MAHE BEACH TRADING COMPANY, BY PARTNER B. KUTTI HASSAN HAJI Vs. THE UNION TERRITORY OF PONDICHERRY REPRESENTED BY THE CHIEF SECRETARY TO THE GOVERNMENT OF PONDICHERRY, UNION TERRITORY OF PONDICHERRY AND ORS.

JUDGEMENT

(1.) THE petitioner owns an Esso patrol pump in Mahe, in the Union Territory of Pondicherry. The petitioner says that he is basing assessed to sales tax on his sales of motor spirit by the Government of Pondicherry under the Pondicherry General Sales Tax Act, 1967. On the 20th March, 1970, he received a notice from the Deputy Tahsildar (Revenue) -cum -Receiver, Municipal, Mahe, stating that in accordance with the deliberation of the Municipal Council, dated 7th August, 1969, duly approved by the Government, the Mayor, Mahe, has taken an Arrete on 13th January, 1970, imposing a municipal tax of 5 paise per litre of petrol or diesel oil sold by the petitioner, and called upon the petitioner to submit particulars regarding the quantity of petrol sold during the period involved and also informed him that he was obliged to disclose in the future the quantity of petrol and diesel sold by him to the appropriate authority. The petitioner was aggrieved by the notice as well as the projected demand therein. He preferred an appeal to the Government of Pondicherry, but was unsuccessful. On 24th November, 1970, the impugned order has been passed once again by the Deputy Tahsildar reminding the petitioner of the imposition of such a tax on the petitioner's sales of motor spirit, and once again the petitioner was called upon to furnish the necessary particulars within a prescribed time. The petitioner having made his representations on the aforesaid communication and having had no fruitful results thereon, has come up to this Court for the issue of a writ of certiorari to quash the order, dated 24th November, 1970, issued by the Deputy Tahsildar in the circumstances stated.

(2.) THE relevant provisions under which the claim has been raised may be briefly stated. On 7th August, 1969, the Municipal Council of Mahe, purporting to act under the Decree of 1880, passed a resolution to the effect that sales of petrol or diesel oil effected within Mahe, shall suffer a tax of 5 paise per litre sold. Thus was approved by the Government of Pondicherry and the resolution was duly publicised in the gazette dated 24th February, 1970. It was only thereafter that the Deputy Tahsildar made the first demand which I referred to already. Apparently on the representations made by the petitioner who Was the only person prejudiced by the levy and the demand, the municipality undertook to review the position on 15th May, 1970, and passed another resolution but to a similar effect, which was again approved by the Government on 22nd September, 1970. In the second resolution, only the rate was altered but the essence of the tax as a tax on sale of motor spirit was maintained. There is a controversy whether this second resolution was to have prospective effect or was made retrospective from 24th February, 1970. It is unnecessary for me to decide this aspect in the instant case. After Government approved the second resolution of the Municipal Council, it appears that the Mayor issued the Arrete, dated 16th October, 1970, authorising the appropriate authority to levy and demand such a tax. It is only pursuant to this last Arrete of the Mayor, dated 16th October, 1970, that the challenged demand was issued as against the petitioner The resolution of the Mahe Municipal Council, dated 24th February, 1970, the text of which was repeated in the later second resolution, runs, in so far as it is material for this case, as follows:

(3.) THE third contention is virtually an answer to the contention of the respondents. The respondents maintained that though eo nomine, this levy is called a "tax on sale", yet, it is effectively and really a 'toll' on motor spirit which is brought into Mahe Municipality. I shall presently consider the contention of the respondents. While answering this, learned Counsel for the petitioner says that the Municipality having adopted the unambiguous language to describe the levy in question as a 'tax on sale' of petrol, cannot whittle down its effect by characterising such a tax which is obviously 'sales tax' as a 'toll' on the induction of motor spirit into the municipality of Mahe.