U.S. Srivastava, J. - (1.) The facts, which have given rise to this petition, are these. The Petitioner is resident of town Kheri pergana and tahsil Lakhimpur, district Lakhimpur. His case is that he does not own any property yielding any income nor does he carry on trade or profession or earn any income within the limits of Town Area Kheri. On the 19th of November, 1966 the Petitioner came to know for the first time that he had been assessed to an amount of Rs. 260/ - as circumstances and property tax for the year 1966 -67 when he received a demand notice for the same. The Petitioner filed an appeal which was dismissed on 23rd September, 1967. He thereupon filed the present petition praying for the quashing of the assessment in relation to the year 1966 -67 and also prayed for quashing of the order dated 23rd September, 1967, being the order passed by the opposite -party no 2 to the petition, namely, Additional Sub -Divisional Magistrate, Lakhimpur -Kheri in the appeal preferred by the Petitioner before him. When the petition came up for hearing before a Bench of this Court on the 30th of November, 1970, the Petitioner placed reliance on a Full Bench decision of this Court in Town Area Committee Sirsaganj district Mainpuri v/s. N.L. Churaman, 1966 AWR 214. The learned Counsel for the opposite parties then contended that this decision needed reconsideration. He also relied on certain passages in the judgment of their Lordships of the Supreme Court in Ram Narain v/s. The State of Uttar Pradesh : AIR 1957 SC 18 : 1957 AWR 63. The case was then referred by the Bench to a Full Bench of five Judges and that is how the matter has come before us.
(2.) The material facts are not in dispute between the parties. The Petitioner admittedly does not carry on any business, trade or profession within the limits of Town Area Kheri and has for several years been carrying on business in the territories comprised in the kingdom of Nepal. He only resides there and the question therefore that arises for consideration in the case is whether in the circumstances he can be assessed to circumstances and property tax by the Town Area, Kheri wherein he resides although no income may be accruing to him from any business or trade carried on in the said Town Area.
(3.) The liability to pay Town Area's circumstances and property tax arises under the provisions of Sec. 14(1)(f) of the U.P. Town Areas Act, hereinafter called the Act. It lays down that a Town Area Committee may impose "a tax on persons assessed according to their circumstances and property not exceeding such rate and subject to such limitations and restrictions as may be prescribed." The State Government in exercise of the powers conferred Under Sec. 39 Sub -section (1) and Sub -section (2)(i) of the Act made "United Provinces Town Areas Circumstances and Property Tax (Assessment and Collection) Rules" to regulate the imposition, assessment and collection of circumstances and property tax imposed under the Act. Rule 3(1) of these rules provides that the tax: may be imposed on any person residing or carrying on business within the limits of the Town Area: Provided that such person has so resided or carried on business for a total period of at least six months in the year of assessment. According to the Explanation attached to the rule, "taxable income" means "gross income accruing within the limits of the town area" and the words "carrying on business" means "the carrying on of any trade, profession, calling or other practice or activity which yields...income but do not include service under Government or a local body." Under Rule 2 the tax is imposed in two separate parts, (1) on his circumstances and (2) on the property, if any, owned by the assessed person and the aggregate of the sums so determined on both the courts constitutes the total amount payable as circumstances and property tax.;