JYOTINDRASINHJI VIKRAMSINHJI JADEJA Vs. GONDAL MUNICIPALITY

JUDGEMENT

(1.) The petitioner, an Ex-Ruler of the erstwhile State of Gondal has filed this petition challenging the validity of the rules sanctioned by the Government under its resolution dated 13th March, 1967 and also the amended rules sanctioned by the Government under its resolution dated 15/01/1972, and framed by the respondent-Municipality for levying taxes on lands and buildings. He has also challenged the Assessment List in respect of the properties in question and has sought orders for preventing the respondent-Municipality from imposing, assessing and collecting the house tax and education cess pursuant to the impugned rules.

(2.) The respondent-Municipality was duly constituted under the provisions of the Gujarat Municipalities Act, 1963 (hereinafter referred to as the said Act'). Under Sec. 99 of the said Act, subject to any general or special orders which the State Government may make and to the provisions of Sees. 101 and 102 of the said Act, a Municipality is empowered to impose any of the taxes mentioned therein for the purposes of the said Act. Under sub-sec. (2), it has been provided that, nothing in this section shall authorise the imposition of any tax which the State Legislature has no power to impose in the State under the Constitution. The respondent-Municipality, in exercise of its powers of imposing taxes, passed a resolution under Sec. 101 of the said Act approving rules for the levy of taxes on buildings or lands or both within the limits of Gondal Nagarpalika. These rules were sanctioned by the Government under the resolution dated 13/03/1967 and were enforced by the Municipality from 1/04/1968. Under the said Rules, which are at Annexure 'A' to the petition, the Municipality fixes the rates of taxes on lands and buildings dividing the properties into two classes, namely, buildings or lands used for residential purposes and those used for purposes of trade, commerce, industry or business. Thereafter, rates of taxes were modified by amending Rule 3 of the said Rules. According to the petitioner, during the period from 1968 to 1972, the Municipality did not assess his properties since he was the Ex-Ruler enjoying privileges of exemption from local taxation under the Covenant entered into by the then native State of Saurashtra with the Government of India, and under the provisions of Art. 362 of the Constitution of India. However, by resolution dated 12/01/1972 at Annexure 'C' to the petition, the State Government instructed the local authorities to withdraw the exemption from local taxation, if any, within their respective State areas which they may have granted to the former Rulers. Thereafter, the Chief Officer of the respondent-Municipality by his letter dated 24/02/1972, requested the petitioner to furnish details of his properties for the purpose of preparing the Assessment List. Personal notices were also issued to the petitioner for filing objections to the valuation or assessment proposed in the Assessment List and thereafter, the Municipality had issued bills for recovery of the house tax in respect of the properties of the petitioner. It is contended that the petitioner used to file statutory appeals under Sec. 138 of the said Act against the bills which were issued in respect of the properties. In the appeals which were filed for the assessment years 1972- 73 to 1977-78, the contention of the Municipality, that the appeals were not maintainable since they were filed without depositing the amount of tax, was upheld and these appeals were dismissed on 31/07/1979. The Revision Applications filed against these orders were also unsuccessful. Ultimately, the respondent-Municipality issued Bill No. 3160 dated 20th September, 1979 (Annexure 'E' to the petition) demanding the house tax for the current year and the arrears as also the education cess. According to the petitioner, the imposition and collection of taxes in respect of his property could not be done under the said rules inasmuch as these rules were not framed after following the procedure laid down under Sees. 101, 102 and 103 of the said Act. It is contended that, when the notice dated 7-7-1966 at Annexure 'G' was published in a daily newspaper on 1 2/07/1966 as required by Sec. 101(b) of the said Act, the proposed rules were not appended with that notice and therefore the provisions of Sec. 101(b) were violated. It is also contended that the proposed rules were not kept at any conspicuous place as stated in the public notice. It is further contended that since, earlier, the petitioner was enjoying privileges of exemption from local taxation, he was not required to send any objections against the proposed rules and the Municipality could not have recovered any taxes without affording him an opportunity to file objections after the exemption was withdrawn. It is contended that the impugned house tax rules are ultra vires Arts. 14, 19(l)(f) and 265 of the Constitution of India, in as much as the petitioner was being discriminated against as he was not given an opportunity of raising objections as was given to other property holders. It is also contended that the Chief Officer of the respondent-Municipality had no authority or jurisdiction to include the amount of penalty under Sec. 16 of The Gujarat Education Cess Act, 1962 in the impugned Bill at Annexure 'E' to the petition. It is pointed out in the petition that, earlier, a suit being Civil Suit No. 230 of 1979 was filed by the petitioner in the Court of Civil Judge (S.D.), Gondal but the ad interim injunction which was granted in his favour was vacated by the trial Court on 16-1-1980 and in the appeal which was filed against that order being Appeal No. 4 of 1980, the ad interim relief was vacated by the Appellate Court on 26/03/1980. The petitioner has stated that he was advised to withdraw that suit and it has now been orally submitted before this Court that, that suit was withdrawn.

(3.) The first contention raised on behalf of the petitioner by the learned Counsel Mr. D. L. Kothari was that, at the time when the said rules were made by the respondent Municipality, the property of the petitioner was exempted from taxation by the local authority. He referred to the Instrument of Accession signed by the Rulers of 'Salute' States in Kathiawar reproduced in Appendix II of the Saurashtra Code Volume II at page 825 and relied upon Clause 8 thereof which provided that nothing in the said instrument affect the continuance of the sovereignty of the Ruler in and over the State or save as provided by or under the instrument the exercise of any power, authority and rights enjoyed by him as Ruler of the State or the validity of any law which was in force in the State at that time. He also relied upon the Covenant entered into by the Rulers of Kathiawar State for the formation of the United State of Kathiawar which is reproduced in Appendix VII at page 841 of the Saurashtra Code Volume IT. He relied upon Articles XI and XII in support of his submission that the property of the petitioner could not be subjected to local taxes. Under Article XI, the Ruler of each Covenanting State was entitled to full ownership, use and enjoyment of all private properties belonging to him on the date of his making over the administration of the State to the Rajpramukh. Under Article XII, the Rulers and members of his family were entitled to personal privileges, dignities and titles enjoyed by them immediately before 15/08/1947. In light of these provisions of the Covenant, it was submitted by the learned Counsel for the petitioner that if local taxes were to be imposed, it would have deprived the Ruler of his entitlement to full ownership, use and enjoyment of his property. It was submitted that, since the Municipality lacked jurisdiction to impose any taxes on the Ruler in view of the said covenance, the rules which were framed pursuant to the notice dated 8/07/1966 were not applicable to the property of the petitioner and later on when, in 1972, the exemption was withdrawn, these rules could not have automatically applied to the said property and it was necessary to frame fresh rules in respect of the property of the petitioner so that he could be given an opportunity of raising objections against the proposed levy. It is difficult to agree with the submissions of the learned Counsel that the property of the petitioner was exempted from taxation and that the respondent-Municipality had no authority to impose any tax under Sec. 99 of the said Act read with Art. 362 of the Constitution of India. Article 362, which was repealed by the Constitution (26th Amendment) Act, 1971, read as under :