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Issues: Whether terminal tax under section 66(1)(o) of the C. P. & Berar Municipalities Act, 1922 was leviable on goods merely passing through the municipal limits in transit, and whether tax collected on such goods was refundable.
Analysis: The expression "terminal tax on goods imported into or exported from the limits of a municipality" was construed in the setting of the statute, its legislative history, and the constitutional scheme distinguishing terminal taxes from taxes on entry of goods for consumption, use or sale. The Court held that goods merely carried across municipal limits and not brought in for the purpose of remaining within the area, nor sent out after becoming part of the local mass of property, were not goods imported into or exported from the municipality in the relevant sense. The word "terminal" was read as referring to the end of the journey, and taxing provisions were required to be strictly construed, with doubts resolved in favour of the taxpayer.
Conclusion: Terminal tax under section 66(1)(o) was not leviable on goods in transit through the municipality, and the tax collected on such goods was recoverable.
Final Conclusion: The levy could not be extended to transit goods, and the appellant succeeded in obtaining refund relief and costs.
Ratio Decidendi: A taxing provision imposing terminal tax on goods imported into or exported from municipal limits does not extend to goods merely passing through those limits in transit, and ambiguous fiscal language must be construed strictly against the taxing authority.
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