TMI Blog2014 (10) TMI 986X X X X Extracts X X X X X X X X Extracts X X X X ..... d responsibilities upon the Municipalities and that is how various aspects of planning, economic development, social justice and functions and duties in relation thereto have to be performed by the Municipalities. They have been entrusted to them. There is force in the contentions of Ms.Karnik that the provisions of every law and by which the powers, authorities and responsibilities have been endowed on the Municipalities must be construed in such a way so as to make existence of the Municipalities meaningful and purposeful. That it is an institution of self Government is, therefore, abundantly clear. That such Institution must have certain freedom, autonomy and independence is also apparent. It is the Legislature of the State and which makes the law by which Municipalities are authorized to levy, assess, collect and appropriate such taxes, dues, tolls and fees in accordance with such procedure and subject to such limits. There could be assignment of duties to the Municipalities. The State Government may assign to a Municipality such taxes, duties, tolls and fees levied and collected by the State Government for such purposes and subject to such conditions and limits. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and goods, etc. are some of the matters and all the provisions in relation thereto as are to be found in Chapter XIA are made applicable to Local Body Tax. The Local Body Tax regime is, therefore, not such as could be termed as destructive of the constitutional scheme. Whenever the State calls upon the Municipal Corporation to levy the Local Body Tax it is not imposing it on the Municipal Corporation, but reminding it to levy, assess and collect the tax which is more friendly and serving all people including traders. That the Local Body Tax has to be then levied, assessed and collected by the Municipal Corporation does not mean that the State takes an unilateral decision in all matters connected with the levy. Though the State takes a decision the Municipal Corporation is not overlooked and as understood above. Therefore, the determination of the rate of levy, selection of articles and goods, manner of levy, assessment and recovery though controlled by the State, but the Municipal Corporation has definite role to play in the same. Its role is by no means diluted or diminished. It is eventually the Local Body Tax and to be levied, assessed and recovered by the local body. There ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Bombay Provincial Municipal Corporation Act, 1949 as illegal being ultra vires the provisions of Sections 127(2) (a), 149, 454, 456 and 457 of the Bombay Provincial Municipal Corporation Act, 1949 and be struck down. (iii) hold and declare that the Bombay Provincial Municipal Corporation (Local Body Tax) Rules, 2010 framed under Section 152T as being ultra vires the provisions of Part IXA Article 243W and Article 243X of the Constitution of India and be struck down. (iv) hold and declare that the Bombay Provincial Municipal Corporation (Local Body Tax) Rules, 2010 framed under Section 152T as being ultra vires the provisions of Section 127(2)(a), 149, 454, 456 and 457 of the Bombay Provincial Municipal Corporation Act, 1949 and be struck down. (v) quash and set aside Notification dated 25.03.2010 and Notifications dated 25.02.2013 annexed at Exhibits B and G to this petition. (b) pending the hearing and final disposal of this Writ Petition, the impugned action of the Respondent No.1 of imposition of Local Body Tax in lieu of octroi on Respondent Nos.2 to 6 and consequential Notification dated 25.03.2010 (Exhibit B) and Notification dated 25.02.2013 (Exhibit G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17.11.2009 addressed by the Mira-Bhayander Municipal Corporation to the Respondent No.1 it is clearly stated that on account of the Respondent No.1's action of forcible levying of Cess upon Mira- Bhayander Municipal Corporation for a period of 109 days between 01.09.2008 to 18.12.2008, it had lost revenue of ₹ 10,46,26,748/-. Hence, it had raised a demand in respect of 15% of the amount which the State Government had promised to give. The Corporation in it's above letter clearly stated that levy of Cess has adversely affected the revenue of the said Municipal Corporation thereby seriously affecting the financial condition which would affect the development works to be undertaken by the Municipal Corporation. It is, therefore, apparent that the forcible levy of cess upon the said D Class Municipal Corporations had led to severe loss and the said Notification had been cancelled ultimately. 7 The Petitioners stated that despite abundant record available with the Respondent No.1 showing that the imposition of any other alternative other than levy of Octroi by the Municipal Corporations, is against the financial / revenue interests of such Municipal Corporations, the R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry 2010 published the Draft Rules as framed under Section 152T of the impugned Act, namely, the Bombay Provisional Municipal Corporations (Local Body Tax) Rules, 2010. The said Rules contemplate *8* wp.2720.13.group.as.lbt the manner in which the Local Body Tax could be levied and collected by the Municipal Corporations. However there was no wide publication of the said Draft Rules to inform all the affected about the impeding changes being brought about by the Respondent No 1. That in fact complete secrecy was kept in the whole process. That a few representations were made by the office bearers of the Petitioner Unions, but they were in fact never called for any hearing. 9 The Petitioners stated that the Respondent No.1 hastily and without following the due procedure of prior publication have finalized the Final Rules under the amended and newly added Section 152T. The Respondent No.1 thereby has breached the legal mandate of Section 152T while issuing the impugned Notification for finalizing the Rules on 25.03.2010. Annexure B to the petition is a copy of the impugned Notification. Though the Draft Notification was published in Government Gazette dated 01.01.2010 the fundament ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .03.2010 for illegally forcing the Municipal Corporations into imposing Local body Tax with effect from 01.04.2013 without finalizing the Rates. That the Respondents No.2 to 6 have already finalized their Budget and finalizing the rates, thereafter, is ex-facie against the interest of the Corporations. Thus, the Respondent No.1 has illegally finalized the Draft Rules 2010 without compliance of Section 152T. 10 It is stated that the Respondent, thereafter, by a Communication dated 7th January 2010 issued to 16 Municipal *10* wp.2720.13.group.as.lbt Corporations mentioned therein, called upon the said Corporations to forward their proposals before 31.01.2010 as regards the Schedule of Rates for the levy of Local Body Tax. It is also stated that in doing so the Octroi income on the said articles and the proposed rates to be applied, shall be so fixed so as to take into consideration the income generation as it stood under the Octroi. It was further stated that for implementation of the Local Body Tax the concerned employees are required to be trained and hence, the list of such employees should be forwarded. It was also stated that for implementation of the Local body Tax it is req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ever, the Respondent No.1 has not given any hearing to the Petitioners and has illegally gone ahead and issued Notification dated 25.02.2013 directing the Respondent Nos.2 to 6 to levy Local Body Tax in their respective Corporations with effect from 01.04.2013. Annexure G to the petition is a copy of the Impugned Notification dated 25.02.2013. That the Respondent Nos.2 to 6 are not in favour of imposition of the Local body Tax in lieu of Octroi and have not passed any Resolution to the said effect till date. That it is thus, ex-facie apparent that the Respondent No.1 by illegally issuing the impugned notification dated 25.02.2013 is forcing the Respondent Nos.2 to 6 to collect Local Body Tax in lieu of octroi. That the said action of the Respondent No.1 is totally and completely in breach of the constitutional mandate of sovereignty of Local Self Governments. 12 It is further stated that the Respondent No.1 has by the above said amendments to the said Act taken away the autonomy of the Municipal Corporations. That the Municipalities are local self Governments under the Constitutional Scheme having full power and authority to choose which tax is in their revenue interests and sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are agitated from time to time by the various Municipal Corporations clearly indicating that such levy of Local Body Tax is totally non-feasible, ineffective and wholly unreasonable, arbitrary and violative of Article 14 of the Constitution of India. It is stated that the Petitioners too have from time to time made representations, but have not been heard. However inspite of the aforesaid legal position the Respondent No.1 has decided to force the Respondent Nos.2 to 6 Corporations into implementing provisions of the impugned Act 2009 and enforce the same by the impugned Rules 2010. That the Respondent No.1 has now issued the Impugned Resolution dated 25.02.2013 to force the Respondent Nos.2 to 6 into enforcing the impugned Act and Rules from 01.04.2013. The said decision of Respondent No.1 is totally disregarding the consequences that would ensue by such levy which will deprive the Respondent Municipal Corporations of its valuable source of revenue which for decades is being earned by the Municipal Corporations by stable levy and collection of Octroi duty. 14 It is stated that the autonomy of the Local Self Government, i.e. Respondent Nos.2 to 6 Corporations, is completely take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further permissions to the said Petitioner Corporations to collect Octroi too have been granted. Annexure-H are the copies of interim orders passed in the said Writ Petitions. 16 The Petitioners, after referring to the above provisions and other material, have contended before us that the impugned provisions, Rules and Notifications imposing Local Body Tax in lieu of Octroi in the Respondent Nos.2 to 6 Municipal Corporations are, therefore, ultra vires, unconstitutional and be declared as such. 17 Ms.Karnik, learned counsel appearing for the Petitioners, submitted that the Petitioners have no personal or vested interest in approaching this Court and seeking the declaration as above. The impression that is being given that the Petitioners are seeking to protect self interest and hence, insisting on continuation of Octroi, is an attempt to divert the attention of this Court from the main grievance and issue. 18 Ms.Karnik submitted that all Municipal Corporations in the State are hard pressed for funds. They are somehow managing the affairs. There is tremendous strain on public fund. The sources of income and revenue for the Municipal Corporations are diminishing and the Muni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... neither any internal loan shall be taken by the Municipal Corporation from any of the funds created by the Corporation nor shall any utilization of such funds for any purposes other than the purposes for which they are created be made by the Corporation. Upon introduction of such provision with effect from 21.05.2011 the Municipal Corporations are obliged to seek an approval in terms of this provision from the State Government. That cripples the Municipal Corporations further. In these circumstances what Section 127 enables is imposition of taxes. The Municipal Corporation by sub-section (1) is mandated to impose the property taxes, taxes on vehicles, boats and animals in terms of clauses (a) and (b) of sub-section (1) and by sub- section (2) thereof in addition the Corporation may, for the purposes of the said Act and subject to the provisions thereof, impose any of the taxes stipulated in the clauses of this sub-section. Ms.Karnik submits that the Corporations do not have wide powers as would enable them to coerce the persons concerned to pay taxes and particularly in the case of Octroi and now Local Body Tax which is an account based taxation. In the absence of such coercive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Constitutional provisions. Ms.Karnik also invites our attention to Article 304(b) of the Constitution of India and urges that there is no compliance with the mandate of the same either. 21 Ms.Karnik invites our attention to the scheme of the said Act and submits that the provisions thereof would have to be construed *19* wp.2720.13.group.as.lbt reasonably and though the sections particularly in the concerned Chapter would have to be read together and harmoniously, still by such process it is not possible to reconcile some of the provisions with each other. She has invited our attention, as already noted, to the amendment to Section 127(2) and the section as it stood prior thereto. She has also invited our attention to Section 149 of the said Act to submit that the procedure to be followed in levying other taxes as laid down by Section 149 would have to be followed and it is the prerogative of the Corporation to make appropriate provisions and in terms of sub-section (1) of Section 149. In elaborating her submission she pointed out that clause (a) of sub-section (1) of Section 149 requires the Corporation to take into consideration the nature of taxes, rates thereof, clas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he collection thereof which is left to the Corporation. There is thus great and serious erosion in the status of the Corporation as an independent unit of Self Government at local level. She has invited our attention to Section 152T of the said Act to urge that if the State Government is going to make the Rules and the Rules as envisaged by Sections 444, 446 and 447 and Schedule-D being already in place, then, collision and conflict situation will arise resulting in chaos and uncertainty and the revenues of the Corporation would further deplete and decrease. This can never be said to be the intention of the Constitution makers or law makers. In these circumstances Ms.Karnik submits that the impugned provisions be struck down. 23 Ms.Karnik has handed over to us the Note of Written Argument particularly on the point of locus of the Petitioners and it is further submitted by her that the group of Petitions before this Court are filed not only by the registered Trade Unions espousing cause of employees of the concerned five Municipal Corporations, but also by Municipal Councillors who are aggrieved by decimation of the power and authority of the Corporation and the enhancement of po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to disruption of free movement of goods and is a major deterrent to the business. Apart from this, there is traffic congestion at Octroi posts creating traffic problems. In paragraph 3 of the statement of objects and reasons, it is stated that there is persistent demand from the traders to abolish octroi system and evolve an alternative system. Ms.Karnik has submitted that insofar as the reasons set out in paragraph 1 of the statement and object are concerned, it is further recorded in paragraph 2 thereof that to overcome above difficulties set out in paragraph 1 as an alternative system the State Government had introduced a Cess in lieu of Octroi in D class Municipal Corporations. However, while implementing the levy collection of cess various difficulties were faced subsequent to which the Corporations were allowed to switch over to Octroi. That the Local Body Tax and Cess are both account based and there is no difference in the levy and collection of them. Thus, the reasons set out in paragraph 1 for now introducing Local *23* wp.2720.13.group.as.lbt Body Tax do not stand the test of reason. 26 Ms.Karnik then submitted that insofar as the reasons set out in paragraph ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itions and which deserve to be dismissed. The argument of Mr.Shinde is that there is absolutely no substance in the challenge. The bogey of encroachment on independence and autonomy of the Corporations is raised only to further the interest of Unions and employees. There is no basis inasmuch as there was never any independence or autonomy to select the tax for imposition. The imposition of tax is by the State Government or subject to it's approval and that has been the position throughout including prior to the amendment. 28 Mr.Shinde has invited our attention to Section 127 of the said Act to submit that the taxes to be imposed under the said Act are specified therein. The Corporation was given the freedom to impose the taxes in addition to those specified in Section 127(1). Thus, the Corporation which is a creation of an Act of the Legislature of the State gives the powers of control and supervision to the State Government advisedly. The State Government has been given equally the powers to give directions and in terms of which the imposition of taxes is directed by the State. Therefore, it is futile and false to urge that the Corporation devices a tax or selects the perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or imposition of Local Body Tax in lieu of octroi has been set out and in that behalf he referred to paragraph 5 onwards of the affidavit in reply. 30 Mr.Shinde submits that the amendment has been brought in by the Bombay Provincial Municipal Corporations (Amendment) Act, 2009 (Act No.27 of 2009) dated 24.12.2009 with effect from 31.08.2009. The disadvantages, obstacles and difficulties faced by earlier system of octroi and collection thereof having been extensively set out it is apparent that the Government had to intervene and clear the mess. Earlier system of octroi was restricting and disrupting free movement of goods which was acting as major deterrent to the growth of business. Therefore, in the alternate and in the form of account based entry the tax was brought in. The account based entry tax was recoverable from the persons carrying on the business within the limits of Municipal area and physically importing the goods into the limits of the Municipal area for consumption, use or sale. 31 Mr.Shinde submits that due to the difficulties faced, there was demand from the various organizations and representative bodies of trading community and transporters to abolish th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rengthen its economy so that it functions independently without depending on the State Government for *28* wp.2720.13.group.as.lbt financial assistance. It can then effectively fulfill the obligations and aspirations of residents and constitutional mandate. Referring to paragraph 14 of the affidavit in reply, Mr.Shinde submits that the decision of the State has been implemented successfully by all Corporations except the Mumbai Municipal Corporation. 32 Mr.Shinde has taken us through para-wise reply in this affidavit and which according to him denies the allegations to the contrary and made by the Petitioners. There is absolutely no opposition for imposition, levy and assessment of Local Body Tax. Mr.Shinde has taken us through the main pleas in this affidavit and which are to the following effect:- 25. With reference to para No.11 of the Petition, it is denied that the impugned Act is ultra vires and unconstitutional and violates the provisions of Part IX-A of the Constitution and is against the basic objects and reasons of 74th Amendment as alleged or at all. It is denied that the impugned amended Act is in direct conflict of the existing provisions of Sections 99, 149, 45 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ution of self Government and to determine for itself as to what would be the beneficial source of revenue as alleged or otherwise. It is denied that the impugned amending Act is contrary to the Articles 243W, 243X and 243Y of the Constitution of India and it is rendered nugatory the said constitutional provisions as the State Government is conferring upon itself the power to decide on behalf of Corporation as alleged or at all. I say that the power and authority to impose LBT flows from Bombay Provincial Municipal Corporation Act, 1949 subject to the limitations imposed by the Act itself. I say that Bombay Provincial Municipal Corporation Act, 1949 does not give the authority or power to the Municipal Corporations to impose or levy tax as per their choice. It is denied that the Municipal Corporation is entitled to determine which of the taxes mentioned in *30* wp.2720.13.group.as.lbt Section 127(2) of the Bombay Provincial Municipal Corporation Act, 1949 is to be imposed depending upon the local factors, financial requirement of the Corporation and other commitments. I say that imposition of LBT in lieu of octroi is within the power and jurisdiction of the State Legislature and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ership. Then, comes Article 243W, on which strong reliance is placed by Ms.Karnik, which reads as under:- 243W. Powers, authority and responsibilities of Municipalities, etc.:- Subject to the provisions of this Constitution, the Legislature of a State may, by law, endow - (a) the Municipalities with such powers and authority as may be necessary to enable them to function as institutions of self-government and such law may contain provisions for the devolution of powers and responsibilities upon Municipalities, subject to such *32* wp.2720.13.group.as.lbt conditions as may be specified therein, with respect to - (i) the preparation of plans for economic development and social justice; (ii) the performance of functions and the implementation of schemes as may be entrusted to them including those in relation to the matters listed in the Twelfth Schedule; (b) the Committees with such powers and authority as may be necessary to enable them to carry out the responsibilities conferred upon them including those in relation to the matters listed in the Twelfth Schedule. 37 Upon a bare perusal of the same it is evident that subject to the provisions of the Constitution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cedure and subject to such limits. There could be assignment of duties to the Municipalities. The State Government may assign to a Municipality such taxes, duties, tolls and fees levied and collected by the State Government for such purposes and subject to such conditions and limits. Therefore, when the Legislature of the State has to endow the Municipalities and by law with powers and authority so as to enable them to function as institutions of self Government effectively, then, that position is in no way affected merely because the law authorizes the State to impose the taxes. Merely because *34* wp.2720.13.group.as.lbt the State has such powers in terms of the law of Legislature does not mean that by itself such law or any provision therein would fall foul of the constitutional mandate. By enactment of Section 127 of the said Act alone the independence of the Municipalities is in no way affected. Chapter-XI of the said Act deals with Municipal Taxation . The law itself states that the Corporation shall impose the tax, namely, property tax, tax on vehicles, boats and animals. Pertinently, sub-section (1) of Section 127 of the said Act is not in any way challenged and on the gro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e rules. (4) Nothing in this section shall authorise the imposition of any tax which the State Legislature has no power to impose in the State under the Constitution. 39 A perusal thereof would reveal that the Corporation shall impose the taxes specified in sub-section (1) and in addition thereto, it may impose for the purposes of the Act and subject to the provisions thereof, the taxes enumerated in clauses (a) to (f) of sub-section (2) of Section 127. That such discretion has been given to the Corporation and to impose the taxes in addition to the taxes which have to be compulsorily imposed, would go to show that the Legislature is aware that by *36* wp.2720.13.group.as.lbt imposition of the property taxes and taxes on vehicles, boats and animals alone, the expenses which have to be incurred by the Corporation cannot be met and mitigated. Therefore, the Corporation has been given discretion to impose the additional taxes and one of it is octroi . There could be a cess on entry of goods into the limits of the city for consumption, use and sale therein and that could be levied in lieu of octroi, but that will be with previous sanction of the State Government. The proviso to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontinuing the octroi. If the proviso of this nature is taken as guarantee against encroachment into the independence and autonomy of the Corporation flowing from the constitutional mandate, then, that argument is clearly misconceived. Even for additional tax or cess in lieu of octroi the State Government's previous sanction is necessary. Therefore, merely because the State's sanction is necessary or State's directions are binding, does not by itself and anything more denude the Municipality of it's constitutional status and position. 41 In that regard the provisions contained in the said Act and particularly in Chapter-XXVIII ought to be noticed. Sections 448 to 452A fall under this Chapter and which is entitled Control . By Section 448 there is a power conferred in the State Government to require performance of duties in default of any municipal authority. By Section 449 the expenses of measures enforced under Section 448 can be recovered. By Section 450 a power is conferred in the State Government to call for extracts from the proceedings, etc.. By Section 450A a power is *38* wp.2720.13.group.as.lbt conferred in the State Government to issue instructions or d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te Legislatures for the State. In New Delhi Municipal Committee v/s State of Punjab reported in AIR 1997 SC 2847 the Honourable Supreme Court held as under:- 91. We have great difficulty in accepting this assertion. Article 265 of the Constitution emphatically mandates that no tax shall be levied or collected except by authority of law . Under the framework of the Constitution there are two principal bodies which have been vested with plenary powers to make laws, these being the Union Legislature, which is described by Article 79 as Parliament for the Union and the State Legislatures, which are described by Article 168 in the singular as Legislature of a State . While certain other bodies have been vested with legislative power, including the power of levying taxes, by the Constitution for specific purpose, as in the case of District Committees and Regional Councils constituted under the aegis of the Sixth Schedule to the Constitution, the plenary power to legislate, especially in matters relating to revenue, still vests with the Union and the State Legislatures. Even if the submission that Municipalities now possess, under Part IXA of the Constitution, a higher juridical s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the State to exercise effective and *41* wp.2720.13.group.as.lbt proper control over the functioning and performance of it's duties by the Municipal Corporation. That is why the drastic power of suspending or rescinding any resolution or order of the Municipal Corporation or other Authority in certain cases is conferred in the State. In addition the power is conferred to dissolve the Corporation itself. Such being the sweep of the powers conferred in the State we do not see how by a mere direction to impose Local Body Tax and levy it within the municipal limits in lieu of octroi could be said to be destructive of the constitutional scheme. Once it is understood that the State has to act in furtherance of and to preserve, safeguard and protect the constitutional mandate and scheme and such powers as are noted above are conferred and to be exercised towards that end, then, there can be no hesitation in rejecting the submissions of Ms.Karnik that firstly in the absence of proviso below clause (aa) and secondly, wording of clause (aaa) itself is ultra vires and unconstitutional being contrary to the scheme noted above. 44 Ms.Karnik submits that not only because there is absence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 99B, 99C and 99D which read as under:- 99B. Determination of categories of goods for Local Body Tax :- The State Government shall, on or before the twentieth day of the February each year, after considering the proposal of the Commissioner in this behalf, and subject to the limitations and conditions prescribed in Chapter XIB, determine the rates and the extent to which the *43* wp.2720.13.group.as.lbt taxes referred to in clause (aaa) of sub-section (2) of Section 127, shall be levied, for various categories of goods in the next ensuing official year and notify such rates and extent in the Official Gazette. 99C. Provisions of section 99B not to apply to Local Body Tax to be first levied:- In the event it is decided first time to levy Local Body Tax specified in clause (aaa) of sub-section (2) of section 127, if the Local Body Tax can not, by following the provisions of section 99B and the other relevant provisions of this Act, be brought into force on the 1 st day of April of any year, then in that case, notwithstanding anything contained in section 99B, the State Government may, by notification in the Official Gazette, subject to the limitations and conditions laid d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very of cess in lieu of octroi, contained in Chapter XIA shall mutatis mutandis apply to levy and collection of Local Body Tax. There, the levy and incidence of cess, certain goods not liable or exempt from cess, liability of cess in certain cases, cess authorities, registration, memorandum of sales or purchases, liability to maintain and produce accounts, production and inspection of accounts and documents and search of premises, seizure of books of accounts and goods, etc. are some of the matters and all the provisions in relation thereto as are to be found in Chapter XIA are made applicable to Local Body Tax. The Local Body Tax regime is, therefore, not such as could be termed as destructive of the constitutional scheme. Rather at every stage and at every step the proposals of the Commissioner have to be considered by the State Government. The word consider means think carefully about, believe to *45* wp.2720.13.group.as.lbt be, take into account when making a judgement, look attentively at (As defined in Concise Oxford English Dictitonary, Eleventh Edition, Revised). Therefore, it is not as if the wishes of the representatives of people residing within the municipal limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the General Body of the Corporation that such power vests. The Commissioner being one of the authorities specified by the said Act thus, cannot be held to be a parallel authority and by himself. What the said Act envisages is, it shall be incumbent on the Corporation to make reasonable and adequate provision by any means or measures by which it is lawfully competent to use or take for the matters specified in Section 63 and for the matters specified in Section 66 it may use all its discretion and provide from time to time either wholly or partly for all or any of the matters therein. The performance and of functions and duties imposed or assigned to the Corporation under the said Act or any other law for the time being in force by the State Government and other authority can be discharged either by the Corporation by itself or subject to such directions as may be issued and in terms and conditions as may be determined by the State Government cause it to be discharged or performed or implemented by any agency. It is in these circumstances that one must note Section 67 of the said Act. By sub-section (1) thereof, respective functions of several municipal authorities shall be such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onourable Supreme Court in AIR 2002 SC 1124 (Baldev Singh Gandhi v/s State of Punjab) held as under:- 9. .... The appellant herein is an elected municipal councilor to a democratic institution i.e. local body. The aim and object of the Act is to make better provisions for administration of municipalities. The municipality is a democratic institution of self governance consisting of local people and for the local people and by the local people. The prime object of the local body is to serve the local people and to provide amenities and service to the people residing within the municipality. As a representative of the public it is the duty of an elected representative to see that the public of his constituency are not burdened with excessive and arbitrary levy. No doubt, a municipal commissioner holds a statutory office in a municipal council, but no statutory code of conduct in respect of municipal councillors has been enacted. However, it is a different question whether such a law could be framed as to restrict the freedom of speech and expression of a municipal councilor. However, it must be borne in mind that the appellant was not an employee or a servant of the municipal cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uphold the Constitutional scheme, then, there is no scope for the plea that the law falls foul of the same and in the manner *50* wp.2720.13.group.as.lbt suggested by Ms.Karnik. 53 Therefore, we are of the view that whenever the State calls upon the Municipal Corporation to levy the Local Body Tax it is not imposing it on the Municipal Corporation, but reminding it to levy, assess and collect the tax which is more friendly and serving all people including traders. That the Local Body Tax has to be then levied, assessed and collected by the Municipal Corporation does not mean that the State takes an unilateral decision in all matters connected with the levy. Though the State takes a decision the Municipal Corporation is not overlooked and as understood above. Therefore, the determination of the rate of levy, selection of articles and goods, manner of levy, assessment and recovery though controlled by the State, but the Municipal Corporation has definite role to play in the same. Its role is by no means diluted or diminished. It is eventually the Local Body Tax and to be levied, assessed and recovered by the local body. Therefore, the State Government being empowered by the vario ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other additional or alternative tax. They cannot further insist that the Municipal Corporation cannot have alternate taxation or additional tax in lieu of cess or vice- versa. These are not matters where they have any conclusive voice. At the most they may place their suggestions and views before the Municipal Authorities, beyond that the law does not given them any right and to impose their views. In such circumstances we do not find any reason to *52* wp.2720.13.group.as.lbt declare the impugned provisions unconstitutional at their behest or at their instance. In view thereof, we do not find any merit in these Writ Petitions. 56 The reliance placed by Mr.Shinde on the Full Bench decision of the Madhya Pradesh High Court in Anil Kumar Gulati v/s State of M.P. (supra), is apposite and well placed. The Full Bench presided over by Honourable Mr. Justice Dipak Misra (as His Lordship then was) has very succinctly analyzed the scheme of the municipal governance and emerging from the constitutional provisions. Their Lordships have held thus:- 17. The first submission advanced by the learned counsel for the petitioners is that in view of the incorporation of certain Articles under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed many a provision of the Constitution. Article 243X also postulates that the Legislature of a State may, by law, authorise a Municipality to collect and appropriate such taxes, duties, tolls and fees in accordance with such procedure and subject to such limits. The aforesaid provision is plain as day to indicate that the Legislature has the authority and it may authorise the Municipality to collect such taxes in accordance with such procedure and subject to such limits. The significance of the term 'such' used at three places under Article 243X(a) cannot be allowed to be marginalised. Thus the submission that the Legislature should have left it to the total discretion of the Municipality or Municipal Corporation is absolutely sans substance. 54. In view of our preceding analysis, we proceed to enumerate our conclusions in seriatim : (i) The concept of self-governance as provided under Chapter IXA of the Constitution is not absolute and *54* wp.2720.13.group.as.lbt subject to law made by the Legislature. (ii) Neither the Municipal Corporation nor Municipality can impose tax independently without the authority of State Legislature as that would tantamount to create ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the competence to deal with the same in appeal. (xii) It would be incumbent on the Municipal Corporation or the Municipality to pass a resolution by fixing the rate on per square foot basis taking into consideration the concept of standard rent fixed under the M. P. Accommodation Control Act though fixation of standard rent would not be the governing or principal primal factor but would be one of the factors. It is also clarified that the fixation of standard rent in respect of a singular house would not meet or subserve the purpose of guidance but when there is fixation of standard rent in respect of a cluster of houses or group of houses that would be taken cognizance of by Municipality or by Municipal Corporation while fixing the annual letting value per square foot on zone basis. (xiii) If a property owner is affected by the resolution passed by the Municipal Corporation or Municipality can assail the same in entirety before the appropriate authority as provided under both the statutes which we have indicated hereinabove. (xiv) If a person is aggrieved with regard to assessment of a property situate inside the Corporation can assail it before the District Judge u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome forward and raised such a plea. Secondly, this section of public is definitely well versed with publication of such drafts in the Government Gazette. Therefore, it is not possible to accept the argument of Ms.Karnik that there is no compliance with Section 24 of the Bombay General Clauses Act, 1904. In this regard what we find from reading of the provisions particularly Section 5 in the Bombay General Clauses Act, 1904 is that it is the official Gazette in which the Act is published and comes into operation on the date on which the assent thereto of the Governor or President as the case may be required is obtained. Thus, it is first published in the official Gazette. Therefore, it is futile to contend that publication in the official Gazette of the draft does not, in the given facts and circumstances, meet the requirement of law. No wider question or controversy needs to be dealt with. The ground in the petition being limited to this aspect, we have no hesitation in rejecting the same. Further, we are not in agreement with Ms.Karnik that there is any undue haste in bringing the Local Body Tax into force. 61 Lastly, the argument was that the mandate of Article 301 and Article ..... X X X X Extracts X X X X X X X X Extracts X X X X
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