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State of Gujarat Vs. Angadia Kantilal Somabhai and ors. - Court Judgment

LegalCrystal Citation
SubjectOther Taxes
CourtGujarat High Court
Decided On
Case NumberCriminal Appeal Nos. 325 to 327 of 1979
Judge
Reported inAIR1982Guj276; (1982)1GLR157
ActsBombay Provincial Municipal Corporations Act, 1949 - Sections 149(1), 466 and 457(7); Ahmedabad Municipal Corporation Octroi Rules - Rules 2 and 11; Ahmedabad Municipal Corporation Octroi Standing Orders - Orders 2.7 and 2.9
AppellantState of Gujarat
RespondentAngadia Kantilal Somabhai and ors.
Advocates: J.M. Panchal, Public Prosecutor
Excerpt:
.....provincial municipal corporations act, 1949, rules 2 and 11 of ahmedabad municipal corporation octroi rules and orders 2.7 and 2.9 of ahmedabad municipal corporation octroi standing orders - where person conveys or brings goods into municipal limits from any other area it would amount to 'importing goods' into municipal limits - person conveying goods into municipal limits would be 'importer of goods' - no reason to limit scope of said expression by holding that importer of goods is only that person who owns goods - even an angadia who imports goods into municipal limits would be liable to pay octroi at octroi naka unless delivery of goods is obtained by owner of said octroi naka. - - (c) determining how octroi shall be collected when no reliable evidence is available of the..........to be 'importers of goods' within the meaning of rule 11 of the ahmedabad municipal corporation octroi rules framed under sub-section (7) of section 457 read with sub-section (1) of section 149 of the bombay provincial municipal corporations act, 1949 (hereinafter called 'the act'). and, if yes, (ii) whether it can be called upon to furnish the information required by the requisition notice issued as per sch. i appended to the rules. in order to decide this question it is necessary to refer to few provisions of law which have a bearing on the point at issue.2. section 127(2) of the act empowers the municipal corporation to impose taxes specified in sub-section (1) of the said section. octroi is one of the taxes specified in subsection (2) of section 127 of the act. section 149(1).....
Judgment:

A.M. Ahmadi, J.

1. In these three appeals the question of general importance which arises for our determination is (i) whether a firm of Angadias can be said to be 'importers of goods' within the meaning of Rule 11 of the Ahmedabad Municipal Corporation Octroi Rules framed under sub-section (7) of Section 457 read with sub-section (1) of Section 149 of the Bombay Provincial Municipal Corporations Act, 1949 (hereinafter called 'the Act'). and, if yes, (ii) whether it can be called upon to furnish the information required by the requisition notice issued as per Sch. I appended to the Rules. In order to decide this question it is necessary to refer to few provisions of law which have a bearing on the point at issue.

2. Section 127(2) of the Act empowers the Municipal Corporation to impose taxes specified in sub-section (1) of the said section. Octroi is one of the taxes specified in subsection (2) of Section 127 of the Act. Section 149(1) enacts the procedure to be followed for levying the taxes specified in subsection (2) of Section 127 of the Act. That section lays down that in the event of the Corporation deciding to levy any of the taxes specified in sub-section (2) of Section 127, it shall make detailed provision, in so far as such provision is not made under the Act, in the form of the rules, modifying, amplifying or adding to the rules at the time in force for any of the matters catalogued in Cls. (a) to (e) of that sub-section. Under Clause (a) rules can be made in regard to the nature of the tax, the rates thereof, the class or classes of persons, articles or properties liable thereto and the exemptions therefrom, if any, to be granted and under Clause (b) rules can be made in regard to the system of assessment and method of recovery and the powers exercisable by the Commissioner or other officers in the collection of the tax. Section 454 next provides that the Corporation may add to the Schedule A rules not inconsistent with the provisions of the Act (which expression shall in this sections be deemed not to include the said Schedule A) to provide for any matter dealt with or for any of the purposes specified in the said Schedule; and may, subject to the same limitations, amend, alter or annul any rule in the said Schedule A. Sub-section (7) of Section 457 provides for making rules in regard to the assessment and recovery of municipal taxes; the conditions on which refunds of municipal taxes shall be allowed; and in respect of a tax leviable under subsection (2) of Section 127, the matters referred to in sub-section (1) of Section 149. Therefore, in exercise of the power conferred by sub-section (7) of Section 457 read with sub-section (1) of Section 149 of the Act, the Corporation framed Rules known as the Ahmedabad Municipal Corporation Octroi Rules (hereinafter called 'the Rules). Rule 11 with which we are concerned reads as under :-

'11. If the Commissioner or any other Officer authorised in this behalf is of opinion or has reason to believe that it is necessary in the interest of Municipal Revenue, to issue . requisition notice as per Sch. 'I' or in such form as may be prescribed by the Municipal Commissioner, from time to time, may issue the same asking any owner or importer of goods or any person connected with the import of goods to return it duly filled in and signed by him within 15 days from the date of receipt of the same. The person, who is required by a written notice so to do, shall fill in correct details and submit a true account of the goods imported by him. The Commissioner or the Officer authorised may require of the said person to produce before him any accounts or documents and to furnish any information relating to the import of goods or any other information in connection therewith as may be required, together with the copies or extracts from such documents etc., as appear to him to be necessary. The octroi duty found due on the information received as per requisition notice or when such information is believed to be incorrect, on such other authentic in. formation as may be obtained, shall, immediately, be paid by the said person on demand. If the amount so demanded is not paid on demand, it shall be recovered, as if it were a tax, by process of recovery as pro. Vided in Chapter VIII (Rules of the Schedule appended to Bombay Provincial Municipal Corporations Act LIX of 1949).'

On a plain reading of this rule it becomes clear that the Commissioner or the officer authorised in this behalf must be of opinion or must have reason to believe that it is necessary in the interest of Municipal Revenue to issue a requisition notice as per Schedule 'I' calling upon any owner or importer of goods or any person connected with the import of goods to return it duly filled in and signed within 15 days from the date of receipt thereof. Therefore, once the required satisfaction is reached, a requisition notice can be addressed to the owner or importer of goods or any person connected with the import of goods. Such a person can be required to produce before the Commissioner or the authorised officer any accounts or documents and to furnish any information relating to the import of goods or any other, information in connection therewith as may be required. Therefore, according to this rule the notice or requisition can be issued to (i) the owner; or (ii) the importer of goods; or (iii) any person connected with the import of goods. The expression 'importer of goods' is not defined by the Rules but the term 'import', according to Rule 2 (a) means conveying into octroi limits of the Ahmedabad Municipal Corporation any articles or goods from any other area, Therefore, if a person brings any article or goods, which is liable to octroi duty or tax from outside the Municipal limits within the Municipal Corporation limits, he can be said to have imported the goods within the meaning of Rule 2 (a) of the Rules. In the context of this definition of the term 'import' found in Rule 2 (a) of the Rules, it is not difficult to define an 'importer of goods'. One who imports goods within the meaning of this Rule can be said to be an 'importer of goods'. According to Webster's Dictionary 'importer' means one who imports. According to Shorter Oxford English Dictionary, (Third Edition), the term 'importer' means one who or that which imports or, introduces. Therefore, any person who brings goods from outside the Ahmedabad Municipal Corporation limits within the Municipal Corporation limits is, for the purposes of these Rules an 'importer of goods'. Such an importer of goods can be served with a requisition notice as per Sch. 11' to the Rules calling upon him to furnish the particulars set out therein.

3. Section 466 empowers the Commissioner to make Standing Orders consistent with the provisions of the Act and the Rules and bye-laws in respect of-

(a) prescribing nakas for the collection of octroi and tolls;

(b) regulating the mode and manner, in which octroi and tolls shall be collected;

(c) determining how octroi shall be collected when no reliable evidence is available of the value of the goods imported;

(d) regulating the stamping, sealing or otherwise marking of imported goods;

(e) prescribing the manner in which refunds of octroi shall be claimed or made and the conditions under which agents shall be recognised and for obtaining refunds of octroi;

(f) determining the supervision under which, the routes by which and the time within which goods intended for immediate exportation shall be conveyed out of the City and the fees payable by persons so conveying the goods; and

(g) any other matter relating to the collection of octroi which is not provided for in the Act.

It must immediately be noticed that the power to make Standing Orders is circum. scribed by the condition that they must be consistent with the provisions of the Act and the Rules and the bye-laws framed under the Act. In exercise of this power the Municipal Commissioner of Ahmedabad framed the Ahmedabad Municipal Corporation Octroi Standing Orders (hereinafter called 'the Standing Orders'). Standing Order 2.7 lays down that the term 'import' shall mean the conveying of any goods into Ahmedabad Municipal limits from any other area. This definition is quite consistent with the definition of the term 'import' found in R. 2 (a) of the Rules. Standing Order 2.9 defines an 'importer' as under:- ' 'importer' shall mean the person who imports the goods into Ahmedabad Municipal limits and shall also include the person who owns the goods at the time of import or whose name is entered in the import bill as importer. It shall also include (i) the person who takes delivery of the goods or articles, when imported by rail or by air or by a vehicle of the Gujarat State Road Transport Corporation; (ii) in case of goods imported through post, the person to whom the goods are delivered by postal department; and (iii) the person or the body of persons doing the business of Angadia.'

Therefore, by this definition a person doing the business of Angadia is an 'importer of goods'. If this definition is consistent with the provisions of the Act and the Rules, there can be no difficulty in reaching the conclusion that a firm carrying on business of Angadias can be served with a requisition notice as per Sch. T under R. 11 of the Rules.

4. Section 399 provides the penalty for failure to comply with the requisition under Rule 11. It lays down that whoever contravenes any provision of the Act or Rule, Bye-law, Regulation, Standing Order, license, permission or notice issued thereunder or fails to comply with any requisition lawfully made under any such provision shall, if no penalty is provided in any other provision of the Act for such contravention or failure be punished, for each such offence, with fine which may extend to one hundred rupees and with further fine which may extend to twenty rupees for every day on which such contravention or failure continues after the first conviction. In the backdrop of these provisions of law we may now proceed to answer the point posed for our decision.

5. In order to answer the principal point arising in these three appeals, it would be advantageous if we bear in mind the relevant facts of these three appeals. In Criminal Appeal No. 325 of 1979 the respondent-accused is one Angadia Kantilal Somabhai. The Octroi Inspector of the Ahmedabad Municipal Corporation filed a complaint against him alleging that even though he was called upon by a requisition notice as per Sch. 'I, of R. 11 of the Rules to furnish particulars in respect of imports made during the period from 1si Feb., 1975 to 31st Dec., 1975 he failed to do so within the prescribed period after the receipt of the requisition and had, therefore, committed an offence punishable under Section 399 of the Act read with R. 11 of the Rules. In Appeal No. 326 of 1979 the respondent-accused is one Naranbhai Shankerbhai. He too was called upon by a similar notice to furnish information regarding the imports between 1st Jan., 1976 and 30th June, 1976 but he failed to do so within the prescribed period after the receipt of the requisition and had, therefore, committed a similar offence. In the last Criminal Appeal No. 327 of 1979 the accused Angadia N. Rajaram. Nagardas was called upon by a similar requisition notice to furnish particulars in respect of goods imported between 1st Jan., 1975 and 31st Dec., 1975 which be failed to do within the prescribed period after the receipt of the requisition and, therefore, committed a similar offence. The learned Metropolitan Magistrate convicted all the three accused and directed them to pay a fine of Rs. 25/- in default, to suffer simple imprisonment for three months. Against the order of conviction the three accused persons preferred separate appeals which were disposed of by the learned City Sessions Judge, Ahmedabad by his judgment and order dated Nov. 28, 1978. The learned City Sessions Judge came to the conclusion that even though by the definition of Standing Order 2.9 Angadias were 'importers', they could not be said to be importers of goods within the meaning of the Rules and, therefore, they could not be called upon by a requisition notice as per Sch. 'I' of R. 11 to furnish the relevant information regarding the import of goods during the period mentioned in the respective requisition notices. He pointed out that even though the expression 'importer' was defined by Standing Order 2.9, there was no such definition to be found in R. 2 of the Rules and, therefore, it was not possible to import the Standing Order definition for the purpose of determining the scope and ambit of R. 11 of the Rules. While deciding the question whether a person or a firm carrying on business of Angadia can be said to be an 'importer' within the meaning of R. 11, the learned City Sessions Judge also referred to the language of Sch. 'I' wherefrom he concluded that the requisition notice under Sch. 'I' can only be served upon the owner and not the person who imports the goods within the limits of Municipal Corporation of Ahmedabad. He was also of the opinion that if Angadias are required to furnish such information as is required by Sch. 'I' of R. 11 of the Rules, it would cause considerable hardship to them because such information would be within the special knowledge of the owners and not the Angadias who are merely carriers of goods. In this view that he took, he came to the conclusion that the respondents-accused who were indisputably carrying on business as Angadias in the City of Ahmedabad at all material times could not be said to be 'importers of goods' within the meaning of R. 11 of the Rules and, therefore, it was not open to the Commissioner or the authorised officer to serve them with requisition notices as per Sch. '1' calling upon them to furnish the particulars set out in the Various columns of that notice within 15 days from the receipt thereof. He, therefore, acquitted the respondents accused of the charge levelled against them.

6. X X X X

7. The Act does not define the expression 'import' or 'importer of goods'. However, Rule 2 (a) defines 'import' to inter alia mean 'the conveying into Octroi limits of the Municipal Corporation from any other area'. The Standing Order 2.7 also defines the expression 'import' to mean the conveying of any goods into Ahmedabad Municipal limits from any other area, The expression 'importer of goods' is not defined by the Rules. Rule 3 which is made subject to the provisions of the Act lays down that an octroi on all goods of the description in Sch. 'A' shall, on the import thereof be payable to the Corporation at the rate specified for such goods respectively in the said Schedule. Rule 4 then enumerates the exceptions to Rule 3. Rule 5 requires the table of rates of octroi to be affixed at certain places. Rules 6 to 10 deal with collection of octroi with which we are not concerned. Rule 11 which has been quoted earlier deals with the issuance of a requisition notice as per Sch. 'P to the Rules. Rule 12 deals with refund of octroi and R. 13 states how much of the octroi paid should be refunded. This is in brief the scheme of the Rules.

8. It becomes clear from the definition of the term 'import' found in R. 2 (a) and Standing Order 2.7 that if a person conveys or brings goods into Ahmadabad Municipal limits from any other area, it would amount to 'importing goods' into Ahmedabad Municipal limits: Any person who conveys goods into Ahmedabad Municipal limits from any other area would, therefore, be an 'importer of goods'. According to the dictionary meaning indicated earlier, one who imports goods is an 'importer of goods'. Nowhere in the Rules has it been mentioned that only the owner of the goods will fall within the expression 'importer of goods'. The expression 'importer' is defined in Standing Order 2.9 reproduced earlier. This definition must be consistent with the Act and the Rules in view of the language of Section 466 of the Act. Once it is held from the definition of the term 'import' that an importer of goods is that person who conveys goods into Ahmedabad Municipal limits from any other area outside the said limits, there is no reason to limit the scope of the said expression by holding that an importer of goods is only that person who owns the goods. Such words of limitation are not found in the Act, the Rules or the Standing Orders. In fact, the Standing Order definition of 'importer' makes it clear beyond my manner of doubt that even an Angadia who imports goods into Ahmedabad Municipal limits would be liable to pay octroi at the Octroi Naka unless delivery of the goods is obtained by the owner at the said Octroi Naka. The learned Sessions Judge in his judgment observes that ordinarily an Angadia would not fall within the term 'importer' and, therefore, he is specifically sought to be Included within the meaning of that expression by standing order 2.9. Now there is no justification, having regard to the definition of the term 'import' in the Rules as well as the Standing Order, to take the view that ordinarily an Angadia cannot be said to be an importer of goods. If an Angadia brings goods within the Ahmedabad Municipal limits from any other limit, he would be an 'importer of goods' within the meaning of the Rules as well as the Standing Order 2.9. The definition in the Standing Order is, therefore, quite consistent with the Rules framed under S. 457 read with S. 149 of the Act.

9. It was argued before the learned Sessions Judge that Angadias can be regarded as ' importers' up to the stage of entry of goods within Ahmedabad Municipal limits and no further and, therefore, they cannot be called upon to answer the requisition issued under R. 11 of the Rules. In other, words, it was argued that as soon as the goods were brought within octroi limits and the duty was paid, Angadias or carriers of goods ceased to be 'importers' of goods and R. 11 of the Rules had no application. This argument found favour with the learned Sessions Judge. It is difficult to understand this line of reasoning for the simple reason that having regard to the definition of the expression 'import' in R. 2 (a), the expression 'importer' in R. 11 must in the context mean one who imports. That person who brings goods liable to octroi within the Ahmedabad Municipal limits from outside its limits would be an importer of goods. The definition in the Standing Order 2.9 is merely illustrative of persons who can be said to be 'importers' within the meaning. of the Rules as well as the Standing Orders. There is no warrant for taking the view that an Angadia who was an importer of goods at the stage of entry ceased to be so on entry and payment of octroi, as such words of limitation do not appear in the Rules or the Standing Orders. The argument that an Angadia is an 'importer' within the meaning of Standing Order 2.9 but he cannot be said to be an 'importer' within the meaning of the Rules is clearly devoid of merit. There is no rationale to come to the conclusion that a person who is an importer of goods within the meaning of the Standing Orders is not an importer within the meaning of the Rules. To take such a view would tantamount to holding that the definition of the word 'importer' in Standing Order 2.9 is not consistent with the Rules. In that event the definition in the Standing Order would clearly conflict with Section 466 which says that the Standing Orders must be consistent with the Act and the Rules. We are, therefore, of the opinion that such a dichotomy is not warranted having regard to the provisions of the Rules and the Standing Orders.

10. The learned Sessions Judge has relied on the requisition form in Sch. 'I' to come to the conclusion that only the owners of goods would be required to answer the said requisition and an Angadia cannot be required to do so. This conclusion is based on the fact that Sch. 'I' uses the language: 'You are requested to furnish correct details of imports made by you or on your behalf'. This language prima facie gives the impression that the requisition is addressed to the owner and he is asked to furnish correct details of imports made by him or on his behalf. Now if an Angadia imports goods through his employee, he can be asked to furnish details of imports made through his employee under Sch. 'I' to (and) Rule 11 of the Rules. The form of the requisition cannot be decisive of the question whether or not any person other than the owner can be 'importer' of goods within the meaning l of R. 11 of the Rules. Once we come to, 1the conclusion that any person who in ports goods within the Ahmedabad Municipal limits is an 'importer of goods', he can be called upon by virtue of R. 11 to furnish the particulars sought by the requisition notice per Sch. 'I'. The learned Sessions Judge observes that as no time limits fixed under the Rules within which such a requisition notice can be issued on the importer of goods, considerable hardship would be caused to the Angadias if they are required to furnish the particulars as per the columns of the requisition notice after a long lapse of time. Now those who are carrying on the business of Angadias must maintain a register containing the particulars of imports made by them from time to time. 13esides, if no period of limitation were prescribed within which such a requisition notice can be issued under R.11 of the Rules, the correct interpretation would be that the requisition notice must be issued within a reasonable time which would depend on the facts and circumstances of each case. This is, however, no argument to come to the conclusion that Angadias cannot be included within the term 'importers' in R. 11 of the Rules. Hardship to the Angadias cannot change the meaning to be given to the word 'importer' in R. 11 of the Rules. The Angadias who are carrying on large scale business of conveying goods into or out of Octroi limits of the Municipal Corporation from or to any other area must know that they may be called upon to furnish details as per Sch. 'I', of (or) Rule11 of the Rules and must' therefore, maintain proper registers containing those particulars so that they may be able to answer the requisition as and where made by the Corporation. We are, therefore, of the opinion that the learned Sessions! Judge was not right in coming to the conclusion that Angadias were not 'importers! of goods' within the meaning of R. 11 of the Rules and were, therefore, not require& to answer the requisition contained in Schedule 'I' thereof.

11 to 14. xx xx xx xx xx xx

15. Order accordingly.


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