Case: Town Municipal Council Vs. Urmilla Kothari

The facts of the case lie in a short compass and may be stated as follows:-Iron ore which is extracted from its mine heads in Hospet Taluka is brought over and stocked in Hubli Railyard by the Mysore Minerals Limited which is a Government undertaking. Having taken up the contract of transhipment of the iron ore from Hubli Railyard to Karwar and Belekeri harbours, the Mysore Minerals Limited has sublet the same to the West End Minerals and Exports Private Limited. The latter has in turn entrusted the execution of the contract to. the re- spondent which is engaged in transport business. The iron ore is accordingly lifted by the respondent in its trucks from Hubli Railyard and carried to Karwar and Belekeri harbours. The trucks of the respondent carrying the iron ore have (en route) to pass. in the course of transit through the limits of various town municipalities situate on the highway of which the appellant happens to be one, but they do not unload and reload the iron ore at any intermediary point or stop.The appellant, on the basis of a resolution passed by it on January 25, 1975, and approved by the State Government levies the aforesaid fee of Re. 1/- per truck under section 124 of the Act read with rule 26 of the Rules. The trucks of the respondent using the State highway within the municipal limits of Kalghatgi, District Dharwar are accordingly made to pay the fee for each of their trips.Feeling that the fee realised by the appellant was invalid, the respondent filed a writ petition, being writ petition No.. 6945 of 1975 in the High Court of Karnataka challenging the levy of the fee and seeking the issuance of a writ of mandamus restraining the appellant from realising the said fee.A Single Judge of the High Court upheld the fee in question and dismissed the writ petition holding that the expression importer, place of import and place of export as used in section 124 (1 ) of the Act are comprehensive enough to describe a person who merely brings the goods within the municipal limits for immediate exportation and the respondent who answered that description was bound to pay the fee. Aggrieved by this judgment and order, the respondent took the matter in appeal to a Division Bench of the High Court which allowed the appeal and issued the writ prayed for by the respondent by its judgment and order dated September 21, 1976. It is against this; judgment and order that the present appeal isthe hearing of the appeal, counsel have reiterated the contentions urged on behalf of the parties in the High Court.

Court's reasoning:
The opening words of section 124 of the Act viz. "any article or animal brought into the municipal limits for the purpose of immediate exportation" on the construction of which the up-shot of the case, depends are very important. They imply processes of importing into and exporting from the municipal limits of goods or animals and are indicative of an element of repose and rest of the goods within the municipal limits. As rightly held b y the Divi- sion Bench of the High Court, the expressions brought into and immediate exportation do not comprehend within their sweep the continuous process of transit of goods, by vehicles which merely use the State highways passing through the areas which lie within the municipal limits. In the instant case, the iron ore is carried in the trucks of the respondent which merely pass through the areas which lie within t he municipal limits and is not unloaded and reloaded at any place within the municipal area. As such, the important element of repose and rest which the words brought into the municipal limits for the purpose of immediate exportation imply is absent in the instantenunciation of law in the above case fully covers the present case. In the present case also, the iron ore which is in transit from Railyard at Hubli to Karwar and Belekeri harbours can hardly be characterised as goods brought into or exported from the municipal limits of Kalghatgi because they are neither imported into nor export ed f rom any point within the municipal limits but are merely carried across a particular stretch of territory or across a particular area with the object of being transported to its ultimatein mind the above authoritative enunciation of law, we are of opinion that as the continuity or continuous process of the carriage of iron ore is not in any way in fact broken within the municipal limits of Kalghatgi, the respondent cannot be said either to bring in or export the iron ore as contemplated by section 124 of the Act read with rule 26 of the Rules and as such is not liable to p ay the octroi or what is styled as supervision fee. A contrary interpretation would make rail borne goods passing through the Railway Stations within the limits of the municipality liable to the imposition of the fee on their arrival at these Railway Stations and departure therefrom which could not be the intention of the Legislature. The High Court was, therefore, perfectly justified in allowing the appeal and issuing the writ sought for.