TATA CHEMICALS LIMITED Vs. ADITYANA NAGAR PANCHAYAT

JUDGEMENT

(1.) .The petitioner-Company, situated within the local limits of the opponent impugns the validity and legality of the claim, demand and notice dated 26th October, 1991 regarding levy of octroi duty of the bygone period on the ground that the same are violative of Arts. 14, 19(l)(g) and other provisions of the Constitution of India, etc.

(2.) . The facts leading the petitioner to prefer this petition under Art. 226 of the Constitution of India may in brief be stated. The petitioner-Company is a Company within the meaning of the Companies Act, 1956. It is engaged in the business of manufacturing of Soda Ash. Lime Stone and Salt are the basic raw materials used in manufacturing process of Soda Ash. The Company is the holder of lime stone quarry on lease in Survey Nos. 602 and 516 of village Adityana, Taluka-Ranavav, in Junagadh District. The office is situated in Plot No. 255, of Survey No. 602. The Company brings from Porbandar to its quarry office, machineries, spare-parts and other materials required for running the quarry by Porbandar-Adityana road. Formerly, Adityana was having village Panchayat and later on it came to be converted into Nagar Panchayat. The opponent-Panchayat passed the resolution on 19th August, 1960 for levying octroi duty on the goods brought within its octroi limits. The Commissioner, Rajkot Division, Rajkot by his order dated 6-2-1961 sanctioned the levy of octroi duty. After such permission the opponent-panchayat started to levy octroi from its different octroi posts as and when the goods were brought within its octroi limits. However, the opponent-panchayat never demanded the octroi duty from the petitioner on the goods brought by it from Porbandar or elsewhere to its lime stone quarry. It was only in the year 1984, the opponent-Panchayat demanded the octroi duty on the goods brought by the Company within its octroi limits. On 15th August, 1989, the petitioner, therefore, filed Special Civil Application No. 1966 of 1989 for a writ of mandamus directing the opponent to furnish a certified copy of the order of the Collector, Junagadh demarcating the octroi limits. Whether the premises of the petitioner-Company were within the octroi limits was the question of fact requiring full-fledged inquiry. The petition was, therefore, withdrawn. Thereafter, the petitioner-Company was convinced about the fact that its office where the goods were being brought was situated within the octroi limits. Both the parties then arranged parleys so as to find out viable solution qua the octroi duty sought to be levied right from 1961 According to the opponent, Rs. 7,53,000/- towards the octroi duty and Rs. 75,30,0007- being the penalty amount thereon in all Rs. 82,83,000/- were being demanded. After prolonged discussion, it was agreed that the petitioner would pay lumpsum amount of Rs. 51,000/- per year towards the claim of the octroi duty for the period from 1st April, 1984 to 31st March, 1990. According to such settlement vide its letter dated 7th November, 1990, the petitioner sent a cheque for Rs. 3,06,000/- to the opponent in full and final satisfaction of the claim. The petitioner had already paid in advance Rs. 25,000/- qua the octroi duty payable during the year-1990-91, a receipt of which is also issued by the opponent on 8th November, 1990; and, thereafter, the petitioner is regularly paying octroi duty as and when the goods are brought within the octroi limits. The petitioner is having several Air-Compressors, Drills and other Machineries which are used in different lime stone mines in the areas Surrounding Adityana, but at no point of time, the respondent preferred to levy octroi duty. The petitioner-Company also purchased one Air-Compressor on 7th December, 1990 and took it to both the mines. When the same was being brought to the Company's quarry workshop at Adityana on 5th September, 1991, it was stopped and octroi was demanded from the operator. The petitioner found that the demand made by the opponent for the duty right from 1961-62 was not consistent with law, because upto 1984 never the octroi duty was demanded. In view of Sec. 178(ii) of the Gujarat Panchayats Act, 1961 it was beyond the power of the Panchayat to levy octroi duty. The opponent-Panchayat informed the petitioner to produce relevant records with regard to the octroiable goods brought within the octroi limits right from 1961-62, failing which it was made clear that the opponent will decide and determine what amounts should be recovered from the petitioner. The petitioner was of the belief that the opponent had no power to levy the octroi duty from 1960 and also to demand the same in 1991 relating to the period from April 1961 to March 1984. If at all, the opponent was having that power, it was arbitrary and unjust. The notice dated 26-10-1991 given demanding the octroi duty is illegal. An opportunity of being heard was not given to the petitioner. Upto September, 1991, the petitioner was never called upon to pay the octroi duty relating to the period prior to 1994. For the first time, the resolution was passed on 6-2-1961. On the amount of octroi duty 100% penalty was also sought to be levied. The notice and claim put forth are, therefore, bad in law. This petition is, therefore, filed for issuance a writ of mandamus or any other appropriate writ quashing and setting aside the impugned notice dated 26-10-1991 and quashing the demand made and threats given vide letter dated 5-10-1991 whereby the demand for the first time was made after 1961-62, the year from which the octroi duty came to be imposed.

(3.) . On several grounds, the learned Advocate for the parties have submitted refuting the case of the other side. Firstly, it is the contentions of the learned Advocate representing the opponent that this Court may abstain from exercising the writ jurisdiction under Art. 226 of the Constitution of India especially when other efficacious remedy is available and yet not resorted to by the petitioner. According to the learned Advocate for the opponent, when the demand was made, old Gujarat Panchayats Act, 1961 was in force and as per Sec. 186(6) of that old Act, the appeal was required to be preferred to the District Panchayat against the claim advanced by the opponent-Panchayat. Subsequently, the Gujarat Panchayats Act, 1993 came into force and the said Section finds place in the new Act as Sec. 200(6). As per that Section also which is couched in the same words, the persons aggrieved by the assessment, levy or imposition of the tax or fee has to file the appeal to the District Panchayat within the prescribed period. When there is such provision about the appeal, and the appeal is not preferred by the petitioner against the demand made, it would not be just and proper on the part of this Court to exercise the powers under Art. 226 of the Constitution. In support of such contentions, the learned Advocate for the opponent has relied upon the decisions of the Supreme Court in the cases of C. A. Abraham v. Income-Tax Officer, Kottayam & Anr., AIR 1961 SC 609 and Commissioner of Income-Tax, Lucknow v. U.P. Forest Corporation, 1998 (3) SCC 530.