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PETITIONER: THAROO MAL

       Vs.

RESPONDENT: PURAN CHAND PANDEY & OTHERS

DATE OF JUDGMENT29/11/1977

BENCH: BEG, M. HAMEEDULLAH (CJ) BENCH: BEG, M. HAMEEDULLAH (CJ) BHAGWATI, P.N.

CITATION:  1978 AIR  306            1978 SCC  (1) 102  CITATOR INFO :  RF         1987 SC1802  (12)

ACT: U.P.   Municipalities   Act,  1916,  s.   132(1)   vis-a-vis Limitation  Act, s. 28--Section 132(4), whether confined  to objections  considered by Municipal  Board--Section  135(3), scope.

HEADNOTE: The  Municipal Board of Pilibhit passed a  resolution  under the  Municipalities Act, imposing a theatre tax of Rs.  25/- per  show.  The resolution was duty published  on  16-5-1972 and  objections were invited, but since no  objections  were received within the time prescribed u/s. 132(1) of the  Act, preliminary  proposals  were  framed and  submitted  to  the prescribed   authority,  the  Commissioner   of   Rohilkhand Division.   The  proposals were returned to  the  Board  for reconsideration on the ground that the proposed rate of  the theatre  tax appeared to be too high, and on  28-8-1972  the Board  reduced  the rate to Rs. 15/- per  show,  though  the publication  of  the  resolution  reducing  the  rates   was dispensed  with  under the proviso to s. 132(2).   On  16-9- 1972, the petitioner and some other owners of cinema houses, sent  their  objections to the initial  resolution,  but  as these  objections had not been presented  for  consideration when  the two resolutions were passed, the  Board  refrained from  submitting  them with the modified  proposals  to  the prescribed  authority u/s. 132(4) of the Act.  The  modified proposals  were  sanctioned  on  31-10-1972  and  were  duly converted  into rules, published in the Gazette dated  14-4- 1973.  The appellant move(] the High Court, but failed. Dismissing the appeal the Court, HELD  : (i) There is a distinction between the period  given for  objections u/s. 132(1) of the U.P. Municipalities  Act, and  the  period of limitation  prescribed  for  proceedings before  a court or a quasi-judicial authority which  on  the expiry  of the period, confers some rights upon parties  not proceeded against, so that the expiry of the prescribed time bars  claims against them. the procedure under s. 132(1)  is legislative and not quasi-judicial and if the objector  does not file his objections within a fortnight, he may lose  his right to object, but his objections will not be invalidated. it  is  not like s. 28 of the Limitation  Act  operating  to

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extinguish any legal right. [256E, G, H, 257A] Niranjan  Lal  Bhargava v. State of U.P.  1969  A.L.J.  295, referred to (2)Section   132(4)  covers  any  objections   whatsoever, whether  made  within  a fortnight or  beyond  a  fortnight, provided they are sent in before the matter is submitted  to the  prescribed authority.  In fact, there is  no  statutory bar against the prescribed authority itself considering  the objections which may be filed before it if the interests  of justice so require. [259B-C] (3)The  effect of the proviso to s. 132(2) added in  1964, is  that  by  dispensing with even the  publication  of  the modified  proposals,  no  such right  of  the  appellant  is violated as could be considered a condition precedent to the validity  of  the  proceedings.   Nevertheless,  if   patent injustice   has  resulted  from  an  irregularity,  in   the imposition   of   a  tax,  s.  135(3)  may  not   cure   the irregularity. [259G-H, 260A] Buland   Sugar  v.  Municipal  Board  [1965]  1   SCR   970, distinguished.

JUDGMENT: CIVIL  APPELLATE  JURISDICTION : Civil Appeal  No.  1201  of 1977. Appeal by Special Leave from the Judgment and Order dated 1- 12-76  of the High Court of Allahabad at Allahabad in  Civil Misc.  Writ No. 3090/93. 255 Y. S. Chitale and K. J. John for the Appellant. Yogeshwar   Prasad,  Rani  Arora  and  Meera  Bali  for  the Respondents. The Judgment of the court wits delivered by BEG, C. J.-The appellant before us by grant of special leave under Article 136 of the Constitution is a partner in a firm carrying  on the business of running a cinema  house  called "Jai  Tames" in the town of Pilibhit in Uttar Pradesh.   The municipal  Board of Pilibhit passed a resolution on 11th  of April,  1971,  imposing a theatre tax of Rs. 25/-  per  show under  section 128(1)(iii-a) read with sections 296 and  299 of  the Municipalities Act (hereinafter referred to  as  the Act).   The  resolution  was  duly  published  in  a   Hindi newspaper on 16 May, 1972, as required by section 94(3) read with   section  131(1)(a)  of  the  Act.   The   preliminary proposals for imposition of a tax were framed under  section 131 of the Act which reads as follows:               "131.  Framing of preliminary proposals               (1)   Where  a board desires to impose a  tax,               it   shall,  by  special   resolution,   frame               proposals specifying               (a)   the   tax,  being  one  of   the   taxes               described  in sub-section (1) of section  128,               which it desires to impose;               (b)   the  persons or class of persons  to  be               made  liable, and the description of  property               or  other  taxable thing or  circumstances  in               respect  of which they are to be made  liable,               except  where and in so far as any such  class               or description is already sufficiently defined               under clause (a) or by this Act;               (c)   the  amount or rate leviable  from  each               such person or class of persons;               (d)   any other matter referred to in  section               153,  which the State Government  requires  by

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             rule to be specified.               (2)   The board shall also prepare a draft  of               the rules               which it desires the State Government to  make               in  respect  of the matters,  referred  to  in               section 153.               (3)The  board shall, thereupon  publish  in               the  manner  prescribed  in  section  94   the               proposals framed under subsection (1) and  the               draft rules framed under sub-section (2) along               with  a  notice  in  the  form  set  forth  in               Schedule III."               Section 132 of the Act then lays down               "132.    Procedure   subsequent   to   framing               proposals               (1)Any inhabitant of the municipality  may,               within a fortnight from the publication of the               said notice, submit to                256 the board an objection in writing to all or any of the  pro- posals  framed  under the preceding section, and  the  board shall take any objection so submitted into consideration and pass orders thereon by special resolution. (2)If the board decides to modify its proposals or any  of them, it shall publish modified proposals and (if necessary) revised draft rules ’along with a notice indicating that the proposals  and  rules (if any) are in modification  of  pro- posals and rules previously published for objection : Provided  that no such publication shall be necessary  where the  modification is confined to reduction in the amount  or rate of the tax originally proposed. (3)Any  objections which may be received to  the  modified proposals  shall be dealt with in the manner  prescribed  in sub-section (1). (4)When  the board has finally settled its  proposals,  it shall submit them along with the objection (if any) made  in connection therewith to the prescribed authority." It  is evident from section 132(1) of the Act that the  time given  to the residents within the municipal limits to  file their objections is a fortnight from the publication of  the resolution,  as  required  by  section  94(1)  of  the  Act. Apparently,  a fortnight is considered a reasonable time  so that  objections may be ’submitted for consideration to  the Municipal  Board.   As was pointed out by one  of  us  (Beg, C.J.)  in  Niranjan Lai Bhargava v. State of  U.P.,(1)  with regard  to almost identically framed provisions of  sections 199 to 203 of the U.P Nagar Mahapalika Adhiniyam, 1959,  the procedure  for the imposition of the tax is legislative  and not  quasi-judicial.   Hence, there seems to us  nothing  to prevent the Municipal Board from considering any  objections which  may have been filed even after a fortnight, a  period which  may, at the most, be construed as a reasonable  limit from  the  publication of the notification after  which  the persons deemed to be notified could not reasonably  complain of  want  of opportunity to object.  The  right  to  object, however, seems to be given at the stage of proposals of  the tax  only as a concession to requirements of  fairness  even though the procedure is legislative and not quasi-judicial. There  seems  to us to be a distinction between  the  period given  for filing objections of the kind with which  we  are concerned  here and the period of limitation prescribed  for proceedings  before a Court or a  quasi-judicial  authority, which, on the expiry of the period, confers some rights upon parties  not  proceeded against so that the  expiry  of  the prescribed  time  bars claims against them.   The  procedure

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being legislative here, the objector could not complain that he did not have an opportunity to object if he did not  file his  objections  within  a  fortnight.   This  is  all  that sections 131 and 132 seem to do so far as (1)  1969 A.L.J. 295. 257 the rights of the objectors are concerned.  They do not seem to us to invalidate his objections although he may lose  his right  to object.  There is nothing here like section 28  of the Limitation Act operating to extinguish any legal rights. In the case before us, the appellant did not put forward any objections  to the proposals.  The proposals were  submitted to the Prescribed Authority, the Commissioner of  Rohilkhand Division, under section 132 (4) of the Act.  It appears that the   Commissioner  of  Rohilkhand  Division  returned   the proposals  for  reconsideration  on  the  ground  that   the proposed  rate of the theatre tax appeared to be  too  high. On the 28th of August, 1972, the Municipal Board reduced the rate to Rs. 151- per show but did not publish its resolution reducing the rate,. The  reduced rate of theatre tax was. not published  as  the proviso  to section 132(2), added by the U.P. Act No. 27  of 1964, dispenses with the need to publish the reduced rate of tax.   Nevertheless, it still gives persons who  object,  if any  do  so at all, the right to have the  objections  dealt with  in the manner prescribed in section 132(1).  The  only manner  in  which  they can be "dealt  with"  under  section 132(1) is that these objections have to be considered by the Board  before  passing  its resolution.   If,  however,  the objections  are received when the Board has,  after  waiting for  a fortnight, duly passed a final special Board as  they were not before it to be considered at all whenit  passed its  resolution.    If the proposals, as  initially  framed, hadbeen  accepted by the Prescribed Authority  no  further opportunity for objecting before the resolution imposing the tax could have arisen. The  petitioner and some other owners of cinema houses  woke up  rather late.  On 16 September, 1972, they sent in  their objections  to the imposition of such tax.          By  that time,   the   Board  had  also  reconsidered   its   initial resolution,  as a result of such advice as was given by  the Prescribed  Authority to the Board, and reduced the  theatre tax  to Rs. 151- per show.  Again, the objections could  not have  been considered even if they were to be deemed  to  be objections to the reduced rate of Rs. 151- per show  because they  were  not there at all for  consideration  before  the Board  when  it passed its special resolution  reducing  the rate on 28 August, 1972.  No doubt, its modified proposal of Rs. 151- per show was not published.  But, this was not done because   the  Board,  quite  rightly,   considered   itself protested by the clear provisions of the proviso to  section 132(2) of the Act. On 18 September, 1972, although the revised proposal to  tax cinema  shows at the rate of Rs. 151- per show was  sent  by the Municipal Board to the Prescribed Authority, yet, it did not  forward  the  objections  of  the  petitioner  to   the Prescribed  Authority.   Perhaps it did  not  forward  these objections  because they could not be taken into account  by the Board itself either before or at the time of framing the modified  proposal  of Rs. 15/- per show as  they  were  not there  at  all.   The Prescribed  Authority  sanctioned  the modified  proposal on 31 October, 1972, without taking  into account the objections of the appellant as 258 they  were  not  before  it.   But,  the  draft  rules  were

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published  on 18 November, 1972, and objections  invited  to them  within  30 days.  Objections to the draft  rules  were filed  on 15 December, 1972, and the rules  were  sanctioned under  section  134  of  the  Act  after  considering  these objections.       The tax was imposed with effect from16 April, 1973, after a gazette notification on 14 April, 1973. It  is  difficult  to understand  why,  when  the  appellant appliedfor copies of the Municipal Board resolution,  the copies were refused. A delegation of the cinema owners  went to  the Commissioner on 3 May, 1973, and was told  that  the Commissioner had not received any of the objections from the Municipal   Board  before  sanctioning  the  modified   tax. Apparently, the Municipal Board took the view that they were irrelevant  when  it did not consider  them.   It.  however, seems  to  have  overlooked the  fact  that  the  Prescribed Authority may have taken a different view. On the facts stated above, Mr. Y. S. Chitale, appearing  for the  appellant,  has  advanced  two  ingenious  arguments  : firstly, he contends that the objections, being there before the revised proposal wassent to the Prescribed Authority on 18 September, 1972, ought tohave  been  forwarded  to  the Prescribed Authority for considerationbecause they had  to be "dealt with", in the manner prescribed in section 132 (1) ;  and  secondly, that, in any case, when the  proposal  was sent,the  Board  was  bound to  forward  to  the  Prescribed Authorityany objections it had in its possession and  could not withhold them.It was urged that this part of the  duty was certainly not carried out bythe Board. As  regards  the first contention, we find it  difficult  to permitthe  appellant  to advance it here for  the  first time.  It  is not found in his writ petition.   It  was  not advanced in that form before the High Court.  It is not even found in the special leave petition in this particular form. However,  even  if  we were to allow  this  question  to  be argued, we find that the objections filed by the  petitioner on  16  September,  1972,  were  really  objections  to  the original  proposal and not to the modified proposal at  all. Section 132(3) gives a right only to actual objectors to the modified proposals to have their objections dealt with under section 132(1) of the Act.  This necessarily means that  the objections  should  be  at least before the  Board  when  it passes  the  resolution on modified proposals.   After  all, that section 132(1) indicates about the manner in which  the objections  are  be  dealt  with  is  that  they  should  be considered  before  the passing of the  special  resolution. Now, if the objections are not there at all when the initial special  resolution  is  passed or even  when  the  modified proposals  were  passed, it is impossible for the  Board  to deal with them in the manner prescribed by section 132(1) of the Act.  Since the duty to send objections could arise only subsequent to the procedure prescribed by section 132(1)  of the Act the contention that the objections should have  been sent to the Prescribed Authority to be considered because of any mandatory duty resulting from the provisions of  section 132(1)  and (3) of the Act must fail.  It may  be  mentioned that we are not 259 concerned here with the validity of any of the provisions on the  ground  of their reasonableness or otherwise  No,  such question has been argued before us.  We have, therefore,  to proceed on the assumption that the provisions of the Act are valid. So far as section 132(4) is concerned, it may be possible to so  interpret the provisions as to confine objections to  be sent  to  the Prescribed Authority to only those  which  the

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Board  took  into  consideration.   Nevertheless,  when   we examine the wide language in which section 132(4) is couched conferring  a right to object, without any  restriction,  we find it difficult to exclude the right of the petitioner  to have  his  objections  sent  to  the  Prescribed  Authority. Apparently, section 132(4) covers any objections whatsoever, whether  made  within  a fortnight or  beyond  a  fortnight, provided they are sent in before the matter is submitted  to the Prescribed Authority.  Indeed, we find no statutory  bar against  the  Prescribed Authority  itself  considering  the objections which may be filed before it if the interests  of justice  go require.  But, the question which arises  before us  is whether the non-observance by the Board of a duty  to send the appellant’s objections to the Prescribed Authority, assuming it is there, would invalidate the imposition of the modified tax.  This, we think, would depend upon whether  we interpret  provisions of section 132(4) as mandatory  or  as directory so far as submission of objections, not  submitted within sufficient time so as to be considered by the  Board, are concerned. As  we  have already observed, no provision of the  Act  has been  Challenged.   Section  1 35 (3) of the  Act  reads  as follows : .lm15               "       135.      Imposition     of      tax.-               (1)........................                (2)......................................                    (3)   A notification of the imposition of               a   tax   under  sub,section  (2)   shall   be               conclusive proof that the tax has been imposed                             in accordance with the provisions of this Act. " It  is  true that, if there is such a gross  breach  of  the rules that the proposal sanctioned could not be deemed to be "imposition of a tax" at all, section 135(3) may not bar the consideration  of  such basic infirmity in  the  proceedings which  make  them no proceedings at all in the eyes  of  the law.   This is the most that can be said on the strength  of Buland Sugar v. Municipal Board,(1) which is strongly relied upon by Mr. Chitale. Mr.  Yogeshwar Prasad, appearing on behalf of the  Municipal Board  however, pointed out that the Buland Sugar  case  was decided  before the proviso to section 132(2) was  added  in 1964.   It does appear to us that the effect of the  proviso is  that,  by dispensing with even the  publication  of  the modified  proposals,  no  such right  of  the  appellant  is violated as could be considered a condition precedent to the validity   of   the  proceedings.   Nevertheless,   if   the petitioner  could have made out a case of such injustice due to some irregularity (1)  [1965](1)S.C.R.970. 4- 1114SCI/77 260 that we should deem the imposition of the tax to be vitiated bythe  non-consideration of a vital matter, we could have taken the viewthat    section   135(3)   will    not    bar consideration of a vital  infirmity, inas    much    patent injustice has  resulted from it, in the imposition of a tax. If it could be argued that there is no imposition of the tax at allas  contemplated  by law, section 135(3)  may  not have  cured  the irregularity.  But, no such  infirmity  has been  pointed  out  to US.  The  result  is  that,  whatever irregularity  there may be in not forwarding the  objections of  the appellant to the Prescribed Authority, as the  Board should  have  done  under section 132(4)  of  the  Act,  the

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irregularity  seems  to be cured by an  application  of  the provisions  of section 135(3) of the Act as  the  Government had notified the imposition of the tax. It may perhaps also be pointed out that, if the incidence of a  tax  is  unfair,  a representation can  be  made  to  the Government  under  section  137 of the Act  even  after  the imposition.   Therefore,  if there is any  gross  injustice, which the petitioner has not been able to make out before us he  can still approach the Government for relief in case  he can make out a case for relief under section 137 of the Act. For  the reasons Oven above, we uphold the judgment  of  the Allahabad  High Court and dismiss the appeal.   However,  in the  circumstances of the case, the parties will bear  their own costs. M.R. Appeal dismissed 261