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PETITIONER: PURI MUNICIPAL COUNCIL AND OTHERS

       Vs.

RESPONDENT: INDIAN TOBACCO CO. LTD.

DATE OF JUDGMENT08/11/1995

BENCH: PUNCHHI, M.M. BENCH: PUNCHHI, M.M. MANOHAR SUJATA V. (J)

CITATION:  1996 AIR  534            JT 1995 (8)    95  1995 SCALE  (6)297

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R  The  famous city  of Puri  in the  State of  Orissa,  is  a municipality under  the Orissa  Municipal  Act,  1950.  It’s limits extends  upto the  sea waters, on the side of the Bay of Bengal.  Fish and  prawn caught by fishermen from the sea have all  along been  brought within  the  municipal  limit, sometimes through the nearest octroi checkpost on payment of octroi and more often without adopting that course. The fish and prawn  are then  taken to  the market by fishermen where they  are   sold  and  bought  by  non-fishermen  for  local consumption or  for export  to other  destinations.  In  the latter course, the goods inevitably are transported and have to pass  out through  octroi checkposts. The dispute between the parties i.e. the Puri Municipal Council and its officers on the  one side  and the Indian Tobacco Company Ltd. on the other,  as   projected  before   the  High   Court  in  writ proceedings centered  around the question whether the taxing provisions of the Orissa Municipal Act and the bye-laws made thereunder, permitted  the Puri  Municipal Council to charge octroi tax  on a non-fishermen merely found in possession of fish and  prawn within  the municipal  area, or while taking them out through exist points, or octroi posts. On challenge made by  the respondent  company to  the steps  taken by the Municipal Council,  the Division  Bench of Orissa High Court has taken  the view  that the  invoked bye-law  11(2) by the Municipal  Council   speaks  of  ’evasion’  authorising  the municipality to  effect recovery  of octroi tax on detection of that  happening but that word was considered by the Bench to be  distinct from  ’non-payment of octroi duty’ the doubt about which  could arise  when the commodity is found in the municipal area  in the  possession of  someone. The straight case of  the municipality  was that  it can,  under the said bye-law,  proceed   against  the   possessors  of   fish  or prawnsincluding exporters  of these  on the  premise of non- payment of  octroi tax.  That plea has been negatived by the

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High Court by a well-reasoned judgment.      The word  expression  octri  committed  by  the  person bringing goods within municipal limits, since it is an entry tax. The person bringing the goods without payment of octroi is the  evader and  can certainly be brought within the ship of bye-law  11(2). A  person merely  in possession  of  such goods within  a municipal  area cannot be brought with ambit of bye-law  11(2) raising  a presumtion that he is an evader because he may not have caused the entry and hence be not an evader. On  the pleas of the municipality, the tax cannot be allowed to  assume the  character of  a possessory tax or an exit tax.  That would be against the text and content of the taxing provisions and their culpable part. the High Court in this fact  situation properly saw through the matter and, in our view.,  afforded appropriate  rellef to  the respondent, throwing out the specious plea of the appellant-municipality based on  the fact  that it  was not in a position to put up octroi posts  at every  conceivable point  alongside the sea shore. That  aspect is  the concern  of the municipality and not that  of the subject. If the words in the taxing statute fail, the tax must fail, without sentiment playing any role.      For the  afore reasons,  the appeal fails and is hereby dismissed. There shall be no order as to casts.