Case: Dantuluri Ram Raju And Ors Vs. State Of Andhra Pradesh And Anr

there is equality and uniformity within each group, the law will not be condemned as discriminative though due to some fortuitous circumstances arising out of a peculiar situation, some included in a class get an advantage over others so long as they are not singled out for special treatment, (1963) 3 SCR 809 = (AIR 1963 SC 591 ), (supra). 36. In the case of Writ Petn. No. 187 of 1970, D/- 4-11-1971 (SC) (supra), this Court dealt with the validity of the Bombay Building Repairs and Reconstruction Board Act of 1969. The said Act related to the problems arising out of the collapse of residential buildings and acute shortage of housing accommodation. Provision was made in the Act for establishing a Board to deal with the said problem by carrying out structural repairs to dangerous buildings by acquiring and reconstructing buildings which were beyond repair and for the re-housing of occupiers who because of such repairs would be dishoused. Temporary levy of an additional cess on buildings and lands to meet the expenditure for the aforesaid purposes was provided for in that Act. One of the grounds which was urged on behalf of the petitioners was that the Act was violative of article 14 in that it failed to recognize the material difference between various buildings with regard to their physical conditions and treated unequals as equals. The petitioners in that case were owners of a residential building which by reason of its having been recently constructed was neither dilapidated nor in dangerous condition. Repelling the above contention this Court observed:"The contention that some of the buildings falling in categories B and C would not need structural repairs throughout the life of the Act or that such repairs would be carried out in buildings not cared for by defaulting landlords, takes no notice of the fact that the primary object of the Act is not to repair all buildings subject to cess but to prevent the annually recurrent mischief of house collapses and the human tragedy and deprivations they cause. The cess being thus levied to prevent such disasters, there is no question of unequal treatment between one class of owners and another". 37. We are, therefore, of the view that the provisions of the impugned Act are not violative of Art.14 of the Constitution. 38. There is no substance in the contention advanced on behalf of the appellants that the right of appeal provided by section 5 of the Act is illusory. The legislature has prescribed the maximum limit of the rate of cess and the notification issued under the Act has fixed that rate. The procedure to be adopted before the levy of the cess has been prescribed in section 4 of the Act. Section 5 gives a right of appeal to a person aggrieved by the levy of the drainage cess under section 4. The matters which can be agitated in appeal may relate to the area for which the cess is levied or the ownership of that area. In case a landowners stand is that the area owned by him is less than that of which cess is levied or that he has transferred the said land or part of it, he can agitate the matter in appeal. The fact that no discretion is given to the appellate authority to determine the rate of cess would not introduce an infirmity or make the right of appeal to be illusory. 39. The argument that there has been excessive delegation of the legislative power in the matter of determining the rate of cess is equally devoid of force. According to Dr. Singhvi, the legislature has merely prescribed the maximum rate at which cess may be levied but has not fixed the minimumrate of the cess. The precise rate of cess is left to the Government by section 3 of the Act and as such, according to the learned counsel there has been excessive delegation of the legislative power. In this connection we find that it is open to the legislature to prescribe the maximum rate of cess. The authority mentioned in the statute, subject to other legal requirements, can levy cess up to that limit. As things are the State Government in the present case has adhered to the maximum prescribed by the Act vide notification dated December 17/20, 1968. The power of the legislature to fix or change the limit of tax has been discussed in para 165 of the Law of Taxation by Cooley, 4th Edition, in the following words:"Power of legislature to fix or change limit: In addition to, or in place of constitutional provisions, there are statutes in many states limiting the amount or rate of taxation by a country, town, municipality, or other local subdivision; and sometimes the limitation imposed upon a municipality is found in its charter. A valid limitation on the rate where fixed by the legislature, is just as binding on countries and municipalities as is such a limitation fixed by the constitution". 40. No authority has been cited before us to show that even though maximum limit of the tax has been prescribed, the absence of a minimum limit vitiates the taxing statute. It is not necessary, however, to dilate upon this aspect of the matter as we find that there are enough guidelines in the Act in respect of the rate of cess because the rate of cess in a division has to be correlated to the amount of expenditure to be incurred on the drainage scheme in that division. 41. It may also be mentioned that subsequent to the decision of the writ petition which is the subject of the present appeal, validity of the provisions of the Act was challenged in a batch of writ petitions before the Andhra Pradesh High Court. The matter was then referred to a Full Bench. The learned judges constituting the Full Bench by means of three separate judgments upheld the constitutional validity of the provisions of the Act. 42.

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

Explanation:
0[ds]21. The modern trend in all progressive countries is towards establishment of a welfare State, and with this and in view, the State has to prepare plans and devise beneficent schemes for the good of the common people. The implementation of those plans and schemes entails colossal expenditure. The State has consequently to tap various sources for augmenting its income and raising the revenue Taxes are levied for this purpose, and the State is given a wide range of choice for the purpose of taxation. It is axiomatic that different situations call for different fiscal measures. The State is presumed to know the requirements of the siutation and act accordingly. No rigidity being possible, it is difficult to apply any set formula. Much greater latitude and discretion has, therefore, to be allowed to the State for the purpose of taxation in the context of article 14 of the Constitution28. Keeping the above observations in view we find that in the present case the Act contains sufficient guidelines for the fixation of the rate of cess and there is also enough material on record to justify a uniform rate of cess for each acre of land in a division of the deltaic area. The imposition of tax on land for raising general revenue is substantially different from the levy of cess for implementation of a drainage scheme for the benefit of lands in an area and the principles applicable in one case would not necessarily hold good in the otherThe question involved in the above case, in our view, was materially different and, as such, the appellants cannot derive much assistance from it, also31. We are not impressed by the above contention. The floods have a vagary and caprice of their own, and it is difficult to predicate about the behavior of flood waters. The problem which arises in one year cannot afford a proper guidance for the following year because the dimensions of the problem in the subsequent year may be hundredfold compared to those of the previous year. This is evident from the figures in the table relied upon by Dr. Singhvi. It would appear therefrom that in the year 1961 only 1,149 acres of land in the Godavari western delta were damaged by floods, while in the year 1959 the damage caused by the floods in that area covered 89,528 acres of land. The material on record further shows that during 1969 floods, an area of as much as 3,69,395 acres out of a total of 4,90,000 acres, that is, about 75 per cent of the area was damaged by floods in the Godavari western delta. It is, therefore, plain that we cannot stick to the average damage referred to by Dr. Singhvi in considering the scheme of drainage. An effective system of drainage has in the very nature of things to make provision not only for a normal rainfal but also to meet those contingenices as arise when there are unusual rains and heavy floods. It is indeed only then that the efficacy of a drainage system is proved. We also find it difficult to accede to the submission made on behalf of the appellants that we should not take into account the figures of damage done in 1969 floodsThe proposed drainage scheme has to provide for years to come adequate safeguards and protection against contingencies created by unusually heavy rains and floods. The fact that the impugned Act enacted in 1968 covered 4,90,000 acres of land in the Godavari western delta shows, in the light of subsequent 1969 floods, the foresight of the authors of the drainage scheme which is the subject of the impugned legislationWe are, therefore, of the view that the provisions of the impugned Act are not violative of Art.14 of the ConstitutionThere is no substance in the contention advanced on behalf of the appellants that the right of appeal provided by section 5 of the Act is illusory. The legislature has prescribed the maximum limit of the rate of cess and the notification issued under the Act has fixed that rate. The procedure to be adopted before the levy of the cess has been prescribed in section 4 of the Act. Section 5 gives a right of appeal to a person aggrieved by the levy of the drainage cess under section 4. The matters which can be agitated in appeal may relate to the area for which the cess is levied or the ownership of that area. In case a landowners stand is that the area owned by him is less than that of which cess is levied or that he has transferred the said land or part of it, he can agitate the matter in appeal. The fact that no discretion is given to the appellate authority to determine the rate of cess would not introduce an infirmity or make the right of appeal to be illusoryNo authority has been cited before us to show that even though maximum limit of the tax has been prescribed, the absence of a minimum limit vitiates the taxing statute. It is not necessary, however, to dilate upon this aspect of the matter as we find that there are enough guidelines in the Act in respect of the rate of cess because the rate of cess in a division has to be correlated to the amount of expenditure to be incurred on the drainage scheme in that divisionIt may also be mentioned that subsequent to the decision of the writ petition which is the subject of the present appeal, validity of the provisions of the Act was challenged in a batch of writ petitions before the Andhra Pradesh High Court. The matter was then referred to a Full Bench. The learned judges constituting the Full Bench by means of three separate judgments upheld the constitutional validity of the provisions of the Act.