Case: Mahapalika Of City Of Agra Vs. Agra Brickkiln Owners' Association &amp; Ors

law, but there was some continuity maintained. A certain ceiling on taxes on professions, trades, callings and employments had been set by Article 276 of the Constitution of India, but this maximum was not Rs. 50/- as in the Government of India Act, 1935 but Rs. 250/-. We may as well extract sub-clause (2) of Article 276, in this context :"276. Taxes on professions, trades, callings and employments. - (1) ........................................ (2) The total amount payable in respect of any one person to the State or to any one municipality, district board, local board or other local authority in the State by way of taxes on professions, trades, callings and employments shall not exceed two hundred and fifty rupees per annum; Provided that if the financial year immediately preceding the commencement of this Constitution there was in force in the case of any State or any such municipality, board or authority a tax on professions, trades, callings or employments, the rate, or the maximum rate, of which exceeded two hundred and fifty rupees per annum, such tax may continue to be levied until provision to the contrary is made by Parliament by law, and any law so made by Parliament may be made either generally or in relation to any specified States, Municipalities, Boards or authorities. (3) ..................................................... Inevitably, it follows that during the post-Constitution period nothing by way of taxes on trades or callings above the limit so set is recoverable and hence the maximum levy from each person under the notification issued under Act II of 1916 rises to Rs. 250/-." 7. A wee-bit twilit area of law, where the High Court has wobbled and gone wrong, if we may say so with respect, relates to the period after the U.P. Nagar Mahapalika Adhiniyam, 1959, came into force. The curious conclusion, the learned single Judge has reached, is that since that date i.e., February 1, 1960, there is to be a sudden drop in the maximum tax leviable under Section 172(2) of the Mahapalika Act to Rs. 50/- from Rs. 250/-, by a rather strained process of resuscitation of the Government of India Act, 1935. 8. We must accept the omnipotence of the Indian Constitution so far as all legislations are concerned, including the Municipal laws. Therefore, by the force of this paramountcy we have read down the notification Ex. H to limit the maximum contemplated by it to Rs. 250/- the ceiling set by Article 276 (2) of the Constitution. But, how can the ghost of the Government of India Act, which died long ago, revive to haunt the taxing laws of the Republic now and bring down the maximum limit from Rs. 250/- to Rs. 50/- ? The learned Judge himself felt that this seemed paradoxical, but thought that that is the effect of this express and categorical proviso. What is that proviso. The court had in mind the proviso to Section 172 of the Adhiniyam. 9. This view of the High Court stems from a simple misconstruction of the proviso to Section 172 of the Mahapalika Act. The said proviso operates as a saving clause affecting the whole section and may, for facility of making the point, clearly be read here :"172. ...................... Provided that where any tax was being lawfully levied in the area included in the City immediately before the commencement of the Constitution of India such tax may continue to be levied and applied for the purposes of this Act until provision to the contrary is made by Parliament." It is plain that such tax, in this proviso, relates to any tax under Section 172 and saves all species or classes of taxes and does not merely preserve the quantum or rate of such tax. It is typology, not the amount that is saved. So it follows that the category of tax on trade or calling is salvaged by the proviso and the notification Ex. H survives. It is clearly erroneous to hold that what is continued is the rate, not the description, of tax. Of course, if only the quantum of tax is kept alive on the wording of the proviso, what remains valid is only upto the maximum mentioned in Section 142 A of the Government of India Act, 1935. But if the class or species of tax is the correct connotation of the expression such tax and any tax - and we have no hesitation to hold that way in the context, setting and language used, the tax on trade or calling is saved. The rate is as fixed in Exhibit H. 10. This does not mean that anything beyond Rs. 250/- (the tax freeze under Article 276 (2)) can be levied. No. The constitutional maximum prevails as it covers all taxes on trade or calling even today. Therefore, until Parliament makes any other law, as contemplated in the proviso to Section 172 of the Adhiniyam, the maximum of Rs. 250/- binds. We have to read down the notification Exhibit H for the post-Constitution period, in tune and confirmity with the Constitution and uphold its validity to the extent of constitutional permissibility. 11. We may thus sum up our conclusion. The period before the Constitution of India came to be enacted, i.e., prior to January 26, 1950, will be governed by the maximum fixed by the 1935 Act and the Municipal Council of Agra will be entitled to collect tax on trade or calling at the rate fixed in Exhibit H, but subject to the maximum of Rs. 50/- per person as already explained. For the second period from the date of the Constitution up to the date of the Mahapalika Act II of 1959, the maximum leviable by way of tax on trade or calling by the Mahapalika will be Rs. 250/- per person. The post-Mahapalika Act period will also be controlled by the same constitutional maximum of Rs. 250/- per person, unless any supervening Parliamentary legislation, as contemplated by Section 172 of that Act, comes into being.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]10. This does not mean that anything beyond Rs. 250/- (the tax freeze under Article 276 (2)) can be levied. No. The constitutional maximum prevails as it covers all taxes on trade or calling even today. Therefore, until Parliament makes any other law, as contemplated in the proviso to Section 172 of the Adhiniyam, the maximum of Rs. 250/- binds. We have to read down the notification Exhibit H for the post-Constitution period, in tune and confirmity with the Constitution and uphold its validity to the extent of constitutional permissibility11. We may thus sum up our conclusion. The period before the Constitution of India came to be enacted, i.e., prior to January 26, 1950, will be governed by the maximum fixed by the 1935 Act and the Municipal Council of Agra will be entitled to collect tax on trade or calling at the rate fixed in Exhibit H, but subject to the maximum of Rs. 50/- per person as already explained. For the second period from the date of the Constitution up to the date of the Mahapalika Act II of 1959, the maximum leviable by way of tax on trade or calling by the Mahapalika will be Rs. 250/- per person. The post-Mahapalika Act period will also be controlled by the same constitutional maximum of Rs. 250/- per person, unless any supervening Parliamentary legislation, as contemplated by Section 172 of that Act, comes into being.