IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD THURSDAY, THE TWENTY FIRST DAY OF JANUARY TWO THOUSAND AND TEN PRESENT THE HON'BLE SMT. JUSTICE T.MEENA KUMARI & THE HON'BLE SRI JUSTICE SANJAY KUMAR WRIT APPEAL NO : 1009 of 2008 Between: The Gold and Silver Jewellery and Diamond Merchants Association, Kurnool, rep., by its Secretary N. Gopalakrishna Murthy. ..... APPELLANT AND 1 The Municipal Corporation of Kurnool, rep., by its Commissioner, Kurnool and another. .....RESPONDENTS The Court made the following : THE HON'BLE SMT JUSTICE T.MEENA KUMARI & THE HON'BLE SRI JUSTICE SANJAY KUMAR WRIT APPEAL No :1009 of 2008 JUDGMENT: (per the Hon’ble Sri. Justice Sanjay Kumar) The order dated 11.7.2008 passed by a learned single Judge dismissing W.P.No.5372 of 2001 is challenged by the unsuccessful petitioner-The Gold and Silver Jewellery and Diamond Merchants Association, Kurnool. In the said writ petition, the appellant-association challenged the levy of licence fee on item No.33 (Silver and Gold Jewellery shop) as per annexure 1, Section 521 (1) of the Hyderabad Municipal Corporation Act, 1955 (for short, ‘the Act of 1955’) and the notification in Rc.No.7378/98/F2, dated 24.12.1999 modified under resolution No.223 dated 19.6.2000 of the Municipal Corporation, Kurnool, whereby the members of the appellant-association were called upon to pay the enhanced licenced fee of Rs.1,900/- per annum. In the alternative, the appellant-association prayed for a declaration that the enhancement of licence fee from Rs.400/- to Rs.1,900/- per annum was illegal, arbitrary and unreasonable. The learned single Judge having considered the matter on merits and in the light of Section 521 of the Hyderabad Municipal Corporation Act, 1955 held that the nature of the business in which the members of the appellant-association were involved could not be said to be of a nature which would not come under Section 521 (1)(e)(ii) of the Act of 1955. The learned single Judge held that the enhancement of the annual licence fee from Rs.400/- to Rs.1,900/- per shop was not arbitrary, illegal or excessive and accordingly dismissed the writ petition. Sri K. Somakonda Reddy, learned Counsel for the appellant- association, challenged the action of the Municipal Corporation of Kurnool in levying licence fee upon the members of the appellant- association on the ground that Section 521(1)(e)(ii) of the Act of 1955 has no application to the business activity of the members of the appellant-association. The learned Counsel stated that the members of the appellant-association were only involved in the sale of Silver and Gold Jewellery and no process of manufacturing was undertaken by them entailing any danger to life or health, whereby Section 521 (1) (e)(ii) could be made applicable. In the alternative, the learned Counsel argued that the enhancement from Rs.400/- to Rs.1,900/- per annum was excessive and arbitrary. Per contra, Sri A. Sreedhar, learned Counsel for the respondent-Municipal Corporation, argued that the activity of the members of the appellant-association involved use of chemicals which were hazardous to human life and health and accordingly, the application of Section 521 (1)(e)(ii) of the Hyderabad Municipal Corporation Act, 1955 could not be said to be untenable. The learned Counsel pointed out that the members of the appellant-association had altogether stopped payment of the annual licence fee after instituting the writ petition before this Court and presently, neither the enhanced amount nor the earlier amount of licence fee was being remitted to the Corporation. The learned Counsel also pointed out that the expenditure incurred by the Corporation under various overheads was far in excess of its revenues and therefore, the enhancement of the licence fee could not be said to be excessive or arbitrary. In exercise of jurisdiction under Article 226 of the Constitution, it is not possible for this Court to ascertain the actual nature of the business activity of the members of the appellant-association. No material is placed before us to decide as to whether the members of the appellant-association are involved only in the sale or also in the process of manufacturing of jewellery. The fact remains that the members of the appellant-association were earlier subjected to licence fee under the provisions of the Hyderabad Municipal Corporation Act, 1955, made applicable to Kurnool Municipal Corporation, and it was only upon enhancement of the licence fee that a challenge is posed to the applicability of the provisions of the Act and the levy of the licence fee. The material placed before us clearly demonstrates that the Corporation has to meet heavy expenditure and in this regard, it is within its power to augment its revenues by enhancing the licence fee. However, it is to be noticed that the Corporation would necessarily have to establish that the activity of the members of the appellant- association posed a danger to life or health, for invoking the provisions of Section 521 (1)(e)(ii) of the Act of 1955. It is brought to our notice that the appellant-association raised objections with regard to the enhancement of the licence fee and thereupon, the Corporation reduced the enhancement from Rs.2,000/- per annum to Rs.1,900/- per annum. However, no enquiry or examination ensued upon such objections into the issue of any danger being posed to life or health by the business activity of the members of the appellant-association. In that view of the matter, it is appropriate that the appellant association be permitted to file fresh objections treating the impugned order dated 24.12.1999 as a further notice. The appellant-association is given liberty to establish before the Corporation that its business activity does not involve any danger to life or health or cause any nuisance as envisaged under Section 521 (1)(e)(ii) of the Act of 1955. The Municipal Corporation shall consider the aforesaid objections and pass appropriate orders after giving due opportunity of hearing to the members of the appellant-association. In the meanwhile, keeping in view the long drawn pendency of this litigation before this Court, it is fit and proper that the appellant- association be directed to deposit half of the enhanced licence fee of Rs.1,900/- p.a. as directed under the impugned proceedings dated 24.12.1999, within a period of two months from the date of receipt of a copy of this Order. Such deposit shall be subject to the final orders to be passed by the Corporation upon the objections of the appellant- association. The appellant-association shall file its objections within a period of two months and the Corporation shall consider the same and pass appropriate orders thereupon, within two months thereafter. The writ appeal is disposed of with the above directions. There shall be no order as to costs. ________________________ Justice T. Meena Kumari ______________________ Justice Sanjay Kumar Dated: 21.01. 2010 Nn. THE HON'BLE SMT JUSTICE T.MEENA KUMARI & THE HON'BLE SRI JUSTICE SANJAY KUMAR WRIT APPEAL NO :1009 OF 2008 (Division Bench Judgment delivered by the Hon’ble Sri Justice Sanjay Kumar) 21.01.2010