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2003 DIGILAW 713 (KER)

Vyapari Vyavasayi Ekopana Samithy v. Adoor Municipality

2003-11-18

K.BALAKRISHNAN NAIR

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Judgment :- 1. The first petitioner is the Vyapari Vyavasayi Ekopana Samithy, Adoor unit. Petitioners 2 and 3 are members of that samithi. This Original Petition is filed by them mainly challenging Ext. P3 notification issued by the 1st respondent Municipality under S.447 of the Kerala Municipality Act. Ext. P3 is a notification issued by the Secretary of the Municipality fixing the rates applicable for grant of licence for carrying on certain trades within the Municipal area. Ext. P1 was the initial notification issued by the Secretary on 21.1. 1997 superseding the earlier notification of 1990. That was challenged before this Court by filing O.P. No. 3881/98. Subsequently, the Municipality decided to keep in abeyance Ext. P1 and taking into account the objections raised to the rates prescribed in Ext. P1, Ext. P3 notification was issued on 14.10.1998, which was to take effect from 1.4.1999. The petitioners attack Ext. P3 on the following grounds:- 01.The rates prescribed in Ext. P3 do not correlate with the special service rendered in terms of S.492(5) of the Kerala Municipality Act. 2. There may be a person dealing in several items provided in Ext. P3. He will have to pay licence fee in relation to each every item. 3. Para.8 of Ext. P1 confers unbridled and arbitrary power on the Secretary of the Municipality to impose any condition while granting licence. 4. The rates fixed under Ext. P3 will reveal total non application of mind. Item 219 deals with manufacturing of goods which may produce unpleasant and offensive smell and fumes. The licence fee for carrying on the said business is only Rs. 100/- whereas item 213 prescribes a fee of Rs. 500/- for conducting gold loan business. Normally, it must be presumed that the Municipality has to expend more or strain more in relation to an industry which generates dangerous and offensive smell and fumes when compared to a business established for providing gold loans. 5. Ext. P3 notification was published in the Gazette dated 16.3.1999 and it was intended to take effect from 1.4.1999. Therefore, the item limit of 60 days provided in the proviso to S.447(1) is not there between the date of notification and its date of effect. 2. The 1st respondent has filed a counter affidavit resisting the prayers in the Original Petition and also stating that the Original Petition is not maintainable. Therefore, the item limit of 60 days provided in the proviso to S.447(1) is not there between the date of notification and its date of effect. 2. The 1st respondent has filed a counter affidavit resisting the prayers in the Original Petition and also stating that the Original Petition is not maintainable. The first petitioner is an unregistered association and it cannot maintain a writ application challenging the fixation of fee made by the Municipality. The affected persons have to challenge it, it is contended. Regarding the various grounds urged by the petitioners, the 1st respondent submits as follows:- 1. The concept of quid pro quo has undertaken a sea change and the benefit derived by the payer of the fee need not have mathematical equivalence to the fee collected. Some benefits enjoyed by the payer of the fee will be sufficient to sustain the rate of fee prescribed. 2. In Para.9 of the counter affidavit, it is submitted that fee will be levied only in relation to the major items traded. 3. Paragraph 6 of Ext. P3 is justified relying on the provisions contained in S.447(3A). 4. The non application of mind alleged against the Secretary is countered by saying that there need not always be mathematical correlation with the service liable to be rendered by the Municipality with the rate prescribed. 5. The time limit of 60 days will apply only if the fee is introduced for the first time. Here what is done is only a revision and therefore, this ground urged by the petitioners is unsustainable. 3.. I heard the learned Counsel on both sides. 4. The preliminary objection raised by the respondents regarding the maintainability of the O.P. cannot be accepted as two traders have also joined as petitioners in the O.P. It is a settled principle of law that tax can be collected without giving any corresponding benefit to the tax payer. It is said, the tax is paid as a price for enjoying the benefits of civilisation whereas the fee is always correlated with the service rendered in return by the payee. In other words, there must be quid pro quo. It is also a settled position that fee can be levied not for rendering a general service applicable to all persons, but for the special service rendered to the person who makes the payment. In other words, there must be quid pro quo. It is also a settled position that fee can be levied not for rendering a general service applicable to all persons, but for the special service rendered to the person who makes the payment. The learned Counsel for the petitioners would point out that apparently, the concept of quid pro quo has been considerably diluted by the decision of the Apex Court in "The City Corporation of Calicut v. T. Sadasivan" (AIR 1985 SC 756). It is a direct decision arising under the Kerala Municipality Act, 1960. The Apex Court said, some indirect benefit derived by the payer of the fee will sustain the fee imposed. But the learned Counsel for the petitioners would submit that in the light of that decision, the erstwhile Municipality Act has been amended introducing the provisions which are identical to those contained in S.492(5) of the present Act. It was provided by the amendment that the levy of the fee should be correlated to the services rendered. It is also pointed out that the point whether any fee can be collected for rendering statutory services was not dealt with in the said decision. In the light of the above principles, the validity of the levy under Ext. P3 has to be decided. It cannot be disputed that the Municipality is rendering some special service to the petitioners and other similarly placed traders by prohibiting the trade, business or manufacturing without a licence. The same, to certain measure, protects the interest of the traders. For effectively enforcing this, the Municipality has to maintain a contingent of employees. So, this is a special service which is not available to other general public. But whether the amount levied will exactly correlate with the amount required for the Municipality cannot be adjudicated under Art.226 of the Constitution of India. This Court cannot sit in appeal over the decision of the Secretary and substitute its decision for that of the Secretary. The maximum amount levied under Ext. P3 appears to be around Rs. 500/-. During these days of inflation, the said amount cannot be said to be unconscionably high or excessive. But the petitioner would point out that if the very same amount is demanded in relation to various items sold., it may be a huge amount. The maximum amount levied under Ext. P3 appears to be around Rs. 500/-. During these days of inflation, the said amount cannot be said to be unconscionably high or excessive. But the petitioner would point out that if the very same amount is demanded in relation to various items sold., it may be a huge amount. The submission made by the Municipality in Para.9 of its counter affidavit that only major items will be charged will redress the grievance of the petitioners in this regard. The submission made by the respondents will take the wind out of the second ground of attack also. The third ground, as mentioned above, concerns apparently, the unbridled power conferred upon the Secretary to impose conditions. Certain provisions in an Act may appear to confer unbridled powers on the statutory authorities without prescribing any parameters for its exercise. But the said power is subject to an implied limitation that it has to be exercised to advance the object of the legislation in question. For example, if a licence is granted to a vegetable vendor and a condition is imposed on him that he should make arrangement for the disposal of the waste generated, it cannot be said to be an illegal condition. Suppose a condition is imposed that he should engage only bald headed employees in his shop, the same will be plainly ultra vires and unauthorised. So, I think, the scheme of the Act will throw sufficient light to decide on the permissibility or otherwise of the conditions imposed. If the Secretary imposes any perverse condition at the time of grant of licence, the petitioners would be free to work out their remedies. 4. The allegation of the petitioners regarding non application of mind in the matter of fixation of licence fee also cannot be accepted for the reasons mentioned by me while dealing with the first contention. Though there may be slight variations with reference to the rates fixed for various trades, the maximum rate as far as various trades are concerned is only Rs.500/-. Therefore, it cannot be held that the said rate is unconscionably high. Since the notification was issued in 1999, the objection regarding the absence of 60 days between the date of notification and the date of enforcement of the notification has become hypothetic. Therefore, it cannot be held that the said rate is unconscionably high. Since the notification was issued in 1999, the objection regarding the absence of 60 days between the date of notification and the date of enforcement of the notification has become hypothetic. In this case also, I am inclined to accept the contention of the Municipality that this being a revision of the rates of fee always fixed, the relevant provision fixing 60 days' time limit pressed into service by the petitioners will not apply. 5. No other points were urged before me. In the result, the Original petition fails and it is accordingly dismissed. But, it is made clear that if any attempt is made to levy licence fee other than for the major items and if any irrational condition is imposed by the Secretary at the time of grant of licence, the petitioners will be free to work out their remedies.