Honble RAJU, J.–These appeals involve for consideration an interesting question as to the nature and character of the levy of `Dharmada, as it is called in the form of an octroi by the Municipal Council, Kota in Rajasthan State, which, according to respondents, is not really an octroi, but the levy and demand of `dharmada tax as such on the goods imported by the respective respondent-companies into the municipal limits of Kota. It is necessary to trace the origin of this levy in this part of the State of Rajasthan.

(2). From the records and materials placed before us, it transpired that in 1860 A.D. the late Ruler of Kota, claimed to be the Sovereign Authority to make even laws, imposed, though on the basis of also a volition expressed by the traders in the locality to pay one such, the levy of dharmada on the traders of `Nandgaon (the ancient name of Kota city), as a compulsory levy by the authority of the said law made by the Ruler. The Schedule of rates of dharmada, so imposed, was said to have continued till 1894 when it came to be sanctioned also by the Resolution dated 6.11.1894 of the Municipality Committee. The seems to have in succession followed by another Schedule of octroi dated 22.11.1922 issued by the Superintendent of Custom and Chief Excise Officer, Kota State, revised subsequently in 1923. It is also disclosed that prior to 1929 cases of evasion of Chungi/Dharmada were entertained and decided in the Court of Magistrate, Kota State, under Sec.106 of the Customs Act, then in force and evasion of octroi and dharmada were said to have been made even as a penal act punishable under the said Act. In the year 1929, the Kota State Chungi Act was said to have been passed empowering the levy and collection of dharmada by the Municipal Board, Kota. In 1959, the Rajasthan Municipalities Act saved the operation of the Chungi Act, 1929.

(3). The Rajasthan Municipalities Act, 1959 (hereinafter called the ``Act) enacted a scheme of taxation for imposition of various categories of taxes by the local authorities classified as ``obligatory taxes in Sec. 104 and other taxes that may be imposed in Sec.105, besides making provisions for levy of property tax, etc. Sec.104, as is stood at the relevant point of time, obligated every Municipal Board by a mandate of law to levy ``at such rate and from such date as the State Government may in each cash direct by Notification in the Official Gazette and in such manner as is laid down in this Act and as may be provided in rules made by the State Government in this behalf, the following taxes, namely–(1) . . . . . . . . . . . . . .; (2) An octroi on goods and animals brought within the limits of the Municipality for consumption, use or sale therein.

(4). Coming to the Notification issued stipulating the rates, it may be stated at this stage that after the coming into force of the Constitution of India, several Notifications came to be issued from time to time such as, i.e., Notification No.F.2(150)LSG/50 dated 21.8.1950; Notification published in the Official Gazette dated 17.12.1951; Notification No.F.150LSG/60 dated 1.2.1962 successively one after the other, in supersession of the earlier one.

(5). It is seen that subsequently the Government has issued another Notification dated 13.5.1968 under Sec. 104(2) of the Act authorising the Municipal Council, Kota, to levy octroi under three sub-heads for different and specific purpose and objects namely, (1) Octroi proper; (2) Dharmada; and (3) Nirkhi, as follows:–

Rajasthan Gazette

Extraordinary

Jaipur, May 13, 1968

Notification Tax F.144(2) D.L.B. 161:–

In suppression of current rates of octroi of Kota Municipal Board, the State Government in exercise of power conferred by Sec. 104(2) of the Rajasthan Municipalities Act, 1959 (Rajasthan Act No.38/1959) hereby directs that the octroi will be levied on goods and animals brought within the limits of Kota Municipality for use, consumption or sale at the rates specified in the following Schedule from the da

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