Advertisement tax requires strict statutory procedure; regulatory power cannot be treated as taxing power, making the levy invalid.

Advertisement tax can be imposed only in the manner expressly authorised by the parent statute, and the mandatory procedure for taxing legislation must be strictly followed. The Act distinguished between State-made rules for taxes under Section 172(2) and bye-laws a corporation could make under Section 541. Because advertisement tax under Section 172(2)(h) required proposal by the elected body, publication, consideration of objections, State sanction and notification, a levy framed through bye-laws without that procedure was ultra vires. The power to regulate advertisements did not imply a power to tax, and the separate procedure for bye-laws was also not followed, so the levy was invalid.

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Issues: Whether the impugned bye-laws imposing advertisement tax were competent in law and whether the statutory procedure for imposing such tax and for framing bye-laws had been duly followed.

Analysis: The Act distinguished between rules to be made by the State Government for taxes under Section 172(2) and bye-laws that a Corporation could make under Section 541. Advertisement tax under Section 172(2)(h) could be imposed only in accordance with the statutory procedure in Sections 199 to 203, which required proposal by the elected body, publication, consideration of objections, sanction by the State Government, and notification. The procedure was held to be mandatory because taxation cannot be imposed except by authority of law and the taxpayer must be given a meaningful opportunity to object. The material on record showed that the Corporation had framed bye-laws, not rules, and that objections were heard by an -level committee rather than by the Corporation or its elected body. The Court also held that the power to regulate advertisements under Section 541 did not carry an implied power to levy tax, and taxation could not be sustained by treating a regulatory power as a taxing power. The separate procedure for making bye-laws under Sections 542 to 544 was also not followed.

Conclusion: The impugned bye-laws, insofar as they imposed advertisement tax, were ultra vires the Act and invalid for non-compliance with the mandatory statutory procedure.

Final Conclusion: The writ petition succeeded and the advertisement tax levied under the impugned bye-laws could not be sustained.

Ratio Decidendi: A municipal body can impose a tax only in the manner expressly authorised by the parent statute, and where the statute prescribes a mandatory procedure for taxing legislation, that procedure must be strictly followed before the levy can validly operate.

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