Hansaria, J. - (1.) The journey to decide the fate of these appeals has to start from 1881 as it was on 12 th March of that year that Notification No. 165 was gazetted stating inter alia that octroi duties in the Cantonment of Poona would be imposed at the rates"for time being" leviable and in respect of the several articles "for the time being" dutiable in the Municipality of Poona, when such articles would enter into the cantonment from any place situate without the limits of the said Municipality. The Poona Cantonment Board authorised the Municipality and thereafter to divide the proceeds as agreed upon. The municipality of Poona having become a Corporation under the Municipality Corporation 1950, it continued to collect octroi on the strength of the aforesaid Notification and agreement . The respondents challenged the legality of the collection of the octroi made as per 1963 Schedule to the Octroi Rules framed by the appellant. This was done by approaching the Bombay High Court by filing petitions under Article 226 of the Constitution which have come to be allowed by the impugned judgment. Hence these appeals by the Municipal Corporation for the City of Pune hereinafter referred as the Municipal Corporation.
(2.) The challenge to the collection was broadly on two counts:- (1) The 1881 Notification does not in fact permit the collection ; and (2) even if factually the Notification were to so permit, the appellant could not have done so in law.
(3.) The High Court accepted both the contentions, the correctness of which has been assailed in these appeals. Factual matrix;