Jagat Narayan, J - (1.) THIS is petition under Art. 226 of the Constitution by 19 business-men of Sojat Road challenging the validity of taxes imposed on items Nos. 12, 13 and 14 by the Panchayat Samiti, Sojat Road, under its resolution dated 18. 11. 61.
(2.) UNDER sec. 33 (2) (i) the Panchayat Samiti has power to impose a tax on such trades, callings, profession and industries as may be prescribed. The trades, callings, professions and industries have been prescribed under the Schedule to the Rajasthan Panchayat Samitis Taxation Rules, 1960. The maximum rate of tax is also prescribed in this schedule. So far as business-men are concerned the following are the relevant items of the schedule: - Maximum rate per annum 4. Bankers, money-lenders, money-changers, pawn-brokers and abkari renters. Rs. 200/- 5. Wholesale and retail traders, auctioneers, manufacturers, contractors, owners of ships and boats and commission agents. Rs. 100/- 6. Brokers, dealers in securities, shares or bills of exchange Rs. 50/- The dispute items run as follows - 12. Money-lenders having annual income above Rs. 1000/ -. 13. Commission agents and other businessmen having annual income above Rs. 1000/- 14. Wholesale and retail traders, commission agents, auctioneers and manufactures, having annual income above Rs. 1000/ -. The maximum rate of tax prescribed for each of the above three categories is Rs. 200/- per annum and it has to be assessed at Rs. 2/- per cent of the annual income. The main, contention on behalf of the petitioners is that the assessment of the above tax on the basis of income is invalid as it really amounts to income tax and not a tax on business. I am unable to accept this contention. There can be no doubt that in a way this amounts to a tax on income but at the same time it is also a tax on business the assessment of which is made on the basis of the income from the business.) Article 267 of the Constitution lays down that notwithstanding anything in Art. 246 of the Constitution taxes can be levied by the Legislature of a State for the benefit of the State or of a municipality. , district board, local board or other local authority therein in respect of professions, trades. , callings or employment and they shall not be invalid on the ground that they relate to at ax on income. The next contention is that taxes under items (13) and (14) exceed the limits laid down in the schedule to the Rajasthan Panchayat Samitis Taxation Rules, 1960. The categories of business-men mentioned in items (13) and (14) fall under item No. 5 of the schedule under which the maximum rate of tax prescribed is Rs. 100/- per annum. I accordingly hold that the levy of tax above Rs. 100/-under items Nos. (13) and (14) is beyond the powers of the Panchayat Samiti. It was also contended on behalf of the petitioners that the Panchayat Samiti did not consider the objections filed by the residents of the villages against the imposition of taxes. I am unable to accept this contention. A perusal of the proceedings of the Panchayat Samiti dated 18. 11. 61 goes to show that the objections which were filed by the residents were duly considered. Another argument which was advanced was that as no notification under sec. 6 of the Rajasthan Panchayat Samitis and Zila Parishads Act was published including part of village Dundla in the Sojat Development Block, the Panchayat Samiti of Sojat has no jurisdiction to levy any tax on the residents of village Dundla. It has not been mentioned in the petition whether any of the petitioners is a resident of that part of village Dundla which was transferred to Sojat Tehsil. In any case this objection also has no force. There was a notification under sec. 6 of the Rajasthan Panchayat Samitis and Zila Parishads Act under which the entire Tehsil of Sojat was included in the Sojat Development Block. On 1st July, 1961 there was a notification transferring part of Dundla village to Sojat Tehsil. This notification was published under sec. 16 of the Rajasthan Land Revenue Act. In view of the wordings of the original notification under sec. 6 constituting the Sojat Development Block, the effect of the notification dated 3. 7. 61 issued under the Revenue Act was, to include part of village Dundla, which was included in Sojat Tehsil in the Sojat Development Block. The writ petition is accordingly allowed in part as indicated above. The Panchayat Samiti Sojat is restrained from recovering taxes from the petitioners in contravention of the above decision. .;