Wanchoo, C. J.—The following question has been referred to a Full Bench for reply:—

"Whether the Municipal Board, Kishangarh, could validly impose in exercise of the powers under sec. 128 (xiv) of the Uttar Pradesh Municipalities Act, licence fee or tax on factories situated within the boundary of Kishangarh Municipality to be collected on the basis of horse power of the factories."

2. The facts which have led to this reference may be briefly narrated. The applicant is a joint stock company having its registered office at Kishangarh and is carrying on business of production and sale of cotton yarn and cloth at that place. The State of Rajasthan by means of a notification No.F-2 (157) LSG/50, dated the 21st August, 1950, published in the Rajasthan Rajpatra, dated 25th November, 1950, sanctioned the imposition of a licence fee on flour mills and other factories at a certain rate based on horse power. This was done under sub-sec. (2) of sec. 135 of the Uttar Pradesh Municipalities Act, 1916 as that Act was in force with respect to Kishangarh Municipality at the time. In consequence of this notification, the Municipal Board of Kishangarh made a demand for a large sum of money from the a

Click Here to Read the rest of this document