TaxTMI 
TaxTMI 
2019 (2) TMI 426
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....tution of India. This Court had also called the Additional Advocate General to ascertain whether the State Government was desirous on opposing the petitions with regard to vires of the levy of Advertisement Tax by the municipalities, however, Sri Manish Goel, Additional Advocate General, State of U.P. appeared and fairly stated that he had nothing to add or submit unless there was a challenge to levy of Advertisement Tax under the U.P. GST. Facts, in brief, in the present petition, are that the petitioner is an advertising firm based at Ghaziabad and started the work of advertising in the district Hathras. The petitioner had taken private properties, not belonging to the Nagar Palika Parishad at four places for putting hoardings on the roof of the said premises. However, in pursuance of the bye-laws framed by Nagar Palika Parishad, Hathras on 12.1.2017 and published on 19.8.2017, a demand of advertisement tax on Hoardings/Sign Boards/Glow Signs affixed at various places including on the private buildings was sought to be recovered from the petitioner. The petitioner therefore challenged the legislative competence to the imposition, collection and realization of the Adverti....
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....mits and deriving special advantages from, or imposing special burdens on, the municipal services; (ii) a tax on trades, callings and vocations including all employments remunerated by salary or fees; (iii) a theatre tax which means a tax of amusements or entertainments; (iv) a tax on dogs kept within the Municipality; (v) a scavenging tax; (vi) a tax on deeds of transfer of immovable properties situated within the limits of the Municipality; (vii) a tax on advertisements not being advertisements published in the newspapers; (viii) a tax on vehicles and other conveyances plying within the Municipality limit or on boats moored therein. (ix) betterment tax. (3) The municipal taxes shall be assessed and levied in accordance with the provisions of this Act and the rules and bye-laws framed thereunder. (4) Nothing in this section shall authorize the imposition of any tax which the State Legislature has no power to impose in the State under the Constitution: Provided that a Municipality which immediately before the commencement of the Constitution was lawfully levying any such tax under this section as then in force, may continue to levy that tax until pr....
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.... Tax 2017 (Act No. 1 of 2017) came into operation with effect from 01.7.2017. Section 17 of the 101 Constitutional Amendment Act is quoted as under: 17. Amendment of Seventh Schedule - In the Seventh Schedule to the Constitution,- (a) in List I - Union List,- (i) for entry 84, the following entry shall be substituted, namely:- "84. Duties of excise on the following goods manufactured or produced in India, namely:- (a)petroleum crude; (b) high speed diesel; (c) motor spirit (commonly known as petrol); (d) natural gas; (e) aviation turbine fuel; and (f) tobacco and tobacco products."; (ii) entries 92 and 92C shall be omitted; (b) in List II-State List,- (i) entry 52 shall be omitted; (ii) for entry 54, the following entry shall be substituted, namely:- "54. Taxes on the sale of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas, aviation turbine fuel and alcoholic liquor for human consumption, but not including sale in the course of inter-State trade or commerce or sale in the course of international trade or commerc....
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....which was earlier available under Entry-55, this coupled with the fact that the power of taxation earlier vested with the municipalities under section 128(2)(vii) of the U.P. Municipalities Act, 1916 having been omitted by virtue of Section 173 of the U.P. Goods and Service Tax Act, 2017, the municipality did not even have the statutory competence to levy, impose or collect Advertisement Tax. In the said view of the matter, the levy and collection of the Advertisement Tax under the provisions of Nagar Palika Parishad, Hathras (Vigyapan Kar Ka Nirdharan Aur Wasuli Viniyaman) Upvidhi, 2015 is clearly without legislative or statutory competence and is ultra-vires under Article 265 of the Constitution of India, U.P. Municipalities Act, 1916 and U.P. Goods and Service Tax Act, 2017. This Court has no hesitation in holding that the said Nagar Palika Parishad, Hathras (Vigyapan Kar Ka Nirdharan Aur Wasuli Viniyaman) Upvidhi, 2015 is without any legislative or statutory competence and, thus, are hereby struck down. In view of the fact that the Court has held the levy and collection of Advertisement Tax as ultra-vires, the amounts so collected from the petitioner are liable to be refu....
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....2017. The aforesaid bye-laws in bye-law No.1(3) clearly states that the said bye-laws would be enforced from the date they are published in the gazette. Therefore, the aforesaid bye-laws came into operation w.e.f. 19.08.2017 which was not possible as by that time Sub-section (2) (vii) of Section 128 of the Municipalities Act was omitted. The mere framing of the said bye-laws prior to the omission of Sub-section 2(vii) of Section 128 of the Municipalities Act would not bring the said bye-laws within the legislative competence as on the effective date the statutory provision enabling the imposition of advertisement tax stood already deleted. Even otherwise, mere framing of bye-laws is not enough unless they see the light of the day which they saw for the first time on publication in the gazette by which time power to impose tax on advertisement was withdrawn. Apart from the above, the State legislature was invested with the power to make laws in respect of taxes on advertisement vide Entry 55 of List II to the 7th Schedule of the Constitution but the said Entry was deleted by the Constitution (101st Amendment) Act, 2016 w.e.f. 12.09.2016. The said Amending Act vide Section 1....