By the Court.—All the petitioners in both the writ petitions are advertising companies/firms engaged in the business of advertising by placing and erecting hoardings on the public land either of the municipal corporation or the development authority or of the public works department as well as on certain private properties. They have challenged the notification dated 24.12.2009 which is said to have been published in the extra-ordinary Gazette notifying the Uttar Pradesh Municipal Corporation (Assessment and Collection of Tax on Advertisement) Rules, 2009 which have been enforced w.e.f. 1.4.2010.

2. We have heard Sri B.D. Madhyan, Senior Advocate, Sri Sanjeev Kumar, learned counsel for the petitioners in one of the writ petitions, Sri C.K. Parekh, learned counsel for the Municipal Corporation and Sri K. Zaidi, for the Agra Development Authority. Learned Standing counsel has appeared for the State of U.P.

3. The contention of learned counsel for the petitioners is that they have a fundamental right to carry business of advertising. The impugned Rules infringe their above right and as such are ultra vires. Secondly, the procedure prescribed under Section 199 to 203 of the U.P. Municipal Corporation Act, 1959 (hereinafter referred to as an ‘Act’) has not been followed in enacting the aforesaid Rules.

4. The respondents have defended the aforesaid Rules on the ground that they are only restrictive in nature and does not completely oust the petitioners from carrying on the business of advertisement. The Rules have been framed in due exercise of powers conferred upon the State Government under Section 540 read with Sections 550, 219, 227 of the Act after considering the objections received.

5. A wholistic reading of the said Act reveals that municipal corporations are empowered to impose taxes as provided under Section 172 of the Act and tax on advertisement (not being advertisement published in the newspaper) is one of them. Section 192 of the Act provides that where such tax on advertisement is imposed, every person who erects, exhibits, fixes or retains upon or over any land, building, wall, hoarding or structure any advertisement or who displays any advertisement to public view in any place whether public or private, shall be liable to pay advertisement tax calculated at such rates and in such manner and as may be prescribed under the Rules subject to exemptions provided therein. The procedure of imposing such tax by corporations has been laid in Section 199 to 206 of the Act. Further Section 227 authorises the State Government to make Rules for the purposes of carrying out the effect of the provisions of Chapter IX dealing with the taxes of the Corporation and particularly, the matters referred to in Section 219 which permits framing of Rules as to assessment, collection, composition, prevention of evasion, refund of taxes and other matters relating to taxes. The procedure for framing such Rules has been provided in Section 540 of the Act.

6. It is tiride to state that a subordinate legislation like the Rules in question are open to challenge primarily on the following grounds :

(i) legislative incompetence;

(ii) being ultra vires to the provisions of the Act under which they have been framed or the Constitution of India;

(iii) being in conflict with any other statutes; and

(iv) being arbitrary and violative of Articles 14 and 16 of the Constitution.

7. The legislative competence of the State Government to frame the aforesaid Rules is not disputed nor it is alleged that the said Rules are in conflict or repugnant to any other statute. The validity of the aforesaid Rules is being questioned only on the ground that they are ultra vires to Article 19(1) (g) of the Constitution of India.

8. A quick glance at the offending Rules demonstrates that they provide for obtaining permission of the Corporation for erecting, exhibiting, displaying, sticking, posting, writing, drawing or hanging an advertisement or hoarding on any sit