TMI Blog2016 (7) TMI 1676X X X X Extracts X X X X X X X X Extracts X X X X ..... e NMMC had included within its jurisdictional area, the MIDC's notified area, wherein, the petitioners' properties/industries are located. Once, the challenge to such inclusion came to be negatived, as a corollary therefore, the NMMC was held entitled to levy property taxes and other taxes upon the petitioners' industries, though, such industries may be stated to be located within the MIDC's notified area. Insofar as the challenge to validity of Rule 41 as aforesaid is concerned, it must be noted that nothing prevented the Small Scale Entrepreneurs Association from raising such challenge in Writ Petition No. 2787 of 2001, which has since been disposed of on 8 July 2010. It is impermissible for parties to raise challenges in installments, when it is apparent that the entire purpose for institution of Writ Petition No. 2787 of 2001 was to question the levy of property taxes or other taxes by the NMMC, insofar as the petitioners' properties/industries, which are located within MIDC's notified area are concerned. The petitioners have not disclosed as to whether in pursuance of liberty granted by this Court in Writ Petition No. 2787 of 2001, the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Demands towards interest and penalty in respect of cess, which had remained unpaid or which is paid after the period stipulated. 2] On basis of the aforesaid challenges, the petitioners have applied for refund, where some amount have already been paid towards cess or for restraint in the matter of recovery of cess, interest and penalty under the provisions of the MMC Act or the Rules made thereunder. 3] Initially, Rule was granted in Writ Petition No. 8506 of 2016 on 22 July 2016 and the respondents were restrained from taking any coercive steps for recovery of penalty and interest, by way of adinterim relief. Although, no Rule was formally granted in the remaining writ petitions, these petitions were taken up alongwith Writ Petition No. 8506 of 2016, as, it was submitted that the issues raised in these petitions were identical to these raised in Writ Petition No. 8506 of 2016. Further, all these petitions were taken up for consideration as the petitioner in Writ Petition No. 8506 of 2016 desired to press for certain additional ad-interim reliefs and the petitioners in remaining petitions desired to press for interim reliefs. Mr. E.A. Sasi, learned counsel for the petitioners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Entrepreneurs Association and ors. Vs. State of Maharashtra and ors. [(2010) 6 Bom CR 442] The learned counsel submitted that it is impermissible for the petitioners to raise substantially the very same challenges under the guise of challenging consequential actions. Learned counsel for the respondents submitted that the challenge to Notification dated 17 December 1991, to the extent, the same includes notified area of MIDC has already been negatived by the Division Bench of this Court. Now that the NMMC, which came to be constituted by Notification dated 17 December 1991 has chosen to levy cess, it is impermissible for the petitioners to challenge the cess on the ground of inclusion of the notified area in the Notification dated 17 December 1991, was itself improper or unconstitutional. Learned counsel for the respondents submitted that there is no novelty in the challenges raised and in any case, such new grounds are barred by principles of res judicata or constructive judicata. 7] Further, Mr. S.V. Marne, learned counsel for respondent Nos.7 to 9 and Mr. V.B. Thadani, learned AGP for the State, submitted that the rules which have been impugned in the present petitions are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hin the MIDC's notified area. Further, perusal of the decision in case of Small Scale Entrepreneurs Association (supra) makes it clear that the contentions now sought to be raised in the present petitions, had been substantially raised in case of Small Scale Entrepreneurs Association (supra). In the context of property taxes and other taxes, the contention has been reproduced in paragraph 25 and 26 in case of Small Scale Entrepreneurs Association (supra) and the same reads thus:- 25. Without prejudice to their basic contention that the MIDC area does not form part of the municipal limits of NMMC, the petitioners submit that in view of clause 7 of the First Schedule of the M.R. T.P. Act, they are not liable to pay the property taxes and the other taxes levied by the NMMC as they are the lessees of MIDC. The petitioners rely upon the Division Bench Judgment of this Court in the case of Jalgaon Municipal Corporation in Writ Petition No.1012 of 2003 dated 9th October, 2006 for contending that it is the statutory obligation of MIDC to provide services in the area falling under the MIDC and consequently, the NMMC cannot provide any services in the said area. The petitioners have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant authority with the prior sanction of the State Government to receive the lumpsum contribution from the relevant authority in lieu of all or any of the taxes levied or services rendered by the local authority. In view of the provisions of clause 7 of First Schedule, it is the relevant authority who is exempt from payment of taxes including the property taxes. The contention of the petitioners that even the plot holders in the MIDC area are exempt and are not liable to pay the taxes, is wholly misconceived. As noted earlier, even under the BPMC Act, there is no provision for granting exemption from payment of taxes, save and except referred to herein above. Clause 7 of the First Schedule exempts the relevant authority from payment of taxes and not the plot holders in the jurisdiction of the relevant authority. But for clause 7 of the First Schedule, even the MIDC would have been liable to pay taxes including property taxes to NMMC. We have noted that under the BPMC Act, the NMMC is empowered to levy various taxes for the purposes of the said Act within its area of operation. Even under the MID Act, the MIDC is empowered to levy fees and service charges on the plot holders as pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no assistance to the petitioners. This Court in case of Small Scale Entrepreneurs Association (supra) has further held that the provisions of MMC Act and MIDC Act and MRTP Act are required to be construed harmoniously. Thus construed, this Court did not find any substance in the contention raised by the petitioners that they were not liable to pay any taxes. This Court has in fact held that the MIDC area is the part of municipal limits of NMMC and therefore, the NMMC has the power to levy tax and recover cess amounts from the petitioners. 13] The petitioners, have, in terms, admitted that Writ Petition No. 2787 of 2001, instituted by the Small Scale Entrepreneurs Association, was a petition instituted by the said Association at the behest of the petitioners. In para 7 of Writ Petition No. 8506 of 2016, the petitioner has stated that in the year 2001 the Association filed Writ Petition No. 2787 of 2001, in which, the Association was bona fide pursuing its stand that the MIDC Industrial Area does not fall within the jurisdiction of the NMMC. It is further stated that at the time of filing of said writ petition, the Association has agitated the ground s whatsoever available to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioners, urged that Rule 41 as contained in Schedule-D to the MMC Act or Rule 41 of the Maharashtra Municipal Corporation (Cess on Entry of Goods) Rules 1996, to the extent, such rules authorised levy of penalty and interest upon the cess amount unpaid or paid beyond the stipulated date, are ultra vires the parent Act, which is MMC Act. Mr. Sasi submitted that the parent Act has no substantive provision which permits the State Government from framing rules of such nature. In the alternate, Mr. Sasi submitted that since in the parent Act, there is no substantive provision for levy of penalty and interest upon the cess amount payable, no such penalty or interest can be authorised by rules and to that extent, the rules are ultra vires the parent Act or otherwise unconstitutional. 17] Insofar as the challenge to the rules being ultra vires the provisions of the parent Act, i.e., MMC Act, is concerned, reference is required to be made to the provisions contained in Chapter XXIX of the MMC Act, entitled RULES, BYE-LAWS, REGULATIONS AND STANDING ORDERS 18] The Chapter - XXIX of the MMC Act comprises Sections 453 to 468. Section 453, which is important to appreciate the peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereon could be so levied, based upon application of some provision in the rules or otherwise. The position in the present case offers no parallel to the position in case of V.V.S. Sugars (supra). 21] Further, Section 454 of the MMC Act provides that the Corporation may add to the Schedule-D rules not inconsistent with the provisions of the MMC Act, which expression shall, in this section, be deemed not to include the said Schedule to provide for any matter dealt with or for any of the purposes specified in the said Schedule and may subject to the same limitations, amend, alter or annul any rule in the said Schedule. The proviso to this section deals with rule regulating punishment of an offence, and therefore, we are, in the present petitions, not concerned with such proviso. 22] Section 456 of the MMC Act reads thus: 456. Power of 1 [State Government to make rules. (1) The [State] Government may at any time require the Corporation to make rules under section 454 in respect of any purpose or matter specified in section 457; (2) If the Corporation fails to comply with such requisition within such reasonable time as may be fixed by the [State] Government, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to make rules and this section opens with a non-obstanate clause, thereby, making it clear that the power of the State Government to make rules under Section 456A is not in any manner circumscribed by anything contained in Sections 456 and 456A of the MMC Act. The rules in the present cases provide for levy of interest and penalty where from cess amount is either not paid at all or paid beyond the period stipulated. There is nothing arbitrary or unreasonable in such rules. We are, in such circumstances, unable to accept the plea that the rules impugned in these petitions are ultra vires the parent Act or that they are ultra vires Constitution of India. 25] In all these cases, the petitioners have been resisting payment of cess for several years. To begin with, the petitioners avoided payment of cess for several years by contending that the NMMC had no legal authority to levy such cess, since, the petitioners' industries fell within the MIDC's notified area. Upon Writ Petition No. 2787 of 2001 instituted by the Small Scale Entrepreneurs Association, which was espousing the cause of the petitioners being dismissed, the petitioners, have contested and challenged the dema ..... X X X X Extracts X X X X X X X X Extracts X X X X
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