JIT RAM SHIV KUMAR AND ORS. ETC. v. STATE OF HARYANA AND ANR. ETC

Citation: [1980] 3 S.C.R. 689

Court: Supreme Court of India

Bench: S. MURTAZA FAZAL ALI, P.S. KAILASAM

Case summary

), after examining the case law on the subject observed that "it is now well-settled by a catena of decisions that there can be no question of estoppel against the Government in exercise of its legislative, sovereign or executive powers....

Judgment text

JIT RAM SHIV KUMAR AND ORS. ETC. v. STA~ OF HARYANA AND ANR. ETC. April 16, 1980 [S. MURTAZA FAZAL ALI AND P. S. KAILASAM, JJ. J P1'11}11b M1111icipal Act, 1911 as amended by Punjab Act 48 of 1951, Section 62. A-Power of State Government to di'rect the ,\lunicipality to impose any tax ulllkr ~ction 61-Exemption from payment of octroi duty not within the com· pelence of the Municipality and ultra vires of its powers-. Whet/1er any suc/1 lllCI whidi is void ab initio, enforceable-Principle of Promissory Estoppel, ingrt• dienll of-Applicability to the instant case. The Municipal Committee of Bahadurgarh, respondent No. 2 established Maadi Fateh in Bahadurgarh Town with a view to improve trade in the area. The Municipal Committ goods imported within the said Mandi. A resolution (No. 8) dated 2(). 12-1916 was passed by the Mllllicipality to this effect. Hand bills wore issued for tho sale of the plots on the basis of tpe resolution and it was proclaimed that Fateh.

Mandi would remain exempt from payment of octroi. Subsequently by resolution No. 4 dated 20-5-1917, the Municipal Committee decided that the term No. 14 to the conditions of sale, namely, that tho purchasers of plots would not be required to pay octroi, be amended to the effect that the Mandi shall remain intmuno from payment of octroi duty for ever. When the resolution was received by the Commissioner of Ambala, in paragraph 3 of his letter datod 26-6·1917, he minuted that the undertaking by the Municipal Commissioner never to in1pose octroi duty in the Mandi was ultra vires and therefore the purchasers of the p)Qla should be informed so that they may withdraw from the purchases. on receipt of this letter the President of the Municipal Committee made representations that if octroi duty was to be levied, tha-e would be no purchasers for the plota end the entire scheme would fall tllrough.

On this, the Commissioner reviled his earlier view and withdrew his objection by further observing tha~ "as l! OOn es the market is established it will be necessary to consider what form of taxation is best to cover the market share of municipal expelnses". The Muni· cipal COmmittee on I(). 3-1919 imposed house-tax of Rs. 3·14·6 per cent per alinum on the shopkeepers to cover the ell i duty and as such even if the municipality is found to have erred in impOBing lfle Octroi Duty, the legislative powers of the State cannot be questioned. Seconilly, it found, that it was not within the competeru:e of the Municipality to grant any exemption from payment of octroi duty and this act '"as ultra vfrts t1t·its power vemmen! is empowered to Im~ octroi duty and under sub clause (b) if the committee fails to canY cat ·the 1 order of the Government, the State Government may impose Octroi Duty. Under S.

70{2) (c), :l Municipal Comn1ittee by a resolution pa£sed at a special meeting and confirmed by the State Government may exempt in whole or in·part from payment of any such tax any person or class of persons or any property or description of property, Jn exercise of those powers, the State Government had by its order dated 4-5-1954 confirmed resolution No. I passed by the Municipal Committee in its specia1 meeting held on 2-3-1954 regarding the eittription of goods imported into Fateh Mandi from levy of Octroi Duty. So"-'equently, in reply to the objection raised 'by the Examiner of Local Funds, the Government pointed out by its letter dated 9-4-1956 (Ann. F) that the Government's action confirming the resolution No. I dated 2-3-1954 of the Municipal Comn1ittee exempting Goods imported into Fateh Mandi, under s. 70(2)(c) of JIT RAM V. HARYANA 691 the Punjab. :rviunii:ipJl Act, 1911, was quite in order. By the impugned order dated 20-10-1967 the Government approved the resolution No.

6 of- the Municipal Co1nmittte dated 21-7-1965 and permitted the Municipality to levy the Octroi Duty. Therefore, the action taken by the State Government is strictly in conformity with the powers conferred on it under s. '70(2) (c) of the Act. lt exempted the petitioners from payment of Octroi Duty for· a partic~ar period and ultimately withdrew the exemption. The action of th~ Government cannot be q;1estione e adopted by it fo~ re~Iating its work, can I -0nly be effected by·the whole Court sitting and deciding. The result is that so far as ! ]le recommendation of the Municipal Committee to the Government to levy octroi duty, is concerned though H is contrary to the. representation it made to the buyers of the sites in the Mundi, the Municipality is not estopped as the representation B • made by it was beyond the scope of its authority. The levy of tax being , for a public purpose i. e.

for augmenting the revenues of the Municipality as laid down in Ram Kumar's case, the plea of estoppel is not ~ available. The order of the Government directing the levy of octroi . in pursuance of the resolution elf the Municipality cannot also be c r challenged as it is in the exercise of its statutory duty. The result is both the appeals fail and are dismissed with costs of one set to be borne equally by the two appellants. S. R. Appeals dismissed. . Q r •• 8-463SCI/80