BILLIMORA NAGAR PALIKA Vs. WOOD POLYMER LIMITED

JUDGEMENT

(1.) These appeals are directed against the judgment of the Gujarat High court dated 21-11-1980/28-11-1980 in Special Civil Application No. 1379 of 1977 filed by M/s Wood Polymer Ltd. (hereinafter referred to as "the petitioner").

(2.) The petitioner was engaged in the manufacture of laminated sheets in its factory at Billimora within the limits of Billimora Nagar Palika (hereinafter referred to as "the Nagar Palika"). For manufacture of laminated sheets the petitioner was importing paper for use as raw material. The Nagar palika levied octroi duty on the paper imported by the petitioner for manufacture of laminated sheets. The said octroi duty was levied on the basis of the price of the imported paper inclusive of excise duty. The petitioner claimed that since the laminated sheets after manufacture were exported out of the municipal limits of the Nagar Palika, the petitioner was entitled to refund of the octroi duty paid by it on the paper brought by it within the municipal limits. The said claim of the petitioner was not accepted by the nagar Palika and the petitioner filed the writ petition, which has given rise to these appeals, wherein the petitioner challenged the validity of Rule 7 of the octroi Rules framed by the Nagar Palika which required an importer to produce the original invoice and to make a declaration. The petitioner also challenged the validity of the bye-laws made by the Nagar Palika with regard to the refund of octroi duty and particularly challenged the validity of Bye- law 14. It was also claimed by the petitioner in the writ petition that the petitioner was not liable to pay octroi on the excise duty paid on the paper imported by it and that octroi duty was payable only on the cost of paper excluding excise duty, since the element of duty that is paid on the paper imported by the petitioner is adjustable against the excise duty payable on the manufactured product under Rule 56-A of the Central Excise Rules.

(3.) By the impugned judgment the High Court, while rejecting the challenge of the petitioner to the validity of Rule 7 of the Octroi Rules framed by the Nagar Palika, has accepted the challenge to the validity of bye-law 14 and has held that the said bye-law being inconsistent with. clause (l) of sub-section (1) of Section 275 of the Gujarat Municipalities Act, 1963 (hereinafter referred to as "the Act") is void. The High Court has, however, rejected the claim of the petitioner that it was not liable to pay octroi on the excise duty paid on the paper imported by it.