JUDGMENT

KULDIP SINGH, J.:- The imposition of "theatre tax" by the Nagar Mahapalika, Lucknow has been challenged by the cinema owners/lessees in these petitions under Art. 32 of the Constitution of India.

2. Sections 172 and 2(77) of the U.P. Nagar Mahapalika Adhiniyam, 1959 (the Act) are reproduced hereunder:-

"Section 172 : Taxes to be imposed under this Act.

(1) For the purposes of this Act and subject to the provisions thereof and of Art. 285 of the Constitution of India, the Mahapalika shall impose the following taxes, namely:-

(a) Property taxes,

(b) & (c).............................

(2) In addition to the taxes specified in sub-sec. (1), the Mahapalika may for the purposes of this Act and subject to the provisions thereof impose any of the following taxes, namely-

(a) a tax on trades, callings and professions and holding of public or private appointments;

(b) to (h).............................

(i) a theatre tax; and

(j) any other tax which the State Legislature has the power under the Constitution of India to impose in the State.

(3) The Mahapalika taxes shall be assessed and levied in accordance with the provisions of this Act and the Rules and bye-laws framed thereunder.

(4) Nothing in this section shall authorise the imposition of any tax which the State Legislature has no power to impose in the State under the Constitution of India.

Section 2 : In this Act unless there be something repugnant to the subject or context-

(77) "theatre tax" means a tax on amusement or entertainments.

3. Sub-section (1) of S. 199 of the Act requires the Nagar Mahapalika to make a preliminary proposal specifying the tax which it desires to impose under S. 172(2) of the Act, the persons or class of persons to be made liable, the amount or rate leviable for each such person or class of persons and any other information which the Government requires. It further requires the executive committee of the Nagar Mahapalika to draft the rules in that respect which are finally to be framed by the State Government. The draft rules are published in the prescribed manner to enable the affected public to file objections. S. 200 of the Act makes it obligatory for the Nagar Mahapalika to consider the objections so received and to re-publish the draft rules in case any change is made therein as a result of such consideration. After considering all the objections the draft rules are finalised by the Nagar Mahapalika and are forwarded to the State Government along with the objections. S. 201 of the Act empowers the State Government to reject, modify or to accept the proposed rules. Under S. 202 of the Act it is only after the rules are finalised by the State Government that the Nagar Mahapalika can pass a special resolution imposing the tax from the date to be specified. Under S. 203 the special resolution is sent to the Government and the tax is imposed on the publication of the resolution in the Government Gazette. S. 540(4) of the Act provides that all rules made under the Act shall be laid for not less than 14 days before each House of the State Legislature as soon as they are made and shall be subject to such modifications as the Legislature may make during the session they are so laid.

4. The proposal of the Nagar Mahapalika, Lucknow to levy theatre tax, @ Rs. 5 / - per cinema show held in a building assessed on annual rental value of Rupees 1 0,000 or more and @ Rs. 3 per cinema show held in a building assessed on annual rental value of less than Rs. 10,000/-, was accepted by the State Government by following the procedure laid down under the Act. The rules called The Lucknow Nagar Mahapalika Theatre Tax Rules were framed and enforced with effect from December 15, 1965 and thereafter the tax was levied with effect from June 1, 1967. The rate of tax was increased from time to time and finally by a notification dated October 30, 1979 published in the U. P. Government Gazette dated October 31, 1979 the theatre tax was enhanced to Rs. 25 / - per show on all class-I cin