Case: Sirsilk Ltd. and Ors Vs. Textiles Committee and Ors

2. The facts in all these cases are more or less similar. It would suffice for our purposes to notice the salient features thereof. To illustrate, the appellant company in Civil Appeal No. 869 of 1973, Messrs Sirsilk Ltd., Hyderabad is a manufacturer of rayon yarn and staple fibre and has established its factory at Sirpur Kagaznagar in the State of Andhra Pradesh for the manufacture of the aforesaid man-made fibres. The Chief Inspecting Officer, Textiles Committee by his letter dated May 19, 1965 directed all the textile mills in India including the appellant to send immediately, the monthwise statements of production for March and April 1965 and a cheque in payment of the fees due thereon. However, the Association of Man-made Fibre Industry, Bombay of which the appellant is a member by its letter dated May 25, 1985 advised the textile mills to keep the payment of fees in abeyance, as it had made a representation dated May 26, 1965 on behalf of its members to the Ministry of Commerce, Government of India and to the Textiles Commissioner. Along with its letter, the Association forwarded to all its members a copy of the said representation. By a further letter dated May 29, 1965, the Association advised all the textile mills including the appellant to send a reply to the letter addressed by the Textiles Committee demanding payment of fees to the effect that the Association had already made a representation to the Ministry of Commerce and to the Textiles Commissioner and as soon as a reply was received by them, they would revert to the subject and take such action as might be necessary in the circumstances. In the meanwhile, the Textiles Committee by its letter dated August 10, 1965 made a demand for payment of the fees for the months of March to July 1965. The appellant in its reply expressed its inability to pay the fees in view of the pending representation made by the Association on their behalf and more so because the Association had advised the members that the fee would become payable by the textile mills only in connection with the inspection and examination and must be commensurate with the exact quantum of services rendered by the Committee. The appellant were however informed that one of its members had already remitted the fees. Consequently, the appellant paid a sum of Rs. 40,186.37 p. towards the fee for the period from March 1, 1965 to February 28, 1966. It however adopted to the stand that the payment of the fee was under a mistake and under misconception as to its legal rights. It accordingly called upon the Association to take up the matter with the Ministry of Commerce and the Textiles Commissioner and to Judge a strong protest against the illegal exaction of the fee by the Textiles Committee from its members when, In fact, no services of any kind were being rendered.3. Thereafter, the Accounts Officer, Textiles Committee by letter dated February 26, 1969 called upon the appellant to remit a sum of Rs. 33,343.62 p. towards the fee in respect of production of rayon or staple fibre for the period from March 1, 1966 to March 31, 1967. It was also advised to pay the fee upto April 1968. In response thereto, the appellant by its letter dated February 27, 1969 stated that the Association had on behalf of its members addressed a letter to the Secretary, Textiles Committee for certain clarifications and on receipt of the reply, the Association would advise its members as to the course of action. Eventually, the Secretary, Textiles Committee by a letter dated March 11, 1970, called upon the appellant that it should remit an amount of Rs. 35,138.63 p. being the amount of fee outstanding within ten days failing which the said amount would be recovered as arrears of land revenue under Section 12(2) of the Act. Aggrieved, the appellant moved the High Court of Andhra Pradesh under Article 226 of the Constitution challenging the validity of the fee and the threatened action for recovery. A learned Single Judge (Parthasarthi, J.) by his judgment dated January 28, 1972 dismissed the writ petition upholding the validity of the levy of the fee. On appeal being preferred by the appellant the judgment of the learned Single Judge was upheld by a Division Bench (Gopuirao Ekbote, CJ and Chennakesava Reddy, J.) by its judgment dated January 22, 1973. The High Court of Andhra Pradesh preferred to follow the view expressed by B.N. Lokur, J. of the Allahabad High Court in Juggilal Kamalapat Cotton Spinning & Weaving Mills Co. Ltd. v. The Textiles Committee, Bombay [1972] Tax. LR 2104, and dissented from the view taken by Issac, J. in The Travancore Rayons Ltd. v. The Textile Committee ILR 1972 Ker. 437 holding that the Textiles Committee was not entitled to levy any fee under Rule 4 of the Rules so long as it was not rendering any service by way of inspection or examination of rayon yarn.4. Briefly stated, the facts in transferred cases nos. 351-352 of 1983 are these. The petitioner in the first case the Century Spg. & Mfg. Co. Ltd., Bombay carry on the business of manufacture of rayon yarn and tyre-cord yarn, both of which form species of what is popularly known as men-made rayon, while the petitioners in the second Messrs Century Enka Limited, Bombay carry on the business of manufacture of nylon filament yarn. By letter dated May 25, 1968 the Accounts Officer, Textiles Committee, Bombay called upon the petitioner the Century Spg. & Mfg. Co. Ltd. to remit a sum of Rs. 5,89,187.46 p. as fees in respect of production of 29,459,373.21 kgs. of rayon yarn for the period from March 1, 1966 to April, 30, 1968. The petitioners were also called upon to pay the fees for April 1968. In reply, the petitioners by their letter dated June 18, 1968 stated that the Association of Man-made Fibre Industry, Bombay had addressed a letter to the Secretary, Textiles Committee for certain clarifications in the matter and on receipt of the reply the Association would be advising its members further. Thereupon, further correspondence ensued between the Textiles Committee on the one hand and the Association on the other. Thereafter, by letter dated February 20, 1969 the Secretary, Textiles Committee intimated the petitioner that it was proposed to initiate immediate action to recover the outstanding fees from the petitioner as arrears of land revenue as contemplated under Section 12(2) of the Act. It was further stated that in order to avoid coercive proceedings the petitioner should pay up the arrears at least upto March 31, 1967 amounting to Rs. 3,19,977.11 p.; in any case before March 1, 1969 failing which the Textiles Committee would be constrained to advise the concerned Collector to enforce recovery of the outstanding fees as arrears of land revenue. The petitioner accordingly moved a petition under Article 226 of the Constitution before the High Court of Bombay for quashing the impugned notice of demand dated February 20, 1969 complaining that they had at no time made any application for inspection and/or examination of the yarn they manufacture nor did they ever approach the said Committee to inspect and/or examine yarn manufactured by them. They averred that neither the said Committee nor any one on its behalf had rendered any service whatsoever to them either at their instance or otherwise. Similarly, the petitioner Century Enka Limited moved a petition under Article 226 of the Constitution before the High Court of Bombay contending that the Textiles Committee was not entitled to demand or recover a sum of Rs. 78,553.15 p. or any other sum by way of fees on the nylon yarn manufactured by them, on the ground that the element of quid pro quo was totally absent inasmuch as no services at all were rendered by the Committee to them. These two writ petitions were ordered to be transferred to this Court under Article 139 of the Constitution and numbered as transferred cases nos. 351-352 of 1983.5. Similar are the facts in other cases. In transferred case No. 354/83 Messrs Nirlon Synthetic Fibres & Chemicals Limited, Bombay carry on the business of manufacture of nylon yarn and apparently paid Rs. 8,820.40 p. by way of fees on the nylon yarn manufactured by them in compliance with the notice of demand issued by the Accounts Officer, Textiles Committee dated February 20, 1969. The petitioner in the other case transferred case No. 355/83 Messrs Garwara Nylons Limited, Bombay also carry on the business of manufacture or nylon yarn and paid Rs. 51,738.89 p. by way of fee in compliance with the circular issued by the Chief Inspecting Officer, Textiles Committee, Bombay dated May 19, 1965 and assert that the payment of the said amount was under a mistake. Both these petitioners moved the High Court under Article 226 of the Constitution challenging the validity of the levy of the fee and prayed for the issue of a writ in the nature of mandamus directing the Textiles Committee to refund the amounts recovered from them. Both these writ petitions were also transferred to this Court under Article 139 and are numbered as transferred cases nos. 354-355/83.6. In Civil Appeals Nos. 863-864/77, the appellant Baroda Rayon Corporation Limited, Gujarat are engaged in the business of manufacture of rayon yarn and paid Rs. 55,100 towards the fee in compliance with the notice of demand issued by the Accounts Officer, Textiles Committee dated March 9, 1966 for the period from March 1, 1965 to February 28, 1966. They were further called upon by the Secretary, Textiles Committee to remit a sum of Rs. 39,211.26 p. towards the arrears upto March 31, 1967. The appellant challenged the recovery of the said amount of Rs. 55,100 as well as the threatened demand of a further sum of Rs. 39,211.26 p. by the Textiles Committee as being ultra vires by petitions under Article 226 of the Constitution before the High Court of Gujarat. A Division Bench (S. Obul Reddy, CJ & N.H. Bhatt, J.) by its judgment dated November 18, 1976 upheld the validity of the fee and accordingly dismissed the writ petitions.7. The appellant in Civil Appeal No. 1460/80 Messrs Modipon Limited, Meerut are manufacturers of nylon yarn. The Accounts Officer, Textiles Committee by his letter dated June 11, 1960 required the company to pay the arrears of fees for the period from March 1965 to May 1968. The company brought a suit being Original Suit No. 86/70 in the Court of the II Civil Judge, Meerut for a declaration and perpetual injunction. In the suit it applied for grant of a temporary injunction under Order XXXIX, Rule 1 of the CPC, 1908 restraining the Textiles Committee from recovering the fees on the ground that the nylon yarn manufactured by them did not fall within the definition of textiles under Section 2(g) of the Act. The learned Civil Judge by his order dated May 12, 1972 granted ad-interim temporary injunction but later vacated the same. The appellant accordingly went up in appeal to the High Court, A Division Bench (M.N. Shukla & N.N. Mithal, JJ) by its order dated April 10, 1980 substantially disallowed the application for temporary injunction while making a direction requiring the learned Civil Judge to examine whether the appellant had commenced production since March 1968 and therefore the demand for fee for the period anterior to the commencement of the production could not possibly be sustained.8. Appellants in Civil Appeals Nos. 1133-34/79 Messrs. J.K. Cotton Spg. & Wvg. Mills Co. Ltd., Kanpur carry on the business of manufacture of rayon yarn under the name and style of J.K. Rayon, and of nylon yarn under the name and style of J.K. Synthetics Limited. For the period from March 1965 to February 1966 they paid Rs. 49,372.65 p. Thereafter, they fell into arrears. The two companies filed petitions under Article 226 of the Constitution before the High Court of Allahabad contending inter alia that the said payments were made under mistake without realising the implications of the Textiles Committee Act or the Rules, and prayed for the issue of a writ in the nature of mandamus directing the Textiles Committee to refund the amount in question. As already stated, B.N. Lokur, J. in Juggilals case by his judgment dated November 6, 1971 upheld the validity of the levy of the fee and dismissed the writ petitions. On appeal, a Division Bench (Satish Chandra, CJ and Yashoda Nandan, J.) by its judgment dated October 24, 1978 dismissed the appeal.9. In Civil Appeal No. 1281 of 1973 the Textiles Committee has come up in appeal against the judgment of a learned Single Judge of the High Court of Kerala (Isaac, J.) who by his judgment dated March 3, 1972 in Travancore Rayons Ltd. held that the levy of the fee by the Committee was without the authority of law and so long as the Committee was not rendering any service by way of inspection and examination of rayon yarn manufactured by Messrs Travancore Rayon Limited, it was not entitled to recover the same.

Reasoning:
19. As to the first contention that the rayon yarn and nylon yarn manufactured by the appellants and the petitioners were filaments and not fibres and therefore did not fall within the ambit of the definition of textiles in Section 2(g) of the Act prior to its amendment, Shri Khaitan who first argued the case of Sirsilk Limited and more particularly Shri Tarkunde appearing on behalf of J.K. Cotton Spg. & Wvg. Mills Co. Ltd., followed by Shri Krishna Kumar appearing for Modipon Limited placed strong reliance on scientific and technological material explaining the manufacturing process of rayon yarn and nylon yarn to contradistinguish the same from fibres. The learned Additional Solicitor General rightly drew our attention to the averments made in paragraph 1 of the writ petitions before the High Court in which each of the appellants and the petitioners has specifically averred that they are manufacturers of rayon, and submitted that they cannot be heard to say that the product manufactured by them was not rayon made of artificial silk or fibre. The contention of the learned Additional Solicitor General must prevail. The averments in paragraph 1 of the writ petitions are more or less the same. We need only reproduce paragraph 1 of the writ petition filed by Messrs Sirsilk Limited, and it reads:The petitioners are a Limited Company incorporated under the Indian Companies Act and are having their Registered office at Himayatnagar, Hyderabad-29. The Petitioners, inter alia, carry on the business of manufacture of rayon yarn and staple fibre both of which form species of what is popularly known as man made yarn. For the purpose of manufacturing the aforesaid yarns, the petitioners have established their factory at Sirpuro the same effect are the averments made in the writ petitions filed by the appellants M/s. J.K. Cotton Spinning & Weaving Co. Ltd., M/s. Baroda Rayon Corporation Ltd. and M/s. Modipon Ltd. as well as by the petitioners M/s. Century Spinning & Manufacturing Co. Ltd., Century Enka Ltd., M/s. Nirlon Synthetic Fibres & Chemicals Ltd. and M/s. Garware Nylons Ltd. On their own showing, the appellants as well as the petitioners are actually engaged in the manufacture of rayon yarn and nylon yarn both of which they aver are species of what is known as man-made fibres. In view of this undisputed factual position, the contention that rayon yarn and nylon yarn manufactured by them are filaments and not fibre or that they are not yarn and therefore do not fall within the definition of textiles under Section 2(g) of the Act prior to its amendment, cannot be countenanced.20. The main thrust of the argument of learned Counsel for the appellants and the petitioners that rayon yarn and nylon yarn manufactured by the appellants and the petitioners are not fibres but filaments, stems from the decision of the Madhya Pradesh High Court in The Gwalior Rayon Silk Manufacturing (Wvg.) Co. Ltd., Birlagram, Ujjain v. The Textile Committee, Bombay (supra). In the decision, the Madhya Pradesh High Court assumes that a fibre in order to answer the description of yarn, in the ordinary commercial sense must be a spun strand meant for use in weaving, knitting or rope-making. It proceeds upon the basis that although viscose staple fibre was manufactured out of fibre but it had to be subjected to various other operations such as blending, carding, combing or hackling and spinning before fibre could be converted into yarn. Upon that basis, the Madhya Pradesh High Court held that viscose staple fibre manufactured by the Gwalior Rayon Silk Manufacturing (Wvg.) Co. Ltd. was made wholly of filaments and therefore was not fibre and hence was not yarn and accordingly did not fall within the meaning of the expression textiles as defined in Section 2(g) of the Act. We are afraid, we cannot accept this line of reasoning.21. The Madhya Pradesh High Court was clearly wrong in giving to the expression textiles in Section 2(g) of the Act a narrow and restricted meaning. The reasoning of the Madhya Pradesh High Court is best stated in the words of G.P. Singh, CJ. speaking for himself and C.P. Sen, J:According to this definition, textiles meant any fabric or cloth or yarn made wholly or in part of cotton, or wool or silk, or artificial silk or other fibre. The use of the word means in the definition gives rise to the inference of its being restrictive and exhaustive. Further, it is clear that what was embraced by the definition before 1st January 1975 was any fabric or cloth or yarn and not any fibre. The definition made a distinction between yarn and fibre. The same distinction appears in Section 2(f) in the definition of textile machinery which expression is defined to mean the equipment employed for the processing of textile fibre into yarn.... The Act does not contain any definition of yarn and hence it has to be understood in its ordinary sense to mean any fibre, or wool, silk, flax, cotton, nylon etc. spun into strands for weaving, knitting or making thread. [Websters New Worlde learned Chief Justice then added:A fibre in order to answer the description of yarn in the ordinary commercial sense must be a spun strand meant for use in weaving, knitting or rope-making Commr. of Sales Tax U.P. v. Sarin Textile Mills AIR1975SC1262 . It is true that yarn is manufactured out of fibre but various operations such as blending, carding, combing or hackling and spinning have to be performed for converting fibre into yarn (See the New Encyclopaedia Britannica, 15th Edition, Vol. 18, p.e was no explicable reason for the legislature to have excluded rayon yarn and nylon yarn from the purview of the definition of textiles in Section 2(g) of the Act prior to its amendment. The expression textiles has been defined in Section 2(g) of the Act in a way as to include not only yarn but also man-made fibres or artificial silk. In the premises, the expression textiles as defined in Section 2(g) of the Act has to be given a broad and liberal construction, in furtherance of the purpose and object of the Act.22. The Madhya Pradesh High Court was clearly in error in construing the expression textiles as defined in Section 2(g) of the Act, prior to its amendment in a narrow and restricted sense. The particular words used by the legislature i.e. the terms yarn, man-made fibres, otherwise known as artificial silk had to be understood according to the common commercial understanding of the terms used, and not in their scientific or technical sense. The High Court failed to bear in mind that the Act is not a scientific treatise on organic or inorganic chemistry but is an enactment by the Parliament for the benefit of the indigenous textile industry, so that it may be able to hold its own in a fiercely competitive international market. In these circumstances, the Act and the words used therein have to be interpreted not on a technological or specialised scientific plane but in the popular sense as understood by experts in the sphere of the textile industry and the commercial world dealing with it. We find no discernible reason for Parliament to have left out man-made fibres like viscose staple fibre, rayon yarn and nylon yarn from the purview of the definition of textiles in Section 2(g) of the Act prior to its amendment particularly when synthetic fibres have a world market and India has entered into a competitive international trade in all textiles in a large way.29. For all these reasons the contention that rayon yarn and nylon yarn manufactured by the appellants and the petitioners are made wholly of filaments and not of fibres and therefore did not come within the purview of textiles as defined in Section 2(g) of the Act prior to its amendment and therefore they were not liable for payment of the fee levied under Rule 21 of the Rules, cannot prevail.30. The various activities undertaken by the Textiles Committee for the development of the textile industry and the promotion of textile exports which have expanded considerably, and the duties entrusted to the Committee to ensure the quality of all textiles whether made wholly or partly of cotton wool, silk, artificial fibre or silk, particularly when Indian Textiles by and large and artificial silk or man-made fibres like rayon yarn, viscose staple fibres and nylon yarn as well as fabrics made of artificial silk, are facing ever increasing competition in the international market from other exporting countries like Japan, China etc. and the production and export of textiles having substantially increased, the legislature thought it necessary to make adequate provision and accordingly created a Textiles Fund under Section 7 of the Act to meet the expenditure of the Textiles Committee which necessarily has to be on a larger scale. At the time when the Textiles Committee was established under Section 3, the legislature accordingly provided for the establishment of a Textiles Fund constituted under Section 7 of the Act from out of which the expenditure of the Committee has to be defrayed. Sub-section (1) of Section 7 provides that the Committee shall have a Fund to be called the Textiles Fund and there shall be credited thereto various items specified in Clauses (a) to (d), apart from all the moneys standing to the credit of the Cotton Textiles Fund established under the repealed Ordinance, immediately before the date on which the Textiles Committee came to be established, which by virtue of Section 24(2)(a) stood transferred to and formed part of the Textiles Fund, and such sums of money as the Central Government after due appropriation made by Parliament in that behalf, pays to the Committee in each financial year by way of grant, loan or otherwise for purposes of enabling the Committee to discharge its functions under the Act. There are only two other sources of income. One of the main sources of revenue, as indicated in Clause (c), is the income derived from the levy of the fee under Rule 21 of the Rules, and the other that indicated in Clause (d) viz. all moneys received by the Committee by way of grant, gift, donation, contribution, transfer or otherwise. After the imposition of the duty of excise as a cess by Section 5A of the Act introduced by Act No. 51/73, the income derived from such cess becomes another source. Sub-section (2) of Section 7 provides that the moneys in the Fund shall be applied for (a) meeting the pay and allowances of the officers and other employees of the Committee and other administrative expenses of the Committee, and (b) carrying out the purposes of the Act. Sub-section (3) of Section 7 provides that all moneys in the Fund shall be deposited in the State Bank of India or be invested in such securities, as may be approved by the Central Government.31. From these provisions, it is amply clear that all the income derived from the levy of the fee under Rule 21 of the Rules has to be credited to the Textiles Fund and the said income is utilised in defraying the expenditure of the Textiles Committee in carrying on its manifold duties. No part of the fee levied under Rule 21 goes into the Consolidated Fund of India. It is only by Section 5F introduced by Act No. 51/73 which provides that proceeds of the duty of excise collected under Section 5A reduced by the cost of collection as determined by the Central Government, shall first be credited to the Consolidated Fund of India and the Central Government may, after due appropriation made by Parliament by law, pay to the Committee from out of such proceeds, such sums of money as it thinks fit for being utilised for the purposes of the Act. We are not here concerned with the duty of excise recovered as a cess under Section 5A but only with the question whether levy of the fee under Rule 21 is sustainable as a fee. That is to say, whether there is sufficient quid pro quo between the levy of the fee and the services rendered. It has not been suggested that any part of the fees levied under Rule 21 can be diverted to any other purpose. When the entire proceeds of the fee are utilised in financing the various projects undertaken by the Textiles Committee, as also the inspection of all textiles including man-made fibres and textile machinery, the appellants cannot be heard to say that there is no reasonable and sufficient correlation between the levy of the fee and the services rendered. The learned Additional Solicitor General drew our attention to the various averments made in the counter-affidavit filed on behalf of the Textiles Committee as well as the Government of India showing the extent of income from the fee levied under Rule 21 and the expenditure of Textiles Committee in each financial year. From the material on record it is amply clear that the levy of the fee under Rule 21 is not commensurate with the expenditure incurred by the Textile Committee. It is not in dispute that the Textiles Committee has over the years built up a huge infrastructure and the Central Government has spent crores of rupees to make the legislation effective and meaningful and to bring about an overall improvement in the quality and standard of the textiles including man-made fibres or artificial silk so that our country may continue to retain its rightful place in the world market in a fiercely competitive international trade.33. Under the heading Collection of Fees, the necessary averments are there showing that the entire amount of fees levied and collected under Rule 21 of the Rules is utilised in meeting the expenses of the Committee on account of pay and allowances of the officers and other employees of the Committee and for carrying out the purposes of the Act. The following is the table showing the fees realisable, fees actually realised and the total expenditure of the Inspectorate during the period from April 1, 1965 to March 31, 1971:34. On these facts, there is no doubt whatever that the entire proceeds of the amount collected by way of fee under Rule 21 of the Rules are spent in carrying on the functions of the Textiles Committee. It cannot be doubted that the activities of the Committee in furtherance of the object and purpose of the Act are to ensure the quality of all textiles whether made wholly or partly of cotton, wool, silk, artificial fibre or silk. The functions of the Committee should generally be to ensure standard qualities of textiles for internal as well as external marketing and manufacture and use of standard type of textile machinery. The grievance of the appellants and the petitioners that there is no inspection of the rayon yam and nylon yarn manufactured by them at the stage of production is belied by the fact that there is pre-shipment inspection of the fabrics manufactured from such fibres for export. The provision for the levy of fees for inspection and examination of textiles under Section 12(1)(a) of the Act or the levy of the fee under Rule 21 of the Rules cannot be challenged on the ground that there is no reasonable relationship between the levy of the fee and the services rendered by the Committee to the entire textile industry to which the appellants and the petitioners before us owning large textile mills belong. When the levy of the fee is for the benefit of the entire textile industry, there is sufficient quid pro quo between the levy recovered from the appellants and the petitioners and the services rendered to the industry as a whole. In the premises, the principles laid down by this Court in Sreeniwasa General Traders are clearly attracted. One of us (Sen, J.) speaking for the Court had observed:The traditional view that there must be actual quid pro quo for a fee has undergone a sea change in the subsequent decisions. The distinction between a tax and a fee lies primarily in the fact that a tax is levied as part of a common burden, while a fee is for payment of a specific benefit or privilege although the special advantage is secondary to the primary motive of regulation in public interest. If the element of revenue for general purpose of the State predominates, the levy becomes a tax. In regard to fees there is, and must always be, correlation between the fee collected and the service intended to be rendered. In determining whether a levy is a fee, the true test must be whether its primary and essential purpose is to render specific services to a specified area or class; it may be of no consequence that the State may ultimately and indirectly be benefited by it. The power of any legislature to levy a fee is conditioned by the fact that it must be by and large a quid pro quo for the services rendered. However, correlationship between the levy and the services rendered or expected is one of general character and not of mathematical exactitude. All that is necessary is that there should be a reasonable relationship between the levy of the fee and the services rendered. If authority is needed for this proposition, it is to be found in the several decisions of this Court drawing a distinction between a tax and a fee. See The Commissioner, Hindu Religious Endowments, Madras v. Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt [1954]1SCR1005 : H.H. Sudhundra Thirtha Swamiar v. Commissioner for Hindu Religious and Charitable Endowments, Mysore [1963] Supp 2 SCR 302 : The Hingir-Rampur Coal Co. Ltd. v. State of Orissa[1961]2SCR537 : H.H, Shri Swamiji of Shri Admar Mutt v. Commissioner Hindu Religious and Charitable Endowments Department [1980]1SCR368 : South Pharmaceuticals and Chemicals, Trichur v. State of Kerala [1982]1SCR519 and Municipal Corporation of Delhi v. Mohd. Yasin [1983]142ITR737(SC) .There is no generic difference between a tax and a free. Both are compulsory exactions of money by public authorities. Compulsion lies in the fact that payment is enforceable by law against a person in spite of his unwillingness or want of consent. A levy in the nature of a fee does not cease to be of that character merely because there is an element of compulsion or coerciveness present in it, nor is it a postulate of a fee that it must have direct relation to the actual service rendered by the authority to each individual who obtains the benefit of the service. It is now increasingly realised that merely because the collections for the services rendered or grant of a privilege or licence are taken to the consolidated fund of the State and not separately appropriated towards the expenditure for rendering the service is not by itself decisive. Presumably, the attention of the Court in the Shirur Mutt case was not drawn to Article 226 of the Constitution. The Constitution nowhere contemplates it to be an essential element of fee that it should be credited to a separate fund and not to the consolidated fund. It is also increasingly realised that the element of quid pro quo in the strict sense is not always a sine qua non for a fee. It is needless to stress that the element of quid pro quo is not necessarily absent in every tax.See also Amar Nath Om Prakash and Ors. v. State of Punjab and Ors. [1985]2SCR72 : City Corporation of Calicut v. Thachambalath Sadalinan and Ors. [1985] 2 SCR 1009 : I.T.C. Ltd. and Ors. v. State of Karnataka and Ors. (per Fazal Ali & Mukharji, JJ) (1985)ILLJ530SC and Om Parkash Agarwal and Ors. v. Giri Raj Kishori and Ors. [1987]164ITR376(SC) .