RANJIT HOSIERY MILLS Vs. AHMEDABAD MUNICIPAL CORPORATION

JUDGEMENT

(1.) By these two petitions the petitioners challenge the amendment made in Entries 19A and 19B in Schedule A of Rule 14 of the Octroi Rules framed in exercise of powers conferred on the Municipal Corporation by virtue of sec. 457(7) read with sec. 149(1) of the Bombay Provincial Municipal Corporations Act 1949 Before the amendment cotton yarn was liable to octroi duty on weight basis under Entry 19(a). All other yarns (other than cotton yarn) were also similarly liable to octroi allout on the basis of weight albeit the rate of octroi duty under the aforesaid two entries varied. By amending the said two entries the basis for calculating the duty has been changed from weight basis to ad valorem basis. Under the amended Entry 19A octroi duty on cotton yarn is imposed at Re. 1/- p. c. Adv. while under Entry 19B the rate of duty is Rs. 2-00 p.c. Adv. The grievance of the petitioners is that the change from weightbasis to ad valorem basis by the amendment of the two entries is unreasonable and violative of Articles 14 and 19 of the Constitution in that it has thrown a heavy and unbearable additional .monetary burden on the petitioners. We do not see any merit in this submission.

(2.) It seems well settled that a taxing statute cannot be challenged can the were ground that the tax imposed by the law is heavy. In JAGANNATH V. UNION OF INDIA A I.R. 1962 S.C. 148 the Supreme Court has in clear and unmistakable language laid down that a challenge to tax law on the mere ground that the tariff imposed by the tax law is heavy cannot be entertained. Again in S. NARAYAN V. UNION OF INDIA A I.R. 1976 S.C. 1986 Ray C. J. speaking for the Court observed that the A Courts had no jurisdiction under Article 226 of the Constitution to go into the reasonableness of Telephone Tariff Rates. It was pointed out that the rates are fixed as a matter of special planning and policy which cannot be subjected to judicial determination. It is therefore clear from the aforesaid two decisions of the Supreme Court that the challenge on the mere ground that the impost is unreasonably heavy cannot succeed.

(3.) The next question is whether the petitioners can challenge the levy on the ground that subsequent of the amendment of the two entries octroi duty is levied on the basis of the value of the an and not on the basis of weight as was the case before the amendment of the two entries. Our attention has not been drawn to any provision of law which prohibits such a change in the manner of levy of octroi duty. In fact as held by the Supreme Court in ANDHRA SUGARS LTD. V. STATE OF I ANDHRA PRADESH A. I. R. 1968 S. C. 599 the argument that percales tax could not be levied with reference to tonnage was repelled by observing than the purchase tax is levied with reference to the price of the goods but it is competent to the Legislature to levy the tax with reference to the weight of the goods purchased. On the same line of reasoning in the absence of any statutory provision to the contrary there can be little doubt that octroi duty can be levied on the basis of the value of the goods. Merely because in the past under the old entries octroi duty was levied on year on weightbasis it cannot be argued that the authorities were not competent to make a change by providing that from the date of the amendment octroi duty on yarn shall be recovered on the basis of the value of the yarn imports. We are therefore of the opinion that there is no merit in this submission urged on behalf of the petitioners.