy the tax from an exhibitor. The first point, however, to be determined obviously is as to where the incidence of the tax must fall if it is levied under, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1916, shows that in England the tax which was levied was known as an entertainments duty and the word -entertainment was defined in the Act as confining ourselves to cinema, a show to which persons obtained admission. In the second instance so far as we can see the tax was leviable from the proprietor. It appears that the tax was leviable in two ways: (1) by placing a stamp upon the ticket of admission, and (2) in the second instance where admission was obtained to a show for example by a turnstile then the tax was leviable with the help of the turnstile. 11. But in either case the tax was leviable from the proprietor. It is obvious that in case the tax was levied by means of a stamp affixed to a ticket of admission, the stamp would have to be purchased in the first instance by the proprietor or the exhibitor of the cinema or the theatre at which it was shown. In the second instance there was no provision in the English Act throwing the liability for payment of the tax whoever paid it in the first instance, upon the person who paid for admission to any entertainment. In case admission was obtained by any person to any place of entertainment without complying with the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d be within the competence of the Provincial Legislature or not. In our view, the same principle must be followed in dealing with the argument which has been made before us. If in substance the tax was a tax upon the show or in the case of the regular theatre upon the performance given therein, it makes no difference whatsoever as to whether the tax is levied from the person who obtains admission to the entertainment or from the person who gives it. It is quite true as Mr. Banaji pointed out that the tax is supposed to be a tax upon luxury, the word entertainment falling within the meaning of the word luxury as it was understood by the Legislature. It is also perfectly true that it cannot be said that the exhibitor of a cinema film gets any luxury whatsoever from exhibiting the film. He is merely following an occupation. It may be that he deals in luxury but that does not alter the fact that it is no luxury for him to give a show. But when the question is as to whether the tax is really speaking a tax upon the performance, it is immaterial whether the exhibitor is enjoying any luxury himself. It has got to be remembered that Entry No. 50 does not empower the levying of a ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contended, however, that in that case an entertainments duty or tax was already levied by the Bombay Government upon all entertainments given in cinema theatres under the provisions of the Act of 1923; and it would no longer be permissible for the Cantonment Board to levy another entertainment duty because this would be double taxation. But we fail to understand that there is anything in our Constitution which prevents double taxation being levied. It is quite true that if ordinarily a Provincial Legislature wanted to levy for itself a tax, it would not pass two laws levying two different duties in respect of the same subject-matter, in this case an entertainment. There is nothing to prevent the Provincial Legislature from charging in respect of entertainments as much tax as it likes. It would not therefore dream of passing of two Acts levying two separate entertainments duties. But instances are not wanting in this country in which taxes are levied twice upon the same thing, once for the benefit of the Provincial Government and in the second instance for the benefit of the Local Self-Government bodies, for example, the District Local Board or the Municipality. The two instance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is 'ultra vires' of the Governor in Council, who enacted the Bombay District Municipal Act, 1901, because it involves delegation of the function of legislation to the Governor in Council, i.e., the executive of the Province. It has got to be remembered that Section 59(1) in the first instance allowed the Municipalities which are governed by the Bombay District Municipal Act, 1901, to levy the taxes, falling within Clauses (i) to (x) of Section 59, sub-section (1). It was realised, however, that the Municipality might find it necessary or at any rate convenient to levy a tax which would not fall within the provisions of Clauses (i) to (x). That was why the Legislature seems to have enacted clause (xi). At the time when the Act was enacted, however, there was no division of taxes between the Provincial Government and the Central Government. There were a number of restraints upon the power of the Provincial Government to levy taxes. The Provincial Government was not allowed to levy new taxes and even though the power to levy, taxes was there, there was a check always available to the Central Government in the form of withholding of the assent of the Governor General which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gislation required that in the first instance there should be power in such Legislatures to pass what is called conditional legislation which was conditional upon the exercise of powers or a limited discretion given to some outside authority, for example, an executive officer of the Government. They have also pointed out that both in England and in India particularly in the latter country the Legislature had delegated considerable powers, after laying down a policy, to outside bodies enabling them to undertake legislation going by the name of subordinate legislation. They have then observed that Parliament must have been aware of what had happened both in England and elsewhere, and when therefore it was constituting Sovereign Legislatures, it cannot possibly be said that it was not in its contemplation that subordinate ' legislation' of the kind which was mentioned by their Lordships would be permitted by the Legislatures which they had constituted. 18. It would appear, therefore, that in the case of a Legislature which is a Sovereign Legislature there is power to permit others after declaring the policy to fill up details. It would be impossible otherwise for a Legislat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20. It appears to us that applying this test, there is nothing in Section 59(1), clause (xi), which renders that section 'ultra vires' of the Governor in Council because of legislative power having been delegated. The Governor in Council in this case was legislating upon the subject of local self-government. It was deemed desirable that Municipalities should be constituted within the province, and if Municipalities are to be constituted within the Province, it was necessary to allot to them sources of taxation. The sources of taxation mentioned in Clauses (i) to (x) of Section 59(1), therefore, were in the first instance allotted to them. Then it was considered necessary apparently either because these sources may be insufficient or because sometimes the Municipalities might prefer to levy another tax in lieu of taxes mentioned in Clauses (i) to (x) that they should have power to levy other taxes also. The question then arose what other taxes the Municipalities can be empowered to impose. Section 59(1), clause (xi), provides that they had the power to impose any other tax provided that the previous approval of the Governor in Council to the nature and object of the ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Provincial Government at the time when the Act of 1901 was enacted was the Governor in Council. It is said that the only difference which was made by clause (xi) is that whereas in the case of a tax which fell within the purview of cls. (i) to (x) it was sufficient for the Municipality in the first instance to follow the procedure laid down when any tax had to be imposed afresh and then submit the rules which it proposed to make on the subject to the Governor in Council for sanction, the Municipality had, when it proposed to levy any tax which was not included in clause (i) to (x) of Section 59(1), in addition to obtain the approval of the Government to the nature and object of the tax even before the Municipality took into consideration a proposal to select that particular tax. It is said that this is merely a Question of procedure differentiating one set of taxes from others and really speaking consequently there was no delegation. Now, we can understand that the Legislature might have, without delegating to anybody any powers, made it incumbent in case of certain taxes which were leviable by Municipality, to obtain the sanction of the Governor in Council not only after the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment of the Presidency. The actual words used in Section 42 which conferred the powers are: .....to make Laws and Regulations for the Peace and good Government of such Presidency, and for that Purpose to repeal and amend any Laws and Regulations made prior to the coming into Operation of this Act by any Authority in 'India', so far as they affect such Presidency: Provided always, that such Governor in Council shall not have the power of making any Laws or Regulations which shall in any way affect any of the Provisions of this Act, or of any other Act of Parliament in force, or hereafter to be in force, in such Presidency. It is obvious, therefore, that the powers were plenary and the Governor in Council could repeal any Act of the Governor General in Council in the Presidency of Bombay. But if any further authority was needed upon this point, it would be furnished by the case of -- 'Riel v. The Queen' (1886) 10 AC 675 (F). The question there arose with regard to the sovereign character of the legislature of the Dominion of Canada and the powers which were conferred upon it and which were called into question in that case were those conferred upon it b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legislature that it must function within certain specified limits, and in our view it does not make any difference to the sovereign character of the legislature if an Act which is passed by it requires the sanction of some outside body. The sanction of some authority which was a part of the Legislature obviously does not make any difference to the sovereign character of the Legislature; nor is it contended that it does. But even when to the laws which are made by a Legislature which, has been invested with powers which are as plenary as those of the Imperial Parliament itself the sanction of an outside person or body like the Governor in Council is required, that does not make the Legislature a non-sovereign legislature; nor does it prevent it from delegating certain powers of subordinate legislation to some one else. It has got to be remembered that the question of the sovereign character of the Central Legislature constituted by the Act of 1861 came up before their Lordships of the Privy Council in -- 'The Queen v. Burah', 5 IA 178 (PC) (G), and they held that the Legislature was a Sovereign Legislature. Now, even -in the case of the Indian legislature constituted by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... got no power to do so. I have already mentioned that in the trial Court the plaintiff attacked the taxes which were levied upon the footing that the power to levy those taxes was not conferred either by Section 60 of the Cantonment Boards Act or in the alternative by Section 73, Sub-section (xiv), of the Bombay Municipal Boroughs Act. It was only when the learned trial Judge came to the conclusion that the Municipality and the Cantonment Board had no power to levy the taxes as entertainments taxes that the Municipality relied upon the levy of the tax before the Bombay Municipal Boroughs Act was enacted and argued that when subsequently the tax which was originally levied was increased, there was no fresh tax imposed. It was then contended on behalf of the plaintiff that in case the Municipality attempted to justify the levy of the tax by the fact that the tax had already been levied under the powers conferred upon the Municipality by the District Municipal Act, 1901, then it was beyond the powers of the Municipality to increase the tax in 1941 and in 1948, there being no power in the Municipality to impose a similar tax under the 1925 Act which then had application. Mr. Banaji w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ionary gives two meanings to the verb modify . One is the root meaning and that is the Municipality may moderate or reduce the tax which had already been leveled. The other meaning is to make partial change or to alter without radical transformation. Mr. Banaji contends that the popular meaning of the word is really speaking to limit or to reduce . But we are unable to accept this contention. The meaning which is relied upon by Mr. Banaji is the root meaning of the word. But a word does not always keep up its root meaning. Instances are not unknown when the word, in course of time, comes to mean exactly the opposite of the root meaning with which it had been brought into use in the first instance. And we think that if an ordinary person was asked as to what the meaning of the word modify is and if he does not know what the root meaning of the term was, he would say that the meaning was to make partial changes or to alter without making any radical transformation. Then in the second instance the dictionary gives both the meanings of the word, and Roland Burrows in Words and Phrases points out instances in which it has been used in the sense of making partial changes so as e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad already once levied. If at all it wanted to increase the tax, it would necessarily have in the first instance to abolish the tax by following a particular procedure. Then it would have again to start the procedure prescribed for imposing the tax afresh and levy the increased tax as a fresh tax. Now, it is quite true that it is after all a question of interpreting a statute in order to find out the powers conferred upon the Municipality, and if by following the ordinary rules of interpretation we arrive at no other result but the one which is contended on behalf of the plaintiffs, then we must give effect to the meaning. But in the first instance both in the 1901 Act and in the 1925 Act we find that the Legislature itself contemplated that the Municipality had the power of increasing taxes. For example, in the 1901 Act Section 74 empowers the Provincial Government to require a Municipality to impose a new tax or to enhance any existing tax. The section provides that the Provincial Government may require the Municipality to impose a new tax or to enhance any existing tax which had already been imposed, end the Municipality shall then forthwith proceed to impose or enhance it in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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