KARNAM SUBBARAO Vs. GOVERNMENT OF ANDHRA PRADESH

JUDGEMENT

(1.) This writ petition has been filed by thirty villagers of Chintagumpalli challenging the validity of section 69 (1) (bb) of the Andhra Pradesh Gram Panchayat Act and G. O. Ms. No. 295, Panchayat Raj (Samithi I) dated 4th April, 1979, and the resolution of the Chintagumpalli village dated 4th January, 1982, and the right of the fourth respondent to collect 'Katarusum' on the sale of agricultural produce in the above mentioned village of Chintagumpalli. Although reference was made in the petition to all the agricultural produce, the argument of the learned Counsel is concentrated upon the agricultural produce of paddy and cotton which are the main agricultural produce of that village.

(2.) Under section 69 of the Gram Panchayat Act, a Gram Panchayat shall levy in the village- (a) a house-tax; (b) a tax on profession, trades or callings; (bb) Kolagaram or Katarusum, that is to say tax on the village produce sold in the village by weight, measurement or number subject to such rules as may be prescribed; and (c) such other tax as the Government may by notification in the Andhra Pradesh, Gazette direct any gram panchayat or class of gram panchayats to levy subject to such rules as any be prescribed."

(3.) Now, the abovenamed Gram Panchayat, by its resolution dated 4th January, 1982, authorised the fourth respondent in consideration of an amount of Rs. 15,000 to collect 'rusum' on the sale of paddy in the village. The petitioners' contention is that the collection of 'rusum' by the fourth respondent under the above resolution dated 4th January, 1982, passed by the Gram Panchayat is illegal. Sri Harnath the learned Counsel for the petitioners, argues that the above extracted portion of section 69 of the Gram Panchayats Act only empowers the Gram Panchayat to impose Kolagaram or Katarusum does not authorise the collection of such a 'rusum' and in the absence of specific authority for the collection 'rusum' the existence of power to impose Kolagaram or Katarusum is not enough to justify the collection of 'rusum'. His argument is that every step in the process of taxation beginning with the declaration of the liability up to collection must be authorised by law as required by the provisions of Article 265 of the Constitution and the language used by section 69 of the Gram Panchayats Act authorising a Gram Panchayat to levy Kolagaram or Katarusum is enough only to impose the liability and at best to quantify it and never to authorise collection and that therefore the collection in this case must be held to be illegal. In support of this contention he first referred to a judgment of the Madras High Court in Rayalaseema Constructions v. Deputy Commercial Tax Officer and also to a judgment of this Court in Venkatarangam v. State. He also relied on Assistant Collector, Central Excise v. National Tobacco Company and Nalla Raja Reddy v. State of Andhra Pradesh. The Division Bench of this Court in Nalla Raja Reddy v. State of Andhra Pradesh analysed the concept of taxation and held that the purpose of Article 265 of the Constitution is to require every stage of the entire taxation process of taxation to b 1. (1959) 2 M. L. J.97 I.L. R. (1959) Mad. 750 : 72 L. W. 446 : A.I. R. 1959 Mad. 382. 2. I. L.R. (1969) A. P. 548. 3. (1972) 2S.C. C. 560.