- (1.) The present writ petition has been filed by the Petitioner-Oriental Insurance Company Ltd., Jhinghara Road, Shambi through its Assistant Manager, Legal Cell. 16A Mahatma Gandhi Marg, Civil Lines, Allahabad for the issuance of writ of certiorari quashing the Government order dated 9.6.1997 and notice dated 31.1.2001 and also for directing by way of mandamus not to impose the licence fee.
(2.) The brief facts of the case are that the Petitioner is a Government of India undertaking and nationalised insurance company created under an Act of the Parliament. Under the (General Insurance Business Nationalisation) Act, 1992, the apex body General Insurance Corporation has been established under Section 9 and it formed it's four subsidiary companies one of which is the Petitioner. Having its branch in the limit of Nagar Palika Parishad, Shamli, district Muzaffarnagar, the aforesaid business of insurance is exclusively in the Union List at Entry No. 47 and can be governed and controlled by the Central Government and the Parliament is only competent to make laws for the same. The insurance companies do not carry on any trade or business for any personal gain but are Government of India establishments and their funds are Government of India funds.
(3.) The Respondent No. 1 Nagar Palika Parishad, Shamli, in the exercise of its power under Section 298 of U.P. Nagar Palika Act, 1916 framed certain bye-laws which were published in the light of the direction of State of U.P. contained in its G.O. dated 9.6.1997, which is annexed as Annexure 1 to the writ petition. In accordance with law those bye-laws Respondent has imposed for first time licence fee of Rs. 12,000 for the year 1999-2000 and Rs. 12,000 for the year 2000-2001 on insurance company under Clause 26 of the Government order. In pursuance of aforesaid G.O. the Respondent No. 1 has sent notice dated 31.1.2001 to the Petitioner's company. The true copy of said notice dated 31.1.2001 has been annexed herewith as Annexure 2 to the writ petition. The Petitioner submits that nowhere in the Act nor in Section 298 any power is given to the Respondents to impose any licence fee on the insurance business. The Act does not provide for any power to impose licence fee on the insurance company. The Respondents do not provide any kind of service to the branches of the Petitioner-company and hence no regulation is required for it's branches by the Nagar Palika Parishad and as such no licence fee can be imposed under any circumstances apart from the fact that the Insurance companies are created under the Central Act in exercise of the power by the Parliament and the Central Government in Entry 47 of List 1 of Schedule 7 can alone impose any such tax of licence fee. The banking business and life insurance business is also under the Union List and they tender similar nature of service to the public like that of the insurance companies but no fee has been imposed on the banking companies operating in public sector or private sector. Under Section 541 of the Nagar Palika Act, provides for the purposes for which bye-laws can be framed. But the insurance business does not find place in that nor particularly in Sub-sections (26), (36), (41) and (43) of Section 541. The licence fee of Rs. 12,000 yearly for two years Rs. 24,000 is highly arbitrary, exorbitant for no services being rendered by the Respondent and there is no element of quid pro quo in the same.;