JAGIR SINGH MOHINDER SINGH Vs. STATE OF PUNJAB

JUDGEMENT

(1.) The enhancement of licence fee imposed in terms of sub-section (3) of Section 121 of the Punjab Municipal Act, 1911, hereinafter referred to as the Act, in regard to the persons engaged in a trade or calling of the kind envisaged in sub-section (1) of S. 121 of the Act, and notified through notification dated 15-3-1980, published in the Punjab Government Gazette on 4-4-1980, has been impugned in the three writ petitions, namely, Civil Writs Nos. 1511, 1934 and 2426 of 1980 by the petitioners, bulk of whom are engaged in the trade of manufacture and sale of agricultural implements like sickle, khurpas, spade, iron plough etc., while some of them are engaged in the trade of manufacture of furniture or of iron safes etc., primarily on the ground that the amount sought to be recovered as licence fee, being a fee and not a tax, the same was excessively high and totally incommensurate with the expenditure incurred to the services rendered in lieu thereof to the petitioners by the said Municipal Committee. Since these three writ petitions involve common question of law, therefore they are proposed to be covered by a common judgment.

(2.) The respondent Municipal Committee took up the stand that the licence fee is an amount imposed and recovered not as a fee but as a tax and, therefore, the question of the same being commensurate or incommensurate with the services rendered by the Municipal Committee to the petitioners did not arise. In the alternative the respondent Municipal Committee urged that between 1953 and 1980, the expenditure incurred by it on various services rendered by it had tremendously increased and, therefore, it could not be said that the enhanced fee imposed by it as notified was excessive.

(3.) So the question that falls for consideration is as to whether the licence fee is in the nature of fee or a tax.