The octroi limits fixed under a by-law framed by a municipality extend up to the limits of the municipal district as extended by a government declaration.

Headnote:
OCTROI DUTY - Imposition - Octroi limits fixed under by-law framed by Municipality - Whether extend up to the limits of Municipal District as extended by Government declaration - Whether Municipality can make a by-law fixing such octroi limits as vary from time to time - Whether Municipality can pick and choose between its parts and exempt any part of it from the levy of octroi duty - Bombay District Municipal Act, 1901 (Bom. Act III of 1901), Ss. 3(5), 4, 59(1)(b)(iv), 77(2), 81, 191B, 20; Bombay General Clauses Act, 1904, S. 20.
Fact of the Case:

The appellant municipality framed a by-law under S. 48 of the Bombay District Municipal Act, 1901, fixing octroi limits, in these terms: "The Octroi limits of the Municipal District shall be the same as the Municipal Districts." The dispute is as to the Meaning of the words "Municipal Districts" in this by-law.
Finding of the Court:

The octroi limits fixed under by-laws No. 3 include the area newly added to the municipal district by the notification of August 25, 1959 and that, consequently, the respondent company was liable to pay octroi duty on the goods entering its premises.
Issues: Whether the octroi limits fixed under by-law framed by the Municipality extend up to the limits of the Municipal District as extended by the Government declaration?
Ratio Decidendi: 1. The expression "municipal district" in the by-law will have the same meaning as that expression has in the Act, unless there be anything repugnant in the subject or context. 2. The octroi duty is, by nature, a duty which is realised on goods entering certain limits over which the municipality charging the octroi has control. 3. The use of the expression "octroi limits" in cl. (iv) of S. 59 (1) (b) therefore need not lead to the conclusion that a municipality can pick and choose between its parts and exempt any part of it from the levy of octroi duty. 4. The municipality does not exceed its jurisdiction to framed the by-law fixing the octroi limits to vary from time to time according to the limits of the municipal district. 5. There is nothing in the Act or rules which disables the municipality to fix the octroi limits in this way, or, in other words, which makes it incumbent on the Municipality to fix the octroi limits as frequently as the area of the municipal district is altered by a notification of the Government under S. 4.
Final Decision: Appeal dismissed.

Judgment

SARKAR, J. : (On behalf of himself and S. K. Das and J. L. Kapur, JJ.) This is an appeal against a judgment of the High Court of Mysore which held that the respondent was not liable to pay any octroi duty to the appellant municipality in respect of dutiable goods brought to its factory as on a proper interpretation of the appellant s by-law fixing the octroi limits, the respondent s factory was outside those limits. The question that arises in this appeal is one of the interpretation of that by-law.

2. The appellant municipality was constituted under the Bombay District Municipal Act, 1901. Section 4 of the Act gives power to the Government to declare any local area to be a municipal district and to extend, contract, or otherwise alter the limits of any municipal district. Section 9 provides that there shall be a municipality for every municipal district. Section 59 of the Act inter alia provides that a municipality may subject to certain conditions impose "an octroi on animals or goods, or both brought within the octroi limits for consumption, use or sale therein." In exercise of its powers under this section, the appellant municipality imposed an octroi duty on certain goods. Section 48 of the Act gives a municipality power to frame by-laws for various purposes including that of "fixing octroi limits". The appellant municipality framed a by-law under this section fixing octroi limits, in these terms : "The Octroi limits of the Municipal District shall be the same as the Municipal Districts." The dispute is as to the Meaning of the words "Municipal Districts" in this by-law.

3. The respondent is a company owning a factory which prior to September 3, 1959 was outside the municipal district of the appellant municipality as such district was till then constituted. There is no dispute that the respondent has all along been bringing into its factory goods of the variety specified in the rule imposing the octroi duty for consumption and use therein but no duty was payable so long as the respondent s factory was outside the municipal district and therefore also admittedly, outside the octroi limits as defined by the aforesaid by-law. By a notification issued on August 25, 1959, the Government of Mysore extended the municipal district of the appellant municipality with effect from September 3,1959 and as a result of this extension the respondent s factory came to be included within that district. On such extension the appellant municipality demanded octroi duty on goods brought into the respondent s factory contending that the factory had thereupon come within its octroi limits as defined by the by-law. The respondent disputed this contention and moved the High Court of Mysore under Art. 226 of the Constitution for a writ of mandamus directing the appellant municipality to forbear from collecting the duty. The High Court did not accept the appellant municipality s contention and issued the writ.

4. The question is whether upon the extension of the municipal district the factory came within the octroi limits as defined by the by-law. The appellant municipality says it did and for these reasons: The expression "municipal district" has not been defined in the by-laws and therefore the definition of that expression in S. 3 (5) of the Act would by virtue of S. 20 of the Bombay General Clauses Act, 1904 apply in interpreting the by- law. Under sub-sec. (5) of S. 3 of the Act a municipal district means the municipal district of a municipality for the time being and, hence the octroi limits prescribed by the by-law would be the municipal district of the appellant municipality as constituted from time to time. Upon the extension of the appellant municipality s municipal district, therefore, its octroi limit would stand extended and the factory would admittedly be within the extended limits.

5. We are unable to accede to this contention. It is based on S. 20 of the General Clauses Act. Now under that section, expressions used in by-laws ar

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