ATMA RAM BUDHIA Vs. STATE OF BIHAR

JUDGEMENT

(1.) These three suits have been heard together because they raise a common question of law, viz.; whether Part III of the Bihar Finance Act, 1950 (Bihar Act, XVII of 1950) is without jurisdiction. This Act will be hereinafter called the impugned Act.

(2.) Title Suits Nos. 1 and 3 of 1952 were originally instituted in the court of the Subordinate Judge at Ranchi, while Title Suit No. 5 of 1951 was instituted in the court of Subordinate Judge at Gaya; but, in view of constitutional question involved in all these suits, they have been transferred to this Court for disposal. In Title Suit No. 1 of 1952 the plaintiff is the co-sharer partner of one Radhe Shyam Bus Service, Ranchi, and he also calls himself the President of the Bihar Motor Congress, an Association which, according to him, has been formed to look after and safeguard the interest of 'transport owners'. In Title Suit No. 5 of 1951 there are a large number of plaintiffs who claim to hold licenses and permits for plying motor cabs, public service vehicles and public carriers for hire on different routes mentioned in their licenses. In other words, these suits are by the 'owners' of motor vehicles as defined in the 'impugned Act'. The plaintiff in Title Suit No. 3 of 1952 is one Satya Narayan Chowdhary who styles himself a member and President of the Bihar Motor Travellers' Association, resident of Ranchi, and he claims that, in course of his duties, he has to" travel a great deal by motor buses and taxis and has to transport goods by 'public carriers'. It may be mentioned here that the term 'public carriers' as used in the Act refers to vehicles and is different in its import from the meaning given to it under the Motor Vehicles Act (Act IV of 1939). He has, therefore, instituted the suit as a passenger carried by these vehicles. The principal defendant in all these suits is the State of Bihar. The plaintiffs have substantially sued for a declaration that the impugned Act is 'ultra vires' the Bihar Legislature and for permanent injunction restraining the defendant, its-servants and agents from realising any tax under the Act, or calling upon the plaintiffs to file returns as "owners" or to deposit security or to maintain accounts in pursuance, or in furtherance of the provisions of the said Act,

(3.) The Bihar Finance Act, 1950, received the assent of the Governor on the 27th of March, 1950, and was published in the Bihar Gazette, Extraordinary, on the 30th of March, 1950, and it came into operation on the 1st of April following. Acting under Part III of the Act. the State of Bihar has levied a tax on all passengers and goods carried by motor vehicles and 'public carriers' at the rate of 2 annas in the rupee on all fares and freights payable to the owners of such vehicles and 'public carriers'. The Act also provides for the framing of rules to give effect to the purpose of the Act, and, in pursuance of that provision, rules were framed which were notified on the 24th of July, 1950, and published in the Bihar Gazette Extraordinary on the 25th of that month. The plaintiffs allege that taking advantage of the provisions of the Act, the State of Bihar and the officers of the Commercial Taxing Department of the State had been insisting upon the plaintiffs for the payment of those taxes and have realised such taxes from them. They have also compelled the plaintiffs, who are owners of such vehicles, to file returns and to do certain other acts prescribed by the a.foresaid statute. The plaintiffs submit that the Act nowhere provides for payment of the taxes by passengers' and consignors of goods, nor is there any provision in the Act making passengers or consignors of goods liable for the payment of the tax either to the owner or to the State Government. It is. therefore, stated that the acts of the State Government are all illegal and arbitrary though made under cover of the provisions of the impugned legislation. They further contend that the tax imposed under the said Act was beyond the legislative competence of the State Legislature and was not covered by any of the Entries in List II or III of the Seventh Schedule of the Constitution of India. They also allege that the aforesaid Part III of the Bihar Finance Act, 1950, and the rules made thereunder are null and void and are also opposed to various provisions of the Constitution of India dealing with fundamental rights. According to the plaintiffs, the defendant had no right to impose duties and obligations upon the plaintiffs of a drastic character without any corresponding advantage to them and there was no warrant in the Constitution for the imposition of such obligations on the citizens engaged in lawful avocation.