The Municipal Committee, Raipur v. Phoolchand and Others

HiJli1attd/oh J, HWAYATULLAH, J.-These two appeals by

special leave h>1vc been filed by the .Municipal Committee, l{aipur, against two different respon-dents, who carry on business of extraction of oil from oil ~eeds. 'l'he case involves an interpretation of the Bye-laws of the .Municipal Committee and the determination of octroi duty which wa11 payable by the respondents in the relevant years of asseBS-ment on sarso oil seed.R brought by them within the a.re.a of the appellant Committee for purposes of their business. The Municipal Committee demand-ed an ad valorem octroi duty Rs. 4-11-0 per cent from the respondents, claiming to levy it under item 44 of the Schedule of goods liable to octroi duty in the Raipur Municipality, appended to the Rules framed on June 4, 1951. The respondents, on the other hand, contended that a duty of 2 annae per maund was leviable under item 4 of the aame Schedule, which covered the case of oil seeds. The respondents made representations describ-ed as appeals, but were unsuccessful. Their demand for refund of octroi duty paid by them waa refused, and they, theref01e, filed petitions under Art. 226 of the Constitution in the High Court of Nu.gpur (later, of Madhya Pradesh) against the appellant, alleging, inter alia, that this imposition of octroi duty ad valorem at Rs. 4-11-0 per cent on Barso oil seeds as against other oil seeds was ultra viru the Municipal Committee under .A1:t. 14 of the Constitution. They also averred that ootroi duty was properly leviable under item 4 and not under item 44. In the High Court, the petition out of which Civil Appeal No. 356 of 1961 arises, was heard by a learned single JudgP, who held that sarso oil seeds were chargeable to duty under item 19'1 44 and not under item 4. From the order of the Thi MuniciµI learned single Judge, it does not appear that the Committee, Ro;;Uf constitutional question was urged before him. v. PhooW..,,J Against this order, a Letters Patent Appeal was filed, and the Divisional Bench, which heard the H i"iPalulloh appeal, held, disagreeing with the learned single Judge, that duty was properly leviable only under item 4. Before the Divisional Bench also, it does not appear that t.he constitutional question was argued. The petition, out of whit>h Civil Appeal No. 357 of 1961 arises, was heard by a Divisional Bench, which, following the earlier decision, decided against the appellant Committee.

The entries in the Schedule of goods liable to octroi duty in the Ra.ipur Municipality contain eight classes of goods. Under them are grouped 67 items, the serial numbers running consecutively through all the classes. Class I is headed "Articles of food or drink or mm for men or ani !llals". Item 4, which i9 in that class re •ds "Oil-seeds of every description not specifically mentioned elsewhere". Class Vis headed "Drugs, spices and gums, toilet requisites and perfumes", and item 44 reads "Betel-nuts, gums, spices, Indiav heros and Indian raw medicin-es and drugs, such as nuts, ilaichi, laung, jaiphal, jy,ipatri, dalchi11i, s<mt, katha, zeera, dkania garlic, dry chillies, pEpper, ahahzeero, maithi, sarao ... etc.

and known a kirana" (groceries). Item 4 is charge- -I able to a duty of 2 annas per maund, and item 44

is chargeable ad valorem at Rs. 4-11 ·0 per cent.

In addition to these entries, there is item 17, which reads "Vegetable oils (not hydrogenated) not provided elsewhere such as Tilli Tel, Barso Tel, Al.9i Tel, Falli Tel, Narial Tel, Andi Tel", which are chargeable to a duty of 4 annas per maund.

It is conceded on all hands that sar8o is an oil seed, and if there was nothing more in the Schedule a, duty of 2 annas per maund would be leviable on 1arao as an oil seed. The dispute arises, because 1961 sarso is mentioned again in Item 44 with a very Tiu M1111icipol much higher duty, and it is contended by the Commi/lte, Raijnu appellant that the won:Li "not specifically

v. Committ~e Phoo/d1anJ mentioned el sew here" in item 4 ex: elude sar8o from /fiJtJ_l'O(U/fah ], that item, and that its specific mention in item 44

makes it. liable to the higher duty indicated there. The learned single Judge of the High Court held in favour of the lllunicipa.lity. According to him, t-his reason was sound and tho higher duty demanded \l'aB the proper duty p1yable. The Divisional Hench on the other hand, points out that the two classes (I and V) are entirely different. Class I deals with articles of food or drink for use for men and animals while Class V deals with drugs, spices and gums, toilet requisites and perfumes. The division indicat-es clearly that goods belonging to one category are uoi included in the goods belonging to the other. The Divisional Ben~h also points out that item 4 must be read as it stood and the specific mention must be in the same manner in which that entry was framed. Item 4 deals with "oil seeds", and tho specific mention must be al! "oil-setds" else-where in the Schedule. It WM also argued for the respondents that "elsewhere" meant elsewhere in the same Class. but the appellant Committee point-ed out that the serial numbers were all consecutive, and that the specific mention could be anywhere in the Schedule. The two arguments a.re equally plausible, and nothing much, therefore turns upon them.

In our opinion, the Divisional Bench of the High Court was right when it said that the specific mention elsewhere must be M oil seeds and not as something else. Class V deals with spices and groceries and the concluding words of item 44 "known as kirana" determine the ambit of that item. Though sarso might be mentioned there, it must be taken to have been mentioned as a spice or as kirana and not as oil seed. The cxfont of item 4, which deals with oil seedl! of every descrip-tion, could only be cut down by a specific mention J96J elsewhere of an item as an oil seed. • Thi Municipal

Item 44 contains fairly Ion;; list, ont of which Wmmittee, •• Raipur we have quoted a few illustrative items. Each of Phoolchand these items is referable to the general heading Hidayatullah J. either as a drug or a spice or gum, etc. Sarso, it is admitted, is sold as kirana and as a spice. The mentir,n of sarso there is limited by the general heading to which it belongs, namely, a spice, drug or herb sold as kirana. No doubt, sarso as an oil seed is the same article as sarso sold as kirana ; but we must take into account the intention behind the bye-law and give effect to it. If it was intended that sarso as an oil seed was to be taxed in a special way, it would be reasonable to expect that it would have be foung a specific in mention as an oil seed with a different duty. One would not expect that it would be included in a long list of artieles of kirana and in this indirect way be taken out from a very comprehensive entry like item 4, where oil seeds of every description are mentioned.

Though the next argument is not conclusive because there is no logic behind a tax, still it is to be noticed that sarso oil (a maund of which, as the affidavit of the respondents sh<;>ws, is express-ed from three maunds of oil seed) bears only an octroi duty of 4 annas per maund, while three maunds of sarso oil seed under item 44, if it were applicable, bear a duty of Rs. 4-3-6 per maund, if the price of sarso is takl>n as Rs. 30 per maund as stated in the affidavit. This leads to an anomaly, whioh, in our opinion, could not have been intended.

Finally, it may be aaid that if there be any doubt, the Divisional Benoh. of the High Court very properly resolved it in favour of the taxpayer.

We, therefore, hold that the judgment of the High Court is correct, and dismiss these appeals With costs.

Appeals dismissed.

CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 356 and 357 of 1961.

Appeals by special leave and certificate from the judgments and orders dated October 16, 1959, and February 16, 1960, of the M.1dhya Pradesh High Court in L. P. A. No. 93 of 1957 and Miso. Petition No. 254 of 1959 respectively.

1961 S. T. Desai and N. H. liingorani, for the 1b1 It .. i<i/>al appellant.

Conlmilltt, Rai/>ur M. /(. Nambiar, S. N. Andley, Ramuhwar Nath

v.

Phoow-J B ncl P. L. Vohra, for respondent No. I.

1960. October 20. The Judgment of the Court was delivorcd by