JAYANTILAL NARANBHAI SHAH Vs. DHOLKA MUNICIPALITY
HIGH COURT OF GUJARAT
JAYANTILAL NARANBHAI SHAH
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(1.)The petitioners who are residents of Dholka have filed this petition in their capacity as tax payers challenging the revised octroi schedule where under octroi duty on several items is sought to be substantially increased. The facts leading to this petition briefly stated are as under.
(2.)The respondent Municipality passed a Resolution No. 285 dated 1/02/1978 for the upward revision of octroi duty as per the revised schedule appended to Annexure A to the petition. The proposal was then forwarded to the State Government as required by sec. 101(c) of the Gujarat Municipalities Act 1963 (hereinafter called the Act). Sec. 99 of the Act empowers the Municipality to impose certain taxes including octroi. Sec. 101 requires the Municipality to observe the preliminary procedure of passing a resolution at a general meeting selecting the tax to be imposed and approving the rules prepared as required by clause (1) of sec. 271 of the Act. The resolution should inter alia specify the classes of persons or property or both to be subjected to tax and the amount or rate at which the municipality proposes to assess each such class. After the resolution is passed it is incumbent upon the municipality to publish the rules so approved with a notice in the prescribed form. Clause (c) thereof with which we are concerned provides that any inhabitant of the municipal borough objecting to the imposition of the said tax or to the amount or rate pro posed or to the classes of persons or property to be made liable thereto or to any exemptions proposed may within one month from the publication of the notice send his objections in writing to the municipality. After the objections are received the said clause enjoins upon the municipality to take into consideration all such objections or authorize a committee to consider the same and report thereon and unless it decides to abandon the proposed tax it must submit such objections with its opinion thereon and any modifications proposed in accordance therewith to the State Government. Sec. 102 next provides that the State Government may refuse to sanction the rules submitted under sec. 101 or may return them to the municipality for further consideration; or if no objection or no objection which is in its opinion sufficient was made to the proposed tax within the period prescribed under sec. 101 may sanction the said rules without modification or subject to such modifications not involving an increase in the amount to be imposed as it deems fit. Sec. 103 provides for the publication of the sanctioned rules.
(3.)The petitioners case is that after the notice was published as required by sec. 101(b) of the Act objections were received to the proposed hike in the octroi rates and the same were considered by the municipality. However the municipality over ruled the said objections. The proposal was then forwarded to the State Government for according sanction. The petitioners contend that the objections taken to the proposed octroi rates were not submitted by the municipality to the State Government and therefore the State Government had no opportunity to consider the objections taken by the petitioners and other citizens. This is the first ground on which the proposed revised schedule of octroi rates is challenged by the petitioners. The second ground is that the proposed octroi rates are sought to be increased mala fide with a view to granting benefit to persons dealing in waste yarn and cotton yarn at the cost of dealers of other items. These are the two contentions on the basis of which the proposed octroi rates have been challenged. As I am of the view that the challenge must succeed on the first count I do not consider it necessary to examine the second count.
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