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PETITIONER: KIRPAL SINGH DUGGAL

       Vs.

RESPONDENT: MUNICIPAL BOARD, GHAZIABAD

DATE OF JUDGMENT: 26/03/1968

BENCH: SHAH, J.C. BENCH: SHAH, J.C. RAMASWAMI, V. MITTER, G.K.

CITATION:  1968 AIR 1416            1968 SCR  (3) 551  CITATOR INFO :  R          1990 SC  47  (11)  D&E        1992 SC  53  (4)  RF         1992 SC 645  (27)

ACT: U.P.  Municipalities  Act, 1916-Exemption under  s.  157(3)- Rules requiring application for refund within six months  of payment-Application  for refund beyond six  months-Suit  for recovery-Jurisdiction of Civil Court, if barred.

HEADNOTE: The  appellant  transported, between August 1953  and  March 1955 certain materials in execution of a contract to  supply goods  for use by the Government of India.   The  respondent Municipality  collected  toll while the  appellant’s  trucks were  passing  through  the  toll  barrier.   The  appellant obtained  in  June  1955 a certificate  from  the  authority concerned  that  the  goods  transported  were  "meant   for Government   work  and  had  become  the  property  of   the Government".  The appellant then applied to the Municipality for  refund  of the amount paid pursuant  to  the  exemption granted by the Government Order under s. 157(3) of the  U.P. Municipalities Act, 1916.  The respondent declined to refund the  amount.  In an action against the respondent the  trial court decreed the claim.  In appeal the Civil Judge  decreed the claim only for the amount paid after December 13.  1954. The High Court affirmed the order of the Civil Judge.   Both the Civil Judge and the High Court took the view that by the Rules framed under the Act an application for refund  within six  months from the date of actual payment is  a  condition precedent  for  refund of the toll. - Allowing  the  appeal, this Court, HELD : The Civil Judge and the High Court exalted, what were merely  matters  of  procedure which  the  Municipality  was entitled to require compliance with in granting refund, into conditions precedent for the exercise of the jurisdiction of the  Civil  Court.   The  rules  framed  by  the  Government relating to the procedure to be followed in giving effect to the exemptions on April 15, 1939, do not purport to bar  the jurisdiction  of  the Civil Court if the  procedure  is  not followed.    If  these  procedural  requirements   are   not

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fulfilled,  the Municipality may decline to refund the  toll and relegate the claimant to a suit.  It would then be  open to the party claiming a refund to seek the assistance of the Court, and to prove by evidence which is in law  admissible, that  the  goods transported by him fell  within  the  order issued under a. 157(3) of the Act. [555 B-F].

JUDGMENT: CIVIL  APPELLATE  JURISDICTION  :  Civil  Appeal  No.725  of 1965. Appeal  by special leave from the judgment and  order  dated February 3, 1964 of the Allahabad-High Court in F.A.F.O. No. 122 of 1961. Bishan Narain and Harbans Singh, for the appellant. Rameshwar Nath, for the respondent. The Judgment of the Court was delivered by Shah,  J.  Between August 1, 1953 and Match  28,  1955,  the appellant  transported 521 truck-loads of  "stone-grit"  and other 552 materials  from  Delhi  to  Muradnagar  in  execution  of  a contract to supply goods for use by the Government of India. The  trucks  of the appellant had to pass through  the  toll barrier  of the Municipality of Ghaziabad, and toll  at  the rate  of Rs. 8 per truck was collected from  the  appellant. The  appellant  obtained  a certificate  from  the  Garrison Engineer,  M.E.S., Meerut, on June 10, 1955, that the  goods transported by the appellant "were meant for Government work and  had  become  the, property  of  the  Government".   The appellant then applied on June 14, 1955, to the Municipality of Ghaziabad for refund of the amount of toll paid  pursuant to the exemption granted by Government Order under s. 157(3) of  the U.P. Municipalities Act, 1916, and the  Municipality having  declined to refund the amount, the appellant  served the  statutory notice and commenced an action  ;Against  the Municipality  in  the Court of the Munsif  at  Ghaziabad  on February  11,1956,  for a decree for Rs. 4,300.   The  trial court  decreed the claim.  In appeal, the IInd Civil  Judge, Meerut,  upheld  the claim of. the appellant  only  for  the amounts  paid  after December 13, 1954.  The High  Court  of Allahabad  affirmed  the  order of  the  Civil  Judge.   The appellant has appealed to this Court. The relevant provisions of the Act, the rules and the orders issued by the Government may first be noticed.  Under s. 128 of  them U.P. Municipalities Act, 1916, the Municipal  Board is,  subject to any general rules or special orders  of  the State Government in that behalf, competent to impose in  the whole or part of a municipality the taxes specified in  that section  and  one  of  the taxes specified  is  "a  toll  on vehicles  and other conveyances, animals, and laden  coolies entering the’ municipality".  Under,s. 157 (3)    of the Act the State Government may, by order, exempt from the  payment of a tax, or any portion of a tax, imposed under the Act any person or class of persons or any property or description of property.  Pursuant thereto the Government of U.P. issued an order  on April 15, 1939, which, insofar as it is  material, provides               "....the         Provincial         Government               are......pleased  to  issue  an  order   under               section,  157(3)  of the  U.P.  Municipalities               Act, 1916, exempting those goods which are the               property of Government or which become so sub-               sequent to their entry within a  Municipality,

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             from the payment of terminal tax or toll.               2.The  procedure  to  be  followed  in  giving               effect to the exemption sanctioned above shall               be as follows :-               ’When  goods are imported by a private  person               for  supply to Government in fulfillment of  a               contract, or otherwise intended for the use of               ’Government  a  written  intimation  to   that               effect shall be given to the officer col- 553               lecting  terminal tax/terminal toll who  would               immediately  forward  it to the  Terminal  Tax               Superintendent.   The tax/toll on goods  shall               then be paid but if subsequently they actually               become the property of Government, it shall be               refunded  on  a  certificate  of  the  officer               authorised  to receive the goods on behalf  of               Government’ The  State Government is authorized by s. 296 to make  rules consistent  with  the  Act in respect,  amongst  others,  of matters described in s. 157 "generally for the guidance of a board or any Government officer in any matter connected with the  carrying  out of the provisions of this  or  any  other enactment   -relating   to   municipalities".    The   State Government   framed   rules  relating  to   assessment   and collection  of toll in the Ghaziabad Municipality.  Rules  I and 5 are material:               "1. No person shall bring within the limits of               the  Ghaziabad Municipality any laden  vehicle               or other laden conveyances or laden animal  in               respect of which a toll is leviable, until the               toll  due in respect thereof has been paid  to               such  persons  and at such. barriers  or  such               other  places  as the board may from  time  to               time appoint.               Explanation.- . .  .  .  .  .  .  . "               "5.  When  goods  are imported  by  a  private               person for supply to Government in fulfillment               of  a contract or otherwise intended  for  the               use of Government, a written intimation to the               effect  shall  be given to  the  officer  col-               lecting that tax who would immediately forward               it to the Toll Tax Superintendent.  The tax on               goods shall then be paid, but if  subsequently               they   actually   become   the   property   of               Government,   it  shall  be  refunded   on   a               certificate  of  the  officer  authorised   to               receive the goods on behalf of Government.               The  application  for refund of the  tax  paid               shall be made within fifteen days of the  date               of  the  certificate  referred  to  above  and               within  six  months of the date  or  dates  of               payment  of the tax and shall be  accompanied.               by the original toll, receipts.               Note :--.   .   .   .   ." The Civil Judge was of the opinion that toll is  immediately payable in all cases, but where goods are for the use of the Government, it becomes refundable when the, property becomes the property of the Government, and a certificate is  issued by  the officer concerned to that effect.  He  further  held that the application for refund must be made within  fifteen days of the date- of the certi- 554 ficate and within six months of the date of payment -and  an application  for refund within six months from the  date  of

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actual payment is a condition precedent to the refund of the toll  and  .,even  though a certificate  by  the  prescribed authority  is  issued beyond six months of  actual  payment. The High Court agreed with that view. Under  tile order issued by the Government under  s.  157(3) ,of the Act the amount of toll paid by the appellant  became refundable to him.  The appellant was therefore entitled  to claim  against the Municipality that the amount  be  repaid. The  right  to  enforce that claim was a right  of  a  civil nature,  and could be enforced in a civil suit,  unless  the suit was barred by the law of limitation or the right was by reason  of  some statutory provision extinguished,  .or  the jurisdiction  of the civil court was barred expressly or  by necessary implication, or that the enforcement of the  right depended  upon the fulfillment of a condition  precedent  or upon existence of some fact collateral to the actual  matter which the Court had to try and which was not shown to exist. It was held by the Civil Judge, and rightly, that the  claim was  not barred by s. 326 .of the U.P.  Municipalities  Act, 1916, because the suit was not in respect of any act done or purported to have been done in the official capacity.  There is nothing, in the order issued by the State Government,  or any  other provision of the law, that on the expiry  of  any particular period or on the happening of a contingency,  the claim  stands extinguished.  The jurisdiction of  the  civil court to entertain a suit for refund of tax levied under  s. 128  of the Act is also -not barred by express enactment  or by necessary implication, arising out. of the provisions  of ss.  153(c), 160, 162 and 164 .of the Act.   Section  153(c) merely  provides  for framing of the  rules  regulating  the system on which refunds shall be allowed and paid.   Section 160  makes provisions for appeals relating to  taxation  and the  authorities to which the right to appeal may  be  exer- cised.   Section  162 provides for a reference to  the  High Court .where a question of liability to, or the principle of assessment  of, ,a tax arises on which the  officer  hearing the  appeal entertains reasonable doubt.  Section  164  bars the jurisdiction of civil and criminal courts in matters  of valuation  or assessment or about the liability of a  person to be assessed or taxed.  But the dispute in this case  does not  relate to valuation or assessment, or liability  to  be taxed or assessed.  When the goods in respect of which  toll was  paid  became the property of the Government,  the  toll paid by the appellant became refundable and the jurisdiction of  the civil court to entertain a claim for refund of  toll arising  by  virtue  of an order under  s.  157(3)  was  not excluded.   It was not contended either in the trial  court, the  first appellate Court or even the High Court  that  the jurisdiction  of  the civil court to entertain  a  suit  was excluded.   The  first appellate Court has in  fact  granted ,refund  of a part of the amount paid and the right  of  the civil 555 court  to  direct refund in appropriate cases has  not  been challenged in this Court. But  counsel  for the respondent contended  that  the  rules framed by the Government regarding the procedure constituted a condition precedent to the exercise of the right to  claim refund  and recourse to the civil court being  conditionally strict  compliance with the procedure prescribed  the  civil court  was  incompetent  to  decree  the  suit  unless   the condition  was fulfilled.  We are unable to agree with  that contention.   The rules framed by the Government merely  set up,   the  procedure  to  be  followed  -in  preferring   an application to the Municipality for obtaining refund of  the

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tax paid.  The Municipality is under a statutory obligation, once the procedure followed is fulfilled, to grant refund of the  toll.  The application for refund of the toll  must  be made within fifteen days from the, date of the issue of  the certificate  and within six months from the date of  payment of  the  toll.  It has to the accompanied  by  the  original receipts.    If  these  procedural  requirements   are   not fulfilled,  the Municipality may decline to refund the  toll and relegate the, claimant to a suit.  It would then be open to the party claiming a refund to seek the assistance of the court,  and to prove by evidence which is in law  admissible that  the  goods transported by him fell  within  the  order issued under s. 157(3) of the Act.  The rules framed by  the Government  relating  to  the procedure to  be  followed  in giving  effect to the exemptions on April 15, 1939,  do  not purport  to bar the jurisdiction of the civil court  if  the procedure is not followed.  In our judgment, the Civil Judge and  the  High -Court exalted what were  merely  matters  of procedure,  which the Municipality was entitled  to  require compliance   with  in  granting  refund,   into   conditions precedent  to  the  exercise of jurisdiction  of  the  civil court.   It  is impossible on a bare perusal  of  the  order issued -by the Government and the rules framed by it to give to the order and the rules that effect. The appeal is therefore allowed and the decree passed by the High  Court is set aside and the decree passed by the  trial court is restored with costs throughout. Y.P.                      Appeal allowed. p. C.I./68 556