S. P. Kochhar v. Chief Judicial Magistrate — 1985 DIGILAW 190 (ALL)

JUDGMENT : N.D. Ojha, J. Both these writ petitions raise identical questions and as such are being decided by a common order. 2. In connection with preparation of assessment list of house Nos. 52/11, 52/14 and 97 Rajpur Road, Dehradun, u/s 145(1) of the U.P. Municipalities Act, 1916 (hereinafter referred to as the Act) the Nagar Palika (City Boardj, Dehradun, by order dated 29th March, 1934, determined the annual value of the aforesaid three houses at Rs. 6,000/-, Rs. 4,24,908/- and Rs. 2,21,325/- respectively. A perusal of this order, copy whereof has been filed as an annexure to both these writ petitions, indicates that this annual value has been determined on the basis of the gross annual rent for which these houses are "actually let" as contemplated by Clause (b) of Sub-section (1) of Section 140 of the Act. The house tax and water tax were thereafter calculated on the basis of the aforesaid annual value in the manner contemplated by the Act and notices of demand in respect of house tax and water tax have been served on the Petitioners. 3. Aggrieved by the assessment of tax in the manner stated above the Petitioners have preferred appeals u/s 160 of the Act which are pending before the Chief Judicial Magistrate, Dehradun. In these appeals applications were made by the Petitioners for staying the realisation of the tax assessed. These applications have been dismissed on 2nd January, 1985, in view of Section 161 of the Act which inter alia contemplates that no appeal u/s 160 of the Act 'shall be heard and determined unless the amount claimed from the Appellant has been deposited by him in municipal office. The Chief Judicial Magistrate has taken the view that since the deposit of the amount claimed from the appellanis in the municipal office is a condition precedent for hearing and determination of the appeals it was not possible to stay the realisation of the said amount. The Chief Judicial Magistrate has taken the view that since the deposit of the amount claimed from the appellanis in the municipal office is a condition precedent for hearing and determination of the appeals it was not possible to stay the realisation of the said amount. Two reliefs have been claimed in each of these two writ petitions (a) for the quashing of the order dated 2nd January, 1980, passed by the Chief Judicial Magistrate and for the issue of a writ of mandamus directing him to hear the appeal without the deposit of the amount of tax; and (b) for issuing a writ of mandamus directing the Nagar Pallka not to realise the taxes from the Petitioners in pursuance of the notices of demand issued in this behalf during the pendency of the appeals preferred by the Petitioners. 4. Having heard counsel for the Petitioners at some length we are of opinion that it is not possible to grant either of the two reliefs priyed for in these writ petitions in view of the mandatory provision contained in this behalf in Section 161 of the Act already pointed out above, namely, that no appeal preferred u/s 160 of the Act shall be heard and determined unless the amount claimed from the Appellant has been deposited by him in the municipal office. 5. What was, however, urged by counsel for the Petitioners is that the aforesaid provision contained in Section 161 of the Act was ultra vires. We find it difficult to agree with this submission. Reliance was placed by counsel for the Petitioners on Kunnathat Thathunni Moopil Nair Vs. The State of Kerala and Another, AIR 1961 SC 552 where it was held that Article 265 of the Constitution imposes a limitation on the taxing power of the State in so far as it provides that the State shall not levy or collect a tax except by authority of law, that is to say, that a tax cannot be imposed or collected by a mere executive fiat, it has to be done by authority of law which must mean valid law. In order that the law may be valid a tax proposed to be levied must be within the legislative competence of the legislature imposing a tax and authorising the collection thereof and, secondly, the tax must be subject to the conditions laid down in Article 13 of the Constitution. Nothing has been brought to our notice to indicate that the enactment of the U.P. Municipalities Act was beyond the legislative competence of the State legislature. Further the house tax and water tax imposed under the Act is on the face of it not in any way in violation of any of the conditions laid down in Article 13 of the Constitution. 6. Counsel for the Petitioners then urged that the condition placed by Section 161 of the Act in regard to the amount claimed from the Appellants being deposited was an onerous one and had virtually the effect of negativing the right of appeal. In our opinion there is no substance in this submission either. In AIR 1935 5 (Privy Council) it was held by the Privy Council that "After all, it is to be remembered that all appeals in this country and elsewhere exist merely by statute and unless the statutory conditions are fulfilled no jurisdiction is given to any Court of Justice to entertain them." The same view was reiterated in Durga Shankar Mehta Vs. Thakur Raghuraj Singh and Others, AIR 1954 SC 520 where it was held; It is well known that an appeal is a creature of statute and there can be no inherent right of appeal from any judgment or determination unless an appeal is expressly provided for by the law itself. In P.N. Agarwal v. Ragho Prasad 1969 AWR 48 a Full Bench of this Court held: The right of appeal being a creature of the statute, its nature and character will be determined and controlled by (he provisions. Since the right of appeal is a creature of statute an appeal would lie only if this right has been conferred by the statute and subject to such condition? as the legislatures its wisdom may prescribe in regard to the maintainability of the appeal. When conditions precedent are prescribed by the legislature m au enactment for the maintainability of an appeal the right of appeal is created only subject to the fulfilment of those conditions precedent. as the legislatures its wisdom may prescribe in regard to the maintainability of the appeal. When conditions precedent are prescribed by the legislature m au enactment for the maintainability of an appeal the right of appeal is created only subject to the fulfilment of those conditions precedent. Since no one has an inherent right of appeal recourse to the statutory right of appeal can obviously be taken subject to the fulfilment of the condition precedent laid down in this behalf by the statute concerned. In this connection it may be pointed out that it is not the U.P. Municipalities Act alone but there are various other enactments wherein the legislature in its wisdom has considered it appropriate to make a direction for the deposit of the amount determined by the trial authority before an appeal may successfully be persued. To illustrate reference may be made to the third proviso to Section 30(1) of the Workmen Compensation Act, 1923, which contemplates thai; no appeal by an employer under Clause (a) of Sub-section (1) shall lie unless the memorandum of appeal is accompanied by a certificate by the Commissioner to the effect that the Appellant has deposited with him the amount payables under the order appealed against. Likewise in the Payment of Wages Act, 1936, Sub-section (1-A) was inserted in Section 17 of the said Act which deals with appeal by Section 15 of Act No. 53 of 1964 with effect from 1st February, 1965 to the following effect: (1-A) No appeal under Clause (a) Sub-section (1) shall lie unless the memorandum of appeal is accompanied by a certificate by the authority to the effect that the Appellant has deposited the amount payable under the direction appealed against. Since the provision contained in this behalf is within the legislative competence of the legislature and does not violate any of the conditions laid down in Article 13 of the Constitution nor is in violation of any provision contained in Part III of the Constitutions. The said provision cannot be held to be ultra vires. The courts obviously are not entitled to go into the wisdom of the legislature in imposing the condition of the amount claimed from the Appellant being deposited by him in the municipal office before his appeal is heard and determined. 7. The said provision cannot be held to be ultra vires. The courts obviously are not entitled to go into the wisdom of the legislature in imposing the condition of the amount claimed from the Appellant being deposited by him in the municipal office before his appeal is heard and determined. 7. Counsel for the Petitioners then urged that even though the Petitioners have preferred appeals which are pending before Respondent No. 1 as aforesaid the order of the Nagar Palika dated 29th March, 1984, determining the annual value of the three houses in the manner stated above may be quashed in these writ petitions notwithstanding the pendency of those appeals inasmuch as the existence of the remedy of appeal was onerous Reliance in support of this submission was placed by counsel for the Petitioners on Himmatlal Harilal Mehta Vs. The State of Madhya Pradesh and Others, AIR 1954 SC 403 where it was held dealing with the provisions of the C.P. and Berar Sales Tax Act that since the remedy provided by the said Act was of an onerous and burdensome character and before the assessee could avail of it he had to deposit the whole amount of the tax, such a provision can hardly be described as an adequate alternative remedy. 8. Reliance was also placed on Thansingh Nathmal and Others Vs. A. Mazid, Superintendent of Taxes, AIR 1964 SC 1419 where it was held that ordinarily the Court will not entertain a petition for a writ under Article 226, where the Petitioner has an alternative remedy, which without being unduly onerous an equally efficacious remedy. 9. Counsel for the Petitioners also relied on U.P. State v. Mohd. Nooh AIR 1958 SC 86 . This decision was considered by the Supreme Court in Titaghur Paper Mills Co. Ltd. and Another Vs. State of Orissa and Others, (1983) 2 SCC 433 and it was held that the decision in Mohommad Noon's case was one which dealt with a case of lack of jurisdiction and violation of rules of natural justice. In the instant case obviously it cannot be said that the Nagar Palika lacked jurisdiction to Impose house tax and water tax. State of Orissa and Others, (1983) 2 SCC 433 and it was held that the decision in Mohommad Noon's case was one which dealt with a case of lack of jurisdiction and violation of rules of natural justice. In the instant case obviously it cannot be said that the Nagar Palika lacked jurisdiction to Impose house tax and water tax. Further the order dated 29th March, 1984, determining the annual value of the three houses mentioned above was also not passed in violation of the rules of natural justice inasmuch as the Petitioners were admittedly heard before the passing of the said order. As regards the decision of the Supreme Court in the cases of Himmat Lal and Than Singh (supra) it may be pointed out that in the case of Titaghur Paper Mills Co. Ltd. (supra) it has been held dealing with the provisions of Orissa Sales Tax Act that where the Petitioner had a remedy by way of appeal and second appeal and in the event of failure to get relief in the appeals could have the case stated to the High Court, a writ petition was not maintainable. 10. In this connection it may also be pointed out that in neither of these two writ petitions there is any prayer for quashing the order dated 29th March, 1984, determining the annual value of the three houses mentioned above. That apart if the submission made by counsel for the Petitioners is accepted it would result in practically deleting Sections 160 and 161 from the U.P. Municipalities Act which deal with appeals relating to taxation, limitation and preliminary deposit of the tax claimed inasmuch as in every appeal that may be preferred u/s 160 of the Act the amount claimed from the Appellant will have to be deposited before the said appeal is heard and determined. The effect would be that the power of hearing appeal relating to taxation under the U.P. Municipalities Act will virtually stand transferred to the High Court under Article 226 of the Constitution in every case. In our opinion it would not be an appropriate exercise of discretion under Article 226 of the Constitution to do so. 11. The matter can be looked into from another angle. In Siliguri Municipality and Others Vs. In our opinion it would not be an appropriate exercise of discretion under Article 226 of the Constitution to do so. 11. The matter can be looked into from another angle. In Siliguri Municipality and Others Vs. Amalendu Das and Others, (1984) 2 SCC 436 it was held: Normally, the High Court should not in proceedings under Article 226 grant any stay of recovery of tax, thereby blocking the source of revenue, on mere asking of the party challenging the tax. The grant of stay in such matters should be an exception and not a rule. It is needless to stress that a levy or impost does not become bad as soon as a writ petition is instituted in order to assail the validity of the levy. So also there is no warrant for presuming the levy to be bad at the very threshold of the proceedings. The only consideration at that juncture is to ensure that no prejudice is occasioned to the rate payers in case they ultimately succeed at the conclusion of the proceedings. This object can be attained by requiring the body or authority levying the impost to give an undertaking to refund or adjust against future dues the levy of tax or rate or a part thereof, as the case may be, in the event of the entire levy or a part thereof being ultimately held, to be invalid by the court without obliging the tax payers to institute a civil suit in order to claim the amount already recovered from them. On the other hand, the Court cannot be unmindful of the need to protect the authority levying the tax, for, at that stage the Court has to proceed on the hypothesis that the challenge may or may not succeed. The Court has to snow awareness of the fact that in a case like the present a municipality cannot function or meet its financial obligations it its source of revenue is clocked by an interim order restraining the municipality from recovering the taxes as per the impugned provision. And that the municipality has to maintain essential civil services like water supply, street lighting and public streets etc. apart from running public institutions like schools, dispensaries, libraries etc. What is more, supplies have to be purchased and salaries have to be paid. And that the municipality has to maintain essential civil services like water supply, street lighting and public streets etc. apart from running public institutions like schools, dispensaries, libraries etc. What is more, supplies have to be purchased and salaries have to be paid. The grant of an interlocutory order of this nature would paralyse the administration and dislocate the entire working of the municipality. 12. In this view of the matter even if there was a prayer for quashing the order dated 29th March, 1984, determining the value of the three houses mentioned above and even if some point was made out on merits for admission of these writ petitions this Court would still have required the Petitioners to deposit the tax and no interim order of stay of recovery of tax would have been granted there being no exceptional circumstance. In that view of the matter it could hardly be treated a case where the filing of a writ petition was more efficacious than pursuing the appeals already filed by the Petitioners and pending before Respondent No. 1. 13. In view of the foregoing discussion we are of opinion that no case has been made out even for entertaining these writ petitions for the purpose of the quashing the order dated 29th March, 1984, mentioned above. In the result we find no merit in these two writ petitions and they are accordingly dismissed. A copy of this order may be supplied to counsel for the Petitioner within three days on payment of usual charges.