TMI Blog1970 (4) TMI 153X X X X Extracts X X X X X X X X Extracts X X X X ..... rse of events leading upto these proceedings. Various Textile Mills which are involved in these cases will hereafter be referred to as the companies . These companies own immovable properties consisting of lands and buildings in the city of Ahmedabad. The Municipal Corporation of the City of Ahmedabad (which will hereinafter be referred to as the Corporation ) in the purported exercise of its power under the Act and the rules framed thereunder assessed the immovable properties of the companies to property tax for the assessment years 1964-65 and 1965-66. Those assessments were done on the basis of the method popularly known as flat rate method. According to that method in valuing the lands, the value of plants and machinery were also taken into consideration. The buildings were assessed on the basis of their floor area. Those assessments were challenged by means of writ petitions under Arts. 226 and 227 of the Constitution before the High Court of Gujarat, by the companies. Those petitions were dismissed by the High Court. The aggrieved companies thereafter brought up the matters in appeal to this Court. During the pendency of those appeals, the Corporation proceeded to assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n March 30, 1968, the State of Gujarat brought into force an Act entitled, Bombay Provincial Municipal Corporation (Gujarat Amendment) Act, 1968 (hereinafter referred to as the amending Act). The appeals filed by the companies in this Court cam up for hearing on April15, 1968. This Court allowed those appeals following its decision in New Manek Chowk Spg. and Weaving Mills Co. Ltd. and ors. case (supra). When those appeals were heard neither the State of Gujarat, nor the Corporation brought to the notice of this Court, the provisions of the amending Act. After the judgment of this Court in those appeals, the concerned companies called upon the Corporation to refund the amounts illegally collected from them as property taxes for the assessment years 1964-65 and 1965-66. The Corporation did not respond to the demands made by those companies. Hence they again moved the High Court of Gujarat under Art. 226 of the Constitution seeking writs of Mandamus against the Corporation and its Officers directing them to refund the amounts illegally collected from them and for a declaration that s. 152A of the Act newly introduced by the amending Act is ultra vires the Constitution. The High Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (introduced by the Ordinance) violative. of the Constitution? Section 152A reads as follows (1) In the City of Ahmedabad if in respect of premises included in the assessment, book relating to Special Property Section, the levy, assessment, collection or recovery of any of the property taxes for any official year preceding, the official year commencing on the 1st April 1968 is affected by a decree or order of a court on the ground that the determination of the rateable value of the premises on the basis of rental value per foot of the floor area was not according to law or that sub-rules (2) and (3) of rule 7 of the rules contained in Chapter VIII of Schedule A to this Act were invalid, then it shall be lawful for the Municipal Corporation of the City of Ahmedabad to assess or reassess in respect of such premises any such property tax for any such official year at the rates applicable for that year in accordance with the provisions of this Act and the rules as amended by the Bombay Provincial Municipal Corporations (Gujarat Amendment) Act, 1968, as if the said Act had been in force during the year for which any such tax is to be assessed or reassessed; and accordingly the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in accordance with the provisions of the Act and the rules as:amended by the amending Act as if the: said Act has been, in force during the years. for which such tax is to assessed or reassessed and accordingly fix the rateable value of lands and buildings of those premises and assess or reassess the tax payable and when the tax is so assessed or reassessed, the tax so assessed may be levied, collected and recovered by the Corporation and for that purpose the provisions of the amending Act and the rules shall, so far as may, be apply to such collection and proceedings preceding those collections. That provision further says that the fixation of rateable value so made and the collection and recovery of such tax shall be valid and shall not be called in question on the ground that the same were in any way inconsistent with the provisions of the Act and the rules in force prior to the commencement of the amending Act. The section also authorises the Corporation to deduct from the amounts earlier illegally collected the tax assessed according to law. All that the proviso to that section says is that the Corporation shall pay simple interest at the rate of six per centum for annum on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Municipality and ors. ([1970] 1 S.C.R. 388) our present Chief Justice speaking for the Constitution Bench of the Court observed Before we examine s. 3 to find out whether it is effective in its purpose or not we may say a few words about validating statutes in general. When a legislature sets out, to validate a tax declared by a court to be illegally collected under an ineffective or an invalid law, the cause for ineffectiveness or invalidity must be removed before validation can be said to take place effectively. The most important condition of course, is that the legislature must possess the power to impose the tax, for, if it does not, the action must ever remain ineffective and illegal. Granted legislative competence, it is not sufficient to declare merely that the decision of the court shall not bind. for that is tantamount to reversing the decision in exercise of judicial power which the legislature does not possess or exercise. A court s decision must always bind unless the conditions on which it is based are so fundamentally altered that the decision could not have been given in the altered circumstances. Ordinarily, a court holds a tax to be invalidly imposed because ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed by law. The position of a Legislature is however different. It cannot declare any decision of a court of law to be void or of no effect. Again Shah, J. (one of us) in Janpada Sabha, Chhindwara v. The Central Provinces Syndicate Ltd. and anr. and State of Madhya Pradesh v. Amalgamated Coal Fields Ltd. and anr. ([1970] 3 S.C.R. 745) ; speaking for the Constitution Bench explained the legal position in these words : The relevant words which purported to validate the imposition, assessment and collection of cess on coal may be recalled they are cesses imposed, assessed or collected by the Board in pursuance of the notifications notices specified in the Schedule shall, for all purposes, be deemed to be-, and to have always been validly imposed, assessed or collected as if the enactment under which they were so issued stood amended at all material times so as to empower the Board to issue the said notifications/notices. Thereby the enactments, i.e. Act 4 of 1920 and the Rules, framed under the Act pursuant to which the notifications and notices were issued, must be deemed to have been amended by the Act. But the Act does not set out the amendments intended to be made in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
