Shah, J. - (1.) This appeal is filed with special leave granted by this Court against the judgment of the High Court of Assam "declaring ultra vires" a notification dated December 4, 1959 issued under Section 334 (4) of the Assam Municipal Act, 1956 (No. 15 of 1957).
(2.) By notification dated May 22, 1958 issued in exercise of the powers conferred by Section 334 (1) of the Assam Municipal Act, 1956, the Government of Assam signified its intention to declare that with respect to a specified area (including a part of the Naharkatia Tea Estate) "improved arrangements" were required, and invited objections against that proposal from interested parties. The owners of the Naharkatia Tea Estate did not file any objection. On December 4, 1959 a notification was issued under Section 334 (4) declaring the specified area as the Naharkatia Town Committee. In consequence of that declaration holders of land and buildings, within the specified area became liable to pay certain municipal taxes. On receiving a demand from the Town Committee for license fee and municipal taxes the respondent Company (owner of the Naharkatia Tea Estate) filed a petition in the High Court of Assam challenging the validity of the notification dated December 4, 1959 and for an order restraining the Town Committee from taking any action in pursuance of the notification and the notices levying tax, on the plea that the notification was issued "as a colourable device for taxing the assets of the Company with the sole motive of augmenting the income of the Town Committee without any obligation or necessity to expend funds for providing municipal amenities. It was asserted that the Naharkatia Tea Estate was a "fully developed private property"; that it had arranged to provide all amenities required by law for the welfare of its employees and residents within the plantation, and on that account inclusion of the part of the plantation within the Town Committee was "illegal and in excess of the powers conferred by the Assam Municipal Act, 1956."
(3.) The High Court accepted the contention of the Company. They observed that it could not have been the intention of the Legislature to provide for setting up a Town Committee in an area where adequate arrangements of lighting, maintenance of roads, conservancy, water-supply, hospital amenities and other "welfare arrangements" had previously been made by the owner. In the view of the High Court the demands for licence fee and tax were made by the Town Committee with the "ulterior motive to get money from the tea estate without reference to any service of providing facilities and amenities and that the inclusion of the tea garden within the Town Committee area must be held to be mala fide and contrary to Section 334 of the Act". The High Court accordingly declared invalid the notification dated December 4, 1959 constituting the Naharkatia Town Committee insofar as it related to the area of the Naharakatia Tea Estate. The State of Assam has appealed to this Court with special leave.;