1963 (9) TMI 50 - SC - Indian Laws

Court upholds constitutionality of tax provisions under Uttar Pradesh Municipalities Act

GOPAL NARAIN Versus STATE OF UTTAR PRADESH & ANR.

The Court dismissed the petition challenging the constitutional validity of various sections of the Uttar Pradesh Municipalities Act, 1916 and ... Constitutional validity of s. 128(1) of the Uttar Pradesh Municipalities Act, 1916 (U.P. Act No. 11 of 1916) questioned insofar as it authorizes a Municipal Board to impose all or any of the taxes mentioned therein in any part of the municipality? Held that:- Appeal dismissed. The question of the validity of the tax depends upon the existence of power to tax in respect of a subject. The Municipal Board had certainly power to impose the scavenging tax. The mention of cl. (xii) in the notification appears to be a mistake for cl. (xi) and that does not effect the power of the Municipal Board to impose the tax. There are no merits in this contention either. Issues Involved:1. Constitutional validity of Section 128(1) of the Uttar Pradesh Municipalities Act, 1916 under Article 14 of the Constitution.2. Validity of the notification imposing house tax and scavenging tax in the Civil Lines area under the doctrine of classification.3. Alleged violation of statutory provisions of the Act infringing the fundamental right under Article 19(1)(f) of the Constitution.4. Constitutional validity of Section 131(1)(b) of the Act under Article 14.Detailed Analysis:1. Constitutional Validity of Section 128(1) of the Uttar Pradesh Municipalities Act, 1916 under Article 14 of the Constitution:The petitioner argued that Section 128(1) of the Act, which authorizes the Municipal Board to impose taxes in any part of the municipality, violates Article 14 of the Constitution as it confers arbitrary power without any policy or guidance for classification. The Court reviewed the relevant provisions, including Sections 7 and 8, which outline the duties and discretionary functions of the Municipal Board. The Court concluded that the Act provides sufficient legislative guidance for the Municipal Board to impose taxes in specific areas, particularly where special amenities necessitate higher expenditure. The Court held that the policy underlying Section 128(1) does not offend Article 14, as it allows for reasonable geographical classification based on the need for special amenities in certain parts of the municipality.2. Validity of the Notification Imposing House Tax and Scavenging Tax in the Civil Lines Area under the Doctrine of Classification:The petitioner contended that the notification imposing house tax and scavenging tax in the Civil Lines area was void as it could not be justified under the doctrine of classification. The Court examined the historical context and development of the Civil Lines area, noting that it had been treated as a separate unit with special amenities since 1870. The Court found that the differences between the old city and the Civil Lines area, such as broader roads, parks, and specialized sanitary arrangements, justified the geographical classification for taxation purposes. The Court held that the notification did not infringe Article 14, as the classification had a reasonable relation to the object of the statute.3. Alleged Violation of Statutory Provisions of the Act Infringing the Fundamental Right under Article 19(1)(f) of the Constitution:The petitioner argued that the taxes were imposed in violation of the statutory provisions of the Act, infringing his fundamental right under Article 19(1)(f). The Court noted that the house tax had been imposed since 1870 and the scavenging tax since 1939, with no challenges raised until now. The Court presumed that the statutory authority followed the prescribed procedure, given the long acquiescence by the residents. The Court rejected the petitioner's specific objections regarding the procedural violations under Section 131, finding no evidence to support the claims. The Court concluded that the taxes were imposed in accordance with the law and did not infringe the petitioner's fundamental rights.4. Constitutional Validity of Section 131(1)(b) of the Act under Article 14:The petitioner claimed that Section 131(1)(b) conferred arbitrary power on the Municipal Board to impose taxes without clear guidelines. The Court clarified that Section 131 provides the machinery for imposing taxes, while Section 128 enumerates the subjects of taxation. The Court explained that the procedural steps outlined in Sections 131 to 136 ensure a reasonable nexus between the tax, the rate, and the persons liable to pay. The Court emphasized that the quasi-judicial procedure, which includes public notification and opportunities for objections, ensures that the power to tax is not arbitrary. The Court held that Section 131, when read with Section 128, does not violate Article 14.Conclusion:The Court dismissed the petition, holding that the impugned sections and notifications were constitutionally valid and did not violate Articles 14 or 19(1)(f). The taxes were imposed in accordance with the statutory provisions, and the classification for taxation purposes was reasonable and justified. The petition was dismissed with costs.