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PETITIONER: NAGAR MAHAPALIKA, MEERUT

       Vs.

RESPONDENT: M/S.PREM NATH MONGA BOTTLERSPVT.LTD. AND ANR.

DATE OF JUDGMENT:       18/03/1996

BENCH: JEEVAN REDDY, B.P. (J) BENCH: JEEVAN REDDY, B.P. (J) AHMAD SAGHIR S. (J)

CITATION:  1996 AIR 1302            JT 1996 (3)   389  1996 SCALE  (2)816

ACT:

HEADNOTE:

JUDGMENT:                       J U D G M E N T B.P.JEEVAN REDDY,J.      This appeal  is  preferred  by  the  Nagar  Mahapalika, Meerut against the judgment of a learned Single Judge of the Allahabad High  Court dismissing  the writ petition filed by it. The matter arises under the Uttar Pradesh Municipalities Act, 1960 [the Act] and pertains to levy of octroi.      The respondent is a company which runs a bottling plant in Meerut.  Inter alia,  it bottles a drink known as "Double Seven" under  a franchise agreement with M/s.Modern Bakeries Limited, New  Delhi, a  Government of lndia Undertaking. The bottles are  sent out  of the  Meerut local  area to various dealere for  sale. According  to the respondent, the sale is subject to  the condition  that after the drink is consumed, the bottle  is to  be returned  to it.  Accordingly, bottles were being  returned to  it from time to time. The appellant proposed to  levy octroi on the entry of such bottles un the ground that  the said  bottles were  being brought  into the Meerut local  area for the purpose of "use", i.e., for being filled with  the drint  "Double  Seven".  According  to  the appellant-corporation, the  empty  bottles  being  "articies made of  glass" within  the meaning  of  Entry  138  of  the Notification dated  january 4, 1975 were subject to the levy of entry  tax. The  respondent  resisted  the  levy  on  two grounds, viz.,  (1) that the entry of empty bottles into the local area  for the  purpose of  being filled  with the said drlnk and  meant for  being taken  out for  sale outside the tocal area  does not  amount to  entry of  goods  for  "use" within the  meaning of  the expression "consumption", use or sale therein"  which alone  attracts  the  levy  within  the meaning of  Section 128(1)(viii)  of the Act and (2) that in any event,  the  said  empty  bottles  are  covered  by  the exemption clause  contained in  the said notification and in particular by  Entry 13  thereof.  Both  the  contenta  were rejected by  the appellant whereupon the respondent filed an

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appeal before  the learned  District Juage under Section 472 of the Act. The learned District Judge upheld the contention of the  appellant, which  led the  appellant-corporation  to approach the  High Court by way of a writ petition. The High Court did not go into first of the two contentions mentioned above. lt  dismieeed the  writ petition upholding the second contention urged by the respondent.      The Notification dated January 4, 1975 appears to be in two parts.  The first  part mentions the articles subject to entry tax. They are as many as 190 entries [according to the copy placed  before us.]. The second part contains a list of articles which are exempt from octroi and this part contains 37 entries.  Entry 40  of the  taxable  items  (first  part) mentions "aerated  water, cold  drinks of  all kinds"  among other goods. The entry reads:      "Lime juice  and lime cordid gas of      all kinds  and aerated  water, cold      drinks of  all kinds  and sweetened      milk."      Entry 13 of the second part (exempted articles) reads:      "Empty  milk  cans,  mineral  water      bottles,  kerosine   oil  tins  and      drums, gas  cylinders, wine bottles      and  drums   and  gunny   bags   if      imported for  being  refilled  with      the commodities  for which they are      in ordinary use."      The  contention   of  the  respondent  which  has  been accepted by  the High Court is that the words "mineral water bottles" in  Entry 13 of the Exempted Articles are the empty bottles of  "aerated water  (and) cold  drinks of all kinds" mentioned in Entry 40 of the Taxable Articles. It is pointed out that  "mineral water" is not found in any of the taxable entries and  that the  said expression  was contemplated  as referring to aerated waters and cold drinks. It is submitted that in  the year  1975, when  the  said  notification  said issued, mineral water as is now understood was not in use at all. On  the other  hand, the  contention of  the appellant- corporation was  tnat "mineral  water"  and  "aerated  water (and) cold drinks of all kinds" are two distinct articles as understood sn common parlance and in the commercial world by people who  deal in them. The submission is that the mineral water can  never be  understood as comprising either aerated water or cold drinks and, therefore, the bottles in question are not exempted under Entry 13 of the Exempled Articles. It is also  brought to  our notice  by learned counsel for both the parties  that since  1987,  the  relevant  entries  have undergone a  change and  that this  question would not arise after the year 1987.      While  we  agree  with  the  learned  counsel  for  the appellant-corporation  that  "mineral  water"  and  "aerated water/cold drinks"  are  different  and  distinct  articles, whether in common parlance or in the commercial parlance, we are not  inclined to  interfere in the matter in view of the following findings recorded by the learned Single Judge:      "In the list of exemptions drawn up      in the  year  1956  at  item  No.15      there was an entry corresponding to      entry 13 which runs as follows:           ’Empty  milk   cans,   mineral           water  bottles,  kerosine  oil           tins and  drums, gas cylinder,           wine  bottles  and  drums  and           gunny  bags  if  imported  for           being   refilled    with   the

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         commodities for which they are           in ordinary use.’           Judicial notice  can be  taken      of  the  fact  that  there  are  no      natural  waters  found  within  the      Meerut Corporation limits. When the      entry of  mineral  water  was  made      mineral  water   was  not  prepared      artificially in the year 1956. Thus      the above  entry in 1956 also could      not have contemplated mineral water      as  the  learned  counsel  for  the      cotemporation would  have the court      understand   the   term.   In   the      circumstances,     the      meaning      suggested by  the counsel  for  the      Company that  mineral water be held      to        include        efforscent      (effervescent?) drinks,  should  be      accepted.           The  Corporation  admits  that      Double  Seven   prepared   by   the      Company is  an aerated  drink which      means that  it is  an    efforscent      (effervescent?) drinks and it would      be a mineral water.           Thus the mineral water bottled      by the  Company  would  be  taxable      under Item  138 of the VII Schedule      and it  can only   escape octroi if      it is  shown that it is to be found      in the  list of exempted articles I      hold that  the empty  Double  Seven      bottles being  bottled  by  mineral      water are  exempted under  entry 15      of  the   list  of  exemption  from      octroi."      The decision  of the High Court was rendered on January 13, 1983.  lt may  be noted  that the learned District Judge was also  of the  same opinion.  We are  inclined to presume that the  High Court  and the  learned District  Judge  were aware of  the factual situation obtaining in that State both in 1956  and in  1975 aHd  that at this distance of time, it would not  be proper  and advisable  to interfere with their upinion. They have pointed out that the said notification of 1975 was preceded by a notification of 1956 and that in 1956 mineral water  as we  know today was not known in commercial circles and,  therefore,  when  the  notification  used  the expression "mineral  water", it  meant aerated  water or the cold drinks.  This course we are adopting also because it is stated that after 1987 this question would not arise.      In view  of the above, it is not necessary for us to go into the question whether the entry of empty bottles for the purpose of  being  filled  with  cold  drinks/aerated  water constitutes "use"  within  the  meaning  of  the  expression "consumption, use  or sale  therein"  occurring  in  Section 128(1)(viii) of  the Act  or for  that matter in Entry 52 of List-II of  the Seventh  Schedule  to  the  Constitution  of India.      The  appeal   is  accordingly   dismissed  but  in  the circumstances with no order as to costs.