IMPORTANT POINT
Exemption under Article 12-A is not available to industrial units located in the Industrial Areas.

JUDGMENT

ASHOK BHUSHAN, J.

Leave granted.

2. This appeal has been filed against the judgment and order dated 17th July, 2014 of High Court of Judicature at Allahabad by which judgment Civil Misc.Writ (Tax) No.447 of 2014 filed by the appellants has been dismissed.

3. The brief facts of the case are:

Appellant No.1 is an Industries Association registered under the Societies Registration Act, 1860 whose members are running small industries. Zila Panchayat, Hapur initiated proceedings for realisation of tax for members of the appellant -Association which was objected to and a representation was submitted to the District Magistrate. Appellant also represented the matter to the Upper Mukhya Adhikari, Zila Panchayat, Bulandshehar and filed a Civil Misc. Writ Petition (Tax) No.4 of 2013 which was disposed of by the Allahabad High Court by order dated 6th January, 2014, directing the State Government to consider the appellant's representation. The representation submitted by the appellant was rejected by the Principal Secretary, Panchayat Raj vide its order dated 23rd June, 2014. The State Government held that although the area has been declared as industrial area under U.P. Indusrial Area Development Act, 1976 but no notification having been issued as industrial township within the meaning of Article 243-Q(1) proviso of the Constitution, the Zila Panchayat/Nagar Panchayat is entitled to realise tax and appellants cannot claim exemption from taxation by local authority. Aggrieved by the order of the State Government, appellants filed a Civil Misc. Writ (Tax) No.447 of 2014 claiming the following reliefs:

"A. Call for the records of the case; and issue writ, order or direction in the nature of certiorari quashing the order dated 23-6-2014 passed by respondent No.1 (Annexure 8 to this writ petition).

B. Issue writ, order or direction in the nature of mandamus directing the respondent Nos.2, 3 and 4 not to realise any taxes from the members of petitioner No.1 (as mentioned in paragraph No.10 of the writ petition and other members of petitioner No.1).

C. Issue any other writ, order or direction the Hon'ble Court deems just and proper on the facts and circumstances of the case.

D. Award cost of this petition to the petitioner."

4. The writ petition was heard by the High Court and the same was dismissed by its judgment dated 17th July, 2014. The Division Bench of the High Court relying on an earlier Division Bench judgment in Rishipal & Ors. v. State of U.P. & Ors., 2006 (1) AWC 426, dismissed the writ petition. The Division Bench also held that the area having not been declared as industrial township, exemption as sought to be claimed by the appellants under Section 12-A of 1976 Act is misconceived. Aggrieved by the judgment of the High Court, the appellants have filed this appeal.

5. We have heard Ms. Meenakshi Arora, learned senior counsel for the appellants, Mr. Aviral Saxena has appeared on behalf of respondent No.5. We have also heard learned counsel appearing for the State of U.P.

6. Learned counsel for the appellant contends that area in question having been declared as industrial area by issuing a notification dated 5th September, 2001 in exercise of power under Section 2(d) of U.P. Indusrial Area Development Act, 1976 (hereinafter referred to as 1976 Act'). The appellants are entitled for the benefit of exemption as contemplated by Section 12-A of the 1976 Act and by virtue of Section 12-A no Panchayat is to be constituted for the said area. Hence, the Zila Panchayat is not entitled to realise any tax under the Uttar Pradesh Kshetra Panchayat and Zila Panchayat Adhiniyam, 1961.

7. The Authority constituted under the 1976 Act fully satisfied the condition under Section 12-A of the 1976 Act, hence, there is no requirement of issue of any separate notification as contemplated by Article 243-Q of the Constitution of India. It is submitted that once industries have been set up under the notified industrial development area and taxes under Section 1