Ranjana Desai, J.

1. The petitioner-Company is, inter alia, engaged in the manufacture and sale of aerated beverages marketed under different brands. The products of the company are distributed from its plant at Roha, District Ratnagiri through its chain distributors to places like Sangli, Miraj and Kupwad.

2. Respondent 1 is the Sangli Miraj Kupwad Municipal Corporation (for short, “the Corporation”) constituted under the Bombay Provincial Municipal Corporation Act, 1949 (for short, “the BPMC Act”). Respondents 2 and 3 are the officers of respondent 1. Respondent 3 is the Octroi Superintendent, who has issued the impugned Bill dated 17/2/2010 demanding Octroi from the petitioners amounting to Rs.8,22,986/-.

3. The petitioners' challenge to the bill must be stated. According to the petitioners, their products are distributed and sold in returnable and reusable glass bottles. Glass bottles are stored in plastic crates. Glass bottles and crates are owned by the petitioners. They are never sold to any distributor or retailer. Once the product in the glass bottles kept in crates is consumed, glass bottles along with crates are returned to the petitioners for filling after cleaning and washing them. The petitioners pay Octroi levied on the aerated beverages when they enter Octroi limits of Sangli, Miraj, Kupwad City Municipal Corporations. The impugned bill has the effect of levying Octroi separately on the glass bottles and plastic crates utilized by the petitioners to pack and transport the aerated beverages manufactured by them. The aerated beverages cannot be separated from bottles and crates. The bottles and crates are neither consumed nor sold but are returned. Hence, Octroi cannot be levied on them. The impugned bills are, therefore, illegal and arbitrary.

4. We have heard Mr. Dwarkadas, learned senior counsel for the petitioners at some length. Mr. Dwarkadas reiterated the contentions raised in the petition. He submitted that plastic crates and glass bottles are durable and reusable. They are used a number of times by the petitioners. The cost of the bottles and crates is amortized and included in the retail sale price of the soft drinks. Since the cost of glass bottles and crates is already included in the price of the beverage on which the Octroi is levied and collected, no further Octroi can be levied on the glass bottles and crates. The cost of the durable and returnable bottles and crates cannot be added to the cost of the beverage as is also the case under the Central Excise Act and the Maharashtra Value Added Tax Act, 2005. Mr. Dwarkadas drew our attention to the definition of the term Octroi as found in Section 2(42) of the BPMC Act. He submitted that as per this definition, Octroi means a cess on the entry of goods into the limits of a city for consumption, use or sale therein. Counsel submitted that the bottles and crates are not sold. They are not consumed. The bottles are used but again sent out and refilled. The crates are also similarly sent back. Hence, the levy of Octroi is unjustified.

5. Mr. Kumbhakoni, learned senior counsel for the respondents submitted that the petitioners have made out no case for quashing the impugned bill. He relied on the judgment of the Supreme Court in Acqueous Victuals Private Limited v. State of Uttar Pradesh & Ors. (1998) 5 SCC 474. He pointed out that in this judgment, the Supreme Court has held that to attract Octroi to goods imported within the Municipal limits, the goods must be completely consumed within the Municipal limits, or used for an indefinite period in such a way that they come to rest finally and permanently within the Municipal limits or sold within the Municipal limits. That is the underlying idea behind the words 'sale', 'consumption' or 'use' found in the definition of the term 'Octroi'. Counsel submitted that in this case, the Supreme Court has stated that it is for the Companies who bring the said bottles in the Municipal limits to satisfy the auth