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1990 (9) TMI 71 - SC - Income TaxWhether there had been an increase in the rent and rule 6 of Schedule II which dealt with the value of the building for the purposes of property tax was inapplicable as the levy under the old Act on the basis of the rental value and enhancement could be done according to the procedure contained in Schedule VII, rule 10 of the old Act? Held that:- The power to tax is a sovereign power and is legislative in character and it has to be exercised within constitutional limitations. The statutes relating to municipal taxes may be changed according to the existing legislative rules of State policy unless forbidden by the Constitution from doing so. An irregular assessment may also be regularised with retrospective effect within the same constitutional limitations. Where the court has not already declared invalid a taxing measure which was of doubtful validity, it is permissible for the appropriate Legislature to validate it by retrospective legislation. No legal fiction is involved in such a case. Mr. Subba Rao's submission has, therefore, to be rejected. The Government Order impugned before the High Court has been covered and validated by the above provisions, the Government Order itself covered the period after the repeal of the old Act and till the date of commencement of the Fourth Amendment, so that no interregnum was really there. The assessment made according to the provisions of the old Act was validated as actions taken by the Council pursuant to the impugned Government Order and not under the provisions of the old Act which was already repealed. While referring to the old Act, the Government Order did not revive the Act but only prescribed the same procedure as was found in the repealed Act as a transitory measure. The validity of section 4(1) of the Fourth Amendment Act having not been challenged before the High Court, we do not find any infirmity in the impugned judgments of the High Court. Appeal dismissed.
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