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High Court Of Madhya Pradesh
P. V. Dixit, C. J.
MUNICIPAL COMMITTEE/council - Appellant
Versus
MEGHRAJ PHOJRAJ BAGHRECHA - Respondents
Civil Revn. 426 Of 1964
Decided On : 02/03/1965
(2) Municipalities Act, 1961 (M.P.) - S.13.1(7)- municipalities Act, 1922 (C.P. & Berar)-S.85 (2) - bar on suit for refund of tax-applies to taxes which the Municipal Committee is empowered to impose-suit for refund of amount recovered as tax which the Municipal Committee is not empowered to impose-the bar on civil suits not applicable -term 'under the Act' -meaning of.
In construing the provisions of section 9 of the Code of Civil Procedure the fundamental principle' of law that a person having a grievance of a civil nature has, independently of any statute, a right to institute a suit in some Court must be remembered and every presumption must be made in favour of the jurisdiction of a civil Court and the exclusion of jurisdiction of a civil Court is not to be readily inferred. The cognizance of a suit of a civil nature must be expressly or impliedly barred and a provision of law ousting the jurisdiction of a civil Court must be strictly construed. AIR 1963 SC 1547 & AIR 1964 SC 1873 relied on. [Para 7
Section 85 of the C.P. and Berar Municipalities Act, 1922 and section 133 of the M.P. Municipalities Act, 1961, no doubt in express and unambiguous terms lay down that no refund of any tax shall be claimable by any person otherwise then in accordance with the provisions of the Act. This by necessary implication excludes from the cognizance of a civil Court; a suit for the refund of any tax, imposed under the Municipality Act.
But a Municipal council being a body created by the statute on whom certain powers have been conferred by the statute, must keep within the authority granted to it. The provisions with regard to the procedure, assessment, levy or refund of tax contained in the municipalities Act do not cover a tax which the Municipal council has no authority at all to impose. It follows, therefore, that the remedy provided in section 85 of the Act of 1922 or section 133 of the Act of 1961 must be taken as confined to the refund of those taxes which the Municipal council hall power to impose but which it has imposed in an irregular manner in the exercise of its powers The bar under those provisions does not apply to a refund claim of a tax, the imposition of which was not permitted under the relevant Municipal Act. [Para 8
A suit for refund of a tax, which a Municipal Committee had no authority whatsoever under the relevant Municipal Act to impose, is maintainable. 5 MPLC 25, ILR 1948 Nag.
761, ILR 1948 Nag. 971, AIR 1963 SC 1547 & AIR 1964 SC 1873 relied on. [Para 9 TI1e argument that the imposition of a tax, even if ultra vires the powers of a Municipality under a Municipal Act, would be ul1der the Act so as to attract the prohibition contained in section 85 of the Act of 1922 or section 133 of the Act of 1961 cannot be accepted. AIR 1947 PC 78, AIR 1951 SC 23 & 1960 JLJ 656 referred to. 1 Para 11
(3) Municipalities Act, 1961 (M.P.) – S.319 - Municipalities Act, 1922 (C.P. & Berar) - S.48 - word "purporting to be done" - import of-act completely outside the provisions of the Act-not included
(4) Word, & Pharoses-term 'purporting to be done under the Act' -meaning of.
The expression 'purporting to be done under the Act' will not include an act which is wholly outside the provisions of the Act and thus ultra vires.
Section 48 of the Act of 1922 or section 319 of the Act of 1961 does not apply to a case where the action of the Municipal Committee is prohibited by law, wholly beyond its jurisdiction or ultra vires the Municipal Act 24 MPLC 9 and ILR 1948 Nag. 971 relied on. [Para 12
( 1 ) THIS order will also govern the disposal of Civil Revisions Nos. 427, 634, 635, 636, 637, 702, 703, 704 and 705, all of 1964.
( 2 ) THESE ten revision petitions by the Municipal Council, Balaghat, are directed against decisions of the Court of Small Causes, Balaghat, giving to the plaintiff-opponent in each case a decree against the Municipal Council for the refund of the amount of terminal tax realized by the Council from each of the plaintiffs in circumstances to be presently stated. By a notification issued on 7th March 1935 under Section 66 (1) (o) of the Central Provinces and Berar Municipalities Act, 1922, the Municipal Committee of Balaghat imposed terminal tax on import and export of goods by rail or roads within its limits at rates mentioned in the schedule appended to the notification. On 6th December 1960 another notification was issued by Government under Sub-sections (5) and (7) of Section 67 of the Act amending the notification issued on 7th March 1935 so as to impose a terminal tax for the first time on certain goods and enhance the rate of tax on taxable articles included in the schedule appended to the notification of 7th March 1935. In 1961 the Municipal Committee authorized the railway authorities to recover terminal tax on goods imported or exported by rail, and accordingly the railway authorities recovered terminal tax from the plaintiffs. The notification dated 6th December 1960, in so far as it imposed terminal tax on certain goods for the first time and enhanced the rates of tax on articles included in the schedule appended to the notification dated 7th March 1935, was declared to be illegal and quashed by this court in a petition under Article 226 of the Constitution in Radhakishan v. State of m. P. , Misc. Petn. No. 59 of 1962, D/- 9-4-1962 (Madh Pra) filed by one radhakishan. Relying on its earlier decision in Bhikamchand v. Municipal committee, Chhota Chhindwara, 1961 M. P. LJ 937 it was held by a Division Bench of this Court in Radhakishan's Case, Misc. Petn. No. 59 of 1962, D/-9-4-1962 (Madh Pra) that the terminal tax imposed by the Municipal Committee 1960 was a fresh imposition which the Committee was not competent to do by reason of item no. 89 of List I of the Seventh Schedule and the imposition was not saved under article 277; that the notification dated 6th December 1960 superseding the previous imposition of terminal tax imposed a new tax and was not one merely continuing the levy of the terminal tax which was lawfully levied at the commencement of the Constitution; and that, therefore, the imposition of terminal tax on certain goods for the first time and enhancement of the rate on other goods was altogether ultra vires the powers of the Municipal Committee and, therefore, illegal. Consequent to the quashing of the notification dated 6th December 1960 each of the plaintiff-non-applicants filed suits giving rise to these petitions for the refund of the amount of terminal tax which had been recovered from him and the imposition of which, according to this Court's decision in Radhakishan's Case Misc. Petn. No. 59 of 1962, D/-9-4-1962 (Madh Pra) was ultra vires and illegal.
( 3 ) THERE was no dispute in any suit about the amount realized by way of terminal tax from any of the plaintiffs. The Municipal Council contested the suits mainly on two grounds, namely, that they were not maintainable in view of Section 85 (2) of the C. P. and Berar Municipalities Act, 1922, and Section 133 (2) of the Madhya pra. Municipalities Act, 1961; and that the suits not having been filed within six months of the date of the accrual by time under Section 48 (2) of the Act of 1922 as well as under Section 319 (2) of the Act of 1961. Both these pleas were negatived by the learned Judge of the Court of Small Cause who, relying on mesuram Kishunpershad v. Municipal Committee, Jubbulpore, ILR (1948) Nag 766 : (AIR 1949 Nag 270 and Municipal Committee, Karanja v. New East India press Co. Ltd. Bombay I
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