Chandra Reddy, C.J.
1. In this Writ Petition the Andhra Pradesh Urban Areas Surcharge on Property Tax Act (XIII of 1958) (hereinafter referred to as the Act for the sake of brevity) is challenged as being unconstitutional and ultra vires. This Act directs the Municipal Councils of Andhra Pradesh State to levy surcharge on property tax on certain buildings.
2. The petitioner, a resident of Kurnopl town, owns forty seven buildings within that Municipality. He was paying yearly property tax of Rs. 4,130-12 Nps. On 18-4-1959 he received a notice of demand for payment of Rs. 413-01 Nps. as surcharge on the tax paid by him for the year 1958-59. The petitioner immediately filed this petition under Article 226 of the Constitution questioning the validity of this Act.
3. The primary contention urged on behalf of the petitioner is that it is not within the competence of the State Legislature to make law empowering .he Municipality to levy a tax on the property tax payable under the provisions of the Madras District Municipalities Act. According to the learned counsel the relevant entry in List II of (he Seventh Schedule to the Constitution does not authorise the State to enact a law enabling the Municipalities to levy tax on the tax imposed on buildings and such a legislation is covered by Item 92 of List I of the Seventh Schedule. We are not convinced that there is substance in this contention. Item 49 of List II of the Seventh Schedule assigns the subject of 'taxes on lands and buildings' to the State Legislature. Therefore it is prima facie within the legislative competence of the State Legislature to make all laws on the topic relating to taxes on buildings.
4. The short point for consideration is whether this Act authorises the Municipalities to levy tax on the property tax, or, whether the surcharge contemplated by the Act is only an additional tax on the buildings. This Act was made with a view to provide for levy of surcharge on property tax on certain buildings in the major Municipalities in the Stale of Andhra Pradesh. Section 3, which is the charging section, postulates:
'Notwithstanding anything contained in the Municipal Act but subject to the provisions of Section 4, there shall be levied in the cities of Hyderabad and Secunderabad and in every major Municipality in the State of Andhra Pradesh, with effect from the financial year commencing on the first day of April 1958 a surcharge on the property tax payable for the year in respect of every building of the class specified in column (1) of the Table below at the rate specified against each class in column (2) of the said Table'.
5. Now, what is the character of the levy that is within the contemplation of this enactment? The surcharge here is only an additional tax on the buildings. It cannot be regarded as a tax on the tax. On the other hand, it partakes of. The same character as the property tax to which the building is subject. The Act only permits an increase in the property tax at the rate specified against each class in column 2 of the said table. The subject-matter of the tax remains the building itself. That it is nothing but an increase in the rate of property tax on the buildings could be gathered from Article 271 of the Constitution which says:
'Notwithstanding anything in Articles 269 and 270, Parliament may at any time increase any of the duties or taxes referred to in those articles by a surcharge for purposes of the Union and the whole proceeds of any such surcharge shall form part of the Consolidated Fund of India.'
It is true that Article 271 is inapplicable to the present case. We are only referring to it as throwing light on the connotation, of the expression 'surcharge'. That article clearly establishes that surcharge is only an increase in the duties or taxes leviable under a particular enactment i.e., it is art extra charge or tax. There can be little doubt that the pith and substance of the impugned legislation relates to the subject of taxes on buildings within the contemplation of Entry 49 of List II. There-tore, the argument that the surcharge envisaged by this enactment is a tax on tax is baseless.
6. A similar view was taken by a Single Judge of the Madras High Court in C. V. Rajagopalachariar v. State of Madras, : AIR1960Mad543 . It was laid down there that a surcharge of land revenue would partake of the character of land revenue and should be deemed to be an additional land revenue. This argument therefore fails and is rejected.
7. Another point presented by the learned counsel for the petitioner is that Section 4 of the Act is obnoxious to Article 14 of the Constitution in that it confers upon the executive authority unregulated discretion to choose any one of the buildings occupied by the owner. Under that section it is open to the concerned authority to exercise discrimination against similarly situated owners of buildings i.e., by choosing the house of the lowest value in regard to one owner and of the highest value in regard to another in respect of the category of building wholly occupied by him. In order to appreciate this argument,' we have to turn to the provisions of Section 4 of the Act
'(1) Where a person owns only one Building in a major municipality and it is wholly occupied by the owner, such building shall be assessed to the surcharge under Section 3 only at a rate of 5 per cent, of the property tax payable in respect of that building irrespective of its annual or rateable value.
(2) Where a person owns more than one building in a major municipality, and some or all of them are either occupied wholly or partly by the owner or let out on rent:
(a) any one of the buildings wholly occupied by the owner shall be assessed to the surcharge at a rate of 5 per cent, of the property tax irrespective of its annual or rateable value: and
(b) the remaining buildings (whether occupied
wholly or partly by the owner or let out on rent) shall be assessed at the rate applicable thereto under Section 3, the total of the annual of rateable values of all such buildings being taken as the basis for determining the rate of surcharge applicable to each sub-building :
Provided that where a person owning more than one building occupies one of the buildings for his dwelling purpose and another for his trade or business, only the building occupied by him for dwelling purpose shall be entitled to be assessed to the surcharge at the rate of 5 per cent, of the property tax under Clause (a)
X X X X'
8. We are here concerned only with Clause (a) of Sub-section (2). What is complained in regard to this clause is that the executive authority could make hostile discrimination as between owners similarly situated and could act arbitrarily, there being no principle guiding the exercise of power in this behalf. It may be difficult to predicate that the clause by itself suffers from the vice of hostile discrimination. It is a general power conferred upon the executive authority and does not exclude any particular or class of owners. But the particular act performed by the executive authority may be open to question as being tainted with hostile discrimination and that act could be attacked as repugnant to Article 14 of the Constitution. However, we need not here consider further whether the clause in question is a discriminating provision and as such it infringes Article 14 or whether it is only the particular act performed by the executive authority that could form the subject-matter of challenge as the matter can be disposed of on a short ground.
9. It is not complained here that the petitioner is in occupation of more than one building and that the executive authority has discriminated against him. The utmost that could be said is that in the event of his occupying more than one house for dwelling purpose there is a likelihood of discriminatory treatment being meted out to him. In other words, there is a remote contingency of the executive authority exercising hostile discrimination against him. But, that could not in our opinion, be a ground for striking down a legislative measure. A mere threat or possibility of an unequal treatment would not be sufficient to invalidate an enactment as violative of Article 14 of the Constitution. It is only when the individual has been affected, that he could make a legitimate complaint that Article 14 of the Constitution has been contravened.
10. In Qasim Razvi v. State of Hyderabad, : 1953CriLJ862 it was remarked by Mukherjea, J. (as he then was) that a mere threat or possibility of an unequal treatment was not sufficient and that if actually the accused had been discriminated against, then and then only he could complain, not otherwise. Therefore there is no justification to invalidate the Act merely because the power conferred on the executive authority is likely to be exercised arbitrarily.
11. Moreover, the petitioner does not want that this clause should be declared ultra vires for the reason that it does not serve him any useful purpose. It is this clause that empowers the executive authority to confer some benefit on the owner of buildings who occupies wholly one of the buildings for his dwelling purpose. If this provision of law is declared illegal, that does not confer any advantage on the petitioner. It is for that reason that the petitioner's learned counsel submits that he does not want such a relief. Therefore, it is unnecessary for us to pursue this topic any further.
12. The third ground urged in support of this petition is that the Municipality has not adopted the procedure indicated in Section 5 of the impugned Act. What is complained by the learned Counsel for the petitioner is that the Municipality has not acted as required by Section 5, which says:
'Save as otherwise provided in this Act, all the provisions of the relevant Municipal Act and the rules made thereunder relating to the assessment or realisation of property tax or in any matter connected wherewith (including exemption from assessment) shall apply to the assessment and realisation of the surcharge levied under this Act: Provided that the Government may direct that the said provision shall apply subject to such modifications and restrictions as may be prescribed'.
The argument raised by the learned counsel is that section 78(3) of the District Municipalities Act requires that there should be a resolution of the Municipal council specifying the rate at which any such tax shall be levied and the date from which it shall be levied, that since in this case such a resolution has not been adopted, the levy is illegal and unenforceable. This contention is utterly devoid of substance. Section 78(3) of the District Municipalities Act is inapplicable to this case as this is not a case where the Municipality has determined to levy a tax in which case alone the rate has to be specified. That apart, it is not alleged in the petition that there was no resolution levying surcharge on the property tax. This contention therefore, cannot be given effect to. Even otherwise, if the executive authority makes the levy without following the procedure indicated in the District Municipalities Act, it is open to the petitioner to carry an appeal to the authorities concerned and have it rectified. That would not justify the issuance of a writ of prohibition prohibiting the respondent from proceeding to collect the surcharge in a case like this.
13. The argument based on Rule 10 of the Taxation and Finance Rules is equally untenable. That rule does not come into play here at all since there is no increase of assessment between two general revisions. This is only a case of levy of surcharge under the Act in dispute. This argument has, therefore, to be negatived. Further, this ground has not been taken in the petition.
14. In the result, all the grounds of challenge fail and the writ petition has to be dismissed with costs. Advocate's fee Rs. 100/- (one hundred).