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PETITIONER: UNION OF INDIA & ORS.

       Vs.

RESPONDENT: R. C. JAIN & ORS.

DATE OF JUDGMENT17/02/1981

BENCH: ISLAM, BAHARUL (J) BENCH: ISLAM, BAHARUL (J) PATHAK, R.S. REDDY, O. CHINNAPPA (J)

CITATION:  1981 AIR  951            1981 SCR  (2) 854  1981 SCC  (2) 308        1981 SCALE  (1)320

ACT:      Payment  of   Bonus  Act,  1965-Section  32(iv)-Whether applicable  to   Delhi   Development   Aothority-Tests   for determining whether a body is a local authority.

HEADNOTE:      Section 32(iv)  of the  Payment of  Bonus Act  provides that nothing in the Act shall apply to employees employed by an establishment  engaged in  any industry  carried on by or under  the  authority  of  any  department  of  the  Central Government or State Government or a local authority.      The  Delhi  Development  Authority,  a  statutory  body created under  the  Delhi  Development  Act,  1957  for  the development of  Delhi according  to plan,  paid bonus to its employees for  a period  of ten years upto the year 1973-74, but later discontinued payment of bonus on the advice of the Ministry of law.      The employees’  petition impugning  the action  of  the Authority in  stop ping  the payment of bonus was allowed by the High Court.      On the question whether the Delhi Development Authority is a  "local authority"  and whether  the provisions  of the Payment of Bonus Act are attracted:      Allowing the appeal, ^      HELD: The  Delhi Development  Authority is endowed with all the  usual attributes  and characteristics  of a  ’local authority’ and  therefore the  provisions of  the Payment of Bonus Act are not attracted. [865 A]      The expression  ’local authority’ is not defined in the Payment of  Bonus Act. The General Clauses Act defines it to mean  a  municipal  committee  or  other  authority  legally entitled to  or entrusted by the Government with the control or management  of a  municipal or  local fund.  It is  not a sound rule  of interpretation to import the definition of an expression in one Act into another. The definition of ’Local Fund’ in  the Fundamental Rules, Treasury Code and elsewhere cannot be imported into the definition of Local Authority in the General  Clauses Act and thus into the Delhi Development Act. An authority, in order to be a local authority, must be of like  nature and  character as a municipal committee etc.

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possessing among others many, if not all, of the distinctive attributes and  characteristics of a municipal committee. It must possess  one essential  feature,  namely,  that  it  is legally entitled  to or entrusted by the Government with the control and management of a municipal or local fund. [857 B- H]       The  distinctive attributes  and characteristics  of a local authority are:      (i)  It   must  have  separate  legal  existence  as  a corporate body;  (ii) it  must not  be a  mere  governmental agency but  a legally  independent  entity;  (iii)  it  must function in  a defined  area and  must ordinarily be elected wholly or partly, 855 directly or  indirectly by the inhabitants of the area; (iv) it must  enjoy a  certain degree  of autonomy, which, though not complete,  must be  appreciable; (v)  the  statute  must entrust the  authority with  such governmental functions and duties as  are usually  entrusted to  a municipal  body  for providing such  amenities, as health and education services, water and  sewerage, town  planning and  development, roads, markets, transportation  etc. to  the inhabitants;  (vi)  it must have  power to  raise funds  in the  furtherance of its activities and  the fulfillment of the projects entrusted to it by  levying takes, rates, charges, fees etc. all of which may be  in addition  to the  moneys provided  by Government. What is  essential is that the control and management of the fund must vest in the authority.      Municipal  Corporation   of  Delhi   v.  Birla  Cotton, Spinning   Weaving Mills  Delhi & Anr. [1968] 3 S.C.R. 251 @ 288 and  Valjibhai Muljibhai Soneji and Anr. v. The State of Bombay (Now  Gujarat) &  Ors. [1964]  3 S.C.R. 868, referred to.      The Delhi Development Authority is a body corporate. It consists of  a chairman,  vice chairman and a certain number of  official   members  and  non-official  members  who  are representatives of  the Municipal  Corporation Delhi  to  be elected by the Councillors and the aldermen of the Municipal Corporation and  three representatives  of the  Metropolitan Council to be elected by that Council. The object with which the Authority  is established  is "to promote and secure the development of  Delhi according  to plan" in accordance with the provisions of the Act. [859 D-F]      The Authority  is required  to maintain  its  own  Fund which was  not a Consolidated Fund or a separate Development Fund but  is the  Fund of the Development Authority. To this Fund are  to be  credited all  the moneys  received from the Central Government  by way  of grants,  loans,  advances  or otherwise;  all   moneys  received   by  way   of  loans  of debentures; all  fees and charges received by the Authority, all moneys  received from  the disposal  of lands, buildings and other  properties, all  moneys received  by way of rents and profits  or in any other manner. The fund is required to be applied  towards meeting  the expenses  incurred  by  the Authority in  the administration of the Act and for no other purposes. The Act empowers the Authority to impose penalties on persons  for undertaking  or carrying  out development in contravention of  the  master  plan  or  without  permission approval  or  sanction  required  to  be  given  l?  by  the Authority. [860 E-G]      An equally  important feature  with which the Authority is clothed is its power to make regulations-a power which is analogous to the power given to municipalities to frame bye- laws. [862 G]      The salient  features of  the Act  show that  the Delhi

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Development  Authority   is  constituted  for  the  specific purpose  of   planned  development   of  Delhi  which  is  a governmental  function  ordinarily  entrusted  to  municipal bodies. It  has an  element of popular representation though some of  the members  are indirectly  elected. It  enjoys  a considerable degree of autonomy within the bounds prescribed by the  Act. The  fact that some supervision is exercised by the Central  Government does  not detract  from the autonomy because the  supervision exercised  is the usual supervisory power  which   every   State   Government   exercises   over municipalities, District Boards etc. [863 A-D]      The term "taxation" used with reference to the power of a local  authority to raise funds is to be understood not in any fine and narrow sense to include 856 only compulsory  exactions but  in a  broad generic sense to include fees levied essentially for services rendered. Today the distinction  between a  tax and  a fee his withered away both  being  compulsory  exactions  of  money  by  a  public authority. The  crucial test  is to  see whether  the public authority is  authorised by  statute to  make  a  compulsory extension of  money and  not to  see whether  the  money  so exacted is  to be utilised for specific or general purposes. [863 G-H]      There is  no valid  reason to  hold that the betterment charge which  the Authority  can impose  upon an  owner of a property in  respect of  the increase  in the  value of  the property is a fee and not a tax. The charge is not levied on the  basis   of  the  increase  in  the  value  of  property consequent on the development of the area. In other words it is a  charge on  the accrued  capital gain which may bear no proportion whatsoever to the cost of development. [864 E]      The fact  that the  Delhi  Development  Act  refers  in several sections  to  "local  authority  concerned"  meaning thereby the  ordinary local  authority (as  for example  the Delhi  Municipal   Corporation)  functioning   in  the  area discharging   a   multiplicity   of   civic   functions   as distinguished from  the Delhi  Development Authority,  which performs one of the several functions that a local authority performs,  is   no  ground   for  holding   that  The  Delhi Development  Authority   is  not   a  local  authority.  The Authority is  endowed with  all  the  usual  attributes  and characteristics of a local authority. [864 H]      Nor does the fact that other Municipal Acts provide for the   reconstitution   of   a   dissolved   or   superseeded municipality  while  the  Delhi  Development  Act  does  not provide for  such reconstitution  of the  Authority after it fulfills its assigned functions make it any the less a local authority. By  the very  nature of  the work entrusted to it its life  is transient;  when the  work is  accomplished and there  is   no  need  for  its  continued  existence  it  is dissolved. It  is by  what it  is during its life and not by what its  shape would be after it has performed its assigned functions that it can be determined whether the authority is a local authority as defined in the General Clauses Act [865 B-D]

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil Appeal No. 3351 of 1979.      Appeal by  Special Leave  from the  Judgment and  Order dated 27-2-1979  of the  Delhi High  Court in Civil Writ No. 1139/78.

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    Abdul Khader,  S. P.  Nayar and  Miss A. Subhashini for the Appellant.      P. R. Mirdul and P. N. Gupta for Respondents 1-5.      The Judgment of the Court was delivered by      CHINNAPPA REDDY,  J.-The question  for consideration in this appeal  is whether the Delhi Development Authority is a ’local Authority’  whose employees  are  taken  out  of  the purview of  the Payment of Bonus Act 1965, by Sec. 32(iv) of that Act,  which provides  that I  nothing in  the Act shall apply to  employees employed  by an establishment engaged in any industry  carried on  by or  under the  authority of any Department of the Central Government or State Government or 857 a Local Authority. It appears that for about ten years prior to 197374  bonus was  paid to  the employees  of  the  Delhi Development Authority  but it  was stopped thereafter on the advice of  the Ministry of Law. The employees questioned the stoppage of  the payment  of  bonus  by  filing  Civil  Writ Petition No. 1139/79 in the Delhi High Court. The High Court allowed the  Writ Petition  and the  Union of  India and the Delhi Development  Authority  have  preferred  this  appeal, after obtaining  special leave  of this Court under Art. 136 of the Constitution. The expression ’Local Authority’ is not defined in  the payment  of Bonus  Act. One must, therefore, turn to  the General Clauses Act to ascertain the meaning of the expression. S.3(31) defines Local Authority as follows:           "Local Authority shall mean a Municipal Committee,      District Board,  Body of  Port Commissioners  or  other      authority legally  entitled to,  or  entrusted  by  the      Government  with   the  control   or  management  of  a      municipal or local fund".      ’Local Fund’  is  again  not  defined  in  the  General Clauses Act.  Though the expression appears to have received treatment in the Fundamental Rules and the Treasury Code, we refrain  from   borrowing  the  meaning  attributed  to  the expression in  those rules  as it  is not  a sound  rule  of interpretation to  seek the meaning of words used in an Act, in the  definition clause  of other statutes. The definition of an  expression in  one Act  must  not  be  imported  into another. "It  would be  a new  terror in the construction of Acts of Parliament if we were required to limit a word to an unnatural  sense   because  in   some  Act   which  is   not incorporated or  referred to such an interpretation is given to it for the purposes of that Act alone" (per Loreburn L.C. in Macbeth  v. Chislett. For the same reason we refrain from borrowing  upon  the  definition  of  ’Local  Authority’  in enactments such  as the Cattle Trespass Act 1871 etc. as the High Court has done.      Let  us,   therefore,  concentrate   and  confine   our attention and enquiry to the definition of ’Local Authority’ in Sec.3(3) of the General Clauses Act. A proper and careful scrutiny of  the language  of  Sec.3(31)  suggests  that  an authority in  order to be a local Authority, must be of like nature and  character as  a  Municipal  Committee,  District Board or  Body of Port Commissioners, possessing, therefore, many,  if   not  all,  of  the  distinctive  attributes  and characteristics of a Municipal Committee, District Board, or Body of  Port Commissioners,  but, possessing  one essential feature, namely, that it is legally entitled to or entrusted by the  Government with,  the control  and management.  Of a municipal or  local fund.  What  then  are  the  distinctive attributes 858 and characteristics,  all  or  many  of  which  a  Municipal Committee, District  Board or  Body  of  Port  Commissioners

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shares  with   any  other   local  authority?   First,   the authorities must  have separate legal existence as Corporate bodies. They must not be mere Governmental agencies but must be legally independent entities. Next, they must function in a defined  area  and  must  ordinarily,  wholly  or  partly, directly or indirectly, be elected by the inhabitants of the area. Next,  they must  enjoy a  certain degree of autonomy, with freedom  to decide  for themselves  questions of policy affecting the  area administered  by them.  The autonomy may not be  complete and  the degree  of the dependence may vary considerably but,  an appreciable  measure of autonomy there must be.  Next, they  must be entrusted by Statute with such Governmental functions  and duties  as are usually entrusted to municipal  bodies, such as those connected with providing amenities to  the inhabitants  of the  locality, like health and education  services, water  and sewerage,  town planning and  development,  roads,  markets,  transportation,  social welfare services  etc. etc. Broadly we may say that they may be entrusted  with  the  performance  of  civic  duties  and functions which  would otherwise  be Governmental duties and functions. Finally,  they must have the power to raise funds for the  furtherance of their activities and the fulfillment of their projects by levying taxes, rates, charges, or fees. This may  be in addition to moneys provided by Government or obtained by  borrowing or  otherwise. What  is essential  is that control  or management  of the  fund must  vest in  the authority.      In Municipal  Corporation of  Delhi  v.  Birla  Cotton, Spinning &  Weaving Mills  Delhi &  Anr., Hidayatullah,  J., described some  of the  attributes of  local bodies  in this manner:           "Local  bodies   are   subordinate   branches   of      governmental activity. They are democratic institutions      managed by  the representatives  of  the  people.  They      function for  public purposes  and take  away a part of      the  government   affairs  in  local  areas.  They  are      political sub  divisions and  agencies which exercise a      part of  State functions. As they ale intended to carry      on local  self-government the  power of  taxation is  a      necessary adjunct  to their other powers. They function      under the supervision of the Government".      In Valjibhai  Muljibhai Soneji and Anr. v. The State of Bombay (Now  Gujarat) &  Ors. one  of the  questions was -11 whether the  State Trading Corporation was a local Authority as 859 defined by  Sec. 3(31)  of the General Clauses Act, 1897. It was held  A that it was not, because it was not an authority legally entitled  to or  entrusted by  the Government  with, control or  management of a local fund. It was observed that though the  Corporation was  furnished  with  funds  by  the Government for  commencing its  business that would not make the funds of the Corporation ’local funds’.      Keeping in  mind what  we have  said above,  we may now take a close look at the provisions of the Delhi Development Act. The  Delhi Development Act, 1957, is ’an Act to provide for the  development of  Delhi according  to  plan  and  for matters ancillary  thereto’. The act extends to the whole of the  Union   Territory   of   Delhi.   Sec.   2(d)   defines "development" as  meaning, with  its grammatical  variations "the carrying  out of building, engineering, mining or other operations in,  on, over  or under land or the making of any material  change  in  any  building  or  land  and  includes redevelopment’.’ Sec.  3 empowers  the Central Government to constitute an  authority to  be called the Delhi Development

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Authority. The  Authority is  to be  a body corporate having perpetual succession  and a  common  seal,  with  the  usual corporate attributes.  The authority  is  to  consist  of  a chairman, a  Vice Chairman  and a certain number of official and nonofficial  members. The  non-official members  are  to include two  representatives of the Municipal Corporation of Delhi to  be elected  by the Councillors and aldermen of the Municipal  Corporation   from  among  themselves  and  three representatives of  the Metropolitan  Council for  the Union Territory of  Delhi to  be elected  by the  members  of  the Metropolitan Council  from among  themselves. The objects of the authority  as set  out in  Sec. 6  are "to  promote  and secure the  development of  Delhi according to plan" and for that purpose to "have the power to acquire, hold and dispose Of land  and other  property", and  "to carry  out building, engineering, mining  and other  operations, to execute works in connection with supply of water and electricity, disposal of sewage  and other services and amenities and generally to do anything  necessary or  expedient for  purposes  of  such development and  for  purposes  incidental  thereto".  Sec.7 requires the  Authority to  carry out a civic survey of, and prepare a  master plan  for, Delhi.  The master  plan is  to define various zones into which Delhi may be divided for the purposes of development and indicate the manner in which the land in  each zone  is proposed  to be  used (whether by the carrying out  thereon of  development or  otherwise) and the stages by  which any  such development shall be carried out. The master  plan may also provide for any other matter which is necessary  for the  proper development  of  Delhi.  Sec.8 provides for  the preparation of zonal development plans and Sec.8(2) prescribes what a zonal deve- 860 lopment plan  may contain or specify. Sec.9 provides for the submission of  all plans  to the  Central Government  by the Authority  for   approval.  Sec.  12  empowers  the  Central Government to declare any area in Delhi to be a ’development area’ for  the purposes of the Act. It further provides that after the  commencement of  the Act  no development  of land shall be  undertaken or  carried out, without the permission of the  Authority, if  the area  is a  development area, and without the  approval or  sanction of  the  local  authority concerned if  the area  is an  area other than a development area. Sec.13  prescribes the  procedure to  be followed.  IT provides for  a fee  (to be  prescribed  by  the  Rules)  to accompany every  application to obtain permission under Sec. 12. Sec.  15 empowers  the Central Government to acquire any land which is required for the purpose of development or for any other  purpose under  the Act.  After acquiring the land the  Central   Government  may  transfer  the  land  to  the Authority or any local authority on payment by the Authority or the local authority of the compensation awarded under the Land Acquisition  Act and  all the  charges incurred  by the Government. Thereafter,  subject to  any directions given by the Central Government the Authority or, as the case may be, the local authority concerned may dispose of the land, after or without  undertaking  or  carrying  out  any  development thereon, to  such persons,  in such  manner any  subject  to such‘ terms  and conditions  as it  considers expedient  for securing the development of Delhi according to plan. Sec. 22 authorises the  Central Government  to place at the disposal of the  Authority all or any developed and undeveloped lands in Delhi  vested in the Union for the purpose of development in accordance  with the  provisions  of  the  Act.  Sec.  23 obliges the  Authority to  have and maintain its own fund to which are to be credited-

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    "(a) all  moneys received  by the  Authority  from  the           Central  Government   by  way  of  grants,  loans,           advances or otherwise:      (aa) all  moneys received by the Authority from sources           other than  the Central Government by way of loans           or debentures:       (b)  all fees  and charges  received by  the Authority           under this Act;       (c)  all moneys  received by  the Authority  from  the           disposal of lands, buildings and other properties,           movable and Immovable; and       (d)  all moneys  received by  the Authority  by way of           rents and  profits or  in any other manner or from           any other source." 861      The fund  is required  by S.23(2) to be applied towards meeting the  expenses  incurred  by  the  Authority  in  the administration of the Act and for no other purposes. Sec. 24 enjoins a  duty on  the authority  to prepare  a  budget  in respect of  the financial  year  next  ensuing  showing  the estimated receipts and expenditure. Copies of the budget are to be  forwarded to the Central Government. Sec. 25 requires the accounts  of the Authority to be audited annually by the Comptroller and  Auditor General  of India. Sec. 26 requires the Authority  to prepare  a report  of its  activities  and submit the  same to the Central Government. Sec. 27 provides for the constitution of pension and Provident Funds. Sec. 28 empowers the authority to authorise any person to enter into or upon  any land  or building with or without assistance of workmen for  the purposes  specified in the Section. Sec. 29 provides for  penalties for  persons undertaking or carrying out development in contravention of the master plan or zonal development plan or without permission, approval or sanction required by  Sec. 12.  Sec. 30 provides for the making of an order of demolition of a building where development has been commenced or  completed in contravention of the master plan, zonal plans or the permission, approval or sanction referred to in  Sec. 12.  Sec. 31  enables the  Authority to  make an order  requiring   development  to   be  discontinued  where development has  been  commenced  in  contravention  of  the master plan  or zonal  development plan or without obtaining permission, approval  or sanction  as required  by Sec.  12. Sec. 33  provides that all fines realised in connection with prosecutions under  the Act  shall be  paid to the Authority or, as  the case may be, the local authority concerned. Sec. 36 empowers  the Authority  to require  the local  authority within whose  local limits  an area  has been  developed  to assume responsibility for the maintenance of amenities which have been  provided in the area by the Authority and for the provision of  the amenities  which have not been provided by the Authority.  Sec. 37  empowers the Authority to levy upon the owner  of a  property or  any person  having an interest therein a  betterment charge  in respect  of the increase in value of  the property  as a  consequence of any development having been  executed by  the Authority  in any  development area  or   as  a  consequence  of  any  area  other  than  a development area  having been  benefited by the development, Sec. 38  provides for the assessment of betterment charge by the Authority  and Sec.  39 provides  for the  settlement of betterment charges  by Arbitrators  to be  appointed by  the Central Government. Sec.40(2) authorises the recovery of any arrear of  betterment charge  as an  arrear of land revenue. Sec.  40A  further  provides  that  any  money  due  to  the Authority on  account  of  fees  or  charges,  or  from  the disposal of lands, buildings or other properties

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862 to be recovered by the Authority as arrears of land revenue. Sec. 41  obliges the  Authority to carry out such directions as may  be issued  to it  from time  to time  by the Central Government.  Sec.  42  requires  the  Authority  to  furnish reports,  returns  and  other  information  to  the  Central Government as  may be  required from  time to  time. Sec. 46 provides for  the  authentication  of  permissions,  orders, decisions, notices  and other  documents by the Secretary or any other  officer  authorised  by  the  Authority  in  that behalf. Sec.  47 declares every member and every officer and other employee  of the  Authority to  be  a  public  servant within the meaning of Sec. 21 of the Indian Penal Code. Sec. 52 enables  the Authority  to delegate any power exercisable by it  under the Act except the power to make regulations to such officer  or local  Authority as may be mentioned in the notification. Sec.  56 empowers  the Central  Government  to make rules  and Sec.  57 enables  the  Authority,  with  the previous  approval   of  the   Central  Government  to  make regulations consistent  with the  Act  and  the  rules  made thereunder to  carry out the purposes of the Act. Every rule and every  regulation made  under the  Act is required to be laid before  each House  of Parliament  by Sec.  58. Sec. 59 empowers the Central Government to dissolve the authority if it is  satisfied that  the purposes  for which the authority was established  have been  substantially achieved  so as to render unnecessary its continued existence.      We  see   that  the   Delhi  Development  Authority  is constituted for  the specific purpose of ’the development of Delhi according  to plan’. Planned development of towns is a Governmental function  which is  traditionally entrusted  by the various  Municipal Acts in different States to municipal bodies. With  growing specialisation,  along with the growth of titanic  metropolitan complexes,  legislatures have  felt the need  for the  creation  of  separate  town-planning  or development authorities  for individual  cities.  The  Delhi Development Authority  is one such. It is thus an authority, to which  is entrusted  by Statute  a Governmental  function ordinarily  entrusted  to  municipal  bodies.  An  important feature of  the entrustment  of Governmental function is the power given  to the Authority to make regulations (which are required to  be laid  before Parliament).  The power to make regulation is  analogous  to  the  power  usually  given  to municipalities to frame bye-laws.      The activities  of the  Authority are  limited  to  the local area  of the  Union Territory of Delhi. The High Court appears to have assumed that the Delhi Development Authority has extra-territorial  powers extending  to peripheral areas in the  adjoining States.  There is  no basis in the Statute for the assumption made by the High Court. 863      There is  then an  element of popular representation in the constitution  of the  Authority. Representatives  of the inhabitants of  the locality,  three elected  from among the members of  the Delhi  Municipal Corporation and two elected from among  the members  of the  Delhi Metropolitan Council, figure among its members.      What of  autonomy? The  Master Plan and the Zonal plans prepared by the Authority have to be approved by the Central Government, the  budget has  to be  forwarded to the Central Government, annual  returns have  to  be  submitted  to  the Government and  the directions  that the  Central Government may give  have to  be carried  out. But within these bounds, the Authority  enjoys a  considerable degree of autonomy, as is seen  from the summary of the provisions of the Act which

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has been set out by us. The powers of the Central Government over  the   Delhi  Development   Authority  are   the  usual supervisory powers  which every  State Government  exercises over municipalities,  district boards  etc. Such  powers  of supervision do not make the municipalities disautonomous and mere satellites.      We finally  come to  the important question whether the legislature  has   vested  any  power  of  taxation  in  the Authority.      One of  the submissions  of the learned counsel for the respondent was  that the  fund of the Authority, required to be maintained  by Sec.  23 of the Delhi Development Act, was not a  local fund  as no part of it flowed directly from any taxing power  vested in the Delhi Development Authority. The submission  of   the  learned  counsel  was  that  the  fees collected under  Sec. 12  of the  Act and the charges levied under Sec.  37 of the Act did not part-take the character of tax but  were mere  fees which were the quid pro quo for the services which  were required  to be  performed by the Delhi Development Authority  under the  Act. We  were referred  to Hingir-Rampur Coal  Co. Ltd. & Ors. v. The State of Orissa & Ors. We  are unable  to agree  with the  submission made  on behalf of  the respondents.  In the  first place  when it is said that  one of the attributes of a local authority is the power to  raise funds by the method of taxation, taxation is to be  understood not  in any  fine and  narrow sense  as to include only those compulsory exactions of money imposed for public purpose and requiring no consideration to sustain it, but in  a broad generic sense as to also include fees levied essentially for services rendered. It is now well recognised that there is no generic difference between a tax and a fee; both are  compulsory exactions of money by public authority. In deciding  the question  whether an  authority is  a local authority, our  concern is  only to  find  out  whether  the public 864 authority is  authorised by  Statute to  make  a  compulsory exaction of  money and not with the further question whether the money  so exacted  is to  be utilised  for  specific  or general purposes.  In the second place the Delhi Development Authority is constituted for the sole purpose of the planned development of  Delhi and  no other  purpose and  there is a merger, as  it were,  of specific  and general purposes. The statutory situation is such that the distinction between tax and fee  has withered  away. In  the third  place we  see no reason to  hold that the charge contemplated by Sec. 37 is a fee and  not a  tax. The  case cited: The Hingir-Rampur Coal Co. Ltd.  & Ors.  v. The  State of  Orissa &  Ors.,  has  no application. That  was  a  case  where  the  Government  was empowered to  levy a cess for the purpose of the development of the mining areas in the State. The cess levied was not to become a  part of  the consolidated fund and was not subject to an appropriation in that behalf; it went into the special fund earmarked  for carrying  out the  purpose of  the  Act. There  was  a  definite  correlation  between  the  proposed services and  the impost  levied and it could e legitimately claimed that  the rate-payer  in substance  was compensating the State  for the  services rendered  by it  to him. In the present case  there is  no consolidated fund and no separate development fund.  There is  only one  fund, the Fund of the Delhi Development  Authority. What is more important, nor is there any question of any co-relation between the betterment charge and  the expenditure  incurred by  the  Authority  in carrying out  the purposes  of the  Act. The  charge is  not levied on  the basis  of the  expenditure  incurred.  It  is

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levied on  the basis  of the  increase in  the value  of the property consequent  on the development of the area; one may say the  charge is  on the accrued capital gain; it may bear no proportion whatsoever to the cost of development.      A submission  of the learned counsel was that the Delhi Development Act  itself referred  in several places to local authorities  as   distinguished   from   Delhi   Development Authority. It  is true  that in Sections 12, 15, 30, 31, 34, 36, 42  and some  other provisions  we find  a reference  to ’local authority  concerned’ meaning  thereby  the  ordinary local  authority  functioning  in  the  area  discharging  a multiplicity  of   civic  functions.   The  Delhi  Municipal Corporation for  example is  one such  local authority.  The Delhi Development  Authority is  constituted for  performing one of  the several  functions which  a local  authority may perform.  That   the  local   authorities  performing  other functions are  referred to as ’local authorities’ in the Act by which  the Delhi  Development Authority is created, while the Delhi  Development  Authority  is  referred  to  as  the Authority, is no ground for holding 865 that  the  Delhi  Development  Authority  is  not  a  ’local authority’ as  defined by  Sec.3(31) of  the General Clauses Act. The Delhi Development Authority is endowed with all the usual attributes  and characteristics of a ’local authority’ and there  is no  reason to  hold that  it is  not a  ’local authority’.      Another submission  of the  learned counsel  which  was pressed  upon   us  was  that  every  statute  dealing  with municipalities and  providing for  their supersession and/or dissolution invariably  provided for  reconstitution of  the municipality after  a stipulated  period whereas dissolution in the  case of  the Delhi  Development  Authority  meant  a complete extinction  of the  authority since the Act did not provide for  its reconstitution.  Our attention was drawn to the municipalities  Acts of various States. We are unable to see the force of the submission. The very nature of the work entrusted by the legislature to the development authority is such that  its life  can be  but transient. When the work is accomplished  and   there  is  no  need  for  its  continued existence it  is dissolved  and its life becomes extinct. It is  by   what  it   is  during  its  life  and  not  by  the consideration whether  there is life after death and whether it can  have many lives, that we determine whether the Delhi Development Authority  is a  local authority  as defined  in S.3(31) of the General Clauses Act.      On a  consideration of  all the  aspects of  the matter placed before  us we  are of  the  opinion  that  the  Delhi Development Auhority is a Local Authority and therefore, the provision of the Payment of Bonus Act are not attracted. The result, therefore,  is that  the appeal  is allowed  and the Writ Petition filed in the High Court is dismissed. However, we do  wish to  observe that the Delhi Development Authority may not  only be  a model for development activities but may strive to  be a  model employer  too. Bonus  was paid to the employees for  over ten  years and  we were  not told of any reason for  withdrawing this  benefit  from  the  employees. Merely because the Law Department advised that they were not bound to  pay bonus,  they were  not obliged to withdraw the benefit. The  question which  ought to  have been considered was not  whether they  were legally  bound to  pay bonus but whether in the context of sound management-labour relations, bonus should  continue to  be paid.  It is a matter which we earnestly  desire   the  Delhi   Development  Authority  may reconsider. There is no order as to costs.

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P.B.R.                                       Appeal allowed. 866