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The Municipal Corporation of the City of Ahmedabad Vs. Premchand Mahasukhram, Deceased by His Heirs - Court Judgment

LegalCrystal Citation
SubjectMunicipal Tax
CourtGujarat High Court
Decided On
Judge
Reported in(1964)5GLR847
AppellantThe Municipal Corporation of the City of Ahmedabad
RespondentPremchand Mahasukhram, Deceased by His Heirs
Cases ReferredRaleigh Investment Co. Ltd. v. Governor
Excerpt:
- - (a) that it be declared that the special notices served on us by the corporation are bad in law and illegal. in that case western india prospecting syndicate limited had preferred a tax appeal under section 406(1) of the act on the ground that the publication of the assessment list on the basis of capital valuation for the tax on open land was illegal and ultra vires the powers of the corporation and that the non-authentication of the assessment list for the years 1947-48 to 1950-51 had vitiated the assessment lists and that therefore the tax claimed and levied bad not become due and payable. it was pointed out to us in the course of the argument that the fixation or the charging of a tax might be disputed by an assessee not only on the ground that the quantum or the amount claimed.....n.m. miabhoy, j.1. these two appeals arise from a common order passed on 11th of april 1960 by the learned district judge ahmedabad in civil appeals nos. 370 of 1958 and 371 of 1958 by which he allowed the appeals with costs set aside the decrees of the trial court in civil suits nos. 529 of 1956 and 273 of 1957 and remanded the suits for hearing and deciding them on merits. the appellant in both the high court appeals is the municipal corporation of the city of ahmedabad the original defendant (hereinafter called corporation). in appeal no. 77 of 1960 the respondents are the heirs of one premchand mahasukhram the original plaintiff in civil suit no. 273 of 1957 (hereinafter called plaintiff premchand). in appeal no. 78 of 1960 the respondent is the rustom jehangir vakil mills company.....
Judgment:

N.M. Miabhoy, J.

1. These two appeals arise from a common order passed on 11th of April 1960 by the learned District Judge Ahmedabad in Civil Appeals Nos. 370 of 1958 and 371 of 1958 by which he allowed the appeals with costs set aside the decrees of the trial Court in Civil Suits Nos. 529 of 1956 and 273 of 1957 and remanded the suits for hearing and deciding them on merits. The appellant in both the High Court appeals is the Municipal Corporation of the City of Ahmedabad the original defendant (hereinafter called Corporation). In appeal No. 77 of 1960 the respondents are the heirs of one Premchand Mahasukhram the original plaintiff in Civil Suit No. 273 of 1957 (hereinafter called plaintiff Premchand). In appeal No. 78 of 1960 the respondent is the Rustom Jehangir Vakil Mills Company Limited the original plaintiff in Civil Suit No. 529 of 1956 (hereinafter called the Mills) A common point of law arose in both the District Court appeals. Therefore the learned District Judge disposed off both those appeals by a common judgment. The same common law point arises also for determination in the present two appeals. We deliver this common judgment which will dispose off both the High Court appeals.

2. The common point of law which arises in both the appeals is whether the original suits filed by the aforesaid plaintiffs were maintainable at law. The learned 3rd Joint Civil Judge (Senior Division) Ahmedabad who decided both the suits held that the suits were not maintainable and dismissed them on that ground The learned District Judge Ahmedabad held that the suits were maintainable and therefore he reversed the decrees of the learned trial Judge and remanded the suits under Order 41 Rule 23 Civil Procedure Code. It is against these orders of remand that the present two appeals are directed.

3. In order to appreciate the point raised for decision it is necessary to summarize the plaints. It is necessary to do so because as we shall presently show in the ultimate analysis the question about the maintainability of the suits can only be answered on the basis of the contents of the plaints. The suit have been dismissed in limine. Therefore the Court must necessarily proceed on the assumption that the contents of the plaints are true.

4. Plaintiff Premchand was the owner of three premises bearing census Nos. 981 981 and 981/2 and situated in the City of Ahmedabad The Municipal Commissioner of the Corporation (hereinafter called the Commissioner) issued special notices under Rule 2U Sub-rule (2) of Chapter VIII (hereinafter called the Taxation Rules) of the Schedule to the Bombay Provincial Municipal Corporations Act 1949 (hereinafter called the Act) on 24th March 1955 calling upon Premchand to show cause why the rateable values of the aforesaid three premises for the year 1954-55 should not be revised. Premchand filed objections in time. The Appellate Officer on behalf of the Commissioner rejected the objections on 5th of September 1955 and communicated the decision to Premchand on 30th September 1955. Premchand was served with a bill dated 1st of February 1956 for payment of the tax amount of Rs. 167-14-0 on the revised rental values. He paid the amount on 13th of February 1956 under protest. Then Premchand gave the statutory notice on 15th of February 1956 to the Corporation claiming refund of the amount of Rs. 167-14-0. The Corporation replied on 23rd of March 1956 that no such refund would be given. Premchand attacked the recovery of the aforesaid amount of Rs. 167-14-0 on the following grounds viz. (i) that in the special notices reasons had not been given for the proposed amendments and (ii) that the actual amendments were not made during the official year 1954-5 and that therefore they were ineffective to charge Premchand with the tax liability for the year 1954-55. On these two grounds Premchand alleged that the bill No. 126 dated 1st February 1956 was illegal and the amount recovered from him was illegally recovered. Premchand further alleged that the cause of action arose on 13th February 1956 and also on 23rd of March 1956 when the Corporation refused to grant him the refund. Premchand made the following prayer in the plaint:

That it be declared that the above recovery has been made illegally and that the above amount of Rs. 167-14-0 be refunded by the defendant with 6% running interest from the date of the suit till payment.

5. The Mills are in occupation of certain premises near the Dudheshwar Road Ahmedabad. For the financial year 1954-55 the Corporation fixed the rateable value of those premises. The dispute between the Mills and the Corporation relating to the rateable value was referred to an arbitrator. The latter gave his award and the Corporation demanded tax for the financial year 1954-55 on the basis of that valuation. That tax was paid by the Mills. However thereafter the Commissioner issued special notices under Rule 20 Sub-rule (2) of the Taxation Rules proposing to revise the rateable value by including certain items of the Mill machinery for the purpose of fixing the rateable value. The Mills filed objections but they were overruled by the Deputy Municipal Commissioner on 28th of November 1955. Thereafter the Corporation presented a bill for Rs. 1 258 demanding that sum by way of additional tax on the basis of the revised valuation. That amount was paid by the Mills under protest on 8th of December 1955. The Mills challenged the recovery of the aforesaid additional amount on the following grounds viz. (i) that the recovery was in disregard of the award of the arbitrator which award was binding on both the parties; (ii) that the additional items of machinery the value of which has been taken into account in fixing the ratable value were Dot liable to the property tax levied under the Act; and (iii) that as the objections of the Mills were disposed off on 28th of November 1955 they were ineffective to fix the tax liability on the Mills for the financial year 1954-55 and that they could be effective only for the financial year 1955-56. The Mills alleged that the cause of action arose on 8th of December 1955 the date on which the amount was illegally recovered from the Mills and also on 12th of January 1956 the date on which the statutory notice was served on the Corporation. The Mills made the following prayers in the plaint:

(a) That it be declared that the special notices served on us by the Corporation are bad in law and illegal.

(b) That the Honourable Court be pleased to pass a decree in their favour for Rs. 1 258 against the Corporation recovered for the year 1954 illegally on 8th of December 1955 under protest with running interest at 6% from the date of recovery that is 8 December 1955.

6. The Corporation resisted both the aforesaid suits on a number of grounds. One of the grounds was that the suits were not maintainable. This plea was based on the submission that the only remedy which was available to the two plaintiffs was by way of an appeal under Section 406 of the Act and that therefore suits for recovering the amounts of the tax were barred. Therefore it is necessary to quote the relevant part of Section 406 of the Act in the first instance. It is as follows:

406 (1) Subject to the provisions hereinafter contained appeals against any rateable value or tax fixed or charged under this Act shall be heard and determined by the Judge.

The term Judge has been defined in Section 2 Sub-section (29) of the Act to mean in the city of Ahmedabad the Judge of the Court of Small Causes.

7. The controversy between the parties is as follows. The Corporation alleges that all the grounds on which two plaintiffs challenge the recovery of the tax could have been heard and determined by the Judge in the tax appeals which the plaintiffs did not choose to file. It is urged that the Judge was constituted a tax tribunal for determining all the disputes relating to the rateable value or the tax fixed or charged under the Act and that being so the jurisdiction of the Civil Court to deal with those disputes was excluded. In the lower Courts the plaintiffs resisted the aforesaid contention by urging that the tax tribunal had no jurisdiction to deal with the questions raised in the two suits. The contention was that the tribunal had jurisdiction to determine only the quantum or the amount of the tax and nothing else and that it was only the Civil Court which had jurisdiction to decide all the questions other than the questions relating to the quantum or the amount of the tax. For the latter proposition the plaintiffs relied upon the judgment delivered by Mr. Justice J.C. Shah (as he then was) in the Bombay High Court in Western India Prospecting Syndicate Limited v. The Municipal Corporation of The City of Ahmedabad Civil Revision Application No. 1005 of 1956. The identical question arose for decision before the learned Judge. In that case Western India Prospecting Syndicate Limited had preferred a tax appeal under Section 406(1) of the Act on the ground that the publication of the assessment list on the basis of capital valuation for the tax on open land was illegal and ultra vires the powers of the Corporation and that the non-authentication of the assessment list for the years 1947-48 to 1950-51 had vitiated the assessment lists and that therefore the tax claimed and levied bad not become due and payable. Strangely in that case it was the Corporation which resisted that appeal on a submission quite contrary to the one raised in the present two litigations. The Corporation there contended that the tax tribunal hearing the tax appeal had no jurisdiction to decide the aforesaid two points and that those points could be heard only by an ordinary Civil Court. That contention was upheld by the tax tribunal and the tax appeal was dismissed. The aforesaid civil revision application was directed against the tax appeal. When the application came up for hearing along with a group of five other revision applications Shah J. declined to issue a rule in those civil revision applications and delivered a short judgment for refusing to issue the rule. It is not necessary for us to examine in details the reasons which induced the learned Judge to reject the contention of the Western India Prospecting Syndicate Limited. It appears that the same question had arisen but under two different Acts before the High Court of Bombay in two cases. In The Municipality of Ankleshwar v. Chhotalal Ghelabhai Gandhi reported in 57 Bombay Law Reporter 547 the Bombay High Court held that in a tax appeal under Section 86 of the Bombay District Municipal Act 1901 the tax tribunal set up under that Act could determine only the question about the quantum or the amount of the tax and nothing else. In Gopal Mills Co. Ltd. v. The Broach Borough Municipality reported in 58 Bombay Law Reporter 300 the same High Court held that the tax tribunal set up under the Bombay Municipal Boroughs Act (Bom. XVIII of 1925) to hear lax appeals was also restricted in the same way An attempt was made in the case of Western India Prospecting Syndicate Limited to persuade Shah J. that the scheme of the Act was different from the schemes of the Bombay District Municipal Act and the Bombay Municipal Boroughs Act. Mr. Justice Shah briefly referred to several provisions of the Act and after considering the scheme of the Act came to the conclusion that that scheme was similar to the scheme of the aforesaid other two Acts. In our Court Mr. Shah Learned Counsel for the two plaintiffs placed reliance upon the judgment of a Division Bench of the Bombay High Court reported in the case of Balkrishna Dharamdas Vora v. The Poona Municipal Corporation reported in 65 Bombay Law Reporter 119 That was also a case under the Act and the identical question was raised and decided in that case. It was held therein that in Section 406 Sub-section (1) of the Act the words tax fixed or charged do not cover the vires or the legality of the tax but mean only the amount or quantum of the tax. Elaborate arguments were addressed to us by Mr. Vakil to the React that the decisions recorded by the Shah J. and the Division Bench of the Bombay High Court were wrong and that there were material differences in the schemes of the Act and the aforesaid two other enactments which differences had gone unnoticed and that a correct reading of all the relevant provisions showed that the tax tribunal set up under Section 406 of the Act had jurisdiction not merely to decide the question of the quantum of the tax but that it had jurisdiction to decide all other questions relating to the tax fixed or charged. It was pointed out to us in the course of the argument that the fixation or the charging of a tax might be disputed by an assessee not only on the ground that the quantum or the amount claimed was bad but also on some such grounds as (i) that the assessee was primarily or even secondarily not liable for the payment of the tax claimed (ii) that the property on which or in respect of which the tax was sought to be levied was not liable for the tax and (iii) that the steps antecedent to the assessment of the tax were defective and rendered the recovery of the tax illegal. Mr. Vakil contended that the scheme of the Act and the Act according to the definition clause includes the Rules enacted in the Schedule aforesaid disclosed that all these questions could be gone into by the tax tribunal. Mr. Vakil however conceded that the tax tribunal had no jurisdiction to decide the question as to whether the tax was ultra vires the Act We may say that prima facie many arguments advanced by Mr. Vakil were weighty and deserved very serious consideration. However ultimately we came to the conclusion that for the purpose of disposing of the two appeals it was not necessary to decide whether the tax tribunal had or had no jurisdiction to decide questions relating to the fixation or the charging of the tax other than the questions relating to quantum thereof. We did not think it necessary to decide this question because in our judgment even if the contention of Mr. Vakil were right that the tax tribunal had jurisdiction to decide the aforesaid and other questions relating to the assessment of the tax liability the contention that the suits were not maintainable cannot be upheld. In view of this conclusion of ours we did not hear the arguments of Mr. Shah Learned Counsel for the two plaintiffs on the aforesaid controversy as to the questions which could be decided by the tax tribunal. In our judgment even if the contentions of Mr. Vakil are accepted the Civil Court will have still jurisdiction to entertain the two suits aforesaid and its jurisdiction is not barred. We propose to set out reasons for reaching this conclusion just in a moment.

8. Before dealing with the subject in hand in our judgment it will be convenient to set out the main principles on which Mr. Vakil relies in support of his arguments. In the present litigations we are concerned with the liability of the two plaintiffs to pay the property taxes imposed by the Corporation under Section 127 of the Act. Mr. Vakil is right in contending that the liability to pay the property tax claimed from the two plaintiffs is a liability created by a statute. There is no dispute about this. Basing himself upon this admitted position Mr. Vakil con tends that the present cases fall within the purview of the third principle enunciated by Willes J. in the case of Wolver Hampton New Water Works Co. v. Hawkesford 6 C.B. (N.S.) 336 at page 356 in his following classical passage which has been accepted in several cases as an authoritative pronouncement:

There are three classes of cases in which a liability may be established founded upon statute. One is where there was a liability existing at common law and that liability is affirmed by a statute which gives a special and peculiar form of remedy different from the remedy which existed at common law; there unless the statute contains words which expressly or by necessary implication exclude the common law remedy the party suing has his election to pursue either that or the statutory remedy. The second class of cases is where the statute gives the right to sue merely but provides no particular form of remedy there the party can only proceed by action at common law But there is a third class viz where a liability not existing at common law is created by a statute which at the same time gives a special and particular remedy for enforcing it.... The remedy provided by the statute must be followed and it is nor competent to the party to pursue the course applicable to cases of the second class. The form given by the statute must be adopted and adhered to.

In our judgment the third principle aforesaid on which Mr. Vakil relies does not apply to the facts of the two cases. The passage deals with the question of enforcing a statutory liability. The person who is entitled to enforce that statutory liability is the Corporation and not the two plaintiffs and therefore the limitation for enforcing that liability if there is any applies to the Corporation and not to the plaintiffs. It is true that the principle has been extended to the enforcement of a statutory right as well:-see Hurdutrai v. Official Assignee of Calcutta (1948) 52 C.W.N. 343 at page 349. But it is quite clear from the facts narrated above that the right which the two plaintiffs claim to enforce is not a right given to them by the Act. Prom the summary of the two plaints which we have already given it is abundantly clear that the right which the two plaintiffs claim and the liability of the Corporation which they seek to enforce is the right of the plaintiffs to recover an amount illegally recovered from them and the liability of the Corporation to refund an amount so recovered the withholding of which amount would be a wrongful act on their part. The right which the plaintiffs claim and the liability of the Corporation to refund an amount so recovered the withholding of which amount would be a wrongful act on their part. The right which the plaintiffs claim and the liability which they seek to enforce do not arise under the Act but they arise de hors the Act and under the general law of the land. In the case of Firm of llluri Subbayya Chetty and Sons v. State of Andhra Pradesh reported in : [1963]50ITR93(SC) at page 324 Their Lordships of the Supreme Court have indicated the correct approach to a problem of the aforesaid kind. The relevant observations are as follows: In dealing with the question whether Civil Courts jurisdiction to entertain a suit is barred or not it is necessary to bear in mind the fact that there is a general presumption that there must be a remedy in the ordinary civil courts to a citizen claiming that an amount has been recovered from him illegally and that such a remedy car be held to be barred only on very clear and unmistakable indications to the contrary. The exclusion of the jurisdiction of Civil Courts to entertain civil causes will not be assumed unless the relevant statute contains an express provision to that effect or leads to a necessary and inevitable implication of that nature.

The question may be looked at from another angle also. In effect the grievance of the two plaintiffs is that moneys which rightfully belonged to them have wrongfully passed into the hands of the Corporation without the authority of law. Article 265 of the Indian Constitution says that no tax shall be levied or collected without the authority of law. It must follow from this constitutional provision that if anybody levies or collects any tax without the authority of law then the levy or collection would be an illegal act. Section 9 of the Civil Procedure Code enacts that the Civil Court has got jurisdiction to entertain every suit of a civil nature unless cognizance thereof is barred by any law. The right to receive back an amount illegally recovered is cleary a right of a civil nature Therefore the ordinary Civil Court will have jurisdiction to deal with a dispute wherein the citizen alleges against a statutory corporation that it has levied or collected a tax from him without the authority of law and the burden will be upon the Corporation to prove that such jurisdiction is barred by any law either expressly or impliedly. Maxwell enunciates the same principle at page 122 in his 11th Edition of Interpretation of Statutes in the following passage:

It is supposed that the legislature would not make any important innovation without a very explicit expression of its intention especially since in recent years such an intention has often been very explicitly expressed It would not be inferred for instance from the grant of a jurisdiction to a new tribunal over certain cases, that the legislature intended to deprive the superior court of the jurisdiction which it already possessed over the same cases.

Therefore in order to succeed the Corporation must show that the provisions contained in the Act bar either expressly or impliedly the jurisdiction of the ordinary Civil Court. That is the main point which requires to be decided in the two appeals.

9. Mr. Vakil conceded that there was no express bar to the jurisdiction of the ordinary Civil Court enacted in the Act. However he contended that the Act bar by necessary implication the jurisdiction of the ordinary Civil Court. For this purpose Mr. Vakil mainly placed reliance upon Section 406 Sub-section (1) already quoted We have already indicated that we propose to assume for the purpose of the present two appeals that the tax tribunal has got the power to decide the validity or otherwise of the grounds on which the two plaintiffs challenge the levy or the collection of tax. But a finding that the tax tribunal has been given such a power cannot necessarily lead to the conclusion that the jurisdiction of the ordinary Civil Court is barred thereby. In the case of Firm Seth Radha Kishan (deceased) represented by Had Kishan and Ors. v. Administrator Municipal Committee Ludhiana reported in : [1964]2SCR273 Their Lordships summarize the law on this subject as follows at page 1551:

Under Section 9 of the Code of Civil Procedure the Court shall have jurisdiction to try all suits of civil nature excepting suits of which cognizance is either expressly or impliedly barred. A statute therefore expressly or by necessary implication can bar the jurisdiction of civil Courts in respect of a particular matter. The mere conferment of special jurisdiction on a tribunal in respect of the said matter does not in itself exclude the jurisdiction of civil Courts.

In Firm of Illuri Subbayya Chetty and Sons case Their Lordships have made the following observations which are pertinent immediately after the passage already cited:

The mere fact that a special statute provides for certain remedies may not by itself necessarily exclude the jurisdiction of the civil Courts to deal with a case brought before it in respect of same of the matters covered by the said statute.

It is one thing to say that a tribunal has got jurisdiction to decide a particular matter and a totally different thing to say that no other tribunal has jurisdiction to do so. There are several instances of more than one Court having concurrent jurisdiction over one and the same subject-matter. Therefore in order to resolve the controversy it is not enough for a Court to record a finding that a tax tribunal has got jurisdiction to deal with a subject-matter. In order to succeed the person pleading the bar must be able to show that the tax tribunal has been given exclusive jurisdiction. The exclusive jurisdiction may be found by necessary implication. Now in order to substantiate this point Mr. Vakil relied upon the principle that where a statute itself creates a liability and also provides for the necessary machinery for deciding about the existence or nonexistence of that liability then the jurisdiction of the ordinary Civil Court must be regarded to be barred. There are cases where it has been held that where a taxing statute enacts provisions which constitute a complete Code in itself for dealing with the liability created thereby then the jurisdiction of the ordinary Civil Court would be barred vide Privy Council case of Raleigh Investment Co. Ltd. v. Governor-General In Council reported in 49 Bombay Law Reporter 530. But the validity of this argument of Mr. Vakil would depend upon the recording of a finding that the Act provides such a complete Code for the determination of the tax liability. Mr. Vakil has not been able to convince us about the correction of this submission. On the contrary in our judgment Section 413 of the Act by implication shows that such is not the legal position. A perusal of the Act relating to tax liability created thereby shows that the following stages are gone through before a tax liability comes into existence. These stages apply not merely to the liability in respect of a property tax but also the liabilities created in respect of a number of other taxes. Section 127 of the Act provides for the imposition of two compulsory taxes and a number of other optional taxes. Therefore the first stage is the stage of the imposition of a tax. The second stage is the stage of the levy of the tax. At this stage the Corporation decides the property on which and the person on whom the tax is to be levied. Each year under Section 99 of the Act the Corporation determines the rate at which and in the case of optional taxes the extent to which the tax is to be levied. Then comes the stage of assessment of a tax. At this stage the Commissioner undertakes the task of assessing a property or a person to the tax. Elaborate provisions have been enacted in the Taxation Rules in this connection and they show the various steps which have to be taken in the matter. The steps which have been prescribed in the Taxation Rules differ according to the different types of taxes. Having regard to the fact that Section 406 deals with the liability created by any of the aforesaid taxes and not merely one or the other of them it would not be proper to construe the provisions of Section 406 only with reference to the provisions contained in the rules relating to the property taxes as appears to have been done in some of the cases previously mentioned in the course of this judgment. Pausing here for a moment it is crystal clear that if a dispute of a civil nature arises on account of any of the aforesaid steps taken by the Corporation but before the tax levy or assessment the tax tribunal will have no jurisdiction to deal with it. Section 406 aforesaid clearly shows that the appeals are to be against any rateable value or tax fixed or charged under this Act. It is quite clear from this provision that the stage at which the appeal is to be preferred is the stage after a rateable value is fixed or a tax is fixed-or charged under the Act. It is only when the stage of fixation of the rateable value or the fixation or the charging of the tax has been reached that the right to prefer an appeal accrues to the aggrieved person. This is also quite clear from a number of provisions contained in Sub-section (2) of Section 406 of the Act which enumerate the various limitations imposed or the disabilities created for hearing tax appeals. The Taxation Rules show that rateable value is to be fixed for the purpose of assessing properties to each of the property taxes that is water tax general tax and conservancy tax. For this purpose the rules enjoin on the Commissioner to keep an assessment book in which first a rateable value in respect of a property has to be shown and then a public notice has to be published wherein inter alia a date has to be mentioned as the last date for receiving the objections in relation thereto. The rules enjoin on the Commissioner further to decide that objection and certain other objections which can be raised under certain circumstances relating to the mention of the name of any person primarily responsible for the payment of property taxes in the assessment book and the treatment of such property for its liability to be assessed to general tax. After the complaints in relation to all these matters have been decided the Commissioner is enjoined to incorporate the amendments if any consequent upon such decision in the assessmentbook and then to authenticate the assessment-book and to append a certificate thereto under his signature that no valid objection requiring amendment was received relating to the rateable value. After the certificate has been granted and the authentication has been done by the Commissioner the Taxation Rules enjoin upon him further to mention the amount at which each building or land entered in such portion of the assessmentbook is assessed to each of the property-taxes if any leviable thereon. Sub-rule (2) of Rule 19 provides that upon such authentication and certification taking place the assessment-book subject to such alterations as may thereafter be made therein under the provisions of Rule 20 shall be accepted as conclusive evidence of the amount of each property-tax livable on each building and land in the ward in the official year to which the book relates. Rule 20 confers a power upon the Commissioner to amend the assessment-book during the currency of the official year and provides for the same procedure to be followed in relation to an amendment which has the effect of increasing the rateable value of any premises or of imposing any liability on any person for the payment of property taxes. Therefore the stage at which the tax tribunal can be approached in respect of the fixation of the rateable value is the stage after the Commissioner has taken a decision on that subject and the tax tribunal has the authority to decide the question about the rateable value subject to the limitation imposed in Clause (e) of Sub-section (2) of Section 406 of the Act which says that if an appeal against a rateable value is made after a bill for any property-tax assessed upon such value has been presented to the appellant the amount claimed from the appellant must have been deposited by him with the Commissioner. As regards the right of preferring an appeal against a tax fixed or charged under the Act Rule 39 enacts that a bill is to be tendered for the payment of property-tax or tax on vehicles boats and animals or any tax declared by or under this Act to be recoverable in the manner provided for a property tax or any installment of any such tax shall become due. That bill is to specify the period for which and the premises property occupation vehicle boat animal or thing in respect of which the tax is charged and shall also give notice of the time within which an appeal may be preferred.... As regards the octroi and toll taxes the rules say that they are to be paid on demand and bills are to be presented to every person on whom the demand is made specifying in the case of octroi the goods taxable the amount claimed and the rate at which the tax is calculated and in the case of toll showing the amount of toll and the rate at which it is claimed. As regards the theatre tax a different procedure is laid down and it is made payable at the municipal office at least twelve hours In advance of the commencement of the performance In respect of which the tax is due. All these provisions show that the stage for preferring an appeal to the tax tribunal arises in a majority of cases after the bills are presented as aforesaid. After the bills are so presented in the aforesaid cases the person aggrieved by the fixation or the charging of the tax has a right to prefer an appeal to the tax tribunal and if the aggrieved person complies with such of the provisions contained in Sub-section (2) of Section 406 of the Act as may be applicable he has a right to have his appeal heard by the tax tribunal In this connection Clause (e) of Sub-section (2) of Section 406 is relevant a portion of which has already been mentioned above. At this stage we may quote the clause in full.

No such appeal shall be heard unless(e) in the case of an appeal against a tax or in the case of an appeal made against a rateable value after a bill for any property tax assessed upon such value has been presented to the appellant the amount claimed from the appellant has been deposited by him with the Commissioner.

Therefore in the case of a tax liability which a citizen challenges after a bill has been presented therefor the citizen must deposit the amount of the bill with the Commissioner. This deposit is not tantamount to payment of the bill. The tax tribunal decides all the points relating to the tax liability which may have been raised but it is not expected to make any order for the return of the deposit. The latter duty has been cast on the Commissioner by Sub-section (2) of Section 413 which enacts that Effect shall be given by the Commissioner to every decision of the said Judge on any appeal against any such value or tax. Now a tax liability may be challenged as already stated not merely on the ground that the rateable value fixed on the premises was not the correct value but also on the grounds that the person from whom the tax is sought to be levied was not either primarily or secondarily liable therefore or that the rate at which the tax is sought to be levied is not the correct rate and a number of other grounds. Supposing a person pays a bill instead of depositing its amount and does not prefer an appeal under Section 406 and later on he wants to challenge either the amount of the bill or his own liability or the validity of the tax imposed upon him the question for consideration is whether all or any of these points is barred. Having regard to the fact that the rules do not make the entry relating to the primary liability of an individual conclusive is it nr is it not open to an individual to challenge that liability of his by contending that the tax was recovered from him even though he was not primarily or secondarily liable under the Act? There is no direct answer to this question either in Section 406 or any other provision of the Act. Before answering the question on the basis of the scheme of taxation already noticed the provisions contained in Sections 410 411 and 413 of the Act must be noticed. Section 410 confers jurisdiction upon the tax tribunal to refe any question of law or usage having the force of law or the construction of a document for the decision of the District Court. Section 411 provides for an appeal to the District Court under certain circumstances from a decision of the tribunal in respect of the fixation of a rateable value in excess of two thousand rupees and in respect of other decisions upon a question of law or usage having the force of law or the construction of a document. These two provisions show that a tax tribunal and the District Court have the power to decide questions of law and construction of documents arising in tax appeals. Section 413 Sub-section (1) then provides as follows:

413 (1). Every rateable value fixed under this Act against which no complaint is made as hereinbefore provided and the amount of every sum claimed from any person under this Act on account of any tax if no appeal therefrom is made as hereinbefore provided and the decision of the Judge aforesaid upon any appeal against any such value or tax if no appeal is made there from under Section 411 and if such appeal is made the decision of the District Court in such appeal shall be final.

Therefore Section 413 deals with the question of finality of certain matters which may arise in tax appeals and the extent of the finality of such matters depends upon the fact whether an appeal has or has not been preferred. If no appeal is preferred then two things are made final: (i) rateable value fixed under the Act and Act under Section 453 of the Act includes the Rules including the Taxation Rules and (ii) the amount of every sum claimed from any person under the Act on account of any tax. If an appeal is preferred then the decision of the Judge is made final and if a second appeal is preferred the decision of the District Judge is made final. Prom these provisions it is quite clear that if an appeal is not preferred then what would become final are the aforesaid two matters of rateable value and the amount of the claim. The other points on the basis of which a tax liability could have been challenged such as the liability of a person to pay the amount are not made final by Section 413 in express terms. At the most what would become final would be the steps which precede the determination of the amount of the sum claimed in the bill which in the case of property tax has been further made conclusive by Sub-rule (2) of Rule 19 of the Taxation Rules. If an appeal is preferred to the tax tribunal and if it happens to give a decision on the aforesaid and similar other subjects then that decision also would be final and on the assumption that we have made as the decision of the Judge may include a decision on any of the several grounds on which a tax liability can be challenged it may be assumed that the decision of the Judge on those other points also would be final. The same situation will also obtain in the case of decisions reached by the District Court. But an analysis of Section 413 clearly shows that the other grounds on which a tax liability can be challenged do not become final in the case of non-preferment of a tax appeal. In our judgment if the Legislature intended to invest all the grounds on which a tax liability could be challenged with the quality of finality then the aforesaid distinction which the Legislature has made about the things which would be final would be totally out of place. In our judgment this is a clear indication of the fact that the Legislature does not intend to make the complaints on points other than the rateable value or the amount of the claim to be final if no tax appeal is preferred It also becomes clear that even if an appeal comes-to be preferred before a thing can be final there must be a decision of the tribunal or the District Court on the subject. Even assuming that any principle analogues to the principle of constructive res judicata is applicable and that all the grounds on which a tax liability could have been challenged in an appeal must be taken to have been decided impliedly by the tribunal or the District Court even if they are not expressly so challenged and decided even then it is only when an appeal or appeals are preferred that this principle will be applicable. In our judgment if really the jurisdiction of the Civil Court was intended to be barred absolutely by the Legislature by the enactment of Section 406 simpliciter or by the scheme of the Act it is hardly probable that the Legislature would have enacted Section 413 in the way in which it has done. It is undoubtedly true that the Legislature did intend to invest certain matters with the quality of finality. But if the jurisdiction of the Civil Court is intended to be totally barred it is hardly probable that the Legislature would have invested only certain things with that quality in case an appeal was not filed and certain other things in case an appeal was filed. Under the circumstances in our judgment Section 413 of the Act is a clear indication of the legislative mind that the jurisdiction of the Civil Court was not intended to be barred in respect of all the matters on which a tax liability could have been challenged before the tax tribunal. Any provision express or implied in any statute ousting the jurisdiction of a Civil Court must be strictly construed. The bar if not express must follow as a necessary implication Even assuming that there is force in the argument of Mr. Vakil that when a statute provides a complete Code for disputing a tax liability the jurisdiction of a Civil Court is barred by necessary implication in our judgment the existence of Section 413 on the statute book clearly shows that the machinery provided by the Act for challenging the tax liability is not a complete Code in itself. The above considerations must also negative another submission of Mr. Vakil based upon certain observations made by Maxwell on Interpretation of Statutes Eleventh Edition at page 126 wherein the learned author has dealt with the question of ouster of jurisdiction of an ordinary Court by necessary implication. Under the circumstances in our judgment the provisions contained in the Act do not exclude the jurisdiction of the ordinary Civil Court to deal with all the matters which could have been raised in a tax appeal for challenging the tax liability. Whether any of the aforesaid matters raised in the two suits falls within the bar created by Section 413 of the Act is not a matter which falls to be decided in the present two appeals. That is a question which the trial Court will have to decide if and when it happens to be raised in both or any of the two matters. But it is quite clear that any matter which is raised under Section 413 is not a matter which relates to the jurisdiction of the Civil Court. That will be a matter on its own merits. In other words it may be that the points which the plaintiffs seek to raise in the present two appeals may have become final under Section 413. But that is a matter which the Civil Court having jurisdiction in the matter will have to decide. The position in such a case would be analogous to the position which obtains when a person files a suit which is barred by the principle of res-judicata. When a matter is barred by the principle of res judicata it is not correct to say that the Court has got no jurisdiction to entertain the second suit. The correct legal position is that the Court has jurisdiction to entertain the suit but that if the Court decides that the principle of res judicata applies the suit is barred. The Court has got jurisdiction to consider and decide whether that principle applies or not. There is a vital distinction between the loss of jurisdiction of a Civil Court and the finality of a matter which may be raised in a litigation. It may be that there may be no substance whatsoever in a particular claim made before a Civil Court and the claim may come to be dismissed the moment a statement thereof is made. But then in such a case the claim fails not because the Court has no jurisdiction but because the claim has no merit as it is made conclusive by law. Every citizen has the privilege or luxury to file even a frivolous and false suit. Such a suit may be liable to be dismissed The jurisdiction of a Court does not depend upon the strength or weakness of a case which is brought before it but it depends upon the extent of the power which the Court possesses to deal with that matter and decide the same. In our judgment therefore the point on which the Corporation essentially seeks to non-suit the plaintiffs is not the point of jurisdiction of the Court. Probably what the Corporation has in mind is Section 413 of the Act. The Civil Court has got jurisdiction to consider the validity or otherwise of that submission of the Corporation and has a right to decide upon the same. If the matter falls within the purview of Section 413 of the Act then the suit will be dismissed on that ground. If it does not so fall then it is quite clear that the matter if it is of a civil nature does fall within the purview of the jurisdiction of the Court. It may be that in a given case some further relief which a citizen may otherwise be entitled to it may not be proper or expedient for the Court to give because some other matter has become final under Section 413 as for example it may be open for the Corporation to contend that because the amount of the bill has become final no relief can be granted on the basis of the nonliability for the tax or on the ground that the rate at which the tax is charged is not the correct rate or on the basis that the person to whom the bill is issued is not primarily or secondarily liable for it. But all these are matters which pertain to the domain of the merits of the case and not to the jurisdiction of the Court. Therefore in our judgment the decision which was arrived at by the learned District Judge was correct but for different reasons and the two appeals deserve to be dismissed However in view of the fact that the contention of the respondent is being upheld on a ground different from that on the basis of which the decision was obtained by the respondent in the District Court in our judgment it will be proper if each party is directed to bear its own costs. Appeals dismissed. No order as to costs.


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