Hindustan Coca-Cola Beverage Pvt Ltd vs Sangli Miraj & Kupwad Municipal ...

4. In the Civil Appeal filed against the judgment dated 08.10.2010 in the Writ Petition No. 5510 of 2010 the appellant company is, inter alia, engaged in the manufacture of aerated beverages marketed under different brands. The products of the company are distributed from its plant located at Pirangut Taluka, Mulshi, District Pune to amongst other places like Sangli Miraj and Kupwad.

5. According to the appellant, their products are distributed and sold in returnable and reusable glass bottles. Glass bottles are stored in plastic crates. Glass bottles and crates are owned by the appellant. They are never sold to any distributor or retailer. Once the product in the glass bottles kept in crates is consumed, glass bottles along with crates are Page 2 of 20 returned to the appellant for filling after cleaning and washing them. The appellant pays octroi levied on the aerated beverages when they enter octroi limits of Municipal Corporations. The impugned bill has the effect of levying octroi separately on the glass bottles and plastic crates utilized by the appellant to pack and transport the aerated beverages manufactured by them. The aerated beverages cannot be separated from bottles and crates. The bottles and crates are neither consumed nor sold but are returned. The glass bottles and plastic crates are both reusable and durable and are repeatedly used by the appellant. Moreover, it is alleged that the cost of the glass bottles and crates is amortized and included in the retail sale price of the aerated beverages. Hence, it was suggested that Octroi cannot be levied on the value of the glass bottles and crates and the impugned bills are, therefore, illegal and arbitrary.

and a further direction was issued that if such an application is filed, the same will be considered in its proper perspective by the concerned authority and if a case is made out the refund shall be granted.

They are used a number of times by the appellant. The bottles and crates are not sold. They are not consumed. The bottles are used but again sent out and refilled. The crates are also similarly sent back.

Byelaws of the Municipalities provide for levying octroi on soft drinks. As the Municipalities were seeking to levy Octroi on the basis of gross weight not only of the beverages but also of the bottles containing the beverages which were brought within the Municipal limits, the petitioner-Company filed writ petition in the Allahabad High Court challenging the said levy. According to the petitioner-Company, the bye-laws provided for levying octroi on soft drinks but not on the Page 6 of 20 weight of bottles which contained those soft drinks. The High Court dismissed the petition. The High Court held that the bottles in which the soft drinks were carried could be said to have been used within the Municipal limits for the purpose of storing them till they were ultimately utilized by the consumers concerned. Therefore, even the weight of bottles containing these liquids could legitimately be taken into consideration by the Municipalities for imposing the octroi duty thereon.

17.Setting aside the High Court's order to the above extent, this Court permitted the petitioner-Company to lodge its claim for refund by producing evidence on the following points:

company making an application for refund, the concerned authority will consider it in its proper perspective and if a case is made out shall grant refund.

24.Needless to say, in case, the appellant is aggrieved by the valuation of the bottles and crates on the basis of which the impugned bill is issued they are at the liberty to file objections before the appropriate authority, and the appropriate authority will adjudicate the same in accordance with the law, as against which if still aggrieved, further remedy as available could be resorted to.

25.At this stage it is pertinent to mention that during the hearing, the appellant has expressed its concern about the mechanism by which the said levy could be computed and collected as according to them the present procedure is very cumbersome and unworkable at both the ends, and moreover, the same would result into incurring of huge managerial time Page 19 of 20 and administrative cost. After the present judgment was reserved for pronouncement, the appellant has also given proposals to the respondent corporation for devising a suitable and convenient mechanism. The said request on the part of the appellant requires consideration. Accordingly, the responded corporation shall consider the said proposal in accordance with law and even otherwise on their part devise a suitable, convenient and workable mechanism for levy and collection of octroi.

26.With the above said directions both the appeals are dismissed with no order as to costs.

.............................................J [Dr. Mukundakam Sharma] .............................................J [Anil R. Dave] New Delhi, July 4, 2011.