BANK OF BIHAR LTD Vs. COMMISSIONER OF BUXAR MUNICIPALITY

JUDGEMENT

(1.) This application by the Bank of Bihar Ltd. under Articles 226 and 227 of the Constitution of India is for the issuance of a writ in the nature of certiorari quashing the decision, dated the 30th May 1962, of the Revising Committee of the Buxar Municipality and the demand notices issued by the said Municipality.

(2.) The petitioner (the Bank of Bihar Ltd.) is a joint stook Company transacting business is a banker within the limits of the Patna Municipal Corporation, Patna, and the petitioner was assessed to the professional tax as a joint stock company under the provisions of Sections 128 (1) (i) and 177 read with Clause 1(1)(a) of the second schedule of the Patna Municipal Corporation Act (Bihar Act 18 of 1952). The petitioner has several branch offices in the State of Bihar, Uttar Pradesh and West Bengal and one of the branch offices was at Buxar. The petitioner received a demand notice for professional tax under Section 128 of the Bihar and Orissa Municipal Act (Act VII of 1922), on the 20th July 1981. and was directed to pay professional tax of Rs. 250 for the year 1960-61 (vide Annexure A). The petitioner filed objections mainly on the ground that the office or the petitioner at Buxar was only a branch office and not a joint stock company as mentioned in Clause 1 (a) of the fourth schedule to the Bihar and Orissa Municipal Act and the said branch office was not liable to be assessed as a joint stock company. Moreover, me monthly valuation in respect or the premises occupied by the said branch office was Rs. 100 only and as such it was liable, if at all, to professional tax under Clause 1 (b) (d) of the fourth Schedule to the said Act. The copy of the objection petition has been marked Annexure 'B'. The said objections were considered by the Revising Committee of the Buxar Municipality and a copy (Annexure 'C') of its decision, dated the 30th May 1962, was lent to the petitioner by a letter, dated the 2nd June 1962. The copy of the letter has been marked Annexure 'D'. The said Committee overruled the objections holding that the branch office of the Bihar Bank at Buxar was carrying on banking business for making profit within the Buxar Municipal area and as such the Bank had to take out half yearly license and pay the professional tax assessed on it. The assessment of Rs. 125 as professional tax half yearly was held to be fully justified. On the 21st June 1962, the petitioner received another demand notice, dated the 7th June 1962, in respect of the professional tax for the two kists of 1960-61 and 1961-62 each and a copy of this demand notice has been marked Annexure 'E'. The ease of the petitioner was that the said notice of demand was ab initio void as it purported to be under Section 128 of the Bihar and Orissa Municipal Act and not under Section 82 (1) (ff) and Section 150-A of the said Act. In these circumstances, the petitioner made a prayer for the quashing of the said order or the Revising Committee and the notices of demand. Subsequently, the petitioner filed additional grounds in support of the petition indicating that the Bihar Municipal (Amendment) Act. 1958 (Bihar Act XXXII of 1938) amending Section 82 and inserting Sections 150-A to 130-1 and the fourth schedule were ultra vires, in so far us it infringed the equality clause enshrined in Article 14 of the Constitution of India and imposed unreasonable restrictions in contravention of Article 19 (1) (g) of the Constitution of India. Another ground was that the proviso to Clause (sic) in Sub-section (1) of Section 82 as it stood after the amendment was discriminatory on the very face of it, inasmuch as it conferred uncontrolled and arbitrary powers on the State Government to exempt certain classes of profession, trade or callings, according to the sweet will or the executive.

(3.) Learned counsel for the petitioner (the Bank of Bihar Ltd.) submitted at the outset mat the Commissioners of Buxar Municipality (respondent 1) had no jurisdiction to assess the petitioner in respect of me business which was carried on by me branch office of the petitioner at Buxar and the petitioner as joint stock company was transacting business as a banker within the limits of the Patna Municipal Corporation only. The contention was that the petitioner had no doubt branch offices at several places and one happened to be at Buxar, but the head office of the petitioner was within the jurisdiction of the Patna Municipal Corporation and the profit, if any accrued at Patna and not at Buxar. Learned counsel pointed out that the branch office at Buxar was under the supervision and control of the Directors of the Bihar Bank Ltd. and the Joint stock company had one paid up capital and not separate ones in respect of each branch. The Bank of Bihar Ltd. had no doubt its branch offices in various towns within the jurisdiction of various Municipalities, but it was not liable to pay professional tax separately to all those Municipalities in respect of the business which was carried on by those branch offices and the present assessment in respect of the business of the branch office at Buxar was not justified even according to Clause 1 (a) of the fourth schedule to the Bihar and Orissa Municipal Act, 1922. Before dealing with these contentions, I would refer to some of the provisions of the Bihar and Orissa Municipal Act, 1922. Section 82 (1) provide as follows:--