1960 Supreme(All) 151

IN THE HIGH COURT OF ALLAHABAD
S. N. Dwivedi, J.
LALA JAGDISH PRASAD - Appellant
Versus
ADMINISTRATOR, MUNICIPAL BOARD, SAHARANPUR - Respondents
Civil Misc. Writ 2451 Of 1957
Decided On : 08/26/1960

The levy of water tax under Clause (x) of Sub-section (1) of Section 128 read with Clause (b) of Section 129 of the U.P. Municipalities Act is a fee and not a tax within the meaning of that expression in entry 66 of list II in Sch. VII of the Constitution.

Headnote:

MUNICIPAL TAXATION - WATER TAX - IMPOSITION - VALIDITY - ASSESSMENT LIST - PREPARATION - NECESSITY - ANNUAL VALUATION OF BUILDINGS OR LANDS - CONCLUSIVE PROOF - OBJECTION TO ASSESSMENT - MAINTAINABILITY - TAX IMPOSED NOT SOLELY FOR MEETING EXPENSES OF WATER-WORKS - CONSTITUTIONALITY - LEGISLATIVE COMPETENCE - FEE OR TAX - DISTINCTION - DELEGATION OF LEGISLATIVE POWER - FIXATION OF RADIUS BY RULE - VALIDITY.

Fact of the Case:

The petitioners, owners of lands and buildings within the municipal limits of Saharanpur, challenged the legality of the municipal demand for water tax, imposed at the rate of 10% on the annual valuation of lands and buildings, on various grounds.

Finding of the Court:

1. Preparation of an assessment list is not required under Sections 142 and 143 of the U.P. Municipalities Act for the purpose of assessing water tax, as the annual valuation of any building or land entered in the assessment list prepared for assessing tax on lands and buildings is conclusive proof of its annual value for the purpose of assessing water tax. 2. The petitioners, not being users of water supplied by the board's water-works, have no locus standi to challenge the imposition and assessment of water tax on the ground that some other persons, who did not take water from the water-works, were required to pay water tax. 3. The imposition of water tax is not invalid on the ground that it was imposed not solely with the object of defraying expenses connected with the construction, maintenance, etc. of municipal water-works, as the onus of proving otherwise lies heavily on the petitioners, which they have failed to discharge. 4. The impugned provision in Section 129 regarding the fixation of the radius by rule does not amount to delegation of legislative power, as the rule-making power is subject to the negative check of the persons who would be directly affected by it. 5. The imposition of water tax is not ultra vires the U.P. Legislature even after the commencement of the Constitution, as it is covered by items 5 and 17 read with item 66 of list II in Schedule VII of the Constitution. 6. The levy of water tax under Clause (x) of Sub-section (1) of Section 128 read with Clause (b) of Section 129 of the U.P. Municipalities Act is a fee and not a tax within the meaning of that expression in entry 66 of list II in Sch. VII of the Constitution.

Issues: 1. Whether the preparation of an assessment list is necessary for assessing water tax? 2. Whether the petitioners have locus standi to challenge the imposition and assessment of water tax on the ground that some other persons, who did not take water from the water-works, were required to pay water tax? 3. Whether the imposition of water tax is invalid on the ground that it was imposed not solely with the object of defraying expenses connected with the construction, maintenance, etc. of municipal water-works? 4. Whether the impugned provision in Section 129 regarding the fixation of the radius by rule amounts to delegation of legislative power? 5. Whether the imposition of water tax is ultra vires the U.P. Legislature even after the commencement of the Constitution? 6. Whether the levy of water tax under Clause (x) of Sub-section (1) of Section 128 read with Clause (b) of Section 129 of the U.P. Municipalities Act is a fee or a tax?

Ratio Decidendi: 1. The annual valuation of any building or land entered in the assessment list prepared for assessing tax on lands and buildings is conclusive proof of its annual value for the purpose of assessing water tax, and therefore, preparation of an assessment list is not required under Sections 142 and 143 of the U.P. Municipalities Act for the purpose of assessing water tax. 2. The petitioners, not being users of water supplied by the board's water-works, have no locus standi to challenge the imposition and assessment of water tax on the ground that some other persons, who did not take water from the water-works, were required to pay water tax. 3. The imposition of water tax is not invalid on the ground that it was imposed not solely with the object of defraying expenses connected with the construction, maintenance, etc. of municipal water-works, as the onus of proving otherwise lies heavily on the petitioners, which they have failed to discharge. 4. The impugned provision in Section 129 regarding the fixation of the radius by rule does not amount to delegation of legislative power, as the rule-making power is subject to the negative check of the persons who would be directly affected by it. 5. The imposition of water tax is not ultra vires the U.P. Legislature even after the commencement of the Constitution, as it is covered by items 5 and 17 read with item 66 of list II in Schedule VII of the Constitution. 6. The levy of water tax under Clause (x) of Sub-section (1) of Section 128 read with Clause (b) of Section 129 of the U.P. Municipalities Act is a fee and not a tax within the meaning of that expression in entry 66 of list II in Sch. VII of the Constitution.

Final Decision: The petitions challenging the legality of the municipal demand for water tax were dismissed, with the petitioners in each case directed to pay Rs. 201/- as costs to the municipal Board, Saharanpur.