DISTRICT LOCAL BOARD Vs. SHANTARAM RAJARAM

JUDGEMENT

(1.) These appeals and petitions concern an octroi imposed by the Local Board of Ratnagiri under the Bombay Local Boards Act, 1923. For convenience there has been called on together, Second Appeals Nos. 973, 974 and 975 of 1942 and Civil Revision Applications Nos. 208 to 213 both inclusive and 626 to 645 both inclusive, all of 1942. One of the twenty-nine cases so called on comes from Devgad and the remainder from Malvan. Except in Civil Revision Applications Nos. 208 to 213, the Local Board failed in the immediate Courts below.

(2.) The right to impose an octroi was not seriously disputed in the Courts below, but in this Court the arguments have ranged over a more extensive field and it became clear at an early stage that there is a sharp distinction between octroi alleged to be payable before December 22, 1938, and that alleged to be payable after that date. In the Courts below it was the method of collection of the octroi and in particular whether an action was maintainable for it's recovery in the civil Courts which were principally in dispute. However, on the pleadings and the evidence the larger question, which has been argued before us, is clearly open. Therefore before turning to the relevant statutory provisions and rules, it is necessary to say something about the nature of an octroi which, like a customs duty, has certain features which differentiates its nature from a tax. A tax can be and is usually imposed without difficulty on a person because he is the owner of some species of property such as income, a house or a motor car; whereas an octroi and customs duty, though a tax, are limited in scope to a levy or duty on the import of goods or animals into some town, place or country or a levy or duty on the goods or animals. As such the collection of the duty is effected at the point of entry, either by refusing entry or by seizure, or by penalties imposed on any person attempting to introduce the animals or goods and at the same time evading payment of the duty. There are obvious difficulties in imposing personal liability for such a duty, since it is the animals or goods in relation to location which causes the duty to arise and not property in relation to ownership. The word "octroi" is of French origin, and literally means "to authorise", In the Oxford Dictionary it is defined as: "A tax levied on certain articles on their admission into a town (especially in France) ". No such levy is known in England, though it is not uncommon in certain other countries. In Belgium and Egypt it was formerly in force, but its abolition was effected in 1870 and 1903 respectively. No one has been able to suggest how the word came to be applied in India, except that it may have been used as appropriately descriptive of certain forms of levy anciently asserted. Whether an octroi can be correctly applied to a levy on goods or animals coming into a rural as opposed to an urban area seems to be in some doubt. In the article on octroi in the Encyclopaedia Britannica it seems to be suggested that it might be. No mention of the word is to be found in either Stroud's Judicial Dictionary or in Wharton's Law Lexicon, and it is not without significance to observe that in Section 192 of the City of Bombay Muncipal Act, 1888, levies on goods coming into the City of Bombay are called "town-duties". To impose such a levy on goods or animals entering a country district obviously presents great difficulties in its collection, unless, either personal liability can be validly and effectually attached to some person in relation to the goods and animals imported, or unless a very extensive army of officials is to be maintained to guard many miles of marine and rural boundary.

(3.) If the right to impose an octroi exists in a Local Board, its origin must be the creature of statute as also must be, if it exists, the right to enforce personal liability on some person not in physical possession or control of the goods or animals at the time when they attract the duty by an attempt being made to introduce them across the frontier or boundary. By Section 80A of the Government of India Act, 1919, and the sanction given thereunder by Rule 3 of the Scheduled Taxes Rules, a Provincial Legislature is empowered to make and take into consideration any law imposing, or authorising any local authority to impose, for the purposes of such local authority, any tax included in the second schedule to those rules. This schedule is as follows: Schedule II.(In this Schedule the word tax includes a cess, rate, duty or fee). 1. A toll. 2. A tax on land or land values. 3. A tax on buildings.