S. R. Das, C. J. - (1.) The appellant is a public limited company registered under the Indian Companies Act, 1913. It is a lessee of four cinema houses situate within the municipal limits of Poona City known respectively as "Minverva", "The Globe", "Sri Krishna" and "The Nishat". It exhibits cinematography films, both foreign and Indian, in the said four houses. The respondent, a body corporate, was governed by the Bombay District Municipal Act, 1901 (Bom. III of . 1901) up to June 8, 1926, and from then by the Bombay Municipal Boroughs Act, 1925 (Bom. XVIII of 1925) up to December 29, 1949, and, thereafter, by the Bombay Provincial Municipal Corporation Act, 1949 (Bom. LlX of 1949). With effect from October 1, 1920, the respondent, with the sanction of the Government of Bombay levied on the owners and lessees of cinema houses within the limits of the erstwhile province of Bombay a tax of Rs. 2 per day as license fee. Rules for the levy and collection of the said tax were framed by the respondent. Those rules were amended on or about June 3, 1941, enhancing the tax from Rs. 2 per day to, Re. 1 per show. The rules were again revised on or about June 9 1948, under which the tax was enhanced from Re. 1 per show to Rs. 5 per show. At all material times the tax was being collected at the last mentioned late.
(2.) Section 59 of the Bombay District Municipal Act 1901 provided that subject to any general or special orders which the State Government might make in that behalf any municipality (a) after observing the preliminary procedure required by S. 60, and (b) with the sanction of the authority therein mentioned, might impose for the purposes of that Act any of the taxes mentioned in that section. After enumerating ten specific heads of taxes, which a municipality could levy, a residuary category was set forth in cl. (xi) in the words following:- "Any other tax to the nature and object of which the approval of the Governor in Council shall have been obtained prior to the selection contemplated in sub-clause (i) of cl. (a) of section 60." Ever since the appellant became a lessee of the,said cinema houses, the appellant has been making payments of the said tax under protest.
(3.) After giving the necessary statutory notice to the respondent, the appellant, an or about March 31, 1950, filed a suit in the Court of the Civil Judge, Senior Division, Poona, being Suit No. 76 of l950, against the respondent for a declaration that the levy and imposition of the said tax with effect from October 1, 1920, were invalid and illegal; that the enhancement in the rates of the tax with effect first from June 3, l94l, and then June 9, 1948, was invalid and illegal and that the resolutions passed and rules framed in connection with the levy, imposition, enhancement and collection of the said impugned tax were invalid, illegal and ultra vires, for a permanent injunction restraining the defendants from levying or recovering and or increasing and enhancing the said tax and for refund to the appellant of the amounts of the tax collected from it and for costs of the suit and interest. By its judgment dated November 30, 1951, the trial Court held that the said tax was validly levied and imposed, but that the increase and enhancement thereof in 1941 and 1948 were illegal and ultra vires and that the suit was not barred under the Acts governing the respondent. The trial court decreed the suit in part by issuing an injunction restraing the respondent from levying, recovering or collecting the tax at the enhanced rate and passing a decree against the respondent for refund of a sum of Rs. 27,072 with interest and costs. The respondent preferred an appeal and the appellant filed cross objections. But the High Court by its judgment and decree dated February 10, 1948, reversed the judgment of the trial court and dismissed the suit of the appellant with costs throughout. The appellant's cross objections were also dismissed. On December 10, 1953, the High Court granted leave to the appellant to appeal to this Court from the said judgment. Hence this final appeal questioning the validity of the impugned tax.;