Case: Cantonment Board, Mhow, Saugor and Another Vs. M.P State Road Transport Corpn, Rewa Transport Services, Rewa

To consolidate and amend the law relating to the administration of cantonments the cantonments Act 1924 (Act 2 of 1924) was enacted in place of the earlier Cantonment Act (Act 15 of 1910 and the Cantonment Code of 1912) to bring the law relating to the Administration of Cantonments in conformity with the ordinary Municipal Law. Cantonments is defined in Section 3 of the said Act to mean any place or places in which any part of the Forces is quartered to be declared and notified in the official Gazette by the Central Government. Under Section 10 of the said Act for every Cantonment there shall be a Cantonment Board and the said Board is a body corporate having perpetual succession and a common seal with power to acquire and hold property both moveable and immovable as provided under Section 60 of the Act is a General Power of taxation which may be extracted herein Below:-60. General Power of taxation: (1) The Board may, with the previous sanction of the Central Government, impose in any cantonment any tax which under any enactment for the time being in force, may be imposed in any municipality in state wherein such cantonment is situated. (2) Any tax imposed under this section shall take effect from the date of its notification official Gazette or where any later date specified in this behalf in the notification, from such later dateThe Madhya Pradesh Motor Vehicles Taxation Act, 1947 (M.P. Act No. VI. of 19470 provide for the levy of a tax on Motor Vehicles in Madhya Pradesh. Section 3(1) the said Act entitled the Taxation Authority to levy tax on motor vehicles used or kept for use at the rate specified in the First Schedule read with sub-section (2) of section 3 of the said Act. While the Taxation Act was in force the Madhya Pradesh legislatures enacted the law relating to Municipalities and to make better provision for organisation and administration of Municipalities in Madhya Pradesh Called the Madhya Pradesh Municipalities Act, 1961 (M.P. Act No. 37 of 1961). The a foresaid municipalities Act repealed the earlier law relating to Municipalities in different parts of Madhya Pradesh, namely, the central Provinces and Berar Municipalities Act, 1922, the Madhya Bharat Municipalities Act, 1954, the Vindhy a Pradesh Municipalities Act, 1946, and the Bhopal State Municipalities Act, 1955. Section 127(1)(iii) of the said municipalities Act which has direct bearing in deciding the controversy that has arisen in these appeals may be extracted hereinafter in extenso for better appreciation of the point in issue127. Taxes which may be imposed-(1) A council may, from time to time, and subject to the provisions of this Chapter, and any general or special order which the state Government may make in this behalf, impose in the whole or in any part of the Municipality any of the following taxes, for the purposes of the Act, namely:- (iii) a tax on vehicles, boats and animals used a s aforesaid entering the limits of the Municipality but not liable to taxation under clause (ii).The Cantonment Board Saugor by Notification No. 344 dated November 24, 1973 in exercise of power under section 60 of the Cantonment act made provision for imposition of Vehicles Entry Tax at the rates specified in the said Notification. Similarly the Cantonment Board, Mhow by Notification dated 19.12.1979 imposed similar entry tax on Motor Vehicles. The Cantonment Board, Jabalpur by notification dated 6th May, 1978 also imposed the entry tax on motor Vehicles in exercise of power under section 60 of the cantonment Act. All these Notifications issued by different Cantonment Boards were challenged before the Madhya Pradesh High Court by filling writ petitions were allowed by the impugned judgments of the High Court and it was held that the Cantonment Board has no power to levy entry tax on motor vehicles so long as the prohibit ions contained in section 6 of the Taxation Act continues and accordingly notifications issued by the Cantonment Board were quashed and thus the present appeals.

Court's reasoning:
As has been stated earlier under the Taxation Act, Tax could be imposed on the Motor Vehicles which is used or Kept for use as provided in Section 3(2) of the said Act and there is no provision for imposition of tax on vehicles which is neither used nor kept for use but for mere entry into any municipal limits . When the legislatures imposed a ban on levy of tax by any local authority under section 6 of the Taxation Act what is prohibited is levy of tax which is leviable under section 3(2) of the Taxation Act. When the same legislature enacted the Municipalities to impose tax on vehicles entering the limits of the Municipality under Section 127 (1)(iii) they must be presumed to be aware of the pro visions of the Taxation Act and leviability of the tax thereunder in respect of Motor Vehicles used or kept for use. The expression `vehicle having been defined in Section 2(38) to include a bicycle, a tricycle, motor car and ever wheel conveyance which is used or capable of being used on a public street, it is not possible for us to accept the contention of Mr. Agrawal, learned counsel appearing for the respondents to interpret the same expression to mean vehicles other than the `motor vehicles. Since the Taxation Act does not provide for any imposition of tax on entry of the Motor vehicles within Municipal limits whereas the municipal Act authorises for such levy under Section 127(1)(iii) we do not find any inconsistency or repugnancy between the two provisions. In other words while under the Motor Vehicle Taxation Act a tax could be imposed on Motor Vehicles used or kept for use by the registering authority including the Municipalities under section 127(1)(iii) of the Municipalities Act. But so far as the imposition of tax motor Vehicle entering into the Municipal limits is concerned, which is provided under section 127(1)(iii), of the Municipalities Act the said provisions cannot be said to be repugnant to the special statute in respect of Motor Vehicles, namely the Motor Vehicles Taxation Act. It has been stated by this court in the case of Ashoka Marketing ltd. And another etc. etc. vs, Punjab National Bank and others etc. etc. that the principal of statutory interpretation, namely, later laws abrogate earlier contrary laws is subject to exception that a general provision does not derogate from a special one. This would mean that where a literal meaning of the general enactment covers a situation for which specific provision is made by another enactment contained in the earlier Act, it is presumed that the situation was intended to be continued to be dealt with by the specific provision rather than the later general one. in other words if the Taxation Act would have contained a provision authorising imposition of Entry Tax on Motor Vehicle than certainly the later general Act, namely the municipalities Act even if by making a provision of imposition of entry tax on Vehicles entering in to the Municipal limits would not have operated. But since the special law, namely, the Taxation Act does not have any provision authorising imposition of tax on entry of Motor Vehicles. The said provision would remain valid and would be applicable and there would be no bar for the municipality to impose entry tax on all vehicles including Motor Vehicles including Motor Vehicles for entering in to the limits of the Municipalities. This Construction being the only harmonious construction by which both the provisions remain operative it is the duty of the court adopt such construction. There is no dispute with the proposition advanced by Mr . Lekhi, learned senior counsel with regard to theory of implied repeal.This theory the learned the senior counsel advanced since the Municipalities Act did not repeal the provisions of the Motor Vehicles Taxation ActBut in view of our conclusion that there is no repugnancy between Section 3 read with Section 6 of the Motor Vehicles Taxation Act and the provisions of Section 127(1)(iii) of the Municipalities Act and both the provisions operate in two different fields the principle of implied repeal will have no application. In the connection it would be appropriate for us to notice one decision of this court in the Case of The Western India Theatres Ltd. vs. The Cantonment Board, Poona, Cantonment, where the validity of levy of entertainment tax under Entry 50 in Schedule VII of the Government of India Act. 1935 was under considerationThus considered, the tax leviable on Motor Vehicles when used or kept for use under section 3(2) of the Madhya Pradesh Motor vehicles Taxation Act is different from the tax leviable on Motor Vehicles. Entering the limits of the Municipality under Section 127(1) (iii) of the Madhya Pradesh Municipalities Act, 1961 and there is no repugnancy between the two and both the provisions can therefore operate in its own field. Since under Section 127(1)(iii) of the Madhya Pradesh Municipality Act, Municipality could levy a tax on Motor Vehicles entering the limits of the Municipality, the same could be levied by the Cantonment Board in exercise of its power under Section 60 of the Cantonments Act with the previous sanction of the Central Government . Consequently, notifications issued by the Cantonment Boards of Mhow, Jabalpur and Saugar were valid notifications issued under section 60 of the cantonments Act and imposition of tax on motor Vehicles entering into the limits of the Cantonment Boards cannot be said to be invalid or inoperative. The High court in our opinion committed error in striking down those notifications on the ground of repugnancy with this special legislation, namely, the Madhya Pradesh Motor Vehicles Taxation ActSo far as the contention of Mr. Lekhi, the learned senior counsel with regard to the proviso to Section 7 of the Taxation Act is concerned, we however, do not find any force in the same in asmuchas Section 7 deals with the grant to the local authorities and it provides that if a grant was being paid by the state Government to any such Board or Committee immediately before the commencement of the Taxation Act then the said grant shall be continued to be paid. But the Cantonment Board by virtue of the Proviso will not be entitled to receive the said grant unless it agrees not to recover any tax, toll or licence in respect of th e Motor Vehicles. In other words, Section 7 and proviso thereto deals with right of the Cantonment Board and the Municipality to receive a grant which was being paid by the state Government prior to the commencement of the Taxation Act and t he said provision has no connection with the imposition of tax on Motor Vehicle Which is governed by section 3 (2) and the bar on such imposition which is contained in Section 6 of the Taxation Act. In this view of the matter , we are unable to accept the contention of Mr. Lekhi, the learned senior counsel that conjoint reading of section 6 and 7 and its proviso would lead to the conclusion that even under the Taxation Act a Cantonment Board was entitled to impose tax on Motor Vehicles used or kept for use notwithstanding the bar under Section 6.Coming to the conclusion of the applicability of doctrine of desuetude Mr. Lekhi, the learned senior counsel strongly relied upon the decision of this Court in Municipal Corporation for City of Pune and another vs. Bharat forge Company Ltd. and other and submitted that the provisions of the Motor Vehicles Taxation Act must be held to be of disuse as no grant as provided in Section 7 of the Taxation Act has ever been made at any point of time after the enactment of the said Act in 1947. This contention is wholly unsustainable in law in asmuchas we are not concerned with the question of grant to local authorities and Cantonment Board as provided under Section 7 of the Taxation Act but we are concerned with the leviability of tax on Motor Vehicles under Section 3(2) of the Taxation Act. it is nobodys case that no tax was being levied on Motor Vehicles which is used or kep t for use under Section 3(2) of the Madhya Pradesh Motor Vehicle Taxation Act , 1947. That apart to apply the principle of desuetude it is necessary to establish that the state in question has been in disuse for long and the contrary practic e of some duration gas evolved. In other words to make the aforesaid principle applicable in the case in hand it is required to be established that the provisions of Section 3(2) of the Motor Vehicles Taxation Act has been in disuse for a long period and that the imposition of tax on entry of Motor Vehicles into the Cantonment limit has been in operation for a fairly long period. Neither of these two ingredients has been satisfied in the case in hand and therefore the aforesaid principle of desuetude is of no application to the case in hand.