M. M. Ismail, J.
1. Writ Appeal No. 218 of 1972 has been filed against the Judgment of Ramaprasada Rao, J., dated 20th July, 1972 dismissing W.P. No. 777 of 1972, filed by the appellant herein. The Palayamcottai Municipality owns a public market known as the Municipal Mahatma Gandhi Market and the appellant herein happened to be a licensee of stall Nos. 1 and 2 in Block No. 9 of the said market. He filed the writ petition (W.P.No. 777 of 1972) praying for the issue of a Writ of mandamus or any other appropriate writ, order or direction forbearing the respondents therein 'from enforcing or collecting the increased fees for the use of the stalls, shops, pans and stands situated in the Mahatma Gandhi Market at Palayamcottai, pursuant to the resolution passed by the first respondent, namely, the Municipal Council, No. 1518 (1 to 7) dated 14th February, 1972. The said market has been established several years ago and is maintained out of the Municipal funds. The market consists of a large number of stalls and one portion of the market is reserved as fresh market. Certain other stalls in another portion are reserved as mutton stalls. In addition to there being a regular market, a weekly shandy or fair is also held every Thursday. On such shandy days, a large number of vendors come to the market to sell their goods. The first respondent-Municipal Council had been farming out the right to collect the fees in the market year after year, as provided for in section 260 (2) of the Tamil Nadu District Municipalities Act, 1920, hereinafter refened to as the Act. The Commissioner of the Palayamcottai Municipality in February, 1972, put up a proposal to the first respondent-Municipal Council to enhance the fees fixed for the various stalls. At a meeting of the Council held on 14th February, 1972, the first respondent-Municipal Council adopted a resolution No. 1518 by which it raised the fees fixed for the shops situate inside the market by 75 per cent, and for the stalls situate along the perimeter of the market by 100 per cent. Similar enhancements were resolved upon in respect of other fees. The necessary notification was published on 16th February, 1972, in the local dailies, Dhina Thanthi and Dhina Malai. The date of auctioning the right to collect the fees in the market was fixed at 10th March, 1972. The schedule of rates in respect of each stall had been mentioned in the auction notice, which was circulated. The second respondent herein was the highest bidder in the auction held on 10th March, 1972, and his bid amount was Rs. 1,61,600 and the same was accepted by the first respondent-Council by its resolution No. 1590, dated 24th March, 1972. The right that was sold in auction was the right to collect the fees in the market for the financial year commencing from 1st April, 1972 to 31st March, 1973. It is under these circumstances the appellant herein filed the above writ petition for the reliefs referred to above on 5th April, 1972. In the affidavit filed in support of the writ petition, in addition to several other grounds, one of the grounds raised was that no notice or opportunity Was given to persons like the appellant to show cause against the enhancement of the licence fees. According to the appellant, subsequent to the resolution of the Municipal Council referred to above, 17 members of the Municipal Council, whose strength has 32, submitted a requisition for a meeting of the Municipal Council to reconsider the Resolution No. 1518 and although the Chairman called for, what was turned out to be an 'informal meeting' on 4th March, 1972 and all the 17 members who submitted the requisition were present at the so called 'informal meeting', the Chairman and the other members were not present and hence no useful diseussion or review of Resolution No. 1518 took palce. On the other hand, the first respondent in its counter-affidavit pointed out that the stall-holders did not submit any petition requesting to withdraw the enhancement as alleged; that an urgent meeting of the Council convened for 9th March, 1972, could not be conducted for want of quorum; that even the members who . requisitioned the meeting Were not present on that day; and that it was not correct to state that an informal meeting was held on 4th March, 1972.
2. It is against the background of these allegations, the point was raised before Ramaprasada Rao, J., that the appellant herein was not effectively notified about the increase and he and other stall-holders, as aggrieved parties, were not consulted in the matter. The learned Judge, after referring to the facts as emerged from the affidavit and the counter-affidavit, held that in the circumstances and in the facts of the case, he was satisfied that the appellant herein did not raise his little finger against the impost; nor was there any effective opposition made for the prevention of the public auction as proposed in the dailies on 10th March, 1972. In view of this, the learned Judge dismissed the writ petition on 20th July, 1972, as mentioned already.
3. Though the only point that was argued before Ramaprasada Rao, J., was the one relating to the appellant not having had effective opportunity to contest the enhancement of the fees, before us that point was not urged, but the right of the first respondent-Municipal Council to enhance the fees itself Was challenged. For the purpose of understanding how the writ appeal happened to be argued before us in this manner, it is necessary to refer to certain other facts.
4 The Tirunelveli Municipality, which is also conducting a public market known as Nethaji Bose Market, enhanced the fee payable by the different stall-holders. Challenging the said enhancement, W.P. Nos. 913, 978 to 988 and 1076 to 1078 of 1970 were filed. The contention raised on behalf of the petitioners in those writ petitions was that under Section 260 (2) of the Act, the Municipal Council could collect only fees commensurate to the services it rendered and there being no correlation between the quantum of the fees demanded and the expenses incurred by the Municipal Council in rendering services to the said public market, the enhancement of the fees was illegal and unauthorised. The said writ petitions were disposed of by Ramaprasada Rao, J., on 25th. September, 1970. The learned Judge, after an elaborate consideration of the question held:
In conclusion I have to hold that the impost in the instant case is not a tax but certainly it is not a fee which is governed by the doctrine of quid pro quo but is a compulsory exaction sanctioned by statute and being annexed with the right of ownership of property, the owner of the public market has the right to vary it by increasing or diminishing it after notice and after such fixation, recover the same from the stall-holder.
Against the judgment of Ramaprasada Rao, J., the petitioner in W.P. No. 981 of 1970 preferred W.A.No. 102 of 1971. The said writ appeal was dismissed in limine at the stage of admission itself on 18th March, 1971 by a Bench of this Court. The Judgment in the said writ appeal is a short one and the same is as follows:
On facts, it appears the Municipality has arranged to license each market to the highest bidder. According to the appellant, this is not open to the Municipality. The argument is that the expression 'levy a fee' presupposes that the Municipality itself should fix the fee and that Section 260 (2), in so far as it postulates farming out of such fees, loes not contemplate that each building could be licensed to the highest bidder at an auction. We do not think it is necessary to decide in this case whether the nature of the levy is a fee or a tax or some kind of statutory collection, as Ramaprasada Rao, J., is inclined to think. What matters is the scope of the power under Section 260 (2) of the Madras District Municipalities Act. Looking at the power provided by that provision, we have no doubt that it does include the power to license each building to the highest bidder. It is no doubt true that in constructing and providing markets the Municipality discharges a public duty. Even so, it is entitled to a return for the use of the market, and for such use. it is entitled to levy a fee. There is nothing in Section 260 (2) that such a fee it can levy only in respect of a collection of buildings and that too by previous fixation, or farming out the buildings together, Once it has the power to license the markets for fees to be collected in any manner stipulated in the sub-section, it includes also the power, in our view, to license a single market among others to the highest bidder.
On that view, the appeal is dismissed.
It is in view of these earlier proceedings alone, before Ramaprasada Rao, J., the other points dealt with by the learned Judge on the earlier occasion were not argued and the only point with regard to the appellant not having been given an effective opportunity to represent his case against enhancement of the fees was put forward. As a matter of fact, even that case was put forward only because of the reference to a notice occurring in the conclusion of the learned Judge extracted above.
5. Before us, Mr. M. K. Nambiar, learned Counsel for the appellant, contended that since the Bench in W.A. No. 102 of 1971 had stated that it was not necessary to decide whether the nature of the levy was a fee or tax or some kind of statutory collection, as Ramaprasada Rao, J., was inclined to think, the Bench must be deemed to have left that question open, even though it dismissed the writ appeal and consequently the appellant can canvass the correctness of the conclusion of Ramaprasada Rao, J., in the said Writ petition before us in this writ appeal. No objection was taken on behalf of the respondents to the course suggested by Mr. Nambiar, and therefore we heard arguments on the validity of the enhancement of the impost resolved upon by the Municipal Council.
6. The writ petitions, namely, W.Ps. Nos. 1122, 1133 and 1136 to 1142 of 1972, have been filed by the stall-holders in the Netaji Market being a public market owned and run by the Vellore Municipal Council. They also contend that the license fee in respect of the stalls has been increased from time to time and by Resolution No. 1284, dated 28th February, 1972, the Municipal Council resolved to enhance the then existing rate by 10 per cent, with effect from 1st April, 1972, and that such enhancement is illegal and unauthorised, since it bears no correlation whatever to the expenditure incurred by the Municipal Council in the supervision and running of the market. In support of this contention, they have given figures of income and expenditure for various years, as culled out from the Administration Reports of the Municipality. One point of distinction between the cases in these writ petitions and the case in the writ appeal is that in the cases of the writ petitions, the fees in regard to the permanent stalls were being collected by the Municipal Council directly without the same being farmed out, as it has happened in the case covered by; the writ appeal. Mr. T.R. Mani, learned Counsel, who appears for the Writ petitioners merely adopted the arguments of Mr. M.K. Nambiar, learned Counsel for the appellant in the writ appeal.
7. The contention of Mr. Nambiar, is that a Bench of this Court to which one of us was a party, has in W.A. Nos. 22 to 24 and 190 and 191 of 1968 held that in the Act, fees and tax have been dealt with separately and therefore there is no scope for contending that the word, 'fees' occurring in Section 260 (2) of the Act means, 'tax'; once Section 260 (2) of the Act uses the word, 'fees', that refers to the levy imposed by the Municipality to recoup the expenses incurred for the services it renders to the market in question and therefore the test of quid pro quo must be satisfied by the quantum of levy imposed by the Municipality; that in this case admittedly the Municipality did not seek to defend the levy of the enhanced fees on the basis of the expenditure incurred by it in rendering services to the market having gone up and therefore it did not contend that for the enhanoed levy there is quid pro quo; that consequently the enhancement of the fees resolved upon by the Municipality is illegal and unauthorised; that the Municipality, being a statutory corporation, can exercise only such powers and functions as have been expressly conferred on it by statute and the only power with reference to the public market that has been conferred on a Municipality being a power to levy fees, it cannot seek to levy anything else; and that, the concept of 'compulsory exaction sanctioned by a statute' adumbrated by Ramaprasada Rao, J., as distinguished from tax or fees, is something not contemplated by the statute itself and therefore the enhancement of fees in the particular case cannot be supported or sustained on any such ground.
8. As against this, Mr. V.K. Thiruvenkatachari, learned Counsel appearing for the respondents, contended that neither the appellant in the writ appeal nor the petitioners in the writ petitions can seek any remedy under Article 226 of the Constitution of India, since no right of theirs can be said to have been affected by the impugned resolutions of the Municipal Councils, for admittedly they were entitled to use the stalls in the market-only up to 31st March, 1972 ; and not having any right to continue to use the stalls after 31st March, 1972, they cannot complain against the enhancement of the fees for the period from 1st April, 1972 onwards. His second contention is that the fee contemplated by Section 260 (2) of the Act is not a fee in the sense of being charges for certain special or specified services rendered by the Municipal Council to the stall-holders, but it is in the nature of a fee for the license granted by the Municipal Council to various stall-holders enabling them to make use of the property of the Municipal Council and therefore the claim for enhanced fees is derivable from the ownership of the market by the Municipality and with reference to such fees, the statute itself does not impose any restriction whatsoever. The payment of fees is-not compulsory exaction since a person like the appellant and the petitioners, in these cases has always the option to pay the fees demanded by the Municipality and make use of the stall or not tome the stall, if he is not inclined to pay the said fees, whatever the reasons may be;, and certainly it is not open to such a. person to contend that he will squat on the property, but at the same time will pay what he considers to be a reasonable fee, and not what the owner demands of him. His further contention is that the fees in these cases should not be confused with a license fee, namely, a fee levied for the grant of a license with the object of regulating and supervising the carrying on of a trade, occupation or activity and the fee in this context is really a fee or consideration for a license in the sense the expression license has been defined in Section 52 of the Easements Act, 1882.
9. Before we deal with these contentions, it is necessary to refer to the relevant statutory provisions Section 259 of the Act provides that all markets which are acquired, constructed, repaired or maintained out of the Municipal funds shall be deemed to be public markets; and such markets shall be open to all persons of whatever caste or creed. Sub-section (1) of Section 260 states that the Council may provide places for use as public markets. Sub-section (2) of Section 260 is as follows:
The Council may in any public market levy any one or more of the following fees at such rates and may place the collection of such fees under the mangement of such persons as may appear to it proper or may farm out such fees for any period not exceeding three years at a time and on such terms and subject to such conditions as it my deem fit:
(a) fees for the use of, or for the right to expose goods for sale in, such markets;
(b) fees for the use of shops, stalls, pens or stands in such markets;
(d) fees on animals brought for sale into or sold in, such markets; and
(e) license fees on brokers, commission agents, weighmen and measurers practising their calling in such markets.
Sub-section (3) enables the Municipal Council, with the sanction of the State Government, to close any public market or part thereof. Section 261 is important and it is as follows:
261. (1) No person shall, without the permission of the executive authority or if the fees have been farmed out, of the farmer, sell or expose for sale any animal or article within any public market.
(2) The executive authority may expel from any public market any person who or whose servant has been convicted of disobeying any by-laws at the time in force in such market and may prevent such person from further carrying on by himself or his servants or agents, any trade or business in such market, or occupying any shop, stall or other place therein and may determine any lease or tenure which such person may possess; in any such shop, stall or place.
Section 262, deals with private market and Sub-section (1) thereof provides that no person shall open a new private market or continue to keep open a private market unless he obtains from the Council a license to do so. Sub-section (2) deals with the time within which an application for the grant of such license by the owner of the place to be used as a private market should be made. Sub-section (3) is important and the same is as follows:
262. (3) The Council shall, as-regards private markets already lawfully established and may, at its discretion, as regards new private markets, grant the licence applied for subject to such regulations as to supervision and inspection and to such conditions as to sanitation, drainage, water-supply, width of' paths and ways, weights and measures to be used, and rents and fees to be charged in such market as the Council may think proper; or the Council may refuse to grant any such licence for any new private market. The Council may however, at any time, for breach of the conditions thereof, suspend or cancel any license which has been granted under this section. The Council may also modify the conditions of license to take effect from a specified date.
Sub-section (4) deals with the notice to be given of the grant, refusal, suspension, cancellation or modification of the license under that section. Sub-section (5) expressly provides that every license granted under that section shall expire at the end of the year. Section 262-A. states that when a license granted under Section 262 permits the levy of any fees of the nature specified in Sub-section (2) of Section 260 a fee not exceeding fifteen per centum of the gross income of the owner from the market in the preceding year shall be charged by the Municipal Council for such license.
10. We would like to point out that the expression, 'fees' as used in different clauses of Sub-section (2) of Section 260, having regard to the context in which it has been used, cannot mean the same thing. Clause (a) of sub-section (2) of Section 260 refers to the fees for the use of, or for the right to expose goods for sale in, such markets. Clause (b) uses the expression 'fees' for the use of shops, stalls, peas or stands in such markets. It will be seen that the expression, 'fees' in these two clauses has been used in the same sense. While clause (a) deals with the use of markets as such, clause (b) deals with the use of shops, stalls, pens or stands in the markets. With reference to clauses (a) and (b), the common feature is that the fee is for the use of the place. Under clause (c), the fee is levied on vehicles or pack-animals carrying, or on persons bringing, goods for sale in such markets, whether they are sold or not. The fees on vehicles or animals will have necessarily to be paid by the person in charge of the same. Therefore, the expression, 'fees' in this clause is not referable to the use of the place as such, as distinct from the fees provided for in clauses (a) and (b). From this point of view, the fees provided for in clauses (a) and (b) are analogous to stallage, while the fees provided in clause (c) are analogous to toll. Clause (d) refers to fees on animals brought for sale into, or sold in, such markets. Here again, what attracts the fees is the bringing of animals for sale into the market or the actual sale of animals in the market, even though the same might not have been brought for sale. From this point of view, the concept of fees in this clause will differ from those in clauses (a) and (b) on the one hand and clause (c) on the other. Clause (e) deals with license fees on brokers, commission agents, weighmen and measurers practising their calling in such markets. Only in this case there is the provision for the levy of license fees on the persons concerned in respect of the practice of their callings by the persons concerned, with a view to avoid any malpractice. It is significant to note that except in clause (e), even the word, 'licence' does not occur in the other clauses.
11. Thus, an analysis of Sub-section (2) of Section 260 of the Act will clearly indicate that the expression 'fees' has not been used in the same sense in all the clauses of the said sub-section.
12. Mr. M.K. Nambiar contended that the expression 'fees' occurring in a statute should have the same meaning throughout the Act. Certainly as a general proposition of law, no objection can be taken to the same. But at the same time, it could not be overlooked that the same expression may take different meanings and colour in the context in which it has been used. Having regard to the context in which the expression 'fees' has been used in all the five different clauses, of Sub-section (2) of Section 260 of the Act, it is clear that the said expression does not mean the same thing in all the said five clauses.
13. It is in view of this alone, Ramachandra Iyer, J., as he then was, in V.S. T. Thanusthaseem Hammepalli Madarasa, Melapalayam, Tirunelveli Distirct, represented by its Huqdar, V.S. T. Syed Thameem v. Melapalayam Municipality, represented by its Commissioner, Melapalayam, Tirunelveli District : AIR1959Mad506 , stated that,
the levy of a fee on vehicles which bring the goods for sale in the market and on brokers, commission agents and wieghmen cannot in any sense be said to be a fee in respect of the occupation of the property.
and we are in entire agreement with that statement. Admittedly, the present cases fall under clause (b) of Sub-section (2) of Section 260. From what we have indicated above, it is clear that the fees referred to in the said clause mean only the fees for the occupation of the particular stall situated in the market of which admittedly the Municipal Council is the owner and therefore there can be no question of quid pro quo in the sense of the said fees being commensurate with the cost of service; rendered by the Municipal Council either to the appellant and the petitioners or to the markets as a whole.
14. Mr. Nambiar, contended that the payment of fees for licence as defined in Section 52 of the Easements Act, 1882, is a contractual obligation, while the payment of fees under Sub-section (2) of Section 260 of the Act is a statutory obligation and once the Municipality has chosen to exercise its rights under Section 260 (2) of the Act, it can collect only such fees as would be commensurate with the services rendered by it and it cannot seek to collect either rent on the basis of a lease or fees on the basis of a licence as defined in Section 52 of the Easements Act, 1882. Though at one stage, Mr. Nambiar contended that the Municipal Council can collect only fees under Section 260 (2) of the Act and it cannot collect any rent for the market of which it is the owner, he, however, conceded before us, as it was conceded before Ramaprasada Rao, J., himself in the batch of writ petitions already referred to that the fees contemplated by clauses (a) and (b) of Sub-section (2) of Section 260 of the Act can include an element of return to the Municipal Council on the investment which it has made in acquiring or constructing the market in question. Once this has been conceded, we are clearly of the opinion that there is absolutely nothing in the statute to put limit on the said element of return. What should be the proper rent payable in respect of the lease of the stalls in the market or the fees payable in respect of a licence granted by the Municipal Council for the use of the stalls will have necessarily to be variable and flexible depending upon the demand for such place in the particular locality at a particular time and therefore there cannot be any hard and fast rule as to what should be the said return. As a matter of fact, the counter-affidavit points out that very recently the Palayamcottai Municipality constructed 20 stalls inside the Municipal Mahatma Gandhi Market and auctioned on 24th January, 1972 the right to enjoy the same upto 31st March, 1974. The highest bid ranged from Rs. 5 to Rs. 9 per day, that is, Rs. 150 to Rs. 270 per mensem in respect of stalls whose plinth areas are 10' X 8' and 12' X4'. It was this which prompted the Municipal Council to enhance the rates for the existing permanent stalls which are much bigger in size than the new stalls, that is, nearly double the size of the new stalls. From the very nature of the case, it should be a subject-matter of bargain between the owner of the property and the person who is permitted to occupy and no person will be willing to occupy a stall unless he thinks that it is worthwhile for him to do so. As a matter of fact, the appellant in the affidavit filed in support of his writ petition has stated that far similar shops situate on the other side of the road opposite to Mahatma Gandhi Market, the rent charged by private owners are roughly equal to or less than the fees fixed by the Municipal Council in the year 1971-1972. That means, the appellant has an opportunity of carrying on his business in a place where he will be liable to pay less than what the Municipality has demanded in the present case. Notwithstanding this, if the appellant chooses to continue his business in the stall in the public market belonging to the Municipality, it cannot be on any other ground except that it is profitable and worthwhile for him to carry on the business in the stall in the public market in question. The position may be different, if there is statutory compulsion that a particular type of business should be carried on only in a public market, in which case the enhancement of the fees or the rents beyond a certain limit may be said to be unreasonable or oppressive. But, here, if the appellant and the petitioners want to carry on their particular business outside the markets in question, there is nothing in law prohibiting them from doing so and if they continue to carry on their businesses in the markets in question, it is solely because they find it profitable to do so and therefore it is not open to them to contend that they will continue to occupy or make use of the Municipal Council's markets on their own terms and not on the terms offered by the owner. So long as there is no statute controlling or regulating the letting of and the rents recoverable from, a property, the owner of the property has the liberty to put his property to the best use possible and obtain the best return. Taking into account that any benefit or advantage the Municipal Council derives in such process ultimately goes to the public, the buildings belonging to such Municipal Councils have been placed out of the operation of the Madras Buildings (Lease and Rent Control) Act.
15. What we have stated above with reference to rents actually applies to fees for licence or permission granted by the Municipality to the various stallholders. In this case there can be no dispute that the appellant and the petitioners are only in the position of licensees as contemplated by the Easements Act. The appellant in paragraph 7 of the affidavit filed in support of the writ petition admitted,
Each stall-holder enjoys the position of a licensee in respect of his stall. The market shall be kept open between 5 A.M. and 10 P.M. every day. During these hours the licensees are permitted to keep their stalls open and carry on their business.
The petitioners in the writ petitions have also stated in the affidavits:
The stall-holders, whether they are considered as lessees or licensees of the Municipality, then relationship is governed by the provisions of the Act, and it is not open to the Municipality in violation of the statute and unilaterally to change the conditions of the lease or license.
Therefore, even they do not claim any status other than that of lessee or licensee. Even apart from such an admission, having regard to the terms and conditions under which the appellant and the petitioners arc allowed to occupy the respective stalls, there can be no doubt whatever that they are only in the position of licensees. Bye-law No. 30 relating to the Palayamcottai Municipality requires every person using the market to execute an undertaking in favour of the farmer of the fees, and if the fees had not been farmed out, in favour of the Commissioner of the Municipality to the effect that he would conduct himself in accordance with the bye-laws, regulations and conditions then in force or any other rules, regulations, conditions or bye-laws that may be promulgated from time to time and without executing such a document, he will have no right to use the market. Bye-law 24 (b) provided that any person who is in occupation of a stall and who locks it up will have to pay three months' fees therefor in advance to the farmer and enter into an agreement with him and if he fails to do so, the farmer will have a right to evict the said person without any prior notice. We have already referred to the fact that the market can be kept open only between 5 A.M. and 10 P.M. and it is during those hours only the stall-holders can carry on their business. With regard to the Vellore Municipality, involved in the writ petitions, special bye-law (1) provided that the market shall be kept open from 5 A.M to 10 p .M. and during other hours, nobody also will be permitted within the market and the market will be closed and none without the permission of the Commissioner or anybody authorised by him can enter the same. Bye-law 12 (i) states that as the Nethaji Market was to be reconstructed, the stall-holders should vacate their stalls and hand over the same to the Municipal authorities whenever they are required to do so. Bye-law 12 (ii) states that for the purpose of effecting repairs or improvements or if the premises are to be made use of for offices the shall-holders may be required to vacate the stalls at any time and if so-required, they are under an obligation to do so on the refund of the proportionate fees. These provisions coupled with the language of Section 260 (2) (a) and (b) of the Act make it indisputably clear that the stall-holders are in the position of only licensees.
16. As a matter of fact, the question-whether the stall-holders are tenants or licensees with reference to the provisions of the Act came to be considered by the High Court of Andhra Pradesh in Veeram Subba Rao v. Commissioner, The Eluru Municipal Council (1955) A.W.R.197, and it held:
A person who occupies a site or stall in a public market is liable for the payment of a market toll or fee and is merely a licensee who is allowed to occupy a small portion of the market for the sale of his goods. He has no interest in the land or building he is allowed to occupy and there is no transfer of any such interest by way of lease in his favour. The dues or fees are payable by reason of the provision of space in a. public market wherein the occupant is allowed to trade and by reason of Sections 259 and 260 of Madras Act V of 1920 which enable such markets to be brought into existence and the Municipal Council to charge fees for the use of the stalls or shops therein. These provisions do not contemplate the transfer of any right to or interest in property in favour of the trader who is allowed to trade in the market on payment of a fee. The payments made by the traders were 'fees' for the use of shops within the meaning of Section 260 (2) of Madras Act (V of 1920) and the traders were 'licensees' within the meaning of sections 52 to 54 of the Easements Act. The license is granted for a consideration in the shape of fee payable by the licensee at the rate fixed by the Municipal Council under Section 260 (2) (b) of Madras Act (V of 1920). The license fee may be increased from time to time if the Municipal Council thinks it reasonable; for Section 13 of the Madras General Clauses Act provides, thinks it (presumably a mistake for the words 'that where') an Act confers a power, the power may be exercised from time to time as occasion requires.
In fact, the employment of the word, 'use' in the context in which it occurs in clauses (a) and (b) of Section 260 (2) of the Act, is more appropriate to a licence than a lease, though there is nothing to prevent the Municipality from leasing out the stalls or any place in the market. In this context, the discussion of the Court of Appeal in Frank Warr & Co., Ltd. v. London County Council (1904) 1 K.B. 713 is instructive. In that case the agreement between persons who were the lessees of the Globe Theatre in the Strand for a term of twenty-one years, described in the agreement as the landlords, and the plaintiffs, therein described as the tenants, contained the following provisions:
The landlords hereby grant and let, and the tenants hereby take for the term of the landlords' lease commencing the first day of September, 1900 the free and exclusive right to sell refreshments at the Globe Theatre, Newcastle Street, Strand, London, with the necessary use of the refreshment rooms and bars and cloak rooms and wine cellars of the said theatre, together with the free right during the usual hours, of the tenants, their servants and agents, of free access to and from all parts of the house, including the front of the theatre, and premises as may be necessary and is usual and proper according to the custom of the theatres, for the purpose of exercising the rights granted by this agreement, and also the free and exclusive right during the aforesaid term of supplying to the visitors and other people attending the theatre wines, spirits, liquors, cigars, cigarettes, flowers, scent, and refreshments of all kinds, programmes, books of words, books of music, opera glasses and all other articles, and of providing cloak rooms and other accommodation, and also the sole and exclusive privilege during the aforesaid term of advertising and letting spaces for advertisements, which shall be confined to the refreshment and cloak rooms and on all programmes used and offered for sale at the said theatre.
The agreement called the consideration payable by the plaintiffs to the landlords as 'rental'. The key of the cellars at the theatre had been given by the lessees to the plaintiffs, who had kept the cellars locked, and used them for the purpose of storing the wines and spirits which were to be sold in the theatre. Advertisements had been affixed by nails to the walls in the parts of the theatre in which by the agreement such advertisements might be exhibited. The London County Council, the defendant in the action, having power to purchase the Globe Theatre compulsorily under the London County Council (Improvements) Act, 1899, which incorporated the Lands Clauses Consolidation Acts, gave notice of their intention so to do in February, 1902, whereupon the plaintiffs claimed compensation in respect of their interest under the above agreement. The question for consideration was, whether the plaintiffs who were described as tenants had any interest in the theatre at all so as to be entitled to claim a share in the compensation or whether they were merely licensees. The Court of Appeal agreeing with Wright, J., held that the agreement was only a license and not a lease and therefore the plaintiffs had no interest in the land entitling them to claim a share in the compensation. Collins, M. R., stated:
Though the word 'let' is used, the subject-matter of the letting is so defined, it seems to me, as most carefully to exclude the idea that any interest in land is to be given. Instead of letting the refreshment rooms or the cellars, the agreement provides merely for the use of them by the plaintiffs so far as is necessary for its purposes. Even if some of the provisions of the agreement, which have been more particularly relied on by the plaintiffs' counsel such as those which give the right to advertise, and let spaces for advertisements and to use cellars, taken alone, might seem to involve an exclusive use of parts of the premises, and prima facie to point to a demise of those parts, they must, I think, be read in connection with the context, and, taking the agreement as a whole, in my opinion the effect of this is merely to provide for the exercise of privileges by the plaintiffs by way of licence, and not to create an interest in land.
Romer, L.J., poited out:
Reliance was placed by the plaintiffs' Counsel upon the words 'necessary use of the refreshment rooms and bars and cloak rooms and wine cellars'. I do not think that it would really make much difference, even if the words used had been 'exclusive use'; for in Edwardes v. Barrington 85 L.T. 650, the words were 'exclusive right to the use of. I think 'necessary use' only means use so far as is necessary to enable the plaintiffs to supply refreshments in the theatre, at the proper times when it is being used as a theatre and certainly does not involve an absolute parting with the possession of those parts of the theatre by the lessees to the plaintiffs. Again, the fact that the lessees appear to have entrusted the key of the cellars to the plaintiffs for the purpose of preventing strangers from getting in makes to my mind no difference.
In our opinion, this decision also supports our conclusion that having regard to the language of Section 260 (2) of the Act and the bye-laws to which we have drawn attention, the position of the appellant and the petitioners was only that of a licensee and what they were called upon to pay by the Municipal Councils were only fees for such licences.
17. The position in this behalf was elaborately considered in Attorney-General v. Colchester Corporation (1952) 2 All E.R. 297. The Corporation of Colchester owned a market held once a week within the borough and also the soil on which the market was held. The market was of very ancient origin and was re-granted by Royal Charter in 1684. For many years, stallage had been charged by the Corporation, but no charge was provided for in any charter, nor had the amount become fixed by statute, statutory order or custom. In 1939 the Corporation adopted for the first time a method of charging stallage according to the linear foot frontage of the sites, and in 1945 a scale of charges was adopted and published by the Corporation under which persons residing within the borough were charged 1s. 3d. per linear foot, persons residing within ten miles of the borough 2s. per linear, foot, and others 1 per linear foot.. In 1949 the charge for the last class was reduced to 10s. per linear foot.. The plaintiff claimed that the charges were unreasonable and excessive and sought an injunction restraining the Corporation from charging excessively. Danckwents, J., held that the stall holders were not compelled to take stalls, but did so for their greater convenience and as the result of voluntary agreement between them and the Corporation of whose published charges they were aware, and, in those circumstances, the stallage could not be attacked on the ground that it was excessive. The learned; Judge in the course of the judgment, pointed out:
The action, therefore, raises an-extremely interesting question on which, there is very little definite authority viz., whether sums required by an owner of a market to be paid for the exclusive occupation of stalls in the market, by virtue of his ownership of the soil on which the market is held, must be limited to reasonable amounts.
The learned Judge father observed:
The common law right of the public was to come into the market, or fair to buy and sell goods, and the public had no right to erect stalls or to place their goods on the ground in the market except for a purely temporary purpose. If a seller attempted to appropriate a portion of the ground to his exclusive occupation, he committed a trespass and could be sued by the owner of the soil, unless he obtained the owner's consent and agreed with him on the payment to be made to him for the privilege or convenience of erecting a stall. This payment was called a 'stallage', and, if holes were made in the soil for poles or posts, it was called a 'pickage'. But it was established that, if a trader erected his stall without previous agreement with the owner of the soil, the owner of the soil might waive the tort and sue in assumpsit on an implied contract.
It is settled beyond doubt that the owner of the market or of the soil was under no obligation to provide any stalls or pens or other such conveniences. His duty at common law was limited to providing a space in which buyers and sellers could meet and conduct their trading...Conversely, the owner of a market owes a duty not to prevent the public exercising their common law rights of resorting freely to the market, and so is liable if he so covers the site of the market with stalls that insufficient room is left for the market to be enjoyed by those who do not wish to take stalls : R. v. Burdett 91 E. R. 996. In essence, therefore, the right to stallage payments is different from the right to take ordinary tolls from buyers of goods, being not dependent on any royal grant (or prescription amounting to the same) but created rations tenurae or by virtue of ownership of the soil (including the possession or occupation of a lessee).
Dealing with the contention that the charges were unreasonable and excessive, the learned Judge proceeded to state:
It is more easily understandable that a condition of reasonableness should be applied to cases where by virtue of the existence of a monopoly the trader has no choice to pay franchise or market tolls, or tolls can be demanded without question by virtue of some custom, where again the trader could not avoid the payment. In such cases it may well have been desirable to provide more effective remedies 'to prevent extortion' (or the extraction of outrageous tolls) by the statute of Westminister the First. But where the trader is under no obligation to incur the charges except for his greater convenience, as in the case of the voluntary taking of a stall by bargain with the owner of the soil, the same considerations do not apply.
(Italics are ours).
The conclusion of the learned Judge was:
My conclusion, is, therefore, that in cases where an agreement for stallage is reached between the owner of the soil and the stall-holder at rates previously agreed, without unlawful compulsion by the exclusion, of any site for common law market activities, it is a voluntary bargain, which cannot be attacked by reason of the amount of the stallage. It is plain that in the present case the necessary conditions must be accepted as being operative. The charges payable to the corporation were announced beforehand and were well known to those who elected to occupy stalls, and there is no evidence that sufficient space was not available to any trader who wished to exercise his common law rights for the purpose of selling his goods in the market.
We are clearly of the opinion that the reasoning of the learned Judge in that case clearly applies to the present cases as well. As we have pointed out already, in the writ appeal, the Municipal Council of Palayamcottai published on 16th. February, 1972 the enhanced rates which were to come into effect from 1st April, 1972. Similarly, in the writ petitions, enhancement of fees was decided upon by the Market Committee on 21st February, 1972 and the same was approved by the Municipal Council, Vellore, on 28th February, 1972 and the enhanced fees were published. If the appellant and the petitioners were rot willing to pay the enhanced fees, certainly they had an option not to continue to occupy the stalls with effect from 1st April, 1972 onwards.
18. Mr. M.K. Nambiar, contended that the said decision was not based upon any statutory provision and therefore cannot be of any assistance to determine the power of the Municipal Council to enhance the fees leviable under Section 260 (2) of the Act. For the reasons we have already indicated as to what the expression, 'fees'- means in Section 260 (2) (a) and (b), we are unable to accept this argument of the learned Counsel. There is also nothing in the Act to render the principles enunciated 'by the learned Judge in the above case inapplicable to the cases on hand.
19. With regard to the contention of Mr. Nambiar that the recovery of rent on the basis of a lease is contractual and the recovery of fees under Section 260 (2) of the Act is statutory and therefore while purporting to levy a fee under section. 260 (2) of the Act, the Municipal Council cannot claim the same as rent, we are of the opinion that the same is misconceived. Though it is unnecessary to consider this question, in the view we have taken that the appellant and the petitioners are in the position of licensees and not lessees, still we shall indicate the reason for our conclusion that the said contention is misconceived. We have already extracted the provisions contained in Section 261 (2) of the Act. It expressly refers to the determination of 'any lease or tenure'. This provision read with Section 260 (2) of the Act will dearly indicate that the fees contemplated by Section 260 (2) of the Act will take in the rent in the case of a lease and the fees in the case of a license. Thus the statute itself contemplates the Municipal Council leasing out or licensing shops or stalls in the public market and realising rents or fees with reference thereto, and therefore there is no substance in this contention of Mr. Nambiar.
20. We have already extracted the provisions of the Act relating to a private market. The owner of a private market can certainly recover rent as well as fees. The contention that while the owner of a private market can recover rent as well as fees, but the Municipality alone, the owner of the public market, cannot recover any such rent, but recover only fees, has the merit of neither logic nor reasonableness. If the statute itself has expressly provided for such a distinction, certainly the Courts are bound to give effect to the same, unless such distinction itself is established to be illegal or unconstitutional. But in the present cases, there is absolutely no such express provision in the statute prohibiting the Municipal Councils from recovering rent on the basis of lease or fees on the basis of licence and the entire argument is based upon an inference to be drawn from the use of the word, 'fees' in Section 260 (2) of the Act and on a narrow or limited interpretation sought to be placed on that word. It may be noticed that Section 260 (1) merely enables the Municipal Council to provide places for use as public markets and the statute does not impose an obligation on the Municipal Council to make such provision. In' view of this, if such a contention, as put forward by the learned Counsel is accepted, a Municipal Council, with a view to augment its revenue, may be tempted not to provide any of its places or structures as public markets but to let them to others for other purposes, and to merely license private markets under Section 262 of the Act. It is this possibility alone which prompted Hamilton, L.J., in Attorney-General v. Homer (1913) 2 ch. 140, to state:
The justification for the grant of a monopoly of market is that the existence of the market is for the benefit of the public. If the market-keeper is not to get his outlay back and some more, he will give up the market, and where will the public be then ?
21. Mr. V.K. Thiruvenkatachari, in support of his contention relied upon a decision of this Court and a decision of the Supreme Court. The decision of this Court (by a Bench) is the Corporation of Madras v. S. A. Khan and Ors. : AIR1947Mad447 . It related to stalls in the Moore Market, Madras, which belonged to the Corporation of Madras. The stall-holders carry on various trades and businesses and sell their wares to members of the public. In their September, 1944, the Corporation served upon the stall holders notices stating that under section 301 (2) of the Madras City Municipal Act, the Standing Committee (Taxation and Finance) at its meeting held on 30th August, 1944, determined that a specified fee per mensem should be levied for the stalls in their occupation and that with effect from 1st November, 1944, the revised rate per mensem of fee would be levied and they were called upon to pay the fee. On the stall-holders defaulting in payment of the enhanced fee, the Commissioner of the Corporation, purporting to exercise statutory authority, distrained for the recovery of the amount sought to be obtained at the enhanced rate. The stall-holders challenged the validity of the increase and in the suit they claimed a declaration that the demand for enhanced rent and the act of realisation of, and the threat to realise, the enhanced rent by distraint were illegal and ultra vires of the statutory powers of the Corporation; and an injunction restraining the Corporation, its servants, agents or representatives from levying any distraint or exercising any of its coercive powers for the realisation of the enhanced fee. The Bench held that whether the agreement between the stall-holders and the Corporation amounted to a lease or tenancy or was for the payment of a fee by the licensee mattered not, and the rights given by the agreement to the stallholder were to continue until the agreement was determined, and during its subsistence he was under an obligation only to pay the amount which it specified. Therefore, while conceding the right of the Corporation to enhance the levy, whether it was rent or licence fee, since no maximum was prescribed by section 301 (2) of the Madras City Municipal Act, corresponding to Section 260 (2) of the Act, the Bench held that the Corporation had no power to enhance the levy during the currency of the agreement or engagement which had already fixed the amount of levy. Mr. V. K. Thiruvenkatachari contends that in the present cases, the enhancement was not effected during the currency of the period of the licence, but it became effective only from the subsequent financial year and therefore, the appellant and the petitioners, if they want to continue to use the respective stalls even after 31st March, 1972, will have to pay the enhanced levy. As we have pointed out already, section 301 (2) of the Madras City Municipal Act corresponds to Section 260 (2) of the Act and consequently, having regard to the decision of the Bench referred to above, we hold that this contention is well-founded.
22. The decision of the Supreme Court relied on by V.K. Thiruvenkatachari, is Mrs. M.M. Clubwala and Anr. v. Fida Hussain Saheb and Ors. : 6SCR642 . That dealt with the case of a private market known as Jam Bazar Market. The question that had to be considered was the nature of the relationship that existed between the owners of the market and the stall-holders, namely, whether they were in the position of lessors and lessees or licensors and licensees, in the context of the contention of the stall-holders that the rent agreed upon between the parties should not be enhanced by the owners of the market. The Supreme Court, after an elaborate consideration of the agreement that was entered into between the parties and the surrounding circumstances, held that the stall holders were mere licensees of the appellant, that the intention of the parties was to bring into existence merely a licence and not a lease and that the word, 'rent' was used loosely for 'fee' and in this view, reversing the decision of the High Court, it dismissed the suit instituted by the stall-holders praying for an injunction restraining the owners of the market from:
(e) interfering with the possession and enjoyment of the respective stalls by the appellants-plaintiffs 1 to 4, 6 and 7 so long as they pay the rents fixed for each stall;
(f) increasing the rents fixed for the appellants-plaintiffs 1 to 4, 6 and 7 stalls under the written agreements between the said plaintiffs and defendants 4 and 5;
(g) evicting of the appellants-plaintiffs 1 to 4, 6 and 7 or disturbing the plaintiffs and their articles in their stalls by defendants 1 to 3.
The contention of Mr. Thiruvenkatachari, is that this decision directly applies to the facts of the present cases, there being no difference between a private market and a public market, with reference to the nature of occupation of the stalls by the various stall-holders and the relationship existing between the stall-holders and the owners of the market, and in view of the admission of the stall-holders themselves that they ate in the position of licensees and the admitted facts of the present cases. We are of the opinion that this contention is well-founded.
23. Mr. Thiruvenkatachari, alternatively contended that the right to claim a fee from a stall-holder for the permission granted to him by the Municiapl Council to use or occupy a stall, amounting to a licence, as defined in Section 52 of the Easements Act, 1882, flows from the very ownership of the market by the Municipal Council and it is not necessary for the Municipal Council to rely upon Section 260 (2) of the Act to sustain its claims. Sub-section (2) of Section 6 of the Act states:
The Municipal Council shall by the name of the Municipality be a body corporate, shall have perpetual succession and a common seal and subject to any restriction or qualification imposed by this or any other enactment shall be vested with the capacity of suing or being sued in its corporate name, of acquiring, holding and transferring property movable or immovable, of entering into contracts and of doing all things necessary for the purpose of its construction.
We are clearly of the opinion that the capacity of the Municipal Council as a corporate entity to hold property will certainly include its right to enjoy the property by leasing it out and realising rents and by granting licence in respect thereof and receiving fees therefor. This right springs from the very right of ownership of the. property and therefore so long as there is no statutory prohibition for the enjoyment of the property in a particular manner, the Municipal Council can hold the property and enjoy it in the manner most advantageous to it. Mr. P. Chidambaram, who represented by Mr. Nambiar, at a later stage of the hearing, stated that this right under Section 6 (2) of the Act is subject to any restriction or qualification imposed by the Act or any other enactment and Sections 259 to 261 of the Act constituting a complete code with respect to public markets and Section 260 (2) authorising the Municipal Council only to levy a fee with reference to the doctrine of quid pro quo, the Municipal Council cannot claim to recover rent or licence fee, based upon its ownership under Section 6 (2) of the Act. For two reasons, we are unable to accept this argument.
24. In the first place, as we have pointed out already, it was conceded before us that the fee contemplated by Section 260 (2) of the Act can contain an element of return for the investment, the Municipal Council had made in the acquisition of the market, Once this is conceded, the contention that the expression, 'fee' in section 260 (2) must be commensurate with the services rendered by the Municipal Council either to the stall-holders or to the market as a whole loses all its validity. Secondly, if the contention of the appellant is that the expression, ' fees ' in Section 260 (2) (a) and (ft) of the Act means only a quid pro quo for the services rendered by the Municipal Council to the market then the right to levy and recover such fees is different from the right to realise rents or fees for licence and there being no conflict between the two and there being no other statutory provision preventing the Municipal Council from realising rents or licence fees by virtue of its ownership of the market, both the rights can be exercised simultaneously and therefore it cannot be contended that the right in this behalf flowing from Section 6 (2) of the Act is subject to or controlled by the right to levy fee under Section 260 (2) of the Act. On the other hand, if the expression, ' fees', in Section 260 (2) (a) and (ft) means, rent or fees for licence, as held by us, which the Municipal Council can collect by virtue of its ownership of the public market, then it is' merely an amplification of the right available to the Municipality by implication under Section 6 (2) of the Act.
25. Mr. M.K. Nambiar, relied on certain decisions in suport of his contention that the Municipal Council being a creature of the statute can exercise only such powers and functions as have been expressly conferred upon it and such powers and functions are limited by the competency of the Legislature which created the statutory corporation itself. The first decision referred to by him in this behalf is that of the Supreme Court in Jotki Timber Mart etc. v. The Corporation of Calicut and Anr. : 1SCR629 . The question for consideration in that case was when item 52 of List II of Schedule VII to the Constitution refers to a tax on entry of goods within the local area for consumption, use or sale therein, whether the State Legislature was competent to enact a provision conferring a power to tax on the timber brought into the city irrespective of the fact whether it was brought for consumption, use or sale therein or it was in the course of transit to another place. It is in this context that the Supreme Court held that no authority to impose a general levy of tax on entry of goods into a local area is conferred on the State Legislature by Item 52 of List II of Schedule VII of the Constitution and the Municipality derives its powers to tax from the State Legislature and can obviously not have authority more extensive than the authority of the State Legislature.
26. The next decision relied on by him is Attorney-General v. Fulham Corporation (1921) 1 Ch, D. 440. In that case, the statutes conferred power on the Corporation enabling it to provide certain facilities and conveniences for washing and pursuant to that power, the Corporation had established a wash-house, providing certain facilities for customers. In 1920 a new scheme was started by the Corporation on the recommendation of one of its customers which was materially different from the scheme which it was originally carrying on. The question for consideration was, whether the Corporation had the power to do so. It was held that what the Corporation started in 1920 was entirely a new business which it was not authorised to do and the said business cannot be regarded as being ancillary to and consequential upon that which it was entitled to do under the Acts of Parliament.
27. Mr. Nambiar, then relied on Attorney-General v. The Mayor etc. of the City of Leeds (1929) 2 Ch. 291 and in particular on the observation of Luxmoore, J., to the effect:
The corporation was incorporated by Royal Charter in the year 1627 in the reign of King Charles I. The fact that it is incorporated by Royal Charter is of importance, because a corporation so constituted, stands on a different footing from a statutory corporation, the difference being that the latter species of corporation can only do such acts as are authorised directly or indirectly by the statute creating it ; whereas the former can, speaking generally do anything that an ordinary individual can do.
Mr. Nambiar also relied on a decision of the Supreme Court in M. Pentiah and Ors. v. Muddala Veeramallappa and Ors. : 2SCR295 wherein the decision in Attorney-General v. Fullhatn Corporation (1921) 1 Ch, D. 440 referred to already is referred to,
In this context learned Counsel for the appellants invoked the doctrine of law that an action of a statutory corporation may be ultra vires its powers without being illegal and also the principle that when a statute confers an express power, a power inconsistent with that expressly given cannot be implied. It is not necessary to consider all the decisions cited, as learned Counsel for the respondents do not canvass the correctness of the said principles.
In our opinion, none of the above decisions has any bearing on the question we have to consider, in view of our construction of Section 260 (2) of the Act and the meaning of the expression 'fees' occurring in clauses (a) and (b) of Section 260 (2).
28. Mr. Nambiar then referred to certain decisions of the High Courts in India concerning the scope of the power of a Municipal Corporation like the first respondent herein. The decision in Commissioner of Municipal Council, Guntur v. Basil Venkateswara Rao and Anr. (1956) A.W.R. 616 : A.I.R. 1957 A.P 103 was concerned with the resolution of the Municipal Council, Guntur, passed under Sections 270 and 312 of the Act imposing a levy on persons selling or displaying for sale any articles or animals on the margins of public roads at particular rates. Though paragraph 2 of the judgment commenced by stating that what the Municipal Council levied was a tax, the judgment considered the same only as a licence fee. As a matter of fact, Section 270 does not contemplate a levy of any tax and all that it provides is :
270. The executive authority may, with the sanction of the council, prohibit by public notice or licence, or regulate the sale or exposure for sale, of any animals or articles in or on any public street or part thereof.
With reference to this levy of the Municipal Council under Section 270 of the Act, the Court observed :
In this context when fees are levied presumably under Section 270 to enable the Municipality to regulate the sale or exposure for sale of articles in or on any public street the fees levied cannot in any sense of the term be described as a tax. They are levied for the specific purpose of regulating the sale or exposure for sale of the articles in public streets by persons so doing and therefore they must have some relation to the services rendered by the Municipality to regulate the said sales.
They are not in the nature of a tax imposed for general purposes in the interests of general revenue. It is not a tax because the Municipality has no authority to levy such a tax and it has not also followed the procedure prescribed for levying taxes. It is only a fee as the levy is to meet the expenditure that may be incurred by the Municipality for regulating the sales.
Haralal Poddar v. The Municipal Board, Dibrugarh and Ors. A.I.R. 1958 Ass 156 was concerned with a case where the petitioner therein carried on business of selling fresh vegetables and similar other foodstuffs by keeping a stall in the municipal market of Dibrugarh town, on payment of fees to the lessee of the said municipal market. The petitioner Was paying annas four per day since 1945. The Chairman, Municipal Board, Dibrugarh, published a notification showing the enhanced rates of fees for the two zones of the municipal market. It was the said enhancement that was questioned. The contention raised on behalf of the petitioner was that Section 140 of the Assam Municipal Act, 1923, only authorised the levy of tolls and fees which necessarily implied an idea of quid pro quo. 'the amount to be fixed as toll and fee should necessarily be correlated to the services rendered and under the garb of tolls and fees, it was not open to the Board to impose a tax. The further argument was that as there was no evidence produced in the case on behalf of the Municipal Board which would go to show that the money collected as fees was set apart for the maintenance of the market and was not credited to the general revenue, it must be presumed that what the Board was levying in the name of toll and fee was really a tax. The Bench of the Assam High Court dismissed that petition holding that no material had been placed, before the Court by the petitioner on. whom, essentially the burden lay to show that the money realised as fees was not utilised for the maintenance of the market. In the course of the judgment, the learned Judges pointed out :
Section 140 itself gives power to the Board to charge rents, tolls and fees for the right to expose goods for sale in the shops and stalls' standing therein. The Board gave the use of its stalls and shops and further permitted the shop-keepers to exercise rights to expose their goods for sale in the municipal market and as a consideration for the said use, they charged fees which were utilised for the maintenance of the market.
It is not necessary to show that every pie which is realised as a fee is spent for the maintenance of the market. In the report, submitted by the Chairman to the Deputy Commissioner, when he was dealing with the matter, under Section 291 of the Municipal Act and which is Annexure ' J ' to the petition, it is clearly mentioned that all-round improvements of the market were going on by constructing stalls in the Rice and Pan market and there being a proposal to reconstruct the sheds on the open vegetable market which required a considerable amount for which the enhancement in the rate was necessary.
It was also pointed out in the report that the stall-keepers in and around the pucca vegetable market had been using their respective stalls for residential purpose as well, without paying any fee to the lessee for the night use. All these facts go to show that the rate has been enhanced with a view to develop the market and it cannot be said that there was no correlation between the fee charged and the services rendered. In fact, the petitioner did not object to the levy of any fee; what he is objecting to is the enhancement and no material has been placed before us to show that the enhancement has been arbitrary and the imposition has been capriciously made.
29. V. Parthasarathy v. State of Pondicherry (1965) M.W.N. 328, dealt with a case of enhancement of fees for the halting of buses in Karaikkal bus stand. The learned Judge had to consider whether the power conferred on a Municipality by a decree of the President of France issued in 1880 was a power to levy a fee or a power to levy a tax. The learned Judge held :
For all these reasons, I hold that the pre-existing law, granting power to the municipalities to impose a levy for granting a licence to use packing places contemplated only the levy of a licence fee commensurate to the services rendered and not the right to levy an arbitrary tax.
30. The Maharaja Kishangarh Mills Ltd. v. Municipal Board, Kishangarh and Anr. dealt with a levy imposed under Section 135 (2) of the Uttar Pradesh Municipalities Act, 1916, on flour mills and other factories, at a certain rate, based on horse power. The High Court held that when any levy is being justified under Item 66 of List II or Item 47 of List III of Schedule VII to the Constitution as a fee, it should be shown that it is for some services rendered by the State or by the Municipality to the particular person concerned and that its incidence is such as to meet the expense of the service rendered, more or less.
31. H.T. Vasudeva Rao v. Vijayawada Municipality represented by Commissioner, Vijayawada Municipality : AIR1961AP328 was concerned with the licence fee levied on hotels. The High Court held that a licence fee cannot be regarded as a form of taxation and should not be resorted to for the purpose of realising revenue, but only to cover reasonable expenses that may be incurred for the issue of licences, the collection of fees and for exercising supervision over the trade and for ensuring that they are being used properly and that the conditions and restrictions imposed under those licences are carried out and the licence fee should not be out of all proportion to the cost of special services to be rendered to the licencees and to the exercise of supervision for purposes mentioned above.
32. The decision of the Allahabad High Court in Durga Das Bhattacharya and Ors. v. Municipal Board, Banaras : AIR1962All277 was concerned with the levy of a licence fee under Section 294 of the Uttar Pradesh Municipalities Act, 1916. In that case, the Municipal Board had framed rickshaw bye-laws in exercise of the powers conferred upon it under Sections 298 and 294 and imposed an obligation of taking out licences on the proprietors and drivers of rickshaws and fixed the fees payable for licences. With reference to such fees, the Court pointed out that the scheme of Chapter VIII under which Section 294 fell, showed that the provisions contained therein were meant for the purpose of regulation of certain trades, maintenance of public safety and convenience, of the inhabitants of the Municipality, that the fees mentioned in section 294, therefore, were to be imposed for the purpose of rendering services, that is, regulation of trades etc., and that the fee contemplated in Sections 294 and 298 was a fee simpliciter in which an element of quid pro quo was necessarily involved and that it was not a pretence of a fee for a tax; nor was it a fee for licence as contradistinguished from a fee for services rendered.
33. Corporation of Madras v. Spencer & Co. Ltd. I.L.R. 52 Mad. 764 : 57 M.L.J. 71 : A.I.R. 1930 Mad. 55 was concerned with enhancement of licence fee for storing spirit from Rs. 25 to Rs. 200. The levy in that case was purported to be made by the Corporation of Madras under section 365 (2) of the Madras City Municipal Act, corresponding to section 321 (2) of the Act.
34. The last decision relied on is that of the Calcutta High Court in Abdul Majeed Qureshi v. Corporation of Calcutta and Ors. : AIR1967Cal174 . In that case the Corporation of Calcutta purported to levy a fee on purchasers of entrails, guts and offals at a slaughter house. The Calcutta High Court, on an examination of the provisions of the Calcutta Municipal Act, 1951, and the bye-laws framed thereunder, came to the conclusion that they made provisions for every person intending to slaughter animals in a slaughter house to make an application for such slaughter to the Superintendent of the slaughter house for a licence and the Corporation issuing a licence in that behalf and recovering a fee therefor and that therefore there was no provision empowering or authorising the Corporation to impose a licence fee on the purchasers of offals, entrails and guts at the slaughter house.
35. In our opinion every one of the above decisions, except that of the Assam High Court, that of this Court in Parthasarathy's case (1965) M.W.N. 328 and that of the Calcutta High Court, dealt with a case of licence fee in the literal sense, namely, fee for grant of a licence which has been issued for the purpose of regulating or supervising the carrying on of a business, trade or occupation by a citizen. The decision of the Calcutta High Court was not concerned with any general question and it merely held that the actual provisions of the statute as well as the bye-laws did not authorise the imposition of a fee on the purchasers of entrails and offals. This Court in Parthasarathy's case (1965) M.W.N. 328 was concerned with the construction of a decree of the President of France issued in 1880. It is only the decision of the Assam High Court that dealt with a case, similar to the one which we are considering. Even though that decision has stated that it is not necessary to show that every pie realised as fee is spent for the maintenance of the market, it appears to proceed on the basis that there must be some correlation between the fee charged and the services rendered. If the learned Judges have proceeded to hold that the fee must bear some relation to the services rendered in the form of maintaining the market, running the market, of making an all-round development in the market, with respect to the learned Judges, we are unable to agree with their view. On the other band, the judgment itself, as we have pointed out already, proceeds on the basis that the Municipal Board gave use of its stalls and further permitted the shop-keepers to exercise rights to expose their goods for sale and as consideration for the said use, they charged fees. If so, whether the fees were actually utilised for the maintenance of the market or not, is totally irrelevant, for the reasons we have already indicated, namely, that the right to recover such fees flows from the very ownership of the market being vested in the Municipal Corporation concerned.
36. With regard to the judgment of the Bench of this Court in W. A. Nos. 22 to 24 and 190 and 191 of 1968, the question that was considered was, whether the expression ''fees' occurring in section 321 (2) of the Act was used in the sense of tax or only as 'fees'' in the sense of quid pro quo for the services rendered. After an elaborate consideration of the provisions contained in the Act, the Bench came to the conclusion that the statute has dealt with the power of the Municipal Council to levy a tax separately and there was no scope for confusion between 'fee' and 'tax' as they have been used in the statute, and the expression 'fee' occurring in section 321 (2) of the Act did not mean ''tax' at all. The conclusion arrived at by the Bench, after examination of the provisions of the Act, was recorded as follows :
Thus a reference to the provisions of the Act will clearly show that the Act treats taxes and fees separately and it takes care not to confuse one for the other. All the taxes which the Municipal Council is empowered to levy are dealt with under Part III only and no other part of the Act refers to and deals with any tax. Further the Act uses the expression 'fees' mainly in three different contexts. One is under section 321 (2) dealing with fee for permissions and licences. The second is fee which the Municipal Council is entitled to collect for certain specific services or amenities it renders to the public in general. For instance under Section 254 of the Act the Municipal Council is obliged to provide a sufficient number of places for use as municipal slaughter houses and it enables the Municipal Council to charge rents and fees for their use at such rates as it may think fit. Under Section 260, the Municipal Council is empowered to provide places for use as public markets and is authorised to levy one or more of the fees enumerated in Sub-section (2) thereof at such rates and on such terms and at such conditions as it may deem fit. Section 270-B, authorises the Municipal Council to construct or provide and maintain public landing places, halting places and cart-stands and levy fees for the use of the same. Section 280 (1) of the Act states that the Council may, and shall if no sufficient provision exists, provide at the cost of the Municipal fund, places to be used as burial or burning grounds or crematoria, either within or without the limits of the Municipality, and may charge rents and fees for the use thereof. The fees referred to in these sections clearly contemplate that they are in the nature of rents or charges collected from the public for the benefit or the amenity that the Municipal Council itself provides at its own cost. The third context in which the expression 'fees' has been used is Schedule IV of the Act. Rule 33 of the Schedule IV refers to distraint fees and provides that the same shall be payable at such rates not exceeding those mentioned in Appendix C to the rules as may be, from time to time, determined by the Council. Similarly, rule 36 refers to what is called warrant fees. These clearly indicate that the word ' fee ' has been used in the sense of the expenses incurred by the Municipal Council which it can recover from the person concerned. Thus the expression 'fee' and ' tax ' has not been indiscriminately used in the Act as has been done in the Calcutta Municipal Act to which we shall refer presently.
Thus, it will be seen that the above decision, far from supporting the contention of Mr. Nambiar, really supports the conclusion we have come to, since the Bench in that case recognised that the expression ' fees ' in the Act has been used to denote also payments in the nature of rents or charges collected from citizens for the benefit or the amenity that the Municipal Council itself provides at its own cost.
37. We are also of the view that the writ petitions are liable to be dismissed on the simple ground that by the enhancement of the fees in question, no right of the petitioners has been affected. We have already held that the position of the petitioners was that of a licensee and that the period of licence ended on 31st March, 1972. As we have pointed out already, this position has been admitted by the petitioners themselves. Even though the petitioners in the affidavits filed in support of W.P. No. 1122 of 1972 contended that the stall-holders have rights of a fairly permanent character and that they are entitled to the renewal of the term year after year, Mr. T. R. Mani, was not able to bring to our notice any fact which would support or substantiate this claim. Therefore, we proceed on the basis that the petitioners and the appellant Were in| occupation of the respective stalls a; licensees as defined in Section 52, Easements Act, 1882, for the year ending with 31st March, 1972. Section 62 (c) of the Easements Act, itself provides that a license is deemed to be revoked where it has been granted for a limited period and the period expires. Therefore, the licences stood revoked as on 1st April, 1972 and if the petitioners and the appellant wanted to continue to use the stalls thereafter, they could do so only on the basis of fresh licences and for such fresh licences the petitioners and the appellant would have to pay the fee demanded by the Municipal Councils and they had no right to question the enhancement thereof, with reference to the fee prevailing for the year 1971-72. As we have pointed out already, the Municipal Councils did not compel the petitioners and the appellant to occupy the stalls and pay the enhanced fees and the latter should pay the licence fee fixed for the year 1972-73 only if they wanted to continue the use or occupation of the stalls. In this view, the petitioners and the appellant have no right to question the enhancement of the fees, since the said enhancement cannot be said to have affected any of their existing rights. It has been repeatedly held that the existtence of an enforceable right is a sine, qua non for the exercise of jurisdiction by the High Court under Article 226 of the Constitution of India and there being no such enforceable right in the petitioners, they are not entitled to the issue of any writs by this Court.
38. However, Mr. P. Chidambaram, learned Counsel, contended that the appellant Can still obtain relief under Article 226 of the Constitution, because the appellant is a rate-payer and as a rate-payer he can question the action of the Municipal Council and secondly the practice had been to continue the same stall-holder year after year. We are unable to accept either of the above contentions. There is absolutely no case put forward by the appellant and no factual materials have been placed before this Court to sustain his claim that as a rate-payer the appellant can challenge the action of the Municipal Council. As a matter of fact, a specific plea has been taken by the first respondent in paragraph 6 of its counter-affidavit and notwithstanding this, no attempt whatever was made by the appellant to sustain any such claim as to his competency to maintain the writ petition as a rate-payer. There is therefore no substance in the first of the grounds mentioned by the learned Counsel.
39. Equally without substance is the second ground. What the appellant has prayed for is the issue of a writ of mandamus and in order to obtain such a writ, he must show the existence of a right in him and a corresponding obligation placed upon the first respondent towards the petitioner. The fact that a particular stall-holder was being continued year after year on his agreeing to pay the fees demanded by the Municipal Council for each year separately will not confer any legal right on the appellant to continue to be in occupation of the particular stall permanently and it will not enable him to question the new rate of fees fixed for the succeeding year.
40. Having regard to the above conclusion of ours, it follows that the use of the expression, 'compulsory exaction sanctioned by statute '' by Ramaprasada Rao, J., in his judgment, dated 5th September, 1970 in the batch of writ petitions referred to already, is not appropriate, though what is meant by that expression is made clear by the learned Judge himself by stating that the same was 'annexed with the rights of ownership of the property'. All that the learned Judge intended to state was that it was a demand made by the Municipal Council in the exercise of its right as the owner of the public market, as consideration for its allowing the stallholders the use of the stalls. If a stallholder does not want to continue to occupy the stall, there is no question of the Municipal Council compelling him to remain in occupation and pay the fees which demands.
41. Except for this clarification, we are in entire agreement with the reasoning of the learned Judge that the levy falling under Section 260 (2) of the Act is neither a fee in the limited sense of being a quid pro quo for the services rendered' by the Municipal Council to the stall-holder or the market as such, nor a tax, but a return or fee or consideration for the licence, as defined in Section 52 of the Easements Act or a permission, granted by the owner of a property to a stranger to make use of the said property.
42. No other point was urged in the writ appeal.
43. Mr. T.R. Mani, learned Counsel for the petitioners in the writ petitions, raised two other points. In the counter-affidavit filed on behalf of the Vellore Municipal Council, it was contended that the site on which each one of the stalls in the occupation of the petitioners is situate would be of the value of Rs. 16,400 and 9 per cent, of the cost would be Rs. 125 per mensem; and that the petitioners were called upon to pay only Rs. 40-50, the same being one third of the fair rent that could be fixed for the stall. In the reply affidavit, the petitioners contended that a stall complies of a room measuring 9'X7 1/2' and an open verandah measuring 7 1/2X' IT, and covering a total area of just 120 sq. ft.; that the value of Such a space of 120 sq. ft., could not be calculated at Rs. 16,400 which worked out at a staggering figure of over Rs. 130 per sq. ft. or at Rs. 32,500 per ground ; and that the maximum price of land in the business locality in Vellore Town at the junction of Mandi Street; Long Bazaar and Main Bazaar had been fixed at Rs. 4-50 per sq. ft. by the State Government. We are of the opinion that this controversy is wholly irrelevant. Simply because a particular piece of land was valued by the Government for purposes of Stamp Act or for purposes of registration at Rs. 4-50 per sq. ft., it cannot be taken to be a measure for finding out what should be the reasonable return to the Municipality, with reference to the stalls situate in its public market. As we have pointed out already, that will vary from place to place and from time to time depending upon the demand for a stall at a particular place and at a particular time. Even assuming that the facts stated by the petitioners in the reply affidavit are correct, in our opinion, that does not affect in any way the enhancement of the fee made by the Municipal Council.
44. The next point urged by Mr. T. R. Mani, is that the Municipal Council by its resolution, dated 28th February, 1972, resolved to enhance the fee by 10 per cent, only, but because of the Commissioner's rounding off to the nearest five paise, in particular cases the enhancement has amounted to 12 1/2 per cent. In the counter-affidavit filed on behalf of the Municipal Council, it is contended that while fixing the licence fee in respect of the stalls the fee was rounded off to the next five paise with the result there was a slight increase in the fees levied and collected, and that the procedure followed is in accordance with the rules and the administrative instructions issued by the Government from time to time. Before us, it is contended on behalf of the Municipal Council that this procedure is being followed by all the Municipalities in the State, pursuant to a circular issued by the Government. It is not necessary for us to decide in these writ petitions' this question, namely, whether the said rounding off should be done only by the Municipal Council or can be done by the executive authority, pursuant to any circular or administrative instruction issued by the Government, since the petitioners herein have simply prayed for a writ of mandamus to forbear the Municipal Council from levying and collecting stall fees at the enhanced rate as per Resolution No. 1284, dated 28th February, 1972 and have not prayed for any relief in their petitions with reference to the said rounding off, stated to have been effected by the Commissioner of the Municipality.
45. Under these circumstances, the Writ appeal as well as the writ petitions fail and they are dismissed. However we do not make any order as to costs.