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Gajraj Singh & Another v. The Union Of India & Others - WRIT TAX No. 1601 of 2005 [2006] RD-AH 6420 (23 March 2006)


This is an UNCERTIFIED copy for information/reference. For authentic copy please refer to certified copy only. In case of any mistake, please bring it to the notice of Joint Registrar(Copying).



Court No. 10

                     Civil Misc. Writ Petition (Tax) No. 1601 of 2005

  Gajraj Singh and another      Vs.         The Union of India and others

                                                            For Petitioner        :     Naveen Sinha,Sr. Adv.

                                                                                                                                  &  S. P. Dubey

                                                                          For Resp. No.1      :     K. C. Sinha, Adv.A.S.G.I

                                                                                             For Resp. No.2 & 3:    S. P. Gupta, Sr. Adv.

                                                                                                                                   & Isa Khan, Adv.

                                                                                             For Resp. No.4        :    S. N. Verma,Sr. Adv.

                                                                                                                                  & Arun Kumar Singh, Adv.

Hon'ble A.K. Yog, J.

Hon'ble Prakash Krishna, J.


This  writ petition under Article 226, Constitution of India, is at the behest of Motor/Bus of 'Passengers' Transport Union' named 'Meerut-Rohta-Barnawa-Binauli- Baraut Motor Union, for short the 'Union' which is represented by its Secretary-Gajraj Singh',  petitioner no.1.

We may record the statement made by the learned counsel for the petitioner that all the members of Union/petitioner no. 2 (list of which is Annexure-1 to the writ petition) have paid separate court fees in respect of each of them and all of them shall be bound by the decision of this writ petition.

Members of the 'Union'  render transport-service to the Passengers on 'Meerut-Rohta-Barnawa-Binauli-Baraut 'route' on the basis of valid 'permit' issued by competent authority under The Motor Vehicles Act, 1988, called 'M. V. Act'. According to the petitioners,  its members have paid 'Road Tax' and 'Additional Tax',  under The U.P. Motor Vehicles Taxation Act, 1997,hereinafter referred to as M.V. Taxation Act and that they also pay other fee/charges, if any, for availing facilities rendered to by a 'Local Authority', apart from paying 'Property Tax' under Kshetriy Panchayat and Zila Panchayat Adhiniyam. It is contended that -(i) the route in question, which is part of State High way, was constructed and now maintained by Public Works Department of State of U.P., (ii) a small part of this route intercepts certain roads of Meerut Cantonment Board(called the Board) while passing through territorial limits of the Board (para 5 of the writ petition); and (iii) in exercise of powers conferred under Section 60, Cantonment Act, 'Draft proposal' to lev6y 'Toll Tax' upon entry of Motor Vehicle- carrying passengers in the territory of the Board, was published in Daily News paper for information of the concerned to file objections, if any, under Section 61, Cantonment Act;  the Union through its Secretary admittedly filed objections against Draft proposal to levy Toll tax on Passengers-Vehicles before the Board(Annexure 5 to the writ petition); the concerned authority did not communicate its decision to reject those  objections; Under Notification published in the Gazette of India, dated 8.1.2005 (Annexure 6 to the writ petition); 'toll tax' is imposed on Motor vehicles owned by the members of the Union; consequently every transport Vehicle of the Member of the Union while entering the limits of the Board, is required to pay toll tax @ Rs. 75.00 per vehicle per trip  w.e.f. November, 2005 under the impugned Notification and being aggrieved impugned Gazette Notification dated 8.1.2005 (Annexure-6 to the writ petition) is challenged on the ground that the 'Respondents' have no power or authority in law to levy such 'Toll tax' in question. Grievances of the petitioners are contained in paras 15 to 30 of the writ petition.

The impugned Notification dated 8.1.2005 (Annexure 6 to the writ petition) reads:-

"THE GAZETTE OF INDIA, JANUARY 8,2005(Pausa 18, 1926)

                               Ministry of Defence

                               Cantonment Board

                                  Meerut, the

SRO No.   Whereas a notice of certain draft notification for imposing of Toll Tax on the entry of commercial vehicles within the Meerut Cantonment conspicuous part of the Cantonment Board, Meerut on 2nd July, 2004 vide No. Legal Cell/TAX PROP and published in local newspapers namely Dainik Jagran & Amar Ujala on 4th July, 2004 as required under section 61 read with section 255 of the Cantonments Act 1924 (2 of 1924), inviting objections and suggestions from all persons likely to be affected thereby till the expiry of a period of thirty days from the date of publication of the said notice;

AND WHEREAS, all the objections received from public on the said draft notification have been duly considered by the Cantonment Board;

AND WHEREAS, the Central Government have duly authorized the Cantonment Board, Meerut to impose the toll Tax above said as required under section 63 of the said Act;

NOW THEREFORE, in exercise of the powers conferred by section 60 of the said Act, the Cantonment Board, Meerut with the previous sanction of the Central Government, hereby imposes Toll Tax on the entry of commercial vehicles entering and passing through the limits of Meerut Cantonment payable by the owner of the vehicle or the person in charge of the vehicle at the rates specified in the Schedule annexed hereto, namely:-


(Toll fee on Commercial Vehilces laden with goods or passengers entering or passing through Meerut Cantonment).

Serial No.


Categories of Vehicles


Toll tax in Rupees per vehicle per entry



Taxis/Car being used for commercial purpose



Light commercial vehicles



Heavy commercial vehicles



Trailers/Cranes/other very large vehicles

         Provided that the toll Tax shall not be levied on vehicles,

(a)  belonging to the persons residing within the limits of Meerut Cantonment;

(b) belonging to the Central government or the State Government;

(c)   belonging to the Cantonment Board Meerut;

(d)   carrying solely funeral parties;

(e)  belong to persons and properties exempted under section 3 of Indian tolls (Army and Air Force) Act, 1901 (2 of 1901);

(f)    belong/deployed in election;

(g) Tractor of agriculturists used solely for agriculture purposes;

(h)   Buses carrying school students;

(i) Ambulance carrying parties.

Provided further  that the vehicles entering the Cantonment limits subsequent to second entry in a day shall be charged at half the rate specified per entry.

2. The toll tax above said shall come into force on the date of final publication of this notification in the Official Gazette.

                         CANTONMENT EXECUTIVE OFFICER

                                                  (JS MAHI)"

The petitioners,therefore, in this writ petition claim following reliefs :-

(i)    To issue for a writ, order or direction in the nature of certiorari calling for the records and quashing the impugned notification published in the Gazette of India, dated 8.1.2005, in so far as it relates to the imposition of toll tax against the vehicles of the petitioners at the rate of Rs. 75/- per day per trip.

(ii) To issue for a writ, order or direction in the nature of mandamus commanding the respondents not to realize the toll tax from the vehicles of the petitioners at the rate of Rs. 75/- per day per trip, in pursuance of the impugned notification dated 8.1.2005.

(iii) To issue any other writ, order or direction, which this Hon'ble Curt may deem fit and proper in the circumstances of the case.

Union of India, Cantonment Board, Meerut and K.P.Singh (Respondent nos. 1, 2, 3 and 4 respectively) filed three separate 'counter affidavits' and the petitioner also in reply filed 'Rejoinder affidavit' against there  counter affidavit.

Heard learned counsel for the parties except 'Union of India'(Respondent no.4).

Respondent no.1- Union of India has categorically stated vide Para 4 of its counter affidavit that the proposal sent by Meerut Cantonment Board was accepted by the Central Government as contemplated under Section 60 of the Cantonment Act, 1924 and toll in question being imposed "as measure to increase revenue".

Petitioner has, however, controverted the above contention by filing Rejoinder affidavit.  

Respondent no.2 and 3 /Cantonment Board Meerut has in defence vide para 23 and 25 of their counter affidavit pleaded :

23......The vehicles of the petitioner enter into Meerut Cantonment area on point at Rohta Fatak and pass onward avbout three kilometres within the limits of Meerut Cantonment and thereafter reaches at Jain Mandir within the boundary of Nagar Nigam, Meerut.  These roads are exclusively maintained by Cantt. Board Meerut.  The vehicles passing through Cantt. Area, Meerut were utilizing the infrastructure without paying any charges for the services like roads, street light and pavements etc.

25.  That the contents of paragraph no.29 of the writ petition are misconceived, misinterpreted as stated, hence are denied.  It is further stated that the toll tax has been imposed on commercial vehicles entering and passing through the limits of Meerut Cantonment and are continuously utilizing the infrastructure like roads, street light and pavements etc.

On behalf of the contesting respondent nos. 2 and 3  it is next argued that since the vehicles of the petitioners pass through the territorial limits of the Meerut Cantonment Board, the Cantonment Board is well within its rights to levy 'toll-tax'.

Respondent no.4/K.P. Singh (the person who has taken 'Theka' to collect impugned toll tax) has also filed a counter affidavit pointing out that, in pursuance to the 'Terms and conditions' of the lease, he has  deposited security amount apart from paying huge stamp duty and that he is, in addition to the above, also liable to pay Rs.7,65,000/- every week to the Board.

Petitioners in the rejoinder affidavit  filed in reply to the above asserted that Respondent no.4 has no right under law to collect 'toll-tax' on behalf of the Cantonment Board Meerut, which itself cannot validly impose such Toll Tax.

At the outset, learned counsel representing the Board, raised a 'preliminary objection' to the maintainability of this writ petition and argued that it should not be entertained since the petitioners have an equally efficacious alternative remedy for seek redressal of their grievance by filing  'Appeal' under Section 84 , The Cantonment Act, 1924.

"84. Appeals against assessment. -- (1) An Appeal against the assessment or levy of, or against the refusal to refund, any tax under this Act shall lie to the District Court.

(2) If the District Court, on the hearing of an appeal under this section, entertains reasonable doubt on any question as to the liability to, or the principle of assessment of, a tax, the Court may, either on its own motion or on the application of the appellant, draw up a statement of the facts of the case and the point on which doubt is entertained, and refer the statement with its opinion on the point for the decision of the High Court.


(Explanation........................) "

The preliminary objection has no merit and, therefore, rejected for following reasons.

Provision of Appeal under Section 84, The Cantonment Act, provides redressal to person aggrieved from an order of a forum for   'Assessment'. There is no 'Assessment' as such in the instant case. Further, the petitioners under this provision can not successfully challenge validity of the 'Notification' in question. Besides it, the issue in hand involves 'interpretation' of statutory provision and this Court can give more authoritative interpretation/adjudication that the Appellate authority. Lastly the parties have already appeared before this Court, and also exchanged their pleadings in the case and, therefore, the Court deems appropriate to decide the case on merit finally at this stage itself and save the parties from long drawn litigation.  

Before dealing with the merit of respective contentions of the parties, relevant statutory provisions referred during arguments are quoted herein under  for convenience:

The Cantonment Act, 1924.

"Section 60. General power of taxation - (1) The Board may, with the previous sanction of (Central Government), impose in any cantonment any tax which, under any enactment for the time being in force, may be imposed in any municipality in the State wherein such cantonment is situated.

(2)  Any tax imposed under this section shall take effect from the date of its notification in the Official Gazette (or where any later date is specified in this behalf in the notification, from such later date).

" 63-A Power of Central Government to issue directions to the Board:-(1) Where the Central Government is of opinion that for securing adequate financial provision for the efficient discharge of the duties and functions of a Board it is necessary so to do, it may issue directions to the Board requiring it to impose within the cantonment area any tax specified in the direction which it is empowered under this Act to impose and which is not already imposed within the said area or to enhance any existing tax in such manner or to such extent as the Central Government considers fit and the Board shall, in accordance with the direction, forthwith impose or enhance such tax in accordance with the provisions of this Chapter:

Provided that -

(a) no such directions shall be issued without giving the Board and the inhabitants of the cantonment area, an opportunity of showing cause why such directions should not be issued;

(b) the Central Government shall take into consideration any objection with the Board or any inhabitant of the cantonment area may make against the imposition or enhancement of such tax;

(c) it shall not be lawful for the board to modify or abolish such tax when imposed or enhanced without the sanction of the Central Government.

(2)  The Central Government may, at any time, cancel or modify any direction issued by it under sub-section(1) with effect from such date as may be specified in the direction and on and from the date so specified the imposition or enhancement of such tax, shall cease or be modified accordingly.

The Uttar Pradesh Municipalities Act, 1916(U.P. Act no.2 of 1916)

Section 2(9)- "Municipality" means an institution of self-government (referred to in clause(e) of Article 243-P of the Constitution).

Section 128 - Taxes which may be imposed - (1) Subject to any general rules or special orders of the (State Government ) in this behalf, the taxes which a (Municipality) may impose in the whole or part of a municipality are --.





(iv)   a tax on vehicles and other conveyances plying for hire or kept within the   municipality or on boats moored therein :

(v) to (xiii A).....................

       (xiii -B)  a tax on deeds of transfer of a immovable property situated within the limits of the Municipality

        2. Provided ....................

            Provided ...................

         Provided also that no tax under Clause (iv) of sub-section (1) shall be levied in respect of any motor vehicle.

                                                                              (underlined by us to lay emphasis)

IIIrd Proviso to Section 128(2) specifically mentions that a Municipality under U.P. Municipality Act, 1916, shall not be competent to levy tax in respect of any Motor Vehicle.

Uttar Pradesh Municipal Corporations Adhiniyam, 1959

  Section 172(2):

" In addition to the taxes specified in sub-section (1) the Corporation may for the purposes of this Act and subject to the provisions thereof impose any of the following taxes, namely-

(a) a tax on traders callings and professions and holding of public or private appointments;

(b)    an octori on goods or animals brought within the City for consumption, use or sale therein;

                 (Omitted by U.P. Act 9 of 1991 (w.e.f. 1-8-1990)

(c)  a tax on goods exported from or imported into the City in which an octori was in force at the commencement of the Constitution of India;            

  (Omitted by U.P. Act 9 of 1991 (w.e.f. 1-8-1990)

(d)  a toll on vehicles and other conveyances and animals and laden coolies entering the City;

                   ( Omitted by U.P. Act 9 of 1991 (w.e.f. 1-8-1990)

(e)       a tax on dogs kept within the City;

(f)       a betterment tax;

(g)   a tax on deeds of transfer of immovable property   situated within the City;

  (h) a tax on advertisements not being   advertisements published in newspapers;

(i)   a theatre tax; and

(j)   any other tax which the State Legislature has the power under the Constitution of India to impose in the State:

             (Omitted by U.P. Act 9 of 1991 (w.e.f. 1-8-1990)

U.P. Act no.9 of 1991-(Amending Act, w.e.f 1.8.1990)---

Section "2. Amendment of Section 128 of U.P. Act No.2 of 1916.--- In Section 128 of the United Provinces Municipalities Act, 1916, hereinafter in this chapter referred to as the principal Act,--

(a) in sub-section (1),clauses (vii), (viii), (xiii) and (xiv) shall be omitted;

(b) in sub-section(2), in the first proviso, the words "nor shall an octroi on goods under clause (viii) of sub-section (1) and a tax under clause (xiii) of sub-section (1) be levied at the same time", shall be omitted.

Section 8 . Amendment of Section 172 of U.P. Act No.2 of 1959.-- In Section 172 of the Uttar Pradesh Nagar Mahapalika Adhiniyam, 1959, hereinafter in this chapter referred to as the principal Act, in sub-section (2), clauses (b), (c), (d) and (j) and the proviso shall be omitted.


Section 2.   Power to cause levy of tolls on roads and bridges within certain rates and to appoint Collector's responsibilities.-- The State Government may cause such rates of toll, as (it things fit) to be levied upon any road or bridge which has been or shall hereafter be made or repaired (at the expense of the Central or any State Government) and may place the collection of such tolls under the management of such persons as may appear to (it) proper, and all persons employed in the management and collection of such tolls shall be liable to the same responsibilities as would belong to them if employed in the collection of the land-revenue.

Constitution of India. Chapter IX  :-

Article 234(P)-(e) "Municipality" means an institution of self-government constituted under Article 243-Q.

      Article 243-Q. Constitution of Muncipalities-

(1) There shall be constituted in every State,--

(a) a Nagar Panchayat (by whatever name called) for a transitional area, that is to say, an area in transition from a rural area to an urban area;

(b)  a  Municipal Council for a smaller urban area; and

(c) a Municipal Corporation for a larger urban area, in accordance with the provisions of this Part.

It is admitted to all that subject of levy of 'toll tax' is covered under State List II, Schedule VII, Constitution of India.

The General Clauses Act, 1897   (Central Act)

Central and State both define expression 'enactment' as follows:

(19) "enactment" shall include a Regulation ( as hereinafter defined) any Regulation of the Bengal, Madras or Bombay Code, and shall also include any provision contained in any Act or in any such Regulation as aforesaid;

Note: There is identical definition of the expression "enactment" in the State General Clauses Act.

The Apex Court in AIR 1995 SC 1210- Cantonment Board Secunderabad V. G. Venketram Reddy, has held that the expression "Municipality in the State" includes Municipal Corporation.  Article 243 Q, Constitution of India also laid down similar definition.

The  petitioners chose to restrict their challenge to the issue of  'legal competence' of Cantonment Board, Meerut to impose toll tax under impugned notification in purported exercise of its power under Section 60 of the Cantonment Act.

Learned counsel for the petitioner argues  that Cantonment Board Meerut is not competent to levy toll tax in law on the ground that no such 'Toll Tax' on Motor Vehicles (including Passengers Transport Vehicles) can be lawfully imposed by Meerut Municipal Corporation.  It is pointed out, Original (and un-amended) Section 172(2) of U.P. Municipal Corporation Adhiniyam, 1959 that the powers referring to power to levy 'toll-tax' on 'motor vehicles' has been taken away as a consequence of enforcement of Amending Act- U.P. Act No.5 of 1991, which deleted the relevant Clauses of Section 172(2) of the Adhiniyam.

Learned counsel for the petitioner has placed reliance on the following decisions.

1.   AIR 2000 Supreme Court 454- Management of M.C.D., Versus Prem Chand Gupta and another(12 and 13 ).

12. But even that apart, Regulation4(1) of the very same Service Regulations of 1959 clearly provides as follows :

"4(1) Unless otherwise provided in the Act or these regulations, the Rules for the time being in force and applicable to Government servants in the service of the Central Government shall, as far as may be, regulate the conditions of services of municipal officers and other municipal employees",

excepted matters mentioned therein are not relevant for our present purpose.  It, therefore, becomes clear that on a combined operation of Regulation 2(b)(ii) and Regulation 4(1) of the Service Regulations, 1959, the relevant Rules which were in force in 1966 when the respondent-workman's services were terminated were the latter Rules of 1965 and could not be earlier Rules of 1949 which had got superseded and had ceased to exist on the statute book.

13. In this connection, one submission of learned counsel for the respondent-work-man may be noted.  He submitted that as laid down by Regulation 4(1), the Rules for the time being in force as mentioned therein would refer to only those Rules which were in force when Service Regulations of 1959 were promulgated and not any latter Rules.  It is difficult to countenance this submission.  Rules for the time being in force will have a nexus with the regulation of condition of service of the municipal officers at at the relevant time as expressly mentioned in Regulation 4(1).  Therefore, whenever the question of regulation of conditions of service of the municipal officers comes up for consideration, the relevant Rules in force at that time have to be looked into.  This is the clear thrust of Regulation 4(1).  Its scope and ambit can not be circumscribed and frozen only to the point of time in the year 1959, when the Service Regulations were promulgated.  If such was the intention of the framers of the Regulation, Regulation 4(1) would have employed a different phraseology, namely, "rules at present in force" instead of the phraseology "rules for the time being in force".  The phraseology "Rules for the time being in force would necessarily means rules in force from time to time and not rules in force only at a fixed point of time in 1959 as tried to be suggested by learned counsel for the respondent-workman. "

                                                   (underlined by us to lay emphasis)


2. AIR 1982 SC 697-Western Coalfields Ltd.,  Versus  Special Area Development Authority  (13 to 16).  For ready reference para 13 and 16 are reproduced below :

"13.  The first contention of the learned Attorney General is that respondent 1 can exercise only such powers to levy property tax as the Municipal Corporation or the Municpal Council had under the M.P. Municipal Corporation Act, 1961, as these Acts stood on Feb.27,1976, when Cl. (d) was inserted in its present form in S.69 of the Act of 1973.  It is urged that the provisions conferring powers of taxation under the aforesaid two Acts must be taken to have been incorporated in S.69(d) of the Act of 1973 and any subsequent change in those provisions by amendment of the two Acts cannot be availed of by respondent 1. S. 127A and S.135 which, by their own force, create and levy the charge of property tax were inserted in the Municipalities Act and the Municipal Corporation Act respectively with effect from Apr. 1. 1976, that is subsequent to the insertion of Cl. (d) in S. 69 of the Act of 1973.  Relying on this, it is argued that respondent 1 was incompetent to exercise the powers of the Municipality or the Municipal Corporation under S.127 A of the Municipalities Act or S.135 of the Municipal Corporation Act.

16. Applying these principles, we are of the opinion that in the instant case, subsequent amendments made to the Municipal Corporation Act and the Municipalities Act will also apply to the power of taxation provided for in S.69(d) of the Act of 1973.  The Act of 1973 did not, by S. 69(d), incorporate in its true signification any particular provision of the two earlier Acts.  It provides that, for the purpose of taxation, the Special Area Development Authority shall have the powers which a Municipal  Corporation or a Municipal Council has under the M.P. Municipal Corporation Act, 1956 or the M. P. Municipalities  Act, 1961.  The case therefore is not one of incorporation but of mere reference to the powers conferred by the earlier Acts.  As observed in Nathella Sampathu Cheety.  (AIR 1962 SC 316) there is a distinction between a mere reference to or a citation of one statute in another and an incorporation which in effect means the bodily lifting of the provisions of one enactment and making them part of another, so much so that the repeal of the former leaves the later wholly untouched.  S. 69(d) of the Act of 1973 must accordingly be read to mean that respondent 1 shall have all the powers of taxation which a Municipal Corporation or a Municipal Council has for the time being that is to say, at the time when respondent 1 seeks to exercise those powers.

Relying on the ratio decendi 'laid down by the Apex Court in the in the aforesaid cases it is submitted that power to levy toll tax having been withdrawn by virtue of Amending Act U.P. Act no.5 of 1991, no toll tax can be levied by Cantonment Board Meerut. Under existing provisions,  the Board cannot justify imposition of 'toll' in question by referring to the power which Meerut Municipality had under the Adhiniyam to before its amendment i.e. before enforcement of  U. P. Act no.5 of 1991.  

On the contrary Sri S. N. Verma, Senior Advocate, appearing on behalf of Respondent no.4 has placed reliance upon following  decisions :

1. AIR 1967 Allahabad 15 (para4)- M/s Punjab Lime and Lime-stone Co.,  Dehradun Versus Cantonment Board, Dehradun and another.

Vide para 21 of the said judgement, this Court observed that toll on vehicles passing through cantonment area can be imposed after coming into operation of Constitution.

There is no dispute that 'toll tax' can be imposed on 'Motor-Vehicle' passing through 'Municipal' limits after commencement of Constitution of India.  But that is not issue is hand. The question is whether such power is conferred upon 'Municipality' under an enactment.  If the answer is 'Yes', only then Respondent Board can take advantage to justify to exercise such power by it also and not otherwise. Constitution mere confers Power of competence but that must be assumed and exercised under statutory enactment.  Respondent fail to show existence of  statutory  enactment conferring upon a Municipal Board/Corporation requisite power to impose Toll tax on Motor Vehicle.

2.  AIR 1967 Allahabad 24(Alld.H.C)-Mohammad Ibrahim Versus State  of U.P. and others.

In the above case, learned Single Judge of this Court upheld  validity of Section 2 of  Tolls Act.

In addition to the above, Sri S. P. Gupta, Senior Advocate, learned counsel representing the Board/Respondent nos.2 and 3,  submitted that the mere fact U.P. Municipalities Act and U.P. Municipal Corporation Adhiniyam have been amended and relevant provisions conferring power upon a 'Municipality' to levy toll on motor vehicle, have been deleted under Amending U. P. Act no.5 of 19991 is of no consequence and the power of Cantonment Board Meerut, which it once possessed with reference to these Acts- before Amendment, continue to remain intact with the Board under Section 60 of the Cantonment Act. In other words, he argues that when Section 60, Cantonment Act brought in effect- the Board inhered the power to levy Toll-tax in question just as a 'Municipality' had this power under  provisions of Municipalities Act/Corporation Act (before U.P. Act no.5 of 1991 came in force).    

The argument is that even if  the 'Municipalities' have been divested of its power to levy 'Toll-Tax' in question by virtue of Amending U.P. Act no.5 of 1991, the same does automatically divest the Board of its power to levy such Toll Tax and under Section 60 of the Cantonment Act. According to the learned counsel, the power of the Board, which it came to acquire with reference to unamnded Municipalities Act., when Section 60 of the Cantonment Act was initially brought into force, shall remain unaltered, notwithstanding later Amendment of Municipalities Acts.   Learned counsel submits that the language of Section 60 of the Cantonment Act, shows that the reference to 'the power of Municipalities' in the said section is clearly an incorporation by adoption and not by reference and therefore, subsequent deletion of those provisions in Municipalities Act shall not automatically take-away,  from the Board such power.

Reliance is placed upon following decisions :

1.    1979(2) SCC 529 - Mahindra and Mahindra Ltd. Versus  Union of India and another (Pr. 8 and  9 ).

"8. The first question that arises for consideration on the preliminary objection of the respondents is as to what is the true scope and ambit of an appeal under Section 55. That section provides inter alia that any person aggrieved by an order made by the Commission under Section 13 may prefer an appeal to this Court on "one or more of the grounds specified in Section 100 of the Code of Civil Procedure, 1908".  Now at the date when Section 55 was enacted, namely, December 27, 1969, being the date of coming into force of the Act, Section 100 of the Code of Civil Procedure specified three grounds on which a second appeal could be brought to  the High Court and one of these grounds was that the decision appealed against was contrary to law.  It was sufficient under Section 100 as it stood then that there should be a question of law in order to attract the jurisdiction of the High Court in second appeal and, therefore, if the reference in Section 55 were to the grounds set out in the then existing Section 100, there can be no doubt that an appeal would like to this Court under Section 55 on a question of law.  But subsequent to the enactment of Section 55, Section 100 of the Code of Civil Procedure was substituted by a new section by Section 37 of the Code of Civil Procedure (Amendment) Act, 1976 with effect from February 1, 1977 and the new Section 100 provided that a second appeal shall lie to the High Court only if the High Court is satisfied that the case involves a substantial question of law.  The three grounds on which a second appeal could like under the former Section 100 were abrogated and in their place only one ground was substituted which was a highly stringent ground, namely, that there should be a substantial question of law.  This was the new Section 100 which was in force on the date when the present appeal was preferred by the appellant and the argument of the respondents was that the maintainability of the appeal was, therefore, required to be judged by reference to the ground specified in the new Section 100 and the appeal could be entertained only if there was a substantial question of law.  The respondents leaned heavily on Section 8(1) of the General Clauses Act, 1897 which provides :

Where this Act or any Central Act or Regulation made after the commencement of this Act, repeals and re-enacts, with or without  modification, any provision of a former enactment, then references in any other enactment or in any instrument to the provision so repealed shall, unless a different intention appears, be construed as references to the provision so re-enacted.

and contended that the substitution of the new Section 100 amounted to repeal an re-enactment of the former Section 100 and, therefore, on an application of the rule of interpretation enacted in Section 8(1), the reference in Section 55 to Section 100 must be construed as reference to the new Section 100 and the appeal could be maintained only on ground specified in the new Section 100, that is, on a substantial question of law.  We do not think this contention is well founded.  It ignores the distinction between a mere reference to or citation of one statute in another and an incorporation which in effect means bodily lifting a provision of one enactment and making it a part of another.   Where there is mere reference to or citation or one enactment in another without incorporation, Section 8(1) applies and the repeal and  re-enactment of the provision referred to or cited has the effect set out in that section and the reference to the provision repealed is required to be construed as reference to the provision as re-enacted.................................................. But where a provision of one statute is incorporated in another, the repeal or amendment of the former does not affect the latter.  The effect of incorporation is as if the provision incorporated were written out in the incorporating statute and were a part of it.  Legislation by incorporation is a common legislative device employed by the legislature, where the legislature for convenience of drafting incorporates provisions from an existing statute by reference to the statute instead of setting out for itself at length the provisions which it desires to adopt.......................................................................................

................................................................................................It is, therefore, clear that if there is mere reference to a provision of one statute in another without incorporation, then, unless a different intention clearly appears, Section 8(1) would apply and the reference would be construed as a reference to the provision as may be in force from time to time in the former statute. But it a provision of one statute is incorporated in another, any subsequent amendment in the former statute or even its total repeal would not affect the provision as incorporated in the latter statute.  The question is to which category the present case belongs.

9.  We have no doubt that Section 55 is an instance of legislation by incorporation and no legislation by reference.  Section 55 provides for  an appeal to this Court on "one or more of the grounds specified in Section 100".   It is obvious that the legislature did not want to confer an unlimited right to appeal, but wanted to restrict it and turning to Section 100, it found that the grounds there set out were appropriate for restricting the right of appeal and hence it incorporated them in Section 55.  The right of appeal was clearly intended to be limited to the grounds set out in the then existing Section 100.  Those were the grounds which were before the Legislature and to which the Legislature could have applied its mind and it is reasonable to assume that it was with reference to those specific and known grounds that the Legislature intended to limit the right of appeal to any ground or grounds which might from time to time find place in Section 100 without knowing what those grounds were.  The grounds specified in Section 100 might be changed from time to time having regard to the legislative policy relating to second appeals and it is difficult to see any valid reason why the Legislature should have thought it necessary that these changes should also be reflected in Section 55 which deals with the right of appeal in a totally different context.  We fail to appreciate what relevance the legislative policy in regard to second appeals has to the right of appeal under Section 55 so that Section 55 should be inseparably linked or yoked to Section 100 and whatever changes take place in Section 100 must be automatically read into Section 55............................................. We must, therefore, hold that on a proper interpretation the grounds specified in the then existing Section 100 were incorporated in Section 55 and the substitution of the new Section 100 did not affect or restrict the grounds as incorporated and since the present appeal admittedly raises questions of law, it is clearly maintainable under Section 55. ...........................................

                                              (underlined to lay emphasis)

The above case is clearly distinguishable.  Relevant 'Expression in this case- which came to  be interpreted by the Apex Court in the case of Mahindra and Mahindra Ltd. (supra) is distinct and different than the expression used in Section 60, Cantonment Act.  On the other hand, in our case legislative intent- on which Apex Court had laid emphasis while attempting to interpret, shows that the Legislative clearly kept in mind to place a 'Municipality' and Cantonment Board as its counter part to stand on equal footing in the matter of levy of Toll Tax.

2. AIR 1964 SC 1667(1670)- Narottamdas Versus State of Madhya Pradesh and others ( Pr.6).

" 6. It is not disputed that the Madhya Pradesh Legislature had the legislative competence to make a law as regards minimum wages under Entry 24 of List III (Sch. Seventh).  Mr. Setalvad contends that this power of independent legislation was not really exercised by the  Legislature and that in the guise of independent legislation it has in substance passed a validating Act, after an attempt to validate the notification of the 30th December, 1958 had failed.  In support of his argument that it is not independent legislation Mr. Setalvad laid stress on the language of S.2.  That section merely says that the expressions used in this Act shall have the same meaning for the purpose of this Act as defined in the Minimum Wages Act of 1948.  According to the learned Counsel, this shows that this was really a dependent and no independent legislation.  We can find no substance in this argument.  The definition of expressions used in an Act with reference to other Act is a well-known device in legislative practice generally adopted for the sake of brevity.  The definition would remain effective even after the other Act with reference to which the definition was given ceases to exist.   This fact of defining expressions in an Act with reference to some other Act cannot therefore have the effect of making this Act dependent on such other Act.

This decision has no bearing to the issue and does not help the respondent in any manner.

3. AIR 1986 SC 1011- Mrs. Mary Roy, etc. Versus State of Kerala and others (Pr.7)

" 7.     It was then contended on behalf of the respondents, though faintly, that by reason of S.29, sub-sec.(2), the Indian Succession Act, 1925 must be deemed to have adopted by reference all laws for the time being in force relating to intestate succession including the Travancore Christian Succession Act, 1092 so far as Indian Christians in Tranvancore are concerned.  This contention was sought to be supported by reference to the decision of the Travancore-Cochin High Court in "Kurian Augusty v. Devassy Aley, AIR 1957 Trav Co. 1. We do not think this contention is at all sustainable.  The legislative device of incorporation by reference is a well-known device where the legislature instead of repeating the provisions of a particular statute in another statute incorporates such provisions in the latter statute by reference to the earlier statute.  It is a legislative device adopted for the sake of convenience in order to avoid verbatim reproduction of the provisions of an earlier statute in a later statute.  But when the legislature intends to adopt this legislative device the language used by it is entirely distinct and different from the one employed in S.29, sub-sec.(2) of the Indian Succession Act, 1925.  The opening part of S.29, sub-sec. (2) is intended to be a qualificatory or excepting provision and not a provision for incorporation by reference.  We have no hesitation in rejecting this contention urged on behalf of the respondents."

                                                       (underlined to lay emphasis)

This decision lays importance to the expression used in the 'statutory provision'  which calls for interpretation.  On that criterion, the use of words "..........time being in force" leave no scope to doubt that the legislature while enacting Section 60, Cantonment Act clearly referred to the 'Powers' of Municipalities which it possess from time to time and not the Power of Municipality with reference to a fixed or frozen time.

4. AIR 1985 SC 76  - M/s MSCO. Pvt. Ltd.,  Versus Union of India and others (para 4).

4. The expression 'industry' has many meanings.  It means 'skill', 'ingenuity', 'dexterity', 'diligence', systematic work or labour', 'habitual employment in the productive arts', 'manufacturing establishment' etc..  But while  construing a word which occurs in a statute or a statutory instrument in the absence of any definition in that very document it must be given the same meaning which it receives in ordinary parlance or understood in the sense in which people conversant with the subject matter of the statute or statutory instrument understand it.  It is hazardous to interpret a word in accordance with its definition in another statute or statutory instrument and more so when such statute or statutory instrument is not dealing with any cognate subject, Craies on Statute Law (6th Edn.) says thus at page 164:

" In construing a word in an Act caution is necessary in adopting the meaning ascribed to the word in other Acts. " It would be a new terror in the construction of Acts of Parliament if we were required to limit a word to an unnatural sense because in some Act which is not incorporated or referred to such an interpretation is given to it for the purposes of that Act alone.  Macbeth v. Chislett (1910) A.C. 220.223."

This decision again is no authority to interpret the expression "time being in force" as used in Section 60, Cantonment Act.

Section 60. of the Cantonment Act provides that  Cantoment Board may impose a 'Tax' -

(i) with previous sanction of the Central Government

(ii) within its territorial limits

(iii) which a Municipality in the State, (-wherein such Cantonment is situate), may impose under any enactment for the time being in force.

The expression  "under any enactment for the time being in force" used in Section 60, Cantonment Act shows clearly contemplates continuity of the 'enforcement/enactment' of Municipalities Act which may be existing and operative at the relevant time in question i.e. at the  time when such 'Cantonment Board' (wherein such Board is situate) intends to  impose  such 'Toll tax'.

The  question, therefore, which survives for consideration is, 'whether the' toll in question could be validly imposed  under law by the Meerut Municipal Corporation when Government Notification dated 8.1.2005 is issued.

The answer to this question depends upon interpretation of Section 60 Cantonment Act. Language of Section 60, Cantonment Act, in our considered opinion, is clear, unambiguous and needs no effort to stretch while interpreting it. this Section un-mistakenly provides that power of a particular 'Cantonment Board' shall be what its counter-part(Municipality) possess on the date it proposes to levy 'Toll Tax'. Section 60, Cantonment Act has to be  interpreted  by giving normal meaning to the expression used therein without doing violence with the meaning of the 'words' or 'expression' used in the section.

It is quite understandable that legislature intended to confer power upon a 'Cantonment Board' in the matter of 'Tax' only. Those  powers which its corresponding -'Municipality' ( where the Board is situate) had at the relevant point of time in question.  Mere spelling out power by referring to the Constitution of India is not sufficient.  

Preamble of the Constitution reads:-:

" In our Constituent Assembly this twenty sixty day of November, 1949 do hereby adopt, enact and give to ourselves this Constitution."

The word "enact" in the "pre-amble' the Constitution of India, is not to be 'confused' with the expression "enactment" defined in General Clauses Act (quoted above in the judgement).  The word enact' in the Premable is 'verb' which denotes a positive action.  The word 'enactment' used in Section 60, Cantonment Act noun and refers to 'statutory' codification in the shape of Act, etc.

However, The General Clauses Act, (Central and Uttar Pradesh both), define the expression "enactment'' and it is clear that 'The Constitution' is not covered by its definition. The term- "enactment"  refers to 'Act' or 'Regulation'. Constitution of India is neither Act nor Regulation. It is a 'CODE' adopted by the people .  Further 'Constitution of India' merely denies source of powers of different organs of the State. Unless  power is conferred by an 'enactment' Constitution of India existence of Source of Power in the Constitution is of no help to the Respondents.  

Unless there an Act or Regulation is 'enacted' to authorise a Municipality to levy toll in question, Respondent can take no help by referring to Article 243(x) of the Constitution.  

Section 2 Tolls Act, also refers to source of power; it says that by Notification 'State Government' may cause such rates of toll, as it thinks fit to be levied upon any road or bridge....''.

Respondents have failed to plead or produce material to show that Central or State Government, in exercise of said power has ever prescribed rates of toll to be levied by Meerut Municipal Corporation with reference to the 'road' in question.  Court  made specific query on this aspect but received no answer. Section 2(a), (as amended), pleads further rider, that is the road 'in question' must be constructed or maintained "at the expense of Central or the State Government".  There is not even an iota of material to show that road in question has been made or repaired after enforcement of Tolls Act.  

In view of the above, Meerut Cantonment Board is not competent to levy toll- tax  on vehicle passing through its Limits inasmuch as the condition precedent, contemplated under Section 60 of the Act " ( namely - a tax under any enactment for the time being in force" which may be imposed in any Municipality in the State wherein such Cantonment is situate) is conspicuously absent in the instant case.  

Cantonment Board Meerut is not legally competent to impose the 'toll tax' in question and therefore, the impugned notification 8.01.2005 (Annexure 6 to the writ petition) is liable to be quashed.

There is no fault of Respondent no.4, who is given 'Theka'  on the basis of impugned Notification; and since there is 'no fault' of this respondent, he should not be made to suffer.

Consequently,  we direct Cantonment Board Meerut to refund the  amount deposited by him under 'contract' if any, or otherwise in pursuance to the action under the impugned notification and also refund the 'security amount', if any, deposited by him within four weeks of receipt of certified copy of this judgement to Respondent no.4.     Respondent no.4 shall also be entitled to  claim refund of 'Stamp duty' in accordance with law within four weeks of receipt of application along with certified copy of this judgement.    Any excess amount of 'Toll Tax' after adjusting aforesaid refund shall be kept by the Cantonment Board in separate account  and  incurred exclusively for the maintenances of the Road in question.

Writ petition stands allowed.

No order as to costs.

Dated: 23.03.2006



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