Municipal advertisement tax recovery through private contractor is valid only after lawful assessment; coercive powers remain with the corporation.

Municipal advertisement tax could be recovered through a private contractor only after the Corporation validly completed assessment and demand in accordance with the Act and bye-laws. The bye-laws governed intimation, consideration and permission before recovery, so demands raised without that procedure were invalid. The contractor could collect tax already determined by the Corporation, but could not itself assess liability, issue demands as the assessing authority, or exercise coercive recovery powers such as attachment or removal. The impugned demands and coercive action were therefore set aside, while fresh recovery remained open after lawful assessment.

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Issues: (i) Whether the Municipal Corporation could recover advertisement tax through a private contractor without first following the assessment and demand procedure prescribed under the Act and the bye-laws; (ii) Whether the private contractor could issue demands and take coercive steps for recovery of advertisement tax.

Issue (i): Whether the Municipal Corporation could recover advertisement tax through a private contractor without first following the assessment and demand procedure prescribed under the Act and the bye-laws.

Analysis: The statutory scheme distinguished between imposition, assessment and recovery. Section 132(6)(l) of the Act authorised advertisement tax, Section 133 dealt with imposition, and the bye-laws framed under Section 427 formed part of the Act under Section 431. The bye-laws prescribed the manner in which the tax was to be intimated, considered and permitted before recovery. The Court held that the Corporation had to determine the levy in accordance with the bye-laws before any recovery arrangement could operate, and the record did not show compliance with that procedure before demands were raised through the contractor.

Conclusion: The recovery arrangement was not invalid in principle, but the Corporation could not bypass the statutory bye-law procedure. The issue was answered against the petitioners only to the extent that auction-based recovery was permissible after proper assessment, and in their favour to the extent that the impugned demands were raised without compliance.

Issue (ii): Whether the private contractor could issue demands and take coercive steps for recovery of advertisement tax.

Analysis: Section 189A permitted recovery by public auction or private contract, but that power extended only to collection of tax already levied and determined by the Corporation. The Court held that assessment remained with the Municipal Corporation and that coercive powers such as attachment, removal or other compulsory recovery measures were sovereign functions not transferable to the contractor. The contractor could demand payment of the amount validly determined by the Corporation, but could not itself determine liability or employ coercive recovery.

Conclusion: The contractor had no authority to issue demands as if it were the assessing authority or to take coercive recovery measures. This issue was decided in favour of the petitioners.

Final Conclusion: The petitions succeeded in part: the impugned demands and consequential coercive action were set aside, while the Corporation was left free to reissue fresh demands in accordance with the Act and bye-laws and then proceed with recovery through the contractor only to the extent legally permitted.

Ratio Decidendi: Where a municipal taxing statute and its bye-laws prescribe the manner of assessment and collection, recovery through a private contractor is permissible only after the tax is validly determined by the competent municipal authority, and the contractor cannot exercise coercive recovery powers or substitute itself for the assessing authority.

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