TMI Blog1964 (5) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... e Municipal limits of the City. When such goods were exported out of the city municipal limits within specified periods, refund used to be given in respect of the duty so recovered. The respondent has for many years been carrying on business of securing refund of octroi duty on behalf of persons who had paid the duty and were entitled to refund. In respect of the period from the 15th February, 1950 to the 14th September, 1950, the respondent made a claim on behalf of his principals, for the refund of ₹ 73,650/- to which, according, to him, they were entitled. The Munici- pality however paid to him only 90 per cent of this amount. The remaining 10 per cent was deducted in accordance with Rule 18(3) of the Octroi Rules which had been framed by the Municipal Authorities. The respondent then represented to the Corporation that with effect from the 15th February, 1950, the date from which the Corporation came into existence under the Provincial Municipal Corporation Act, 1949, this deduction of 10 per cent had become invalid in law and claimed that this amount should be paid to him. The Corporation however refused to concede this claim. The respondent then brought this suit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The question is whether even though valid then, it has ceased to be valid in law. To find the correct answer to this question it is necessary to be clear first as to the legal basis on which this levy by way of deduction was being made prior to 15th February, 1950. It appears from Ex. D 72, the copy of the Government resolution dated the 6th March, 1922, that the Poona Municipality started this practice of levying this 10 per cent deduction from February 1921. The question of its legality appears to have been raised quite early. The Legal Remembrancer to the Government of Bombay expressed his view on this question in these words:- The special powers conferred in the last sentence of clause (f) of section 48(1) of the Bombay District Municipal Act seems to negative the power of the Municipality (of Shirpur) to make any deduction from the refunds by means of rules regulating the system, for making refunds referred to in the earlier part of the clause. The charge on refunds appears, how- ever, to be a kind of tax which may be imposed under s. 59(b) (xi) of the Act. On this, the Councillors of, the Municipality passed a resolution that a 10 percent tax should be levied on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impose in the State. Apart from this absence of power to impose such a tax, which is clear from the earlier parts of s. 127, we have the categorical prohibition in, sub-section 4 against the imposition of any such tax by the Corporation. Mr. Patwardhan next tried to persuade us that even if this levy could not be made under the new Act as a tax, it could be made as a fee. In support of his argument he drew our attention to s. 147 and s. 466 of the new Act. The first sub-section of section 466 provides that the Commissioner of the Corporation may make standing orders consistent with the provisions of the Act and the rules and bye laws in respect of the matters specified. One of the matters specified is determining the supervision under which, the routes by which and the time within which the goods intended for immediate exportation shall be conveyed out of the City and the fees payable by persons so conveying the goods. [s. 466 (1)A(f)]. Section 147 dealing with a controversy, that may arise, whether the importation of some goods into the City has been for the purpose of consumption, use or sale therein, says: Until the contrary is ,proved any goods imported into the City shall b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation, notice tax, order, scheme, licence, permission, rule, bye- law, or form made, issued, imposed or granted, under this Act or any other law as aforesaid as the case may be; Mr. Patwardhan readily conceded that the 10 per cent deduction, as a tax on octroi refund could not get the pro- tection of el. 5(a) for the simple reason that such taxation is on the face of it inconsistent with s. 127(4) of the Act. He asked us, however, to regard this levy as a fee, and on that basis, argued that this should continue in force under cl. (a) of s. 5 of Appendix IV since the levy of such a fee is consistent with the provisions of s. 466 of the Act. If in fact a fee was being realised' under the old Act, it may be that levy of such fees could continue in force until superseded by any order under the new Act as coming under an order issued under the District Municipal Act, 1901, or the Bombay Municipal Boroughs Act, 1925 . In fact, however, this was not levied as a fee, but was levied as a tax. The tax did not become a fee merely because the new Act (Act LIX of 1949) prohibited the imposition of such a tax. We are clearly of opinion therefor that cl. 5(a) of Appendix IV furnishes n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... funding the amount of octroi duty in certain circumstances. It is, in our opinion, clear that the plaintiff having made the claim in accordance with the rules was the person entitled to receive what amount was legally refundable. As we have found that the deduction of ten per cent could not legally be made, in other words, the entire amount paid was refundable, it follows that the plaintiff was the person entitled to obtain the refund and so he was also entitled to bring the suit. There remains for consideration the appellant's plea of limitation. For this plea, the appellant relies on s. 487 of Act LIX of 1949. The material part of the section runs thus:- (1) No suit shall be instituted against the Corporation or against the Commissioner, or the Transport Manager, or against any municipal officer or servant in respect of any act-done or purported to be done in pursuance or execu- tion or intended execution of this Act or in respect of any alleged neglect or default in the execution of this Act:- (a) until the expiration of one month next after notice in writing has been, in the case of the Corporation, left at the chief municipal office and, in the case of the Co ..... 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