9 o M Uf Singm Bensh IN Em HIGH cotmT OF miCATvnE AT BILAspUR (CG) mam FETItmm ND. ‘ég2‘o? 2004 / PE TI TIGNE R : VM/s $yalaseana mncmte sleepers Pvt; Ltd, through General Manager. M’s Rayalaseema ooncxeta sleepars mctory, I§rgi Road, Kata, matrict Bilaspur (CG). Versus REQPONDENTS m WW muon OF Indla,thrcugh the Secrgtary mparunent o3: milways Mantralay, New Delhi. milecmr. Bilaspur. mgar Panchayat Kata. through Chie Mun§.cipal Officer, Nagar Rnchayat Ibta Rami mad, man-mt Bilaspur (CG). 4;3 4 ¢ (ffi’: HIGH COURT OF CHHATTISGARH AT BILASPUR .WRIT PETITION N0. 4682 of 2004 PETITIONER : M/s‘ Rayalseema Concrete Sleepers Pvt. Ltd. VERSUS RESPONDENTS : Union of India & Others. WRIT PETITION UNDER ARTICLE 226/227 OF THE CONSTITUTION OF INDIA SB: Hon’ble Shri Satish K. Agnihotri, J. Present: Shri Awadh Tripathi, Advocate for the petitioner. Shri Shashank Thakur, Panel Lawyer for the State/respondent No. 2. . ORDER (ORAL) (Passed on 21m day of September, 2010) Challenge in this petition is t0 the bill dated 06.07.2004 (Annexure P/4) amounting to Rs. 5,84,760/— issued by the Chief Municipal Officer, Nagar Panchayat, Kota, and the order dated 12.0 (Annexure P/5) whereby the Chief Municipal Officer, Nagar Panchayat Kota & Tahsildar, Kota, has directed the petitioner to pay the amount of property and terminal tax amounting to Rs. 5,84,760/- Within a period ofseven days. 2. The sole contention of the petitioner is that the petitioner is merely Wa contractor of the Railways engaged in manufacture of railway sleepers on the site allotted to the petitioner by the respondent No.1. The petitioner is in novyvay responsible for payment of any terminal tax or property tax as the transaction between the petitioner and the Railways is not a commercial transaction. The petitioner is paying regular annual fee for the land allotted by the Railways and is not enjoying any facilitieswhatsoever that may be provided by the respondent No. 3. ¢~ e \ w‘,._....‘_.. . , _ ._ , . .4; % \, w \t\ \\ None appears on behalf of the respondent No. 1 and 3. However, the respondent No. 3, vide its return dated 16.09.2005 submits that the petitioner is manufacturing railway sleepers and the same is being sold to the Railways. The land on which manufacturing is being done is within the municipal limits, thus, the petitioner is liable to pay the taxes as levied upon it. On perusal of the agreement which was entered into between the petitioner and the Railways (Annexure P/l), it is found that clause 17 of the agreement, clearly provides that the petitioner (occupier) shall be liable for payment of the local taxes and cesses, and all municipal rates and taxes, if any, only to the Government and as and when demanded. 5. It is an admitted fact that the petitioner is earning profit in the business of manufacture of railway sleepers. Thus, the transaction between the petitioner and the Railways can safely be held as a commercial. transaction and further, as provided under the agreement between the petitioner and the respondent—Railway, the petitioner is liable to pay all the local taxes. 6. w- It is well settled that levy of local taxes would be valid if it is on the lands/buildings used or occupied for any trade or business carried on by or on behalf of the Government. A nine Hon’ble Judges Bench of the Supreme Court, in New Delhi Municipal Council v. State ofPzmjab & Others], by majority, held as under: “177. Lastly, we may quote the pertinent propositions enunciated in Ram Krishna Dalmia v. Justice SR. Tendolkar to the following effect: (SCR p. 297) \\ ‘(1997) 7 scc 339 \ W/ “(b) that there is always a presumption in favour of the constitutionality of an enactment and the burde is upon him who attacks it to show that there has been a clear transgression of the constitutional pr (e) that in order to sustain the presumption of constitionality the court may take into consideration matters ofcommon knowledge, matters of common report, the history of the times and may assume every state offacts which can be conceived existing at the time oflegislation; and...” These are well-settled propositions. Applying them, it must be held that the aforesaid municipal laws are inapplicabe to the properties of State Governments to e xtent such properties are governed and. saved by clause () of Article 289 and that insofar as the propertes used or occupied for the purpose of a trade or busines carried on by the State Government (as explained hereinbefore) are concerned, the ban in clause 1) does not avail them and the taxes thereon must be held to be valid and effective. It may be reiterated that the Delhi Municipal Corporation Act, 1957 and the NDMC Act, 1994 are post—constitutional enactments and that the Punjab Municipal Act too must be deemed to be a post-constitutional enactment for the reasons iven hereinabove. It must, therefore, be held that the levy of property taxes by the said enactments is valid to the extent it relates to lands and buildings owned by State Governments and used or occupied for the purposes of any trade or business carried on by such Sat Government.” te In vew of the foregoing, the Municipal Council is competent to i impose propert and other local taxes on the land and place used y bhe petitione which was in possession of the petitioner for yt r commercal purpo on lease/license. There is no other question i se raise in this petition except competence of the Municipal Council, d on a property owned by the Railways as Union property is exempt from taxation uner Constitution of India. d n inciples; * >i< >1: Thus, for the reasons stated hereinabove, there is no merit in this case and is’accordingly dismissed. No order asto costs. /’/ Sa]. Judge /, . h K, Agnih otr'l Sa tu l th e 1 i s ( g