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Municipal Council, Sangrur. v. Punjab Transformer & Electronics Ltd., S - RSA-2191-2001  RD-P&H 4374 (19 July 2006)
(1) R.S.A. No.2191 of 2001
Municipal Council, Sangrur.
Punjab Transformer & Electronics Ltd., Sangrur.
(2) R.S.A. No.2192 of 2001
Municipal Council, Sangrur.
M/S Sangrur Industrial Corporation,Sangrur.
Date of Decision: 25.7.2006
CORAM : Hon'ble Mr.Justice Mahesh Grover
Present: Shri Naveen Sharma, Advocate for Shri S.S.Behl, Advocate for the appellant.
Shri Jai Bhagwan, Advocate for the respondents.
By this judgment, I propose to dispose of Regular Second Appeal Nos. 2191 and 2192 of 2001 as common questions of law and facts are involved therein.
The respondents filed separate suits for permanent injunction seeking to restrain the appellants from charging octroi on cold rolled grain oriented steel sheets/silicon sheets at the rate of 1.50% on the value of the material. The respondents are manufacturers of electric transformers. It was pleaded that the appellant was charging octroi on the goods in dispute by treating the same to be electric goods. The respondents were importing the raw material from other States and, therefore, it could not be said that the same were electric goods within the definition of `electric goods' given in the Excise and Customs Tariff. The respondents had submitted that they were ready to pay octroi duty on these goods at the rate of Rs.4/- per quintal.
The appellant had contended that the present respondents were the manufacturers of electric transformers and, therefore, the raw material which was in the shape of iron sheets and was being brought by them within the city were electric goods according to Item No.72 of the Octroi Schedule and, thus, there was no illegality in the charging of octroi by treating the goods in question as electric goods.
The trial Court decreed the suits of the respondents and restrained the appellant from charging octroi from them as per the rate given under Item No.72 of the Octroi Schedule. In the appeals filed by the appellant, the lower Appellate Court affirmed the findings of the trial Court.
The sole contention raised by the learned counsel for the appellant is that the Civil Court had no jurisdiction to entertain the suits and in support thereof, he relied on the judgment of this Court in Kelash Nath s/o L.Durga Dass and others Versus Municipal Committee, Batala, AIR 1962 Punjab 389.
I have considered the contention of the learned counsel and perused the record.
The issues that were claimed in both the suits before the trial Court were:-
1.Whether the defendants or their agents are charging ocroi in excess as alleged?OPP
2. Whether the suit is not maintainable without any notice under Section 49 of the Punjab Municipal Act?OPD
3. Whether this court has no jurisdiction to try the suit?OPD
4. Relief. The power to levy octroi is derived by the appellant from Section 61 of the Punjab Municipal Act,1911 (for short, `the Act'). The octroi is one of the taxes specified in sub-section (1) of Section 61 and is leviable by virtue of sub-section (2) of Municipal Account Code, Chapter- V. It is not the case of the respondents that the appellant had no power to impose the octroi duty, but the only case pleaded and set up by them was that the goods which are being subjected to octroi should have been charged under a different head. In this view of the matter, when the power to levy octroi is not under question and the only dispute is regarding its levy under a particular head, in such an eventuality, the Civil Court will have no jurisdiction to entertain the suit and the only remedy that could have been availed by the respondents was by submitting themselves to the jurisdiction of the competent authorities under the Act.
In Kelash Nath's case (supra), a Full Bench of this Court had held that jurisdiction of the Civil Courts in such like matters shall be barred.
Some of the observations made in that judgment, which are relevant in the context of the present controversy, are reproduced below:- A suit for an injunction to restrain the Municipal Committee from levying octroi duty at the rate of Rs.2/- per maund on imported cane under the residuary item No.122 of the Schedule to the Punjab Municipal Act on the allegation that the goods are only liable to pay octroi duty at the rate of annas 2 per maund either under item No.105 or 110 of the Schedule is barred from the cognizance of civil court by virtue of the provisions of Ss. 84 and 86 of the Punjab Municipal Act. When the matter for decision is whether the octroi should be levied under one item or the other of the octroi schedule on particular goods and the assessing authority comes to the conclusion that it is leviable under a particular item i.e., item 122 in the present case, it cannot possibly be said that the action of the assessing authority is in excess of or in contravention of the powers conferred on it by the statute. As it is a clear case of mistake and as no question of jurisdiction is involved, the aggrieved party must seek his remedy under section 84 which provides the forum for appeal and reference in the matter of a wrong assessment. If the committee persists in perpetuating that mistake it may even be open to the plaintiffs to bring that matter upto High Court under Article 226 of the Constitution but the Civil Courts cannot entertain and decide the present suit. AIR 1940 Lah 377 (FB), Applied. Obiter dicta in AIR 1949 EP 18, held not correct. AIR 1960 Punj 561, Dist. R.F.A.No.30 of 1952 D/16.4.1959(Punj), Criticised."
In Harikishan and others Versus Administrator, Municipal Committee, Ludhiana, AIR 1963 S.C. 1547, it was held by their Lordships of the Supreme Court, that " in a case where the liability is created by a statute, the party aggrieved must pursue the special remedy provided by it and he cannot pursue his remedy in a Civil Court." This principle was earlier app[roved by the Judicial Committee in Secretary of State Versus Mask and Co., AIR 1940 Privy Council 105.
The Act is a complete code in itself which provides for mechanism of redressal of the grievances. The levy of octroi is one of the principal modes of collecting revenue by the Local Bodies and whether a particular item falls within the Octroi Schedule for the purpose of levying octroi is within the domain of the Municipal Committee. The Act specifically provides for ousting of the jurisdiction of the Civil Courts in such like matters.
There is, thus, no ambiguity on the question of law as to whether the Civil Court had the jurisdiction to entertain the suits of the respondents or not. The respondents, therefore, in my view, could not have resorted to the jurisdiction of the Civil Court to restrain the appellant from levying the octroi on the goods brought by them in the city.
In view of the above discussion, the present appeals are allowed. The judgments and decrees of the Courts below are set aside with no orders as to costs.
July 25,2006 ( Mahesh Grover )
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