Judgment

AYYANGAR, J. : This petition under Art. 32 has been filed impugning the validity of two notices of demand served on the petitioners requiring them to pay what has been compendiously described as "coal tax" by the respondent, which is a Local Board constituted under the Central Provinces & Berar Local Government Act, 1948 (C. P. & Berar Act XXXVIII of 1948). The ground of challenge is that there was no legislative power for the levy of the tax and that consequently the fundamental rights of the petitioners under Art. 19(1)(f) and (g) are being violated.

2. It may be stated at the outset that the tax now impugned has been imposed by the local authority from March 12, 1935 and that the first occasion when its validity was attacked was in only 1957, though if the petitioners are right in their submission their acquiescence might not itself be a ground for denying them relief. Before however we set out the points urged by the learned Attorney-General in support of the petition, it would be convenient if we narrate briefly the history of the levy of this tax.

3. Section 51 of the Central Provinces Local Self-Government Act, 1920 (C. P. Act IV of 1920), which will be referred to hereafter as the Act, ran :

"51(1). Subject to the provision of any law or enactment for the time being in force, a district council may, by a resolution passed by a majority of not less than two-thirds of the members present at a special meeting convened for the purpose, impose any tax, toll or rate other than those specified in Ss. 24, 48, 49 and 50.

2. The first imposition of any tax, toll or rate under sub-sec. (1) shall be subject to the previous sanction of the local Government."

4. The petitioners are working certain mines situated in the district of Chhindwara and for the area covered by the mines an Independent Mining Local Board was constituted in or about 1926 and such Boards are included in the definition of a Local Board under the Act and they have vested in them all the powers of a District Council. This Mining Board, after obtaining the previous approval of the local Government, passed on March 12, 1935, by the majority requisite under S. 51 (1) of the Act a resolution to impose a tax on coal, coal-dust and coke in the following terms :

"The tax shall be levied at the rate of three pies per ton on coal, coal dust or coke, manufactured at the mines, sold for export by rail or sold otherwise then for export by rail within the territorial jurisdiction of the Independent Mining Local Board."

The tax has been levied and collected ever since.

5. The Local-Self Government Act of 1920 was repealed and re-enacted by the C. P. & Berar Local Government Act, 1948 (Act XXXVIII of 1948), but nothing turns on this, because the later enactment and certain amendments made subsequently contain provisions for the continuance of the Local Boards constituted under the repealed enactment and for the continued exigibility of the taxes and cesses in force at the date of the commencement of the Act of 1948. The respondent was, as stated earlier constituted under the Act of 1948 and is admittedly the successor of the Independent Mining Board which imposed the tax by its resolution dated March 12, 1935 and is legally entitled to continue the levy if the original imposition was valid. There is only one other matter to be mentioned at this stage, viz., that the rate of duty which as seen from the resolution extracted earlier, was 3 pies per ton when imposed in 1935 was raised by the local body to 9 pies per ton in 1949, this being the rate which now prevails. On August 23, 1958, the Chief Executive Officer of the respondent-Sabha served two notices of demand on the first and second petitioners requiring them to pay sums of Rs. 21,898,64 and Rs. 11,838,09 respectively as the tax due by each, for despatches of coal from their respective mines for the period January 1, 1958, to June 30, 1958. It is the validity of these notices that is impugned in this petition.

6. The submi