B. P. DHARMADHIKARI, J:- By this petition filed under Article 226 of the Constitution of India, petitioner, who is citizen of India and resident of village Silewada within the jurisdiction of respondent no. 1 Gram Panchayat, has challenged Resolution No.6 dated 30th July 1994 passed by respondent no. 1 whereby it called for information from house owners about valuation of their houses and provisions of rule 7 of the Maharashtra Village Panchayats Taxes and Fess Rules, 1960 (for short, the "1960 Rules") in so far as the same permits levy of property tax by respondent no. 1 on the basis of capital value of the lands/ buildings.

2. This Court had issued rule on stay while admitting petition on 25.10.1996. On 24.2.1998 that rule on stay was discharged, with the result, there is no interim order operating in the matter.

3. We have heard Mr C.N. Deshpande, learned counsel for the petitioner and Mr. T.R. Kankale, learned Assistant Govemment Pleader for respondent no. 3 State Government. Nobody has appeared for respondents no. 1 and 2 though they are served. Mr. Deshpande has invited attention to the Bill of Demand dated 1.4.1996 served upon the petitioner to urge that the new decision taken by the Gram Panchayat has already been implemented. To substantiate this, he has also invited attention to earlier receipt issued by Gram Panchayat on 30.3.1991 to demonstrate that the tax paid by the petitioner was comparatively much less. According to him, resolution passed by the Gram Panchayat on 30th July 1994 is also based upon erroneous presumption that amendment as proposed to 1960 Rules by the State Government had come into force. He has invited attention to that Notification also to show that only the objections and suggestions were then invited.

4. Learned counsel for petitioner points out that because of this erroneous presumption, the Gram Panchayat had cancelled assessment made by resolution no. 6 dated 31.5.1994 and had undertaken exercise of seeking information from the residents of village as to the valuation of their houses so as to enable it to levy tax in accordance with new rules. According to him, this resolution or then the procedure contemplated by it, is not only ultra vires the provisions contained in the Bombay Village Panchayat Act, 1958 (for short, the 1958 Act") but also unconstitutional. He has invited attention to the provisions of Section 124 of the Act to urge that the said provisions only permit levy of tax on buildings. The modality therefor is prescribed in 1960 Rules. Attention is invited to rule 3 and rule 4 of the 1960 Rules to state how tax is to be levied and how after final publication, the tax comes into force. According to learned counsel, this procedure has not been followed and hence, tax as levied in furtherance of Gram Panchayat resolution dated 30th July 1994 is unsustainable and contrary to the provisions as contained in rule 7 of the 1960 Rules. He submits that rule 7 of the 1960 Rules permits the Gram Panchayat to levy tax on buildings and lands subject to the provisions of subrule (2) and after following the procedure prescribed in rules 3 and 4 of the 1960 Rules. He states that levy of tax essentially has to be as per the capital value or then based on annual letting value of such buildings. The Act or the Rules no where define or explain the phrase "capital value" and the Rules only envisage levy upon annual letting value. Hence, effort made by Gram Panchayat to levy tax by trying to find out valuation of houses i.e. capital value is contrary to rule 7 of 1960 Rules and also contrary to 1958 Act.

5. Without prejudice to all these contentions or in the alternative, learned counsel for the petitioner has invited attention to opening part of Section 124 (1) of the 1958 Act to contend that it uses the word "rate" when it employs phrases "maximum rate and minimum rate". According to him. this word "rate" has got significance in so far as assessment of property tax is concerned. He invites atte