- (1.)THIS appeal and Second Appeal No. 497 of 1937 are two allied plaintiffs' appeals from the judgments of the Additional District Judge, Khamgaon, reversing the decrees of the Additional Subordinate Judge, Second Class, Malkapur, passed in their favour in two suits instituted for a declaration that the tax levied by the Municipal Committee, Nandura, on persons carrying on the trade of ginning and pressing cotton was illegal and ultra vires and for a permanent injunction restraining the defendant Committee from recovering the said tax from the plaintiffs. In one of the suits, there was added a claim for refund of the amount recovered by the committee. This judgment governs the disposal of both.
(2.)THE town of Nandura was declared to be a Municipality with effect from 1st April 1930 by the Local Government's Notification No. 756/27-VIII, dated 4th February 1930 issued under Section 5(2)(a), C.P. Municipalities Act, 1920, as applied to Berar. The Nandura Municipality so formed was by Notification No. 757/27-VIII, dated 4th February 1930, excepted from the operation of Sections 10(2) and (3), 16(2), 67(2), (3) and (4), 175(3), 86(3) and 178(4) of the aforesaid Municipalities Act. By Notification No. 759/27-VIII of the same date, the Local Government appointed a Committee of 13 named members in accordance with rules made by the Local Government under Section 9(2) of that Act. By another Notification the Municipal Committee, Nandura, was excepted from the operation of Section 14, Municipalities, Act, and it was declared that the provisions of the said Section with regard to the residence did not apply to a candidate for election as a member of that Committee at the time of the fresh elections.
On 18th May 1931 the Local Government, by Notification under 2576/848-M-VIII extended the period of office of the nominated members of the Municipal Committee 'till a new body ia elected and begins to function." The Local Government notified the election of nine named persons as members of the Committee in the C.P. Gazette dated 15th August 1931, nomination of two named persons as members in the C.P. Gazette, dated 3rd October 1931 and the selection of two named persons as members in the C.P. Gazette, dated 28th November 1931 and the election of President and two Vice-Presidents in the C.P. Gazette, dated 9th January 1932. Lastly the Local Government published for general information the complete list of President, two Vice-Presidents and members of the Municipal Committee of Nandura, in the C.P. Gazette of the same date.

(3.)ON 20th September 1931, there was a special meeting of the Committee for proposing imposition of a tax on persons carrying on the trade of ginning and pressing cotton within the limits of the Nandura town under 66(1)(b), Municipalities Act. It was unanimously resolved that the tax should be imposed on the bales and bojas in the ginning and pressing factories on the terms provided in the rules of the Jalgaon Municipality and that the rules for collection of the tax should be made on the lines of those in force in that Municipality. The notices of the proposal to impose the aforesaid tax at specified rates and that to make rules for the assessment and collection of it, as therein set out, were published in the C.P. Gazette, dated 11th March 1933. The former was published over the signature of the Secretary, Nandura Municipal Committee, and the latter over that of the Secretary to the Local Government. At a subsequent special meeting held on 15th January 1933, the original proposal was somewhat varied in respect of the rates and at the first special meeting, held on 5th December 1933, certain objections to the proposed tax received from the public were considered and disposed" of. The proposal to impose the tax at the modified rates was duly forwarded to the Local Government for sanction as required by Section 67(5), Municipalities Act. The Local Government sanctioned the imposition of the tax and the rules relating to assessment and collection and published two Notifications announcing the imposition of the tax and the enforcement of the rules in the C.P. Gazette, dated 2nd February 1934. In view of the discussion that is to follow, it is desirable to reproduce textually the Notification regarding imposition of the tax: No. 399-130-M-Vni--In exercise of the powers conferred by Sub-section (5) of Section 67, Central Provinces Municipalities Act, 1922 (C.P. Act 2 of 1922), as applied to Berar, the Local Government is pleased to confirm the following rule made by the Nandura Municipal Committee, in the Buldana district, under Section 66, Sub-section (1), Clause (b) of the said Act, for imposing a tax on persons carrying on the trade of ginning and pressing cotton by means of steam or mechanical prooess within the limits of the Nandura Municipality. The Committee shall levy from all persons carrying on within the limits of the Municipality the trade of ginning cotton or pressing the same into hales by means of steam or mechanical process a tax at the following rates: Rs. a. p. (a) For each boja of 392 lbs ginned ... 0-1-0. (b) For each bale of 392 lbs pressed ... 0-2-0.