Case: Pioneer Motors Private Ltd. &amp; Others Vs. Municipal Council, Nagercoil

On September 9, 1943, the Nagercoil Municipal Council the respondent, passed a resolution under S. 78 of the Travancore District Municipalities Act (Act XXIII of the Malyalam year 1116) hereinafter called the Act. By this resolution, it was resolved to levy a profession tax at the rates specified in the schedule. This was notified in the Government Gazette of September 26, 1943, under the name of the Commissioner of the respondent Council. In this notification, it was stated:"Any inhabitant of the local municipal town objecting to the proposal may submit his objection in writing to this office within 30 days of date of publication of this notificaion in the Government Gazette."This notification was also published in a local newspaper called the "Abhimani". It does not appear, not is there any assertion or allegation that any objection was raised to this tax by the appellants or any one else. On January 12, 1944, a resolution under S. 79 of the Act was passed, by which the profession tax became payable from the beginning of the second half of the Malyalam year 1119. A trust, Kottar Chetty Ninar Desikavinayaga Swamy filed a suit on February 10, 1946, challenging the legality of this tax. C. A. 502 of 1958 has arisen out of that suit. Amongst other allegations, which are common to the other suits, which will be mentioned presently, the trust pleaded that it was not carrying on a profession within the meaning of the word used in the Act and that it was only a religious trust and had no profession. That suit was tried by the Munsif and was decreed. An appeal was taken against that decree to the District Judge.3. Three private limited companies carrying on business brought three suits challenging the legality of the imposition of the tax out of which the other three appeals, i. e., Civil Appeals Nos. 499 to 501, have arisen. In these suits, it was alleged that the publication of the resolution was not in accordance with the provisions of S. 78 of the Act in so far as (1) it was not published by the respondent Municipal Council, but by the Commissioner; (2) the newspaper in which the advertisement was published was not selected by the Council; (3) time given in the notification was fixed not by the Council, but by the Commissioner; and (4) the period prescribed in the notification, that is, "within 30 days", was not fixed by the Council and was not in accordance with the Act. The respondent Municipal Council denied these allegations and several issues were raised and the suits were decreed. The appeal which had been taken in the suit by the Trust was also decided in favour of that plaintiff. The result was that all the suits and the appeal were decided against the respondent Municipal Council. It took four appeals to the High Court. The decrees were reversed and the suits of the various plaintiffs were dismissed. Against those judgments and decrees these four appeals have been brought by the plaintiffs, in the various suits, who are now the appellants.4. In Civil Appeals Nos. 499 to 501, Counsel for the appellants has raised two points (1) that the publication was not by the Council and (2) that the time given in the notification, i. e., "within 30 days" was not in accordance with the law and as these were conditions precedent to the legality of the resolution under S. 79 the resolution was ultra vires and therefore the imposition of the tax was illegal. It is, therefore, necessary to examine the various provisions of the Act upon which the whole argument has proceeded.5. Chapter VI of the Act deals with Taxation and Finance. In S. 77 are enumerated the various taxes which can be levied by municipal councils. Section 78 gives the procedure for the levying of the tax and when quoted it is as follows :-"S. 78. Resolution of Council determining to levy tax or tolls. Any resolution of a municipal council determining to levy a tax or toll shall specify the rate at which any such tax or toll shall be levied and the date from which it shall be levied:Provided that before passing a resolution imposing a tax or toll for the first time or increasing the rate of an existing tax or toll, the council shall publish a notice in Our Government Gazette and at least in one Malayalam or Tamil newspaper having circulation in the municipality of its intention, fix a reasonable period not being less than one month for submission of objections, and consider the objections, if any, received within the period specified:"(Italics (here into   ) are ours).After the various steps given in S. 78 have been taken, a municipal council has then to adopt the taxes proposed by means of a resolution under S. 79, which provides:-"S. 79. Notification of new taxes and tolls. When a municipal council shall have determined subject to the provisions of Section 78 to levy any tax or toll for the first time or at a new rate the executive authority shall forthwith publish a notification in our Government Gazette and by beat of drum specifying the rate at which the date from which, and the period of levy, if any, for which such tax or toll shall be levied." The functions of the executive authority, that is, of the Commissioner of the Council are contained in S. 16 of the Act, which is as follows:-"S. 16. Functions of the Executive Authority. The executive authority of the municipal council shall(a) carry into effect the resolutions of the council;(b) furnish to the council such periodical reports regarding the progress made in carrying out the resolutions of that body in the collection of taxes as the council may direct; and(c) perform all the duties and exercise all the powers specifically imposed or conferred on the executive authority by this Act, and subject, whenever it is hereinafter expressly so provided, to the sanction of the council, and subject to all other restrictions, limitations and conditions hereinafter imposed, exercise the executive power for the purpose of carrying out the provisions of this Act and be directly responsible for the due fulfilment of the purposes of this Act."Section 16, which contains the power of the executive authority, does not support the contention of the appellants, because it provides that the executive authority has to give effect to the resolutions of the council and has to perform all duties specifically imposed on the executive authority by the Act and can also exercise executive power for the carrying out of the provisions of the Act and can act without sanction, unless the Act otherwise requires. Therefore, when the Commissioner of the respondent council got published a notification of the resolution under S. 78 of the Act to impose a tax, he was acting within his powers and the fixing of the time in which objection had to be made was provided under the Act and was not exercise of authority by the executive which it did not possess.Coming now to Civil Appeal No. 502 of 1958, in the plaint it was alleged that the trust was a religions trust and was following no profession and therefore it did not fall within the definition of the word "profession" as used in S. 91 of the Act.

Reasoning:
There is no dispute as to the meaning of that expression alone which has been so construed and the observations of Lord Parker in 1960-3 All ER 500 will apply. But the question that arises in the present case is : what is the exact significance of these words when used in the context of the other words used in the proviso. The power of the municipality to levy the tax does not depend upon period prescribed for notice for objections. The power to tax is derived from the Statute; the provisions relating to the length of notice inviting objections and publication are merely procedural. The object of the notification is to inform the future rate payers and to invite objections from them. The proviso itself uses words "reasonable time." Reading "reasonable time" and "not being less than one month" together, it is clear that the time given must be reasonable and the legislature has only added a guide so that periods shorter than a month may not be fixed. In the present case the whole of the period except one day has been fixed and in view of the other facts it must be regarded as reasonable and to have complied with the provision which is directory in its later part.10. Counsel for the appellants in C. A. 499/501/58 wanted to raise a further objection to the legality of the tax levied and that ground was that the appellants were not carrying on a profession as they were only engaged in motor business and trade. This question was never raised at any previous stage and was not taken in the statement of the appellants case. Therefore it cannot be allowed to be raised. Besides it is without any substance in view of the definition of profession as given in S. 91 of the Act, which includesno specific finding was given as regards the operation of S. 91, the suit was decreed and the question whether the trust followed a profession or not seems to have got lost at the subsequent stages of the proceedings, that is, in appeal in the court of the District Judge and in the High Court. It is this point which was urged by counsel for the trust; his plea was that his case was not covered by S. 91, as being a religious trust it had no profession and was carrying on none. That is a matter which, in our opinion, should have been decided, and as neither the District Judge nor the High Court has given a finding on that point, it is necessary to remit the case to the High Court with the direction that the appeal be reheard and that particular question be decided on the materials on the record. Nothing that has been said in this judgment must be taken to be an expression of opinion on the merits of this plea taken by the appellant Trust.