JUDGMENT Chawdhary, J. (March 2, 1955) 1. This is an application under Article 226 of the Constitution by the Tata Oil Mills Go. Ltd., Bruce Street, Fort Bombay, directed against the District Board of Allahabad, the District Magistrate of Allahabad and the Tax Officer District Board Allahabad for relief by the issue of appropriate writs from payment of a sum of Rs. 500 per annum imposed as Circumstances and Property Tax upon the applicant under the provision of the U.P. District Boards Act. 2. The applicant has its registered office at Bombay and a branch office within the municipal limits of Allahabad in a locality known as the Jawahar Square. It has also got a godown at Naini outside the municipal limits but within the territorial jurisdiction of the District Board of Allahabad. The case of the applicant is that it does not carry on any business at the said godown, and therefore the District Board was not entitled to levy any circumstances and property tax on it. The other ground on which the levy has been challenged is that the provisions of Section 114 of the Distract Boards Act 1922, whereunder the tax has been imposed is invalid inasmuch as the power to impose the tax in question does not come under any of the categories laid down in List II of Schedule VII appended to the Constitution. 3. A preliminary objection was taken by the Learned Counsel for the opposite parties that the present application is not maintainable because adequate relief is obtainable by the applicant by a regular suit. In support of this objection the Learned Counsel cited two cases, District Board Furrakhabad v. Prag Dutt 1948 A.W.R. (H.C.) 346 and The District Board Banaras v. G.F. Kellner and Company 1954 A.W.R. (H.C.) 214, in both of which, it was contended, the legality of imposition of circumstances and property tax was the subject-matter of litigation. The argument of the Learned Counsel for the opposite party was that these rulings show that it was possible for the applicant to ventilate his grievance with regard to the imposition in question by a regular suit. The argument of the Learned Counsel for the opposite party was that these rulings show that it was possible for the applicant to ventilate his grievance with regard to the imposition in question by a regular suit. That may be so, but what distinguishes the present application from the suits which give rise to the appeals reported in District Board Farrukhabad v. Prag Dutt 1948 A.W.R. (H.C.) 346 and The District Board Banaras v. G.F. Kellner and Company 1954 A.W.R. (H.C.) 214 is that one of the grounds on which the imposition is questioned here is that it is ultra vires the Constitution. Where that is the case the plea of availability of an alternative relief would not be a bar to the maintainability of an application under Article 226 of the Constitution. As however the present case involves a question as to the validity of a provision of the U.P. District Boards Act, it is directed that it be listed for hearing before a Bench of two Judges. Agarwala, J. 4. This is an application under Article 226 of the Constitution. The applicant is the Tata Oil Mills Company Limited, Bruce Street, Fort Bombay. The opposite-parties are the District Board of Allahabad, the District Magistrate of Allahabad and the Taxing Officer, District Board, Allahabad. The relief claimed in the application is that an appropriate writ be issued against the opposite-parties restraining them from imposing and levying a tax on circumstances and property of the applicant Company and further praying that a writ of certiorari be issued quashing the appellate order of the Additional District Magistrate, Allahabad dated the 12th of January, 1954. 5. The facts of the case in brief are that the applicant Company has its registered office at Bombay and a sub-office at Allahabad in a locality known as the Jawahar Square. It has a go-down at Naini within the jurisdiction of the District Board, Allahabad. The applicant's case is that it does not carry on any business at the said godown; that all the business is carried on by the sub-office located at Jawahar Square in the city of Allahabad and that what is done at Naini godown is merely to receive the goods from outside and to deliver such of them as have been contracted to be sold at the sub-office at Allahabad. It is explained that this is done by the applicant Company to avoid the payment of action if the goods were received within the limits of the Municipal Board of Allahabad. 6. The applicant has been assessed to what is called tax on circumstances and property, to the extent of Rs. 500 on the supposed income of the business alleged to have been carried on by the applicant Company within the limits of the District Board of Allahabad. When the tax was levied, the applicant Company filed objections to the imposition and the levy of the tax on the ground that the applicant neither resides not carries on business within the limits and jurisdiction of the District Board of Allahabad. The objections were over-ruled by the District Board, and an appeal u/s 128 of the U.P. District Boards Act against the levy was dismissed by the Additional District Magistrate of Allahabad. 7. The applicant's case in this writ petition is that the circumstances and property tax imposed upon him, in the circumstances mentioned above, was not justified by the provisions of Section 114 of the District Board Act and further that Sections 108 and 114 of the District Board's Act themselves have become ultra vires of the Constitution as there is no provision in List II of Schedule 7 of the Constitution enabling the State Government or a District Board to levy a 'circumstances and property' tax. 8. On behalf of the opposite-parties, it has been contended that the applicant Company both resides and carries on its business at Naini within the jurisdiction of the District Board of Allahabad. The facts stated by them are that what is done at Naini is that the goods are received there and the contracts of purchase are entered into and the goods delivered at that place. It is also urged that the Act has not become void. 9. The case came up before a learned Single Judge of this Court and it was urged before him on behalf of the opposite parties that as the applicant has a remedy by way of suit, the writ petition should not be entertained. The learned Single Judge was of opinion that since the applicant had raised a question as to the constitutionality of Sections 108 and 114 of the District Boards' Act this Court should entertain the petition and decide upon the question thus raised. The learned Single Judge was of opinion that since the applicant had raised a question as to the constitutionality of Sections 108 and 114 of the District Boards' Act this Court should entertain the petition and decide upon the question thus raised. In view of the importance of the question, the learned Judge referred the case to a Bench of two Judges. The matter has now been argued before us by Learned Counsel for the parties. 10. In our opinion, since there is a dispute as to what is being done by the applicant Company at Naini within the jurisdiction of the District Board of Allhabad, we do not consider it necessary to decide the disputed questions of fact and since in the absence of the facts being correctly determined, it would be futile to express any opinion as to whether the applicant resided or carried on its business at Naini, we propose, and both the parties are agreed, that we may pronounce upon the constitutionality of Sections 108 and 114 of the District Boards Act, and if the sections were construed as valid law under the present Constitution, to refer the parties to a separate suit. The only question, therefore, that we have to consider is whether Sections 108 and 114 of the District Boards Act empowering the District Board to levy circumstances and property tax have become void under the present Constitution or not. 11. Section 108 of the District Boards Act empowers a District Board "to continue a tax already imposed on persons assessed according to their circumstances and property (hereinafter referred to as the 'tax on circumstances and property') in accordance with Section 114". 11. Section 108 of the District Boards Act empowers a District Board "to continue a tax already imposed on persons assessed according to their circumstances and property (hereinafter referred to as the 'tax on circumstances and property') in accordance with Section 114". Section 114 runs as follows: The power of a board to impose a tax on circumstances and property shall be subject to the following conditions and restrictions, namely,-- (a) the tax may be imposed on any person residing or carrying on business in the rural area provided that such person has so resided or carried on business for a total period of at least six months in the year under assessment; (b) no tax shall be imposed on any person whose total taxable income is less than two hundred rupees per annum; (c) the rate of tax shall not exceed four pies in the rupee on the total taxable income; and (d) the total amount of tax imposed on any person shall not exceed such maximum, if any, as may be prescribed by rule. 12. The rule referred to in Clause (d) above is printed on page 273 of the District Board Manual of Uttar Pradesh, 1953 edition. It runs: The total amount of the tax on circumstances and property imposed by a District Board, on any single Assessee shall not, in any year, exceed the sum of Rs. 2,000. 13. Learned Council for the applicant contends that the circumstances and property tax is a tax not only on the income of a person howsoever derived, but also on his general financial status and may be levied not only when he derives any income, but also upon his general financial position. We do not consider that u/s 114 of the District Board Act, the tax on the circumstances and property is anything else than a tax on income. The sources of income may be varied and many but it is the income alone from all those sources that can be assessed to the tax under the heading of circumstances and property tax. The sources of income may be varied and many but it is the income alone from all those sources that can be assessed to the tax under the heading of circumstances and property tax. If the words 'circumstances and property' were considered apart from the provisions of Section 114, it might be said that they are wide enough to include not only every kind of activity which gives rise to income but also the financial status of a person, but the conditions imposed by Section 114 limit the tax to a tax on income. Clause (b) restricts the imposition of the tax to a case where the total taxable 'income' is Rs. 2,000 or over. Clause (c) restricts the rate of tax to the maximum of four pies in the rupee on the total taxable income. Clause (d) lays down that the total amount of tax imposed on any person shall not exceed a certain figure which, at present is Rs. 2,000. If the 'circumstances and property' tax is to be subject to the conditions mentioned in Clauses (a) to (d) of Section 114, as it has to be, because the section so provides, it is clear that the tax must have reference to the income of the person taxed. It should be remembered that the nature of the tax has to be determined not merely by the name that has been given to it but by its pith and substance as has been very often stated see the Governor General in Council v. The Province of Madras 1945 P.C. 98, Madras General Sales Tax Act, 1939, FCR 18. 14. This was the view of the majority of Judges (Dayal and B. Prasad, JJ.) in the Full Bench decision of this Court, District Board of Farrukhabad v. Prag Dutt 1948 A.W.R. (H.C.) 346. Malik, C.J. however, expressed the opinion "that the fundamental difference between a tax on 'income' and a tax on 'circumstances and property' is that income tax can only be levied if there is income, and if there is no income, no tax is payable but in the case of Circumstances and Property Tax, where a man's status has to be determined his total business turnover may be considered for purposes of taxation, though be may not have earned any taxable income". We may, however, respectfully point out that the learned Chief Justice considered the nature of the tax generally and not with particular reference to the provisions of Section 114 of the District Boards Act because Clauses (a) to (d) of Section 114, though quoted in an earlier part of his judgment were not referred to in the discussion as to the nature of the circumstances and property tax, whether it was a tax on income or otherwise. Ultimately, however, the learned Chief Justice held that in the case before him, the tax had been levied on income. We are in respectful agreement with the views of the majority of the Judges in the above case. 15. The income which is assessable under the circumstances and property tax may be derived from any source--(i) lands and buildings, (ii) professions, trades, callings and employments, (iii) other sources of income such as dividends, interest from securities or other movable property when it does not fall under the previous two headings. It was pointed out that under items 49 and 60 of List II of the Seventh Schedule, the State Legislature can only legislate in respect of taxes on "lands, buildings" and "professions, trades, callings and employments" and it could not provide for tax on any other source of income. This is true, but, Article 277 of the Constitution saves certain laws from becoming void under the Constitution. It recites: Any taxes, duties, cesses or fees which, immediately before the commencement of this Constitution, were being lawfully levied by the Government of any State or by any municipality or other local authority or body for the purposes of the State, municipality, district or other local area may, notwithstanding that those taxes, duties, cesses or fees are mentioned in the Union List, continue to be levied and to be applied to the same purposes until provision to the contrary is made by Parliament; by law. 16. Now, a tax on income is mentioned in the Union List, item No. 82. 17. The circumstances and property tax, therefore, being a tax on income, is saved by reason of the provisions of Article 227 of the Constitution, provided that it was lawfully levied prior to the commencement of the Constitution. 16. Now, a tax on income is mentioned in the Union List, item No. 82. 17. The circumstances and property tax, therefore, being a tax on income, is saved by reason of the provisions of Article 227 of the Constitution, provided that it was lawfully levied prior to the commencement of the Constitution. The Act was valid when it was enacted in 1922 when there was no division of powers between the Centre and the Provinces, as was held in District Board, Dehra Dun v. H. Trotter, Forest Economist, Forest Research Institute, P.O. New Forest (1939) A.W.R. (H.C.) 218. It continued to be valid even under the Government of India Act, 1935 by reason of the provisions of Section 143, Clause (2) of that Act read with the Seventh Schedule, List 1, item 54. 18. We, therefore, hold that the circumstances and property tax levied by the District Board under Sections 108 and 114 of the District Boards Act is valid even under the present Constitution. 19. The result, therefore, is that we dismiss this application with liberty to the applicant to pursue his remedy by means of a suit in the ordinary course. In the circumstances, we make no order as to costs.