B.C. Misra, J.
(1) The petitioners have filed this writ petition feeling aggrieved against the demand of advertisement tax in dispute by the respondent-Committee by its bills dated 28th December, 1963 and 26th February, 1964.
(2) The petitioners have contended that levy of the advertisement tax by the respondent Committee under the notification of the Chief Commissioner under section 61(2) of the Punjab Municipal Act 3 of 1911 is unconstitutional and that the advertisements in dispute displayed by the petitioner do not constitute advertisements within the meaning of the expression used in the relevant bye-laws. In paragraph 9 of the writ, petitioners have further stated specifically that they have had no opportunity to show cause against the correctness of the levy in respect of the advertisement in dispute. They have, thereforee, prayed that a writ be issued restraining the respondent from enforcing the said demand.
(3) The writ petition has been contested on behalf of the respondent-Committee. It has asserted that the levy of the tax is constitutionally valid and that the advertisements displayed by the petitioners constitutes advertisements. With regard to the last contention, the respondents have stated in paragraph 14 of the counter-affidavit tha
(4) The advertisment tax in dispute has been imposed by the respondent-Committee under section 61(2) of the Punjab Municipal Act in pursuance of its resolution dated 7th February, 1958 after the same had been sanctioned by the Chief Commissioner on 23rd January, 1958 and the levy of the tax came into force in pursuance of the said notification with effect from 1st May, 1958, as is clear from the copy of the resolution attached as Annexure 'A' to the petition.
(5) The constitutional validity of the said impition of tax came up for the consideration before a Division Bench of this Court of which I was a member in New Delhi Municipal Committees v. Ishwar Dass Sahani & Brothers (R.S.A. 254-D of 1963 decided on 28th March, 1972). la this decision, its constitutional validity was upheld. The determination of the validity, thereforee, stands concluded so far as this Court is concerned.
(6) So far as the second question is concerned, the matter was decided by me in M/s Broke Bond (India) Private Limited vs. New Delhi Municipal Committee 1973. Rajdhani Law Reporter. 338. In this decision, it was held that in order to attract levy of the tax, the advertisement must relate to the business and commercial activity and must propogate ideas with regard to the goods or services rendered by the party and mere display of the name of the party, without reference to-the goods or services rendered, will ordinarily not constitute an advertisement, unless the displayed name happens to be the trade mark or trade name; in certain circumstances, if the display of the name is so closely associated and prominently displayed with the goods that the connection between the two is obvious, it must also constitute advertisement, but a mere display of the name without any other material will not constitute ardvertisement. Prima face, the advertisements in dispute in the instant case are liable to an advertisement tax since they deal with the goods and services of the petitioners and do not show merely by their name. I, however, do not express any opinion on the said question of fact and there is no doubt that the parties will govern themselves by the rule of law laid down in the aforesaid case.
(7) The last contention of the petitioner has considerable force. It has been pleaded that the petitioners have not had any opportunity to show cause how the tax in dispute had been levied and they have asserted that they had not displayed any advertisements. In reply the respondent referring to giving of several opportunities have clearly in mind the public notices inviting objections issued under section 61 of the Punjab Municipal Act ; which were taken into consideration before imposition of the tax was sanctioned. The notice (Annexure 'C') on which the respondent relies is dated 8th December, .1966 and states that any person objecting to the proposed tax may submit his objections within the period prescribed. These notices and the objections mentioned in paragraph 14 of the counter-affidavit are absolutely irrelevant to the consideration of the question at issue, namely opportunity to the petitioners to dispute the demand of tax raised against them subequent to its legal imposition.
(8) During the course of hearing, the counsel for the respondent sought time to seek instructions as to whether any notice in respect of the advertisements in dispute had ever been issued to the petitioners or served on them. Mr. Mehra reported that unfortunately the relevant file was not available. The provisions for the levy and collection of the advertisement tax is contained in the relevant bye-laws issued on 17th September, 1960 (Annexure 'C' filed by the petitioner which is the same as Annexure 'B' filed by the respondent. The scheme envisaged by the bye-laws is that bye law No.1 creates a charge and takes every person displaying an advertisement as liable 10 pay an advertisement tax at the rates reproduced in Appendix 'A' to the bye-laws. Bye-Law No. 8 requires that nobody shall fix or erect or exhibit any advertisement without paying the entire amount of tax due in advance. Bye-law No. 4 casts a duty upon every person to obtain written permission before displaying an advertisement and if he fails to do so, the Municipal Committee is authorised to cause a notice to be served on the party in the prescribed form, requiring. it to furnish the requisite information in another form prescribed for the purpose. Bye-law No. 8 continues the liability to paythe tax until receipt of written intimation that the advertisement has been removed. Bye-law No. 9 prescribes punishment for breach of the bye-laws which may extend to Rs. 50.00 and in the case of continuing breach, to a further fine of Rs. 5 per day. (After reproducing Bye-laws Nos. 4, 6, 8 and 9 the judgment proceeds)
(9) An analysis of the bye-laws shows that every person who wants to display an advertisement, is required to obtain written permission of the Committee. If he fails to do so and displays an advertisement without such permission, he will be committing a breach of the bye-law and rendering himself lable to punishment. So far as the Municipal Committee is concerned, if it finds any body displaying an advertisement without furnishing details of the advertisement, the Committee must serve a notice on the party in Form 'C' asking the party to supply the requisite information in Form 'B'. These forms have been attached by the respondent as part of Annexure 'B'. It is not disputed that no such notice in Form 'C' had been issued by the respondent to the petitioners. Service of such notice has neither been asserted as a fact in the counter-affidavit nor has any material been placed on the record to show that it had been served on the petitioners. If somebody displays an advertisement without furnishing details and without seeking written permission, the Committee has the power to remove or dismantle the advertisement under the second proviso to bye-law. 6 and also to prosecute the offender under byer-law 9. But it seems very doubtful if the committee can demand the advertisement tax without being in possession of details of advertisement from the party. There is no procedure prescribed in the bye-laws for adjudicating the amount of advertisement tax payable by a party or to determine the dispute of facts relating to the space or the kind of advertisement or the period during which it has been displayed. These questions of fact would arise before the schedule of rates prescribed in Appendix A to the bye-laws is applied and there must be a machinery for determining the basic facts. The bye-law's contain provisions for compelling the party to furnish details of the advertisement and not to display the advertisement without furnishing the details and obtaining written permission except at the peril of punishment In the facts of this case, thereforee there was no information available from the petitioners admitting the details of the advertisements in dispute and the Committee has not taken any steps to compel furnishing of the same.
(10) However, if the committee seeks to assess the advertisement tax on its own initiative, it must before .assessment issue a notice intimating the information about the existence of the advertisements and call upon the party to meet the same and in the exent of the party not accepting the same and raising the dispute, there must be its adjudication and final determination. I find that there is no such machinery provided by the bye-laws and there is no provision in the bye-laws or the Act to the effect that the demand of advertisement tax if raised by the Municipal Committee, would be final and binding even without any admission of the details of advertisement furnished by the party in its application for permission. In the absence of such provisions of law, the principles of natural justice will apply and the Committee must' in in disputed cases, determine the basic facts with regard to the extent, area, duration and kind of advertisement before demanding the amount of tax. In the instant case, the demand has been raised unilaterally without obtaining from the. petitioner the requisite information and without determining the basic facts after notice to the petitioners, hence the rule of natural justice has been violated and the demand of the tax is illegal and will have to be quashed.
(11) As a result, I allow the writ petition and direct the respondent Committee not to enforce the demand of advertisement tax in dispute from the petitioners. The respondent Committee will, however, be at liberty to raise the demand of advertisement tax in dispute again according to law. The parties will bear their respective costs of this petition. (J. K. Jain, Advocate)