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TMI Blog2017 (9) TMI 1997X X X X Extracts X X X X X X X X Extracts X X X X ..... ent Municipal Corporation to levy octroi on the articles as specified in ScheduleH to the said Act. We may note here that Section 139 of the said Act confers powers on the first respondent to impose four types of taxes which include octroi. At the material time, Entry 22(a) of Schedule H read thus: "22(a) Mineral Oils of all sorts, diesel oil, petrol, aviation spirit, all kinds of lubricating oils, while oil, spindle oil, furnance oil, petroleum products, mava oil, sevasol, solvent oil, other fuel oils, oils used as insecticides, natural gasoline, paint solutions and compositions, Turkey Red Oil, and byproducts of mineral oils, but nothing herein before contained shall include kerosene and Crude Oil ...... 1 percent advalorem." The petitioner has referred to a letter dated 27th March 1985 addressed by the Deputy Assessor and Collector (OctroiRefund) of the first respondent to the Senior Deputy Director (F & A), Oil and Natural Gas Commission by which the octroi was demanded on natural gas imported by the petitioner during the years 197879 to 198283. The said letter refers to various books and alleges that the natural gas is similar to liqu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .XII of 1993. The amendment made by the Ordinance and the Maharashtra Act No.XII of 1993, clause(a) of Entry No.22 reads thus: "9. In Schedule H to the Bombay Corporation Act, (a). ..... ..... ..... ..... ..... ..... ..... ..... (b) in entry 22, in subentry (a), for the words "petroleum products" the words "petroleum products including natural gas and liquified petroleum gas" shall be and shall be deemed to have been substituted with effect from the 1st day of April 1978;" In the statement of objects and reasons appended to the aforesaid Ordinance, it was stated thus: "The amendments to Schedule H include inter alia amendment to entry 22(a). The expression "petroleum products" includes natural gas and liquified petroleum gas and octroi could be and is leviable thereon. Doubts have however been expressed whether the expression "petroleum products" so includes the natural gas and liquified petroleum gas. Although it does implicitly so include, clause (a) of entry 22 which provides for levy of octroi on petroleum products is amended to make it explicit retrospectively with effect from the first day of April 1978, being the date by or about which the Corporation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for octroi only for a few days may be within the said period of three months and, therefore, the Municipal Corporation has no power to recover substantial part of their impugned demand for octroi. 7. The third submission was that at the relevant time, the petitioner was Oil and Natural Gas Commission under the Oil and Natural Gas Commission Act, 1959. The natural gas procured or produced by the petitioner will have to be treated as a property of the Government and, therefore, exemption under Section 194 of the said Act will apply. 8. The learned senior counsel appearing for the petitioner relied upon the decisions of the Apex Court in the case of M/s.J.K.Cotton Spinning and Weaving Mills Ltd. and another v. Union of India and Others 1987 (Supp) SCC 350. He also invited our attention to another decision of the Apex Court in the case of R.C.Tobacco (P) Ltd. and another v. Union of India and another (2005) 7 SCC 725. He relied upon the decision of the Apex Court in National Agricultural Cooperative Marketing Federation of India Ltd. and another v. Union of India and others (2003) 5 SCC 23. He urged that the legislative power to amend the enacted law with retrospective effect is sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench of the Apex Court in the case of Association of Natural Gas and others v. Union of India and others (2004) 4 SCC 489. Inviting our attention to the said decision, he submitted that the Apex Court after due consideration of the scientific material placed before it came to the conclusion that the natural gas is a petroleum product and that the words "petroleum" or "petroleum products" have been given wide meaning to include natural gas and other similar products. He would, therefore, submit that the natural gas was always included in Entry 22(a) of ScheduleH and that is the reason why the impugned amendment is clarificatory and declaratory in nature. 10. The learned senior counsel appearing for the respondentMunicipal Corporation supported the learned Advocate General and he relied upon the decision of the Apex Court in the case of Commissioner of Income Tax (Central)I, New Delhi v. Vatika Township Private Limited (2015) 1 SCC 1. He relied upon various other decisions of the Apex Court in the cases of Empire Industries Limited and others v. Union of India and others (1985) 3 SCC 314; The Government of Andhra Pradesh and another v. Hindustan Machine Tools Ltd. (1975) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in interpreting items in statutes like the Excise Tax Acts or Sales Tax Acts, whose primary object is to raise revenue and for which purpose they classify diverse products, articles and substances resort should be had not to the scientific and technical meaning of the terms or expressions used but to their popular meaning, that is to say, the meaning attached to them by those dealing in them. If any term or expression has been defined in the enactment then it must be understood in the sense in which it is defined but in the absence of any definition being given in the enactment the meaning of the term in common parlance or commercial parlance has to be adopted. In Ramavatar Budhiaprasad v. Assistant Sales Tax Officer, Akola, 37 STC 33 (Ori HC) question was whether 'betel leaves' fell within item 'vegetable' so as to earn exemption from sales tax and this Court held that word 'vegetable' had not been defined in the Act, and that the same must be construed not in any technical sense nor from the botanical point of view but as understood in common parlance and so construed it denoted those classes of vegetable matter which are grown in kitchen garden and are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on is necessary in adopting the meaning ascribed to the word in other Acts. "It would be a II new terror in the construction of Acts of Parliament if we were required to limit a word to an unnatural sense because in some Act which is not incorporated or referred to such an interpretation is given to it for the purpose of that Act alone." (Macbeth v. Chislett 1910 AC 220223). 5. When the word to be construed is used in a taxing statute or a notification issued thereunder it should be understood in its commercial sense. It is well known that under the law levying customs duties sometimes exemptions are given from the levy of the whole or a part of customs duty when the goods in question are sold either in the form in which they are received or in a manufactured or semimanufactured state to a manufacturing establishment for purposes of using them in manufacturing finished or semifinished goods in order to lessen the cost of machinery or equipment employed in or raw materials used by such manufacturing establishment. The object of granting such exemption is to give encouragement to factories or establishments which carry on manufacturing business. The appellant, howeve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roleum' or 'petroleum products' has been defined in an inclusive way, so as to include natural gas. In Encyclopaedia Britannica, 15 th Edn. Vol. 19, page 589 (1990), it is stated that "liquid and gaseous hydrocarbons are so intimately associated in nature that it has become customary to shorten the expression 'petroleum and natural gas' to 'petroleum' when referring to both." The word petroleum literally means 'rock oil'. It originated from the Latin term petraoleum. (petra-means rock or stone and oleummeans oil). Thus, Natural Gas could very well be comprehended within the expression 'petroleum' or 'petroleum product'." "37. A survey of the various legislations on the topic would show that the term 'petroleum' or 'petroleum products' has been given a wide meaning to include natural gas and other similar products." (emphasis added) Thus, in so many words the Apex Court after considering the technical material before it held that the natural gas is a petroleum product. 15. Now, coming back to the unamended Entry 22(a), as pointed out earlier, it includes mineral oils of all sorts, diesel oil, petrol, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tes", the learned author has summed up as follows : "Declaratory statutes. The presumption against retrospective operation is not applicable to declaratory statutes. As stated in CRAIES and approved by the Supreme Court : "For modern purposes a declaratory Act may be defined as an Act to remove doubts existing as to the common law, or the meaning or effect of any statute. Such Acts are usually held to be retrospective. The usual reason for passing a declaratory Act is to set aside what Parliament deems to have been a judicial error, whether in the statement of the common law or in the interpretation of statutes. Usually, if not invariably, such an Act contains a preamble, and also the word 'declared' as well as the word 'enacted'". But the use of the words 'it is declared' is not conclusive that the Act is declaratory for these words may, at times, be used to introduce new rules of law and the Act in the latter case will only be amending the law and will not necessarily be retrospective. In determining, therefore, the nature of the Act, regard must be had to the substance rather than to the form. If a new Act is 'to explain' an earlier Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the matter of fiscal statutes. 18. As we have found that natural gas or liquified petroleum gas were always part of petroleum or petroleum products in Entry 22(a), what is sought to be done by the impugned amendment is to declare and clarify that the natural gas and liquified petroleum gas were always included in the term "petroleum or petroleum products" used in Entry 22(a). Therefore, we do not see any unconstitutionality attached to the impugned Ordinance or the impugned Act. 19. It is not possible to accept the submission that there was a serious doubt whether natural gas was included in petroleum or petroleum products. In fact, the submission that two interpretations were possible cannot be acceptable at all in the light of the decision of the Apex Court in the case of Association of Natural Gas and others (supra). 20. Now, we come to Rule 25 of the Octroi Rules which is relied upon by the learned senior counsel appearing for the petitioner. Perusal of the Octroi Rules shows that octroi is leviable on the goods which attract levy of octroi which are brought into limits of the Municipal Corporation by way of import by sea or import by rail or import by air or import by roa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... troi. It is not the case of the petitioner that the petitioner followed procedure of filling in forms and claiming that octroi was not leviable on natural gas. There is no provision under the said Act which provides for a period of limitation or outer limit within which octroi could be levied or collected from the date of its import. Rule 25 is merely an enabling provision which enables the Municipal Corporation to take steps for recovery of octroi in the contingencies which are covered by the said Rule. By no stretch of imagination Rule 25 can be interpreted to mean that in a case of a person who evades octroi by clandestinely importing articles subject to octroi and who fails to follow the procedure laid down by the Octroi Rules is liable to pay octroi only within a period of three months from the date of import of goods and, therefore, after expiry of the said period of three months, the Municipal Corporation is powerless to take steps for recovery of octroi from the person who has evaded payment of octroi. This enabling provision of Rule 25 does not take away power of the Municipal Corporation to recover octroi after expiry of three months from the date of import of goods withi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 17 thereof makes it very clear that all the properties acquired by the Commission vest in the Commission. There is no provision in the said Act which provides that the natural gas procured or produced by the petitioner will be the property of the Government. 24. Thus, the challenge must fail on all grounds agitated by the petitioner 25. The learned senior counsel appearing for the Municipal Corporation stated that the Municipal Corporation has not initiated prosecution under Section 478 of the said Act. Considering the fact that the punishment prescribed by Section 478 is of maximum period of six months, the period of limitation for lodging prosecution on the basis of demand subject matter of this petition has already elapsed. As far as penalty is concerned, in view of Section 4781A, the penalty can be imposed only on conviction of a person for evading the payment of octroi. Thus, for the nonpayment of demand subject matter of this petition, neither penalty nor interest can be levied by the Municipal Corporation. 26. This petition filed in the year 1989 was admitted and interim relief was granted. Thereafter this petition was dismissed and the said order of dismissa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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