Appeal No 234 of 1959
Appeal from the order dated February 15 1957 of the Bombay High Court of Judicature at Nagpur in Special Civil Application No 2 N of 1956
section P Varma for appellant No 1
597 B section Shastri and Ganpat Rai for respondent No 1
B R L Iyengar and T M Sen for respondent No 2 1961
March 28
The Judgment of the Court was delivered by KAPUR J
This is an appeal on a certificate by the High Court of Bombay against the judgment and order of that Court passed on a petition under article 226 of the Constitution by the present appellants in regard to the legality of the notification levying an octroi duty on certain goods
The appellants are some of the ratepayers of the Municipal Committee of Shegaon which is respondent No I in this appeal
The other respondent is the State of Bombay
The appellants were carrying on trade and business which involved their bringing goods within the limits of the Municipal Committee
On July 251954 the Municipal Committee passed a resolution for tile purpose of levying an octroi duty instead of terminal tax
This resolution was published in the State Gazette on June 29 1956 along with rules for assessment
Oil August 4 1956 objections were invited to the proposed tax
The objections by the first appellant were filed on August 4 1956 and by some others on August 5 and 6
At a meeting of the Municipal Committee dated August 16 1956 the objections of the other appellants were rejected as being time barred and those by the first appellant were rejected because it was the only objector whose objections were within time
Some representations were made by the first appellant to the Government and a few days later the other objectors also made similar representations but the Government issued the notification sanctioning the imposition of the tax and the Draft Rules on October 27 1956 though the Gazette Notifications were published on two separate dates ie October 30 and October 31 1956
The appellants then filed a petition under article 226 in the High Court of Bombay at Nagpur challenging the legality of the imposition of the tax
Two main grounds were urged 1 that the notification was ultra 598 vires because section 67 of the C P  Berar Municipalities Act 1922 Act II of 1922 hereinafter termed the Act  had not been complied with and 2 that the rate of tax in regard to certain articles was unauthorised in that it was more than the maximum which could be levied under the law
The High Court rejected the first ground but accepted the second objection and gave relief accordingly
Appellants Nos
2 to 6 have not taken steps for the prosecution of the appeal and the appeal in so far as it relates to them is dismissed for non prosecution
The appellant No 1 before us has challenged the vires of the imposition on two grounds 1 that all the steps necessary for the imposition of the octroi duty had not been taken and therefore section 67 had not been complied with and 2 that as a matter of fact there was no notification imposing an octroi duty
For the purpose of the decision of these objections it is necessary to refer to the scheme of the Act Chapter IX of which relates to the imposition assessment and collection of taxes
Section 66 enumerates the taxes which may be imposed and section 67 prescribes the procedure for imposing taxes
Section 67 reads as under Section 671 A committee may at a special meeting pass a resolution to propose the imposition of any tax under section 66
2 When such a resolution has been passed the committee Bhall publish in accordance with rules made under this Act a notice defining the class of persons or description of property proposed to be taxed the amount or rate of the tax to be imposed and the system of assessment to be  adopted
3 Any inhabitant of the municipality objecting to the proposed tax may in thirty days from the publication of the notice submit his objection in writing to the committee
4 The committee shall take the proposal and a objections received thereto into consideration at a special meeting and may modify the proposals so as not to affect their substance and may then forward them to the Provincial Government along with all objections received its decisions thereon 599 and its reasons therefore
If the committee decided to modify the proposals so as to affect their substance it shall publish them again in the manner prescribed in sub section 2
5 The Provincial Government on receiving such proposals may sanction or refuse to sanction the same or sanction them subject to such modifications as it may think fit or return them to the committee for further consideration 6       7 If any proposals for taxation have been sanctioned under sub Section 5 the Provincial Government may by notification direct the imposition of the tax as sanctioned from such date as may be specified in such notification and thereupon the tax shall come into effect as from the date so speci fied
A notification of the imposition of a tax under this section shall be conclusive evidence that the tax has been imposed in accordance with the provision of this Act
 The objection to the vires of the notification in regard to procedure is that the objections raised by appellant No 1 though within time werenot considered on their merits and were rejected merely on the ground that there was only one objector and as this was one of the essential steps for the validity of the imposition it could not be said that section 67 had been complied with and the imposition was therefore invalid
The High Court rejected this plea because of section 678 although it found that non consideration of the objections was an error in procedure
The language of sub section 8 lends support to this view
It provides that the issuance of the notification imposing a tax shall be conclusive evidence that the tax had been imposed in accordance with the provisions of the Act
But it was argued that as a matter of fact there was no notification imposing the tax and therefore the question of conclusive evidence does not arise
This in our opinion is not established
As stated above there were two notifications issued 600 by the Government both of October 27 1956
One was published in the Gazette on October 30 1956 and the other on the following day
The first notification was as follows No 4963 5869 M XIII
In exercise of the pow ers conferred by sections 71 76 and 85 of the Central Provinces and Berar Municipalities Act 1922 11 of 1922 the State Government are pleased to sanction the following draft rules for assessment collection and refund of the octroi tax within the limits of the Shegaon Municipality in the Buldana District
The rules shall come into force from the date of their publication in the Madhya Pradesh Gazette Extraordinary  
And the second notification stated No 4962 5869 M XIII
In exercise of the pow ers conferred by sub section 2 of section 67 of the Central Provinces and Berar Municipalities Act 1922 II of 1922 the State Government are pleased to confirm the following draft rules for the imposition of the octroi tax within the limits of the SHEGAON MUNICIPAL COMMITTEE in the Buldana district under clause c of sub section 1 of section 66 of the said Act on animals and goods brought for sale expenditure or use in supersession of the rules of terminal tax sanctioned under Notification No 3716 B VIII dated the 15th February 1921
The rules shall come into force from the date of their publication in the Madhya Pradesh Gazette Extraordinary 
The first notification purports to be in exercise of the powers under section 71 which relates to Rules for assessment and for preventing evasion of assessment of taxes section 76 which provides for collection of taxes and section 85 which relates to refunds
That notification therefore lays down the various rules and other matters necessary for the collection of taxes
The second notification on the face of it is under sub section
2 of section 67
It appears to us that this is a mistake and should have been under sub a
7 of section 67
By this notification the State Government confirmed the draft rules for 601 the imposition of the octroi duty which in the context must mean imposition of the tax because the very first rule states Rule 1 Octroi shall ordinarily be levied on commodities included in the following classes and specified in the schedule hereto annexed and at the rates therein entered
The various classes of articles and commodities on which octroi was to be levied are then set out and then the exceptions and explanations are given
With these rules are the schedules specifying the goods under each class which are liable to octroi duty and the rate at which the octroi duty was chargeable
This notification therefore clearly is one which directs imposition of octroi and falls within sub section 7 of section 67 and having been notified in the Gazette it is conclusive evidence of the tax having been imposed in accordance with the provisions of the Act and it cannot be challenged on the ground that all the necessary steps had not been taken
In our opinion this appeal is without force and is therefore dismissed with costs
Appeal dismissed


Summary:
The respondent Municipality passed a resolution under s671 of the CP  Berar Municipal Act 1922 for the purpose of levying an octroi duty which was published in the State Gazette along with the rules for assessment
Objections were invited to the said proposed tax and only one objection was filed within time which was also rejected
The Government gave its sanction to the imposition of the tax and draft Rules by two Notifications
The appellants filed a petition challenging the legality of the imposition of the tax inter alia on the ground that the notifications were ultra vires
They contended that all steps necessary for the imposition of tax had not been taken and that objections raised within time by the respondent No 1 were not considered on their merits and were rejected merely on the ground that there was only one objector as this was one of the essential steps for the validity of the imposition of tax it could not be said that section 67 of the Act had been complied with therefore the imposition was invalid
Held that where the Government Notification clearly was one which directed imposition of Octroi Tax it fell within subs
 7 of section 67 of the Act and having been once notified in the Gazette sub section
8 of section 67 of the Act came into operation and the issue of the notification was conclusive evidence of the Tax having been imposed in accordance with the provisions of the Act and it could not be challenged on the ground that all necessary steps had Rot been taken