KRISHAN LAL GUPTA Vs. STATE OF J&K

JUDGEMENT

(1.) RESPONDENT No. 2. The Municipal Council, Jammu imposed tax on the owners of Flour Mills, Atta Chaki, Rice Mills Hullers, Walnut Factories, Saw Mills, off Liquor Shops, Cinematographs and Factories at different rates including at the rate of Rs. 100/ - per shop per annum on the owners of "Off Liquor Shops" By these petitions, the petitioners, who are the owners of Off Liquor Shops" have challenged the imposition of the tax and consequentially the realization of the tax based on demand made by Municipal Council Respondent No. 2 from the petitioners under the different demand notices. All the four writ -petitions being indentical raising the similar questions were heard together and are being disposed of by the Single Judgment.

(2.) LEARNED counsel for the petitioners at the time of arguments concentrated his arguments mainly on two grounds, firstly because the preliminary notification inviting objections to the proposed tax issued vide Gazette Notification in Jammu and Kashmir Government Gazette dated April 4, 1974 mentions therein wrong Resolution No. 144, by which the present tax was never proposed as a result of which the petitioners were deprived of preferring the objections against the proposed tax and secondly, because the provisions contained under Section 77 of the Jammu and Kashmir Municipal Act, 2008 (1951 A. D.) (hereinafter called the Act) gives an unbreddled power to the Municipal Council to impose the tax at any rate is violative of the provisions of Article 265 of the Constitution of India and exceeds the limits prescribed under Article 276, hence liable to be quashed. It is also submitted that the contention of the learned counsel for the respondents that the mention of Resolution No. 139 in the Notification will not invalidate the imposition of tax cannot be accepted for the simple reason that in a taxing statute, the benefit is to be given to the tax payer and should be interpreted in such a manner, which is more beneficial to the tax payer than the taxing authority. Thus clarification on the point That in fact the Resolution, by which the above tax is imposed is No. 139 and not 144 cannot be pressed into service by the respondents. Pursuant to the above said arguments, it is further submitted that the imposition being bad in law and unconstitutional, the subsequent notification of imposition published in the Government Gazette of December 5, 1974 under the provisions of Section 78(7) of the Act is also liable to be quashed. It is defective, because the final notification having been published only on December 5, 1974; whereas the tax sought to be recovered is restrospective in operation claimed from 1 -9 -1974 cannot stand and being illegal deserves to be quashed, pursuant to which notices of demand issued by the Executive -Officer are also unsustainable in accordance with which no recovery can be effected against the petitioners.

(3.) IN reply the respondents contesting the petitions submitted that while issuing Notification on April 4, 1974, the entire resolution is reproduced in the Notification. Mere mention of Resolution No. 144 instead of 139 cannot invalidate the Notification; it was only a clerical, mistake. None of the petitioners came forward to file any objections against the proposed tax, mere mention of the wrong resolution number cannot be regarded as a deprivation of any of the rights of the petitioners and once a Notification under Sub -sec. (7) of Section 78 of the Act is issued, which was based on resolution No. 68 dated August 28, 1974 having been published in the Government Gazette on December 5, 1974 is conclusive evidence of the fact that the tax has been imposed in accordance with the provisions of this Act. Thus the petitioners cannot now assail the imposition. Regarding objections on the scope of Section 77 of the Act giving no limit and the rate, referring to Articles 265 and 276 of the Constitution of India, it is submitted by the respondents that the Municipal Act being a subsequent legislation cannot travel beyond the scope of Article 276 of the Constitution of India and thus the power being subject to the maximum limit provided under Article 276 (2) of the Constitution of India, the non -mention of the maximum limit in Section of the Act cannot be said to be either unbreddled or the imposition cannot be struck down, under Article 265 of the Constitution of India, because the imposition is under the authority of law and thus the demand made by the Executive Officer and the imposition is not assailable. Regarding coming into force of the tax with effect from 1 -9 -1974, it is submitted that the power is exercisable to announce the date under subsection (6) of Section 78 of the Act and the Resolution of final imposition No. 68 of 1974 having been passed on August 28, 1974 cannot be termed as retrospective in its enforcement and hence the demand made is in accordance with law.