The main legal point established is the interpretation of 'circumstances' and 'property' within municipal limits for the assessment of haisiyat tax.

Hallifax, A J C—Under Section 83(2) Municipalities Act, the Deputy Commissioner of Betul has referred to this Court a question concerning the principles of the assesment of haisiyat tax on Seth Kasturchand under Section 66 of the Act. The same question is submitted in respect of the assessment on Seth Misrilal (Civil Reference No. 265 of 1927). Bach of them lives in, the Betul Municipality and owns villages; outside the Municipality, but in the Betul District, from which he derives an income.

2. The question on which the Deputy Commissioner says he has reasonable doubt is, nowhere formulated, but it is in respect of the words of Clause (n) of Section 66(1), which, says that a haisiyat tax can be imposed on, residents within the limits-of a Municipality ''according to their circumstances and property within those limits.'' It is stated in the reference that the assessee in each case ''says that his malguzari villages are not property within the Municipal limits of Betul, nor can they be called circumstances within those limits'' and that ''the Municipal Committee on the other hand says that they constitute his circumstances within those limits.'' The opinion expressed in the reference is that in the phrase under consideration, the words ''within those limits'' do not qualify the word ''circumstances,'' but only the word ''property'' and also that ''the word 'circumstances' includes land revenue paid by the assessee.''

3. The mention of land-revenue in this last phrase and in other parts of the letter of reference is only a minor instance of the laxity of thought displayed all through the case. In the assessment it was found that the annual income from the villages was a certain sum of money, and that finding has been accepted by everybody. That sum happens to be the same as the land revenue payable on the villages, and indeed that fact was the basis of the finding; but we are in no way concerned with that.

4. But the cases themselves and the references in them have arisen out of such deplorably careless and distorted thinking that it can hardly be called thought at all. It has been assumed by everybody, even in the argument of the matter in this Court, that in one particular case, which is not very clearly defined, the word ''circumstances'' does not mean circumstances at all, but the source of the income which creates those circumstances and is the proper measure of them. The case so excepted seems to be the case of income derived from agriculture in the same district as that in which the Municipality is situated (or perhaps the same province). It is not considered apparently that money received by the assessee in Betul is not a part of his ''circumstances'' if it is derived from agriculture in the Punjab or in England or from shares in a Mill in Manchester or even in another town of the Betul District.

5. It is always hard to explain the obvious, and I cannot see that the meaning of the words under discussion could possibly have been put more clearly, but perhaps, the mistake that has been made can be explained in this way : The contention of the assessee, that his malguzari villages outside the limits of the Municipality cannot be called circumstances within those limits, is obviously correct, and that of the Municipality, that they constitute circumstances within those limits, obviously incorrect, villages cannot possibly be called circumstances nor can they constitute circumstances. But ownership of them can gives rise to circumstances, which may exist in them or elsewhere, and we are concerned with the place where the circumstances exist, not with the place where the property out of which they arise is situated. It is of course equally incorrect to say that the words ''within, those limits'' do not qualify the circumstances, or that the circumstances include land revenue payable.

6. If any further or more specific answer to the reference is required it may be stated as follows : When the Act speaks of circumstances wit