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The Municipality of Dhulia Vs. the New Pratap Spinning, Weaving and Manufacturing Company Limited - Court Judgment

LegalCrystal Citation
SubjectMunicipal Tax
CourtMumbai
Decided On
Case Number First Appeal No. 112 of 1929
Judge
Reported inAIR1935Bom415; (1935)37BOMLR703; 158Ind.Cas.703
AppellantThe Municipality of Dhulia
RespondentThe New Pratap Spinning, Weaving and Manufacturing Company Limited
DispositionAppeal dismissed
Excerpt:
.....of the rules framed by the dhulia municipality provided for the levy of a terminal tax on all goods imported within the municipal limits. another of such rules (rule 5) exempted from the tax 'all goods for bona fide personal use and not for sale.';the plaintiff, a cotton spinning and weaving company limited, imported within dhulia municipal limits building materials required to build its own mill, upon which the defendant municipality levied the terminal tax. the plaintiff having sued for a refund of the tax money :-;that the plaintiff company was entitled to exemption under rule 5, for the expression ' personal use ' was equivalent to ' private use ', and the plaintiff corporation was included in the term ' person '. - - the tax is leviable on corporations as well as on natural..........use ' as equivalent to ' private use '. under the general clauses act a person includes a corporation. it seems to me clear that in rule 5 the distinction drawn is between goods which are imported for sale, and goods which are imported for the use of the importer, and as in this case the goods imported admittedly did not exceed a reasonable quantity having regard to the status and circumstances of the company, i think the company is entitled to the exemption, and the learned judge's decision is correct. the appeal must, therefore, be dismissed with costs.rangnekar, j.3. i agree.
Judgment:

John Beaumont, Kt., C.J.

1. This is an appeal from a decision of the First Class ^Subordinate Judge of Dhulia, and it raises a very short point. The plaintiffs, who are a limited company, sued to recover a sum of Rs. 5,187-15-0 as a refund of the amount charged upon them by the defendant Dhulia Municipality for terminal tax. The Judge held that the plaintiffs were not liable to tax, but as to a large part of the claim it was held that that was barred by limitation, and his order was that the plaintiffs do recover from the defendant Municipality Rs. 382-14-6, and from that decision there is this appeal.

2. The terminal tax is leviable under the Bombay Municipal Boroughs Act (Bom. XVIII of 1925), and the rules applicable thereunder. The question depends on the construction of Rule 5. Rule 3 provides that, subject to the exemptions and the provisions thereinafter specified, a terminal tax shall be payable on all goods, imported within the municipal limits, of the description mentioned in column 1 of schedule A of the rules, and the first column in schedule A includes ' Building materials '. Then Rule 5 provides :-

5. The following goods shall be exempt from the terminal tax, namely :-(a) All goods for bona fide personal use and not for sale, provided the quantity of such goods is reasonable, having regard to the status and circumstances of the owner thereof.

The goods which were imported within the limits of the defendant Municipality in this case were building materials which the plaintiffs required to use for the purposes of building their own mill and not for the purposes of sale, and therefore they claimed to be entitled to the exemption conceded by rule 5. The answer made by the Municipality is that the exemption in fact does not apply to a corporation because the goods cannot be applied bona fide for the personal use of the corporation. The tax is leviable on corporations as well as on natural persons, and if the tax is leviable on artificial as well as natural persons, I think that we must construe the expression ' personal use ' as equivalent to ' private use '. Under the General Clauses Act a person includes a corporation. It seems to me clear that in rule 5 the distinction drawn is between goods which are imported for sale, and goods which are imported for the use of the importer, and as in this case the goods imported admittedly did not exceed a reasonable quantity having regard to the status and circumstances of the company, I think the company is entitled to the exemption, and the learned Judge's decision is correct. The appeal must, therefore, be dismissed with costs.

Rangnekar, J.

3. I agree.


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