JUDGMENT Jagdish Sahai, J. - This special appeal by the Zila Parishad, Muzaffarnagar (here inafter referred to as the Zila ,Parishad) and another is directed against the judgment of 'D. D. Seth, J. dated 16-9-1966 allowing writ petition No. 3123 of 1961 filed by the respondent, Messrs Jugal Kishore Ram Swarup (hereinafter referred to as the firm). 2. According to the firm all its partners reside in the town of Miranpur, which is a town area constituted under the provisions of the U. P. Town Areas Act. It carries on business of manufacture of Khandsari sugar, in its business premises located in that town. Admittedly the firm purchases sugar cane for crushing in two villages, viz. Bhumma and Dhansri. It is the firms case that "after the purchase of sugar cane the same is crushed at these two places in crushers and the juice is converted into Rab which is taken from there to Miranpur for the manufacture of Khand in which the petitioner deals". (See paragraph No. 4 of the writ petition). 3. The town of Miranpur falls within the territorial limits of the District Board of Muzaffarnagar (hereinafter referred to as the Board) . The assessing officer of the Board issued a notice calling upon the firm to furnish its accounts for the purpose of the assessment of the circumstances and property tax on it for the year 1958-59. The firm did not appear and the assessing officer imposed a tax of Rs. 1,750/- ex-parte. In the preceding year the circumstances and property tax assessed on the firm was Rs. 625/-. The firm appealed to the Commissioner, Meerut Division, who dismissed the appeal on 6-4-1960. The firm then filed a review application before him which was dismissed on 13th of July, 1961. There-after the writ petition giving rise to this appeal was filed in this Court by the firm. 4. The writ petition was heard by Seth, J., who, allowed it on the basis of Asa Ram v. District Board Muzaffarnagar, A.I.R. 1959 SC 480. Seth, J. ordered :- "The petition is allowed with costs and the orders passed by the Tax Officer dated 26th December, 1959 and by the Commissioner, Meerut Division dated 6th April, 1960 and 13th July, 1961 are quashed. The respondents are prohibited from levying any circumstances and property tax on the petitioner. Seth, J. ordered :- "The petition is allowed with costs and the orders passed by the Tax Officer dated 26th December, 1959 and by the Commissioner, Meerut Division dated 6th April, 1960 and 13th July, 1961 are quashed. The respondents are prohibited from levying any circumstances and property tax on the petitioner. They are further directed to refund the entire amount of circumstances and property tax paid by the petitioner for the assessment years 1959-60 onwards." 5. We have heard Shri P. C. Gupta for the appellant Zila Parishad and Shri Madhyan for the respondent firm. 6. Shri Gupta has contended that the decision in Asa Ram v. District Boards, A.I.R. 1959 SC 480 is clearly distinguishable and not being a case in respect of circumstances and property tax was wrongly relied upon by Seth, J. Shri P. C. Gupta also submitted that in any case the learned single Judge far exceeded his jurisdiction when he has issued a mandamus commanding the appellants to return the payments made in connection with the assessments for the years 1959-60 onwards, that is, the assessments which were never challenged before the learned single Judge. In our opinion both the submissions are well founded. 7. A District Board is permitted to impose the circumstances and property tax by virtue of the provisions of Sections 108 and 111 of the U. P. District Boards Act read together. Section 108 reads :- "Boards' power of taxation. 108. A board (a) .................................... (b) may 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: Provided that the tax on circumstances and property so imposed shall not be abolished or altered without the previous sanction of the State Government." 8. Section 114, so far as relevant for our purposes, reads :- "114. 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 had so resided or carried on business for a total period of at least six months in the year under assessment; ..................................... Explanation-For the purpose of this section "taxable income" means estimated income, but shall not include income of the following classes : ...................................... (iii) income on which any tax has previously been imposed by any other board under clause (b) of Section 108; (iv) Income on which any tax has previously been imposed under Section 14 of the United Provinces Town Areas Act, 1914." 9. Section 114 clearly provides that a District Board can impose the circumstances and property tax only if a person carries on business or resides in the "rural area" appertaining to the District Board and if he has done so for a total period of at least six months in the year under assessment. "Rural Area" has been defined by Section 3 (10) as follows :- " "Rural Area" means the area of a district excluding every municipality and every notified area as defined in the U. P. Municipalities Act, 1916, every Town Area as defined in the U. P. Town Areas Act, 1914 and every Cantonment as defined in the Cantonments Act, 1924." 10. This means that if there are areas in a district which are constituted as municipalities, or town areas or cantonments, those areas shall be excluded from the taxing jurisdiction of a District Board. 11. Admittedly all the partners of the firm reside in the town of Miranpur, which has a Town Area of its own. Therefore, the only question that requires consideration is whether the firm is carrying on business in any area appertaining to Muzaffarnagar district which is not constituted as a municipality, or a town area or a cantonment. Admittedly the firm has got crushers set up in villages Bhumma and Dhansri where it purchases sugarcane, crushes the same and converts the sugar cane juice into "Rab". After "Rab" has been produced in these two villages, it is sent to the town of Miranpur for being pressed into sugar. Clearly "Rab" is a saleable commodity in itself and is also a finished product. It is used for human consumption even as "Rab" and it can also be pressed for producing sugar. Admittedly the contracts for the purchase of sugar cane with the cultivators were executed in villages Bhumma and Dhansri. These villages do not fall within the limits of any municipality or town area or cantonment. They are, therefore within the "rural area" appertaining to the Muzaffarnagar District Board. 12. Admittedly the contracts for the purchase of sugar cane with the cultivators were executed in villages Bhumma and Dhansri. These villages do not fall within the limits of any municipality or town area or cantonment. They are, therefore within the "rural area" appertaining to the Muzaffarnagar District Board. 12. The question, however, still is whether in view of the facts mentioned above, it can be said that the firm carries on business in villages Bhumma and Dhansri. 13. We are of the opinion that it does. Undeniably the firm is working for gain in the aforesaid villages. It is carrying on manufacturing activity for profits. 14. In Smith v. Anderson, 15 Chancery Division p. 247 at page 258 the Master of the Rolls has observed :- "Then taking the last edition of the Imperial Dictionary, which is a very good dictionary, we find it a little more definite, but with a remark which is worth reading: "Business, employment; that which occupies the time and attention and labour of men for the purpose of profit or improvement". That is to say, anything which occupies the time and attention and labour of a man for the purpose of profit is business. It is a word of extensive use and indefinite signification. Then, "Business is a particular occupation, as agriculture, trade, mechanics, art, or profession, and when used in connection with particular employments it admits of the plural that is, businesses." 15. This decision was followed by our Court in Seth Bimal Prasad v. The District Board, Saharanpur, 1954 ALJ 582. Malik, C. J., who spoke for the Court, observed :- "In Smith v. Anderson, 15 Chancery Division p. 247 (at p. 258) , Jessel, M. R., said : "............ anything which occupies the time and attention and labour of a man for the purpose of profit of business." ........................................... There are two classes of persons who have been made liable for payment of this tax-those who reside in the rural area and those who carry on business in the rural area. anything which occupies the time and attention and labour of a man for the purpose of profit of business." ........................................... There are two classes of persons who have been made liable for payment of this tax-those who reside in the rural area and those who carry on business in the rural area. If the words "carry on business", as is clear, primarily mean doing something for the purpose of gain, as opposed to working for some one else on payment of a salary, then the tax can be levied only on these two classes of persons and it cannot be realised from persons who are not carrying on business and are mere servants on a fixed salary working for, and according to the directions of, the employer." 16. We also find support for our view from Amba Prasad v. District Board, Meerut, A.I.R. 1948 Alld. 325. In this case the plaintiffs were the owners of certain motor lorries. plying on hire and carrying passengers between Delhi and Garhmuktesar. The road lay along an area within the jurisdiction of the, District Board of Meerut. Circumstances and property tax was imposed upon the plaintiff by the Board. Plaintiffs questioned the liability to pay the tax on the ground that they neither resided nor carried on business within the jurisdiction of the Meerut District Board within the meaning of Section 114. The learned Judges, hearing the case, met this argument in the following words :- "The learned counsel for the appellants also argues that, if in the course of the journey from Delhi to Garhmuktesar, the lorries picked up a few passengers at unimportant and wayside stations and the plaintiffs earned a trifling amount this will hardly amount to a "business". 17. The learned counsel for the respondent seeks to meet this contention by relying upon the following observations of Jessel, M. R. in (1879) 10 Ch. D. 691 at p. 694. It was the case of a hospital. "The first question is, is this a 'business' or 'in the nature of a business'? I have no doubt it is. It is in reality an apothecary's business. The question whether it is a business carried on for the purposes of profit or not, is not, in my opinion, material. Even if it is not strictly a 'business', it is, at all events, 'in the nature of a business'. I have no doubt it is. It is in reality an apothecary's business. The question whether it is a business carried on for the purposes of profit or not, is not, in my opinion, material. Even if it is not strictly a 'business', it is, at all events, 'in the nature of a business'. But I am within the terms and meaning of the covenant." 18. The nature or the extent of the business or the profits, if any, is of no consequence. If the plaintiffs picked up passengers regularly at the different stations between Delhi and Garhmuktesar, they will be deemed to carry on business at all such stations. The business was one, spread over all along the line. Or, to put it differently, the entire business constituted one chain, the different stations at which the passengers Were picked, forming so many links of that chain. The plaintiffs must. therefore, be deemed to carry on the business throughout the distance between Delhi and Garhmuktesar." 19. Mr. Madhyan who has appeared for the firm, has placed reliance upon certain reported decisions. The first case that he has cited before us is State of Punjab v. M/S. Bajaj Electrical Ltd., A.I.R. 1968 SC 739. In this case it was held that the question as to whether or not a particular person carried on trade at a particular place is a mixed question of law and fact. In this case the company taxed had no shop or office in Punjab and all that it did was to supply goods from New Delhi pursuant to the orders received. The Supreme Court held that under these circumstances it cannot be said that the company was carrying on trade in Punjab. The case is clearly distinguishable. 20. In the instant case the firm admittedly has crushers installed in villages Bhumma and Dhansri. Not only that it has got a factory set up in these villages to convert sugar cane juice into Rab, and all the contracts for the supply of sugar cane also have been made and executed in these villages. 21. The next case cited is Western U.P. Electric Power and Supply Company Ltd. Etawah v. Town Area Jaswant Nagar, A.I.R. 1957 Alld. 433. This is also a clearly distinguishable case. 21. The next case cited is Western U.P. Electric Power and Supply Company Ltd. Etawah v. Town Area Jaswant Nagar, A.I.R. 1957 Alld. 433. This is also a clearly distinguishable case. In it the vires of the circumstances and property tax imposed by the Town Area Committee of Jaswant Nagar was challenged on the ground of unconstitutionality. It was held that in substance it was a tax on the income other than agricultural in-come and that the tax was not ultra vires. 22. Mr. Madhyan has also relied upon three Madras cases and two Calcutta cases. They are : Municipal Council Dindigul v. Bombay Company Ltd., A.I.R. 1929 Mad. 409, Pachaiammal v. Hindustan Cooperative Insurance Society Ltd. Madras, A.I.R. 1941 Mad. 270, Leelavathi Ammal v. Nemi Kavur Bai, A.I.R. 1943 Mad. 179, Chairman, Jayanagar Municipality v. Sailabala Dutta, AIR 1921 Calcutta 485 and Chairman, Jalpaiguri Municipality v. Jalpaiguri Tea Co. Ltd., AIR 1922 Calcutta 46. 23. All these cases are distinguishable. A bare perusal of the reports of these cases show they have been decided on the basis of their own facts. They do not deal with the U. P. District Boards Act or the U. P. Town Areas Act. We derive no assistant from them. 24. In the end reliance has been placed upon D.B.C. Madge v. Municipal Board, Sitapur, A.I.R. 1937 Oudh 468. This case also has no application to the facts before us. 25. For the reasons mentioned above we are satisfied that the firm is carrying on business in villages Bhumma and Dhansri and the Muzaffarnagar District Board has full jurisdiction to impose circumstances and property tax on the firm. 26. It is true that exceptions (iii) and (iv) to the Explanation of Section 114 of the District Boards Act provide that while making the assessment, income on which any tax has been previously imposed by any other Board and income on which any tax has been previously imposed by any town area shall not be included in the taxable income for the purposes of the imposition of the tax by a District Board. 27. The municipalities and the town areas can impose circumstances and property tax only in respect of the income accruing within their territorial limits. 27. The municipalities and the town areas can impose circumstances and property tax only in respect of the income accruing within their territorial limits. The intention of exceptions (iii) and (iv) to the explanation to Section 114 is not to provide that whenever a municipality or a town area imposes the circumstances and property tax, the District Board cannot at all levy that tax. All that these two exceptions provide for is that even though the District Board can impose such a tax, it would have to exclude the income which would have already been the subject matter of taxation either by another Board or by a town area. 28. Mr. Madhyan also placed reliance upon Section 93 (3) of the District Boards Act, which reads :- "93. Nothing in this Act shall- ............................. (3) entitle a board to exercise within the limits of any municipality, notified area, cantonment or town area any authority which is vested in the municipal board, notified area committee, cantonment committee, district magistrate, town magistrate or town panchayat, as the case may be : provided that the board may nevertheless- (a) have its office within the aforesaid limits, and (b) construct, maintain and control within the aforesaid limits any school, library, hospital, dispensary, poor-house, inspection house or other building or institution which is not maintained exclusively for the benefit of persons residing within the aforesaid limits." 29. In our judgment this provision has nothing to do with the question that we have to decide. All that this section provides for is that a District, Board will have no jurisdiction in the area constituting a municipality, or a notified area, or a town area or a cantonment. In other words the areas which constitute a Municipal Board, Notified Area, Cantonment Committee and have their own autonomous corporations shall be beyond the jurisdiction or control of a District Board. But it does not mean as Mr. Madhyan suggests that a District Board would have no authority to impose circumstances and property tax on person;; residing or carrying on business in "rural area" appertaining to a District Board. We are, therefore, clearly of the opinion that if the firm has carried on business for six months, it is liable to pay circumstances and property tax to the appellant, Zila Parishad. We are, therefore, clearly of the opinion that if the firm has carried on business for six months, it is liable to pay circumstances and property tax to the appellant, Zila Parishad. The question whether it has so carried on business or not is one of fact and should be determined by the assessing authority. 30. Having perused Asa Ram v. District Board we are satisfied that that case is clearly distinguishable. For that reason we are of the view that Seth, J. was in error in allowing the writ petition. 31. It is true that in the instant case tax on the firm has been enhanced that is to say a larger amount has been assessed than what was assessed in the preceding year. It is also admitted that before the assessment was made no opportunity was provided to the firm. To that extent the assessing officer infringed the principles of natural justice as also the statutory provisions. He should have enhanced the amount of tax only after he had heard the firm. 32. We would also like to point out that before Seth, J. the only controversy was whether the assessment made in respect of the year 1958-59 was valid or not. He was not dealing with the assessment made for subsequent years and for that reason we are satisfied that he was in error when he directed the refund of the entire amount of circumstances and property tax paid by the firm for the assessment years 1959-60 onwards. With great respect, that part of his judgment was completely beyond jurisdiction. 33. For the reasons mentioned above we allow this special appeal, set aside the judgment of D. D. Seth, J. dated 16-9-1966 and remand the case to the assessing authority for making a fresh assessment after deciding whether or not the firm has carried on business for six months in the year for which assessment is made. While doing so, he shall keep in mind the provisions of exception (iv) to the explanation of Section 114 of the District Boards Act. He shall take such evidence as he considers necessary or as the parties wish to produce. He will not be governed by the finding of the learned Commissioner recorded in his judgment dated 6-4-1960 as the same, in our opinion, are unsatisfactory. He shall take such evidence as he considers necessary or as the parties wish to produce. He will not be governed by the finding of the learned Commissioner recorded in his judgment dated 6-4-1960 as the same, in our opinion, are unsatisfactory. In the circumstances of the case we direct the parties to bear their own costs.