Madhya Pradesh High Court
Mandsaur Transport Association vs State Of M.P. And Anr. on 15 December, 1987
Equivalent citations: AIR1988MP159, AIR 1988 MADHYA PRADESH 159, (1988) JAB LJ 195
JUDGMENT Qureshi, J.
1. Mandsaur Transport Association, a Non-Trading Corporation, registered under the M.P. Non-Trading Corporation Act, 1962, has filed this petition under Article 226 of the Constitution of India against the State of Madhya Pradesh and their officers who are respondents 2, 3 and 4 and againsl respondent No. 5 who is contractor and who collects toll tax on Shivna Bridge, Mandsaur. According to the petitioner they own buses, trucks and other motor vehicles which have to pass through various roads and bridges during the course of business of transport and the public at large travels in the buses. Therefore, they have filed this petition in the interest of the general public, travelling in their vehicles through the Shivna Bridge at Mandsaur including these who are members of the petitioner-association. In the Mandsaur town, the Government of Madhya Pradesh has built a bridge on the river Shivna. The cost of the construction of the bridge was Rs. 26,58,955.00. Since the date of the opening of the bridge for traffic, the State Government started realizing toll tax from the vehicles passing over the bridge. It has been further stated that since 1973, the State Government has been auctioning the right to recover the toll tax on Shivna bridge. The cost of bridge has been recovered long back and in the year 1985 itself the bid of the auction was Rs. 29,98,930/-. As such, the auction money for one year itself is more than the cost of the bridge. According to the petitioner, the State Government does not have the arbitrary and unfettered powers to levy any amount of toll merely for augmenting the general revenues of the State. The right of levy should be such as to meet the cost of repairs of roads and bridges and aslo for liquidating the actual expenses incurred in their construction within a reasonable time. As the toll tex recovered by the State is different than the other taxes, therefore, the quid pro quo element which distinguishes fees from taxes is also implied in the expression 'tolls' and though it may not be a fee it will clearly come within the scope of compensatory tax. The expression 'tolls' in the Tolls Act means a levy for providing funds for the maintenance of roads and bridges and repayment of loan, if any, takes for their construction. Now since the State Government has already recovered at least ten times more than the cost of constuction the State Government has no authority in law to continue to recover any toll tax on the Shivna bridge in Mandsaur.
2. The second ground challenging the toll tax particularly on Shivna bridge is that Shivna bridge falls within the limits of the Mandsaur Municipality and the State Government vide notification No. F-31-19-84-G-XIX-1030 dated 1-8-1985 has already exempted the bridges falling within the municipal limits. Therefore, also the Government could not charge any toll tax from the vehicles passing over the Shivna bridge. A prayer has, therefore, been made that an appropriate writ or direction or order be issued against the respondents restraining them from recovering the toll tax on Shivna bridge in Mandsaur and to refund the amount of toll tax recovered after deducting the cost of construction of the bridge to those who produce receipts of having paid toll tax after the recovery of the cost of the bridge.
3. The respondents have resisted the claim of the petitioner on the ground that the present petition has not been filed in the interest of the general public and, therefore, the petitioner has no locus standi to present this petition because the averments that the petitioner represents the interest of general public is vague, laconic in material particulars, inasmuch as the details of the vehicles owned by the members of the Association are not given. According to the respondents, the State is empowered to levy toll tax upon any bridge or road which has been made or constructed or repaired or to be made or constructed or repaired at the expenses of the Central or the State Governments. According to the respondents, the toll tax under the provisions of the Indian Tolls Act, 1851 shall be deemed to be public revenue as is provided in Section 8 of the Act. The toll collected under the Tolls Act is as such a public revenue and the State is empowered to utilise this public revenue in the construction, repairs, maintenance or widening of the roads and bridges anywhere in the State. The petitioners are trying to narrow down the scope of Section 2 of the Tolls Act, 1851. The toll tax can be levied on the roads and bridges which have already been made or constructed and isalso leviable for the roads and bridges to be made and constructed in future. Toll is a tax and not a fee. Therefore, it cannot be treated a compensatory tax. It has, however, not been denied that the cost of bridge has already been recovered. Resisting the contention of the petitioner, challenging the levy of toll tax on the ground that the bridge is within the Municipal limits, it has been submitted by the respondents that the entire Shivna bridge does not fall within the limits of the Municipality. Only a small portion of the bridge falls within the municipal limits of Mandsaur. Therefore, the whole bridge cannot be treated within the municipal limitss of Mandsaur Municipality and as such it cannot be exempted from the levy of toll tax.
4. It has further been submitted by the respondents that the toll tax is levied and collected to raise public revenue for the construction and repairs of the bridges and roads in the State. Therefore, the toll tax cannot be equated with the fee and as such there cannot be any restriction over the collection of toll tax after the recovery of the cost of the bridge. The total length of the bridge is 800 feet out of which only 90 feet is within the municipal limits. Therefore, the petitioner cannot challenge the recovery of the toll tax on the ground of the bridge being within the municipal limits. It has also been averred that the petitioner cannot claim any relief against the respondents in view of the fact that all non-commercial vehicles registered in Mandsaur can obtain exemption from the payment of toll tax after obtaining permanent pass from the Executive Engineer, P.W.D. Mandsaur. As such, only commercial vehicles are liable to pay toll tax for crossing Shivna bridge, provided the vehicle has not paid toll tax within the State of Madhya Pradesh during 24 hours beginning from 6 A.M. to 6 A.M. of the next day. Even if commercial vehicles are exempted from the levy of toll tax, they have to pay toll tax on crossing bridge on Khajuria Nala in Km 64/10 of Mhow-Neemuch road for all the vehicles going towards Indore, Bombay and Ahmedabad and on crossing Somli bridge in Km 6/6 of Mandsaur -- Sitamau and Basai bridge in Km 46/88 of Arniva -- Suwasra road for the vehicles going towards Rajasthan. Assuch, although the petitioner shall not get any substantial benefit from such exemption, the contractors of the Khajuria Nala bridge and Somli bridge will be the real beneficiaries because the revenue which is being collected at Shivna bridge will pass on to the contractors collecting toll tax at Khajuria Nala, Somli and Basai bridges and the Government would be put to heavy loss.
5. Learned counsel for the petitioner, Shri Chafekar argues that the toll tax is a compensatory tax and once the State is compensated fully of the amount spent on the construction of the bridge, no toll tex can be levied on such bridge. The learned counsel insupportof his argument hasplaced reliance on the judgment in Maheshwari Singh v. State of Bihar, AIR 1966 Patna 462, wherein it has been held that the expression 'toll tax' means a levy for providing funds for the maintenance of roads and bridges and repayment of loan, if any, taken for their construction. It has also been held in the same judgment that the levy of the tolls by the State Government is compensatory for reimbursing itself to the extent of the cost of construction of this particular bridge without which it may not be possible to undertake construction of such bridges for the general and ultimate public good. The levy of tolls is in the larger interest of travelling public, trade and commerce and is compensatory. The learned Judges have also referred to the majority j udgment of the Supreme Courrt in Automobile Transport Ltd. v. State of Rajasthan, AIR 1962 SC 1406, wherein considering the reasonableness of the tax it was held that the tax imposed on the transport vehicle by the State of Rajasthan was a compensatory tax and was, therefore, not violative of any of the provisions of the Constitution.
6-7. On the other hand, the learned Government Advocate Shri Surjitsingh referring to verious decisions of the S upreme Court and High Courts has tried to draw distinction between the fee and the tax. According to Shri Surjitsingh, the toll tax levied on the bridges by the State Government is not a compensatory tax to compensate for the cost of Shivna bridge. Learned Government Advocate further contends that Section 2 has to be read along with Section 8 of the Indian Tolls Act, in order to properly appreciate the nature of the tax wherein the toll levied under this Act has been held to be public revenue and the public revenue is meant to be spent for the general welfare of the people of the State including construction of new bridges and roads on which the toll has to be levied.
8. InMaheshwariSinghv. State of Bihar, AIR 1966 Patna 462, it has been held as under : --
"Section 2 of the Tolls Act does not give unfettered and unguided arbitrary power to the executive to levy any amount of toll merely for augmenting the general revenue of the State and hence is unconstitutional.
By merely using the expression 'toll1 and by further saying that the tolls shall be levied on roads and bridges made or repaired by Government, the Legislature in Section 2 clearly laid down for the guidance of the Government the principle that the rate of levy should be such as to meet the cost of repairs of the roads and bridges and also for liquidating actual expenses incurred in their construction within a reasonable time. The quid pro quo element which distinguishes fees from taxes is also implied in the expression 'tolls' and though it may not be a 'fee' as ordinarily understood it will clearly come within the scope of a compensatory tax. There are enough indications in the Act for the guidance of the executive. Merely because there is a possibility of misuse of the statutory power by the executive, Section 2 cannot be held unconstitutional."
In that case the levy of tolls at Haroner Bridge in State of Bihar was challenged as unconstitutional. The learned Judge following the Supreme Court case in Automobile Transport Ltd. v. State of Rajasthan (AIR 1962 SC 1406) (supra) were of the view that the toll tax conies within the scope of compensatory tax and there are sufficient guidelines for the Government pertaining to rate of levy of the toll tax on roads and bridges. While so holding, it was observed by the Court that the rate of levy should be such as to meet the costof the repair of the roads and bridges and also for liquidating actual expenses incurred by the Government in construction, within a reasonable time. On the basis of the observation of the Court that tolls are levied to meet the cost of the repair of the roads and bridges and for liquidating actual expenses in the construction of such roads and bridges, the learned counsel for the petitioner submits that the toll tax is imposed by the State to re-imburse the cost of construction of a particular bridge and once the cost is recovered, the Government cannot continue to impose a tax on that bridge, the cost of the construction of which has already been recovered.
9. While trying to ascertain the intention of the legislature in levying tolls on the bridges and roads by enacting the Tolls Act in the year 1851, the learned Judges have traced the history and origin of tolls in England, Europe and America. The Court has sought aid from the Encyclopaedia of the Social Sciences. Vol XIII page 404, wherein it was pointed out that the Parliament passed numerous Acts since 1774 for creating turnpikes and the turnpikes were created with jurisdiction over certain stretch of road with authority ,to borrow money on the security of the tolls, which were to further the funds for the maintenance of roads and payment of the loan. As the scheme was not viable, in 1896 the last turnpike vanished from the British soil Definition of Tolls given in Encyclopaedia Americana Vol. 26 at page 675 has also been considered wherein toll has been defined as the fee exacted by those who erect or maintain a bridge for the privilege of passing over the same, a compensation for services, especially for transportation as canal or railway toll. Reference is also made to Encyclopaedia Britannica, 1965 Ed. where toll bridges have been defined as long span bridges which are mostly buit us self-liquidating projects and by charging tolls on the traffic using them, the expenses are met in most practical manner.
10. In the light of the above definitions of the toils in the Encyclopaedias referred above, the Patna Court came to a conclusion that when in 1851 the Indian Toils Act was passed it may reasonably be inferred that expression 'tolls' in the Tolls Act was intended to convey the same meaning as was given to the expression in Britain, namely, a levy for the purpose of providing funds for the maintenance of roads and bridges and repayment of laon (if any) taken for their construction.
11. In our view Section 8 of the Tolls Act as it stood at the time of its enactment, i.e. before the amending Ordinance of 1937 has to be looked into for ascertaining the intention of the legislature when it used the term 'toll' in the Tolls Act. It reads as under : --
"The tolls levied under this Act shall be deemed public revenue but the net proceeds thereof shall be applied wholly to the construction, repair and maintenance of roads and bridges within the presidency in which they are levied."
A plain reading of the aforementioned provision shows that initially at the time of the enactment of the Act, the net proceeds of the toll tax to be recovered by the levy of tolls were to be applied only to the construction, repair and maintenance of the roads and bridges within the presidency in which they were levied. As such, the proceeds of the tolls were not to be used for the repayment of the loan, if any, which the State might have taken for the construction nor the proceeds were to be applied for the recoupment of the costof the construction of a particular bridge. Instead, the proceeds of the tolls were to be applied for the construction, maintenance and repair of the roads and bridges in the State. Later on in the year 1937 by the Amending Act, the rider of applying net proceedsof the toll wholly to the construction, repair and maintenance of roads and bridges within the State was also lifted by omitting the words which directed the State to apply the net proceedsof the toll tax, wholly for the construction, repair and maintenance of roads and bridges ip the State. Section 8 as it stands to day simply says that the toll levied under the Act shall be deemed to be public revenue.
12. Now we may look at the judgments of this Court and t he Supreme Court where the term 'toll' has been defined. The Madhya Pradesh High Court has had an occasion to define the meaning of the word 'toll' in Swaroopchand Jain v. State of M. P., 1970 MPLJ 205 wherein it has been held that the term 'toll' means a sum of money which is taken in respect of some benefits for the temporary use of the land. It can also be taken for use of roads. In Mataprasad v. Election Officer, Panchayat Elections, Porsa, 1971 MPLJ 384 : (AIR 1971 Madh Pra 136), while making the distinction between toll, fee, tax and cess, it has been held by a Division Bench of this Court that a toll is a payment in respect of some benefit, advantage or service generally for the use of another's property. In Rewa Transport Service, Rewa v. State of M. P., 1979 Jab LJ 738, the operators of motor vehicles had challenged the validity of the notification levying of loll tax by the State Government on the bridges costing Rs. 5 lacs and above constructed under the Second, Third and Fourth Five Year Plans and under the various development plans. This notification was issued by the State Government in exercise of its powers under Section 2 of the Tolls Act, 1851. In that case a Division Bench of this Court had held that toll is a sum of money which is taken in respect of some benefits. The concept of toll is a charge or a payment for the use of roads, bridges, market places and the like. The toll cannot be equated with a general tax. It is in the nature of compensatory tax for the use of certain facilities. The Division Bench also referred to the meaning of the term 'toll' in Strouds Judicial Dictionary (4th Edition) Vol. 5, page 2785 for ascertaining the true meaning of the word 'toll'.
13. In Automobile Transport Ltd. v. State of Rajasthan (AIR 1962 SC 1406) (supra), the petitioner had challenged the tax imposed under the Motor Vehicles Taxation Act on the ground that it offends Article 301 of the Constitution and, therefore, the levy of tax being violative of the Constitution should be struck down as unconstitutional. Considering the nature of the tax so imposed, the majority view of the Supreme Court was that regulating measures or measures imposing compensatory taxes for the use of trading facilities do not come within the purview of the restrictions contemplated by Article 301 of the Constitution. His Lordship Justice S. K. Das (as he then was) expressing the majority view, while examining the grounds of challenge made by the petitioners against the levy of the tax on Motor Vehicles has observed as under (page 1420) : --
"..... .Another class of examples relates to making a charge for the use of trading facilities, such as, roads, bridges, aerodromes etc. The collection of a toll or a tax for the use of a road or for the use of a bridge or for the use of an aerodrome is no barrier or burden or deterrent to traders who in their absence, may have to take a longer or less convenient or more expensive route. Such compensatory taxes are no hindrance to anybody's freedom so long as they remain reasonable; but they could of course be converted into a hindrance to the freedom of trade. If the authorities concerned really wanted to hamper anybody's trade, they could easily raise the amount of tax or toll to an amount which would be prohibitive or deterrent or create other impediments which instead of facilitating trade and commerce would hamper them."
14. If we look to the Dictionary meaning of the word 'toll' we find that in the Shorter Oxford English Dictionary on Historical . Principles, Third Edition, released in the year 1984, the word 'toll' has been defined as a definite payment exacted by the State or the local authority for permission to paw somewhere, do some act, or perform some function. Traditionally 'toll1 was taken by the Sovereignty in return of either protection of right of way, temporary use of land or the right of passage along a road, river or channel over a bridge or ferry. Toll was also known as a charge for the right of landing or shipping goods at a port. A charge made for transfer of goods by railway or canal also falls within the definition of 'toll'.
15. It will, therefore, be seen that the Patna High Court in the absence of the definition of the term 'tolls' in the Tolls Act has taken the aid of the history of tolls in America and England for arriving at a conclusion that the term 'tolls' in Tolls Act was intended to convey the same meaning as was given to the expression in Britain. The Madhya Pradesh High Court referring to Stroud's Judicial Distionary has held that toll is a compensatory tax and is levied for the use of certain facilities. It is a sum of money taken in respect of some benefits i.e. use of roads, bridges, market places and the like. In Rewa Transport Service, Rewa v. State of M. P. (1979 Jab LJ 738) (supra), Mataprasad v. Election Officer Panchayat Elections, Porsa, 1971 MPLJ 384: (AIR 1971 Madh Pra 136) and Swaroop Chand Jain v. State of M. P., (1970 MPLJ 205) (supra), the Division Benches of the Madhya Pradesh High Court have also taken the view that 'tolls' is a sum of money which is taken in respect of some benefits i.e. use of roads, bridges, lands etc. The Supreme Court in Automobile Transport Ltd. v. State of Rajasthan(AIR 1962 SC 1406) (supra) has observed that the taxes levied by the State by way of tolls are compensatory in nature. Tolls are levied for the use of bridge or road in return for the facility provided to the trade and transportation because in the absence of such facility the users may have to take longer or less convenient or more expensive route etc. The Dictionary meaning according to Oxford English Distionary (supra) also lends support to this proposition that toll tax is levied in return of the facilities, provided by the State to transportation and trade by constructing bridges, roads and the like. Therefore, if afore mentioned observations of the Supreme Court, views expressed by Madhya Pradesh High Court and the Dictionary meaning of the term 'toll' are considered along with Section 8 of the Indian Tolls Act, as it stood at the time of the enactment itself, we gather that the legislature intended tolevytolltaxbyenactingTollsAct, 1851 for the purpose of creating a fund for the construction, repair and maintenance of the roads and bridges within the State in which such tax was levied. However, by amending Ordinance of 1937 the rider of using the net proceeds of the toll tax was also lifted and the net proceeds of the tax collected by the State become a part of public revenue for applying it to the welfare activities of the State. As such we find it difficult to agree with the contention that toll tax is recovered for reimbursing the cost of a particular bridge and once the cost of construction has been recovered, the State has no powers to levy toll tax on such a bridge, the cost of which is recovered. '
16. It is true that tolls tax being compensatory in nature in view of the quid pro quo element being present in that tax viz. providing facility of a bridge or road for transportation. Its maintenance and repair, the rates of tax should be correlated to the expenditure incurred for providing such facility and also for its repair and maintenance but that cannot be construed to mean that the intention of the legislature in levying the toll tax on bridges and roads was to recoup the cost of construction of that particular bridge or road. Therefore, in view of the discussion made hereinabove, we are unable to subscribe to the arguments advanced by the learned counsel Shri Chafekar that the State Government after the recovery of the cost of construction of the Shivana bridge could not recover any toll tax from those passing over the bridge. We hold that the toll tax is levied not only for recovering the cost of construction of the bridge but for construction, maintenance and repairs of roads and bridges in the State and also for expenditure on the other welfare activities in the State.
17. The other limb ot the argument of Shri Chafekar is that the State Government vide notification No. F-31-19-84-G-XIX-1030 dated 1-N-1985 has exempted all the bridges which fall within the municipal limits from the toll tax. The contention of the petitioner is that Shivna bridge falls within the municipal limits of the Mandsaur Municipality, and the check-post of the Municipal Committee is also situated beyond the bridge. As such, the recovery of toll tax on Shivna bridge is against the notification of the State Government dated 1-8-1985. The respondents have resisted the claim of the petitioner by filing documents to show that the whole of the bridge over river Shivna is not within the Municipal limits. Annexure R/1 is the letter of the Municipal Committee, Mandsaur which says that Shivna bridge is 828 ft. long out of which only a part of 60 feet of the bridge is within the Municipal limits. The municipal committee has also annexed the trace map of the bridge along with the letter. Annexures R/2 and R/3 are the photographs of the Shivna Bridge towards Mandsaur side according to which a portion of the bridge i.e. 90 feet is within the Municipal limits. Annexure R/4 is a trace map by the Public Works Department of Mandsaur district in which it has been shown that a portion of 710 feet of the total length of bridge is outside the Municipal limits and only a portion of 90 feet out of the total length of 800 feet is within the municipal limits. This averment, that only a portion of the Shivna bridge, falls within the municipal limits of Mandsaur has not been seriously disputed by the petitioner, as no documents have been filed to show that the annexures submitted by the respondents are untrue in any way. Therefore, we have no hesitation in holding that the whole of Shivna bridge is not within the municipal limits of Mandsaur Municipality. This leads to a question whether despite the fact that only a small portion of bridge being within the municipal limits, can the bridge be treated as falling within the municipal limits of the city. In our opinion, the notification is very clear on this point. It says that bridges falling within the municipal limits are to be exempted from toll tax. Had the intention of the executive been to exempt those bridges also, a part of which falls within the municipal limits, the notification would have been worded differently, and ii would have said that all those bridges which fell within the municipal limits wholly or in part shall be exempted from toll tax, but the State has exempted only those bridges which wholly fall within the municipal limits and not those bridges, a part of which falls within the municipal limits. As such, it is clear that the intention of the State was not to exempt those bridges a part of which falls within the limits of the Municipal Committee.
18. Now we have to consider the effect of the check-outpost of the Municipal Committee beyond Shivna bridge towards Ratlam. It has not been disputed before us that the check-post has been erected beyond the bridge after the municipal limits of the city of Mandsaur. It has been stated by the respondents that all the non-commercial vehicles registered in the city of Mandsaur have been granted the facility to obtain passes to pass through the bridge without payment of any toll tax. Therefore, the general public of the city of Mandsaur whose vehicles are registered in the city of Mandsaur should not face any difficulty because of the location of the checkpost. The State Government if it may deem fit. may consider extending the same facility to the owners of the commercial vehicles also if it is shown that the location of the checkpost after the Shivna bridge towards Ratlam is causing hindrance in the trade of the city in any way. However, it is for the State Government to take a decision after considering the circumstanceswhich may be placed by the commercial tehicle owners before it. We, therefore, do not propose to give any direction in this behalf, in the absence of any material before us on this issue.
19. In the result, in view of the aforementioned discussion, we hold that the petitioner-Corporation is not entitled to any relief against the respondents. Accordingly, the petition isdismissed. However, the parties shall bear their own costs as incurred.