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2010 DIGILAW 2883 (ALL)

U. P. ADVERTISER ASSOCIATION v. UNION OF INDIA

2010-09-20

RAJES KUMAR, YATINDRA SINGH

body2010
JUDGMENT By the Court.—The main question involved in this writ petition is, whether money charged by the Cantonment Board, Kanpur (the Board) for granting permission to use its land for putting up advertisement hoarding is a tax and can it be auctioned. THE FACTS 2. The petitioner is said to be an association of 11 advertisers and registered with Registrar, Firms, Societies and Chits, Kanpur (the Registrar). According to the petitioner: Its members were doing business of putting up advertisement hoarding within the area of the Board; The Board used to fix up the rates and the advertisers used to apply for grant of permission to affix advertisement on the fixed rate. 3. The rates fixed by the Board were revised from time to time. They were lastly revised by the resolution of the Board dated 24.5.2007. By this revision, the rates of “13.70 and ‘10/- per sqare feet per month were fixed for different roads within the area of the Board. 4. For the financial year starting from 1.4.2010, the Board published an advertisement on 13.3.2010 in Rashtriya Sahara, inviting sealed tenders for right to get advertisement hoardings affixed in its area for two years. The petitioner or its members neither participated in the auction nor filed their tenders. 5. Three persons had filed their tenders. The tenders were opened on 25.3.2010. The tender of Jagran Prakashan Pvt Ltd, 2, Sarvodaya Nagar, Kanpur (Respondent-5) was the highest, offering bid of ‘45 lakhs per annum. 6. The bid of Respondent-5 was accepted. It was awarded contract to get the advertisement hoardings affixed for the period of two years starting from 1.4.2010. The petitioners have filed the present writ petition, challenging the award of contract to respondent-5. POINTS FOR DETERMINATION 7. We have heard Sri WH Khan and Sri JH Khan for the petitioner; and Sri SD Dubey and Sri CB Gupta for the respondents. The following points arise for determination in the case. (i) Whether the petition should be thrown out as it lacks material particulars; (ii) Whether amount claimed by the Board for granting permission to affix the advertisement hoardings over its land is a tax; (iii) Even if it is a fee, then can it be done without there being bye-laws. (iv) Whether the auction is vitiated due to bad faith on part of Respondent-4; (v) Was the auction duly publicised? (iv) Whether the auction is vitiated due to bad faith on part of Respondent-4; (v) Was the auction duly publicised? (vi) Has the petitioner any right to maintain the writ petition? 1st POINT: PETITION VAGUE—NO RIGHT 8. It is alleged in the petition that the petitioner-1 is an association of eleven advertisers and is registered with the Registrar. However, there is nothing on the record to show as to, (i) Who are its members? (ii) How is It registered? (iii) Is it a society, or a firm, or something else? 9. The petitioner-2 is said to be the secretary of petitioner-1. However there is nothing on the record to show that he had permission to put up advertisement hoarding before the auction or he had applied for renewal of his permission. 10. The writ petition is liable to be thrown, as it lacks material particulars. However, we are not dismissing the writ petition on this ground but are deciding it on merits. 2nd POINT: NOT A TAX 11. The counsel for the petitioner brought to our notice Links Advertisers v. Bangalore Municipality, AIR 1977 SC 1646 (the Links case) and submitted that: An advertisement tax can be imposed by the Board under Section 66(2) of the Cantonment Act, 2006 (the Act) read with Section 172(1)(h) of the UP Municipal Corporations Act, 1959; The amount to affix advertisement hoarding is a tax; and No procedure for imposition of tax has been followed. 12. There is no dispute that procedure for imposition of tax has not been followed. However, according to the Board, it is not a tax but a fee for use of the land of the Board. 13. In the Links case (paragraph-2), the advertisement hoardings were not affixed over the land of the Board but were affixed on the land of the railway administration that the petitioner had taken on lease. It was for this reason held to be advertisement tax. This is not the case here. 14. The auction was permission to get the advertisement hoardings affixed on the land of the Board. These hoardings are not to be affixed on private land. This is clear from the terms and conditions of the auction. 15. The Board has annexed the terms and conditions of the auction in the counter-affidavit. This is not the case here. 14. The auction was permission to get the advertisement hoardings affixed on the land of the Board. These hoardings are not to be affixed on private land. This is clear from the terms and conditions of the auction. 15. The Board has annexed the terms and conditions of the auction in the counter-affidavit. They indicate that advertisement hoarding was to be affixed on the following roads and crossing: (i) Lal Bungalow Road; (ii) Tagore Road, Jajmau up to Purani Chungi; (iii) From Purane Ganga Pul upto CC Padao; (iv) Jaipuriya Road and Tatmil Chauraha; (v) Pani Chakki Chauraha. 16. Section 122 of the Act is titled ‘Property’. It sub-section (g) says that all streets and the pavements, stones, and other materials thereof, and also all trees, erections, material, implements, and things existing on or appertaining to streets vest in the Board. 17. In the present case, the Board had auctioned the right to get advertisement hoardings affixed on the road and the crossing. It is on the land of the Board. The Board is not charging any money for any advertisement hoarding on the private land within the cantonment area. There is also no allegation in the writ petition that advertisement hoarding is to be affixed on any private land. 18. Had the Board charged any money for putting advertisement on the land other than the land of the Board then it could be said that it is advertisement tax. The Links case is distinguishable. 19. In our opinion, the amount being taken by the Board is not a tax. 3rd POINT: NO REGULATION OR BYE-LAWS REQUIRED 20. Section 67 of the Act is titled as ‘Charging of fees’. It provides for what purposes the Board can charge fees. Some heads are specifically mentioned in sub-section (a) to (f) of Section 67. Sub-section (b) of Section 67 {67(b)} of the Act empowers the Board to charge fee on the advertisement other than the advertisement in the newspapers. Sub-section (g) of Section 67 {Section 67(g)} provides that fee for purposes other than Section 67(a) to 67(f) can be provided by regulation. 21. The present case is covered under Section 67(b) of the Act and it was not necessary to provide it by any regulation or bye-laws. In any case, it is money for use of the Board’s land. The petitioner can object to it. 22. 21. The present case is covered under Section 67(b) of the Act and it was not necessary to provide it by any regulation or bye-laws. In any case, it is money for use of the Board’s land. The petitioner can object to it. 22. The Board is claiming fee for granting permission to use its land for affixing advertisement hoarding. It is this right that has been auctioned. The petitioner, in fact, want the right to be given to them. According to them, they had this right up to 31.3.2010. They never challenged the right of the Board to do so. It is only when it was auctioned and was not given to them that they are questioning the right of the Board. 23. In any case it does not lie in the mouth of the petitioner to say that the Board has no right. He according to the case of the petitioner, it members were putting hoarding on the land of the Board and paying charges and its claim is that the Board should renew the permission of its members. 24. It is not a public interest litigation that advertisement hoardings are causing inconvenience and should be removed. On the one hand, the petitioners claim that it should be given to them and on the other, they are raising objection that the Board has no right to do it. Their stand is contradictory and cannot be entertained. 25. The Board in their counter-affidavit has indicated and affixed the policy decision of the Ministry of Defence from time to time. The policy decision indicates that: The permission to get advertisement hoarding affixed on the Board’s land should be given by public auction and; The auction should be for a period of two years. This has been done by the Board in the present case. It has followed the policy of the Ministry of Defence. 26. The Board is merely augmenting its income for betterment of the area. It has all powers to mange its land for earning maximum revenue. The public auction is best method. It gives opportunity to everyone. It is in tune with the policy decision of the Ministry of Defence. The petitioner has no right to challenge it. 27. 26. The Board is merely augmenting its income for betterment of the area. It has all powers to mange its land for earning maximum revenue. The public auction is best method. It gives opportunity to everyone. It is in tune with the policy decision of the Ministry of Defence. The petitioner has no right to challenge it. 27. In our opinion, The Board is entitled to charge fee / money for use of its land; There is no illegality in charging fee for use of its land. 4th POINT: RESPONDENT-4 WAS NOT ASSOCIATED 28. The counsel for the petitioner submitted that: Respondent-4 was the CEO of the Board; He is a corrupt person; The CBI had raided his house; He has conclusively given auction to Respondent-5. 29. The Board has filed counter-affidavit. In paragraph 3(H) and 13 of the counter-affidavit, it has been stated that the charges of CEO was taken from Respondent-4 and was handed over to Sri Pushpendra Singh (DEO, Lucknow Circle) on 9.3.2010. Respondent-4 neither published the notice for auction on 13.3.2010 nor conducted it but was conducted by Sri Pushpendra Singh. 30. The auction was not conducted by Respondent-4. He had no say in the auction. There is nothing to show that there was any collusion between Respondent-4 and 5. In any case, as the auction was not conducted by Respondent-4. It cannot be set aside on this ground. 5th POINT: THERE WAS PUBLICITY 31. The counsel for the petitioner submitted that: The notice for auction was not pasted on the notice board of the Board; There was neither public notice of the auction nor was it duly publicised; The entire proceeding in the auction is illegal. 32. The Board in paragraph-13 of its counter-affidavit, has stated that the notice of the auction was pasted on the notice board. The auction notice was published on 13.3.2010 in the daily newspaper ‘Rashtriya Sahara’ and its has circulation in Kanpur. 33. The proceeding for the auction are also annexed alongwith the counter-affidavit. Three persons had filed tenders. They were opened on 25.3.2010. The bid of Respondent-5 was the highest and was accepted. 34. In view of this, it cannot be said that there was no public notice or the auction was not duly publicised. 6th POINT: NO RIGHT 35. The public auction was for two years. This is the policy of the defence ministry. They were opened on 25.3.2010. The bid of Respondent-5 was the highest and was accepted. 34. In view of this, it cannot be said that there was no public notice or the auction was not duly publicised. 6th POINT: NO RIGHT 35. The public auction was for two years. This is the policy of the defence ministry. The contract was awarded to respondent-5 for ‘45 lakhs per annum. In paragraph-34 of the counter-affidavit. the Board has stated that the total revenue generated for the last year was only ‘36 lakhs. Auction money for this year is much more than the revenue generated last year. 36. The Courts have held (see below)1 that awarding contracts by public auction is the best way of doing it. It generates not only best price but is also transparent. The right to get the advertisement hoardings affixed was auctioned. There was due publicity for the auction. The petitioner or its members did not participate in the auction. They have no right to challenge the auction. CONCLUSIONS 37. Our conclusions are as follows: (a) The auction was for right to get the advertisement hoarding affixed on the land of the Board the money charged for the same is not a tax; (b) The Board had right to auction permission to affix advertisement hoardings on its land and charge money for the same. It was done in pursuance of policy decision of Ministry of Defence. No objection can be taken by the petitioner; (c) There is nothing to show that Respondent-4 was in collusion with Respondent-5. In any case Respondent-4 did not hold this auction. 38. In view of our conclusions, the writ petition is liable to be dismissed. However, as there is interim order, the equities are to be adjusted. Considering the circumstances of the case, (i) We permit the petitioners to continue to put their advertisement hoarding up to end of this month namely 30.9.2010. They would be liable to pay the fee as contemplated in the interim order dated 23.4.2010 till the month of September, 2010; (ii) Respondent-5 will be permitted to work from 1.10.2010; (iii) As Respondent-5 has not been able to work for six months. The amount for the year 2010 will be reduced by half. In case he has deposited excess money that may be adjusted for the next year. With these observations, the writ petition is dismissed. —————