Karnataka High Court
Senior Superintendent Of Post Offices vs Bruhat Bangalore Mahanagara Palike on 4 August, 2010
Equivalent citations: 2010 (4) AIR KAR R 361
Author: Anand Byrareddy
Bench: Anand Byrareddy
I 5 ; E 'W. IN THE HIGH COURT OF KARNATAKA AT BANGALORE DATED TIIIS THE o4"'oAY OF AUGUST, BEFORE: THE HON'BLB MR. JUSTICE AND WRIT PETITION No. 9965 0:22am (LB.'aB:NIf')i WRIT PETITION No. 'l07*9__9_*_QF 2005 (LI3~BMP) IN W.P. 9965 or 2007 (£;§5'_:«.Bl\/._Ili_Ii>_)§V_ l% BETWEEN: i ii Senior Superinl_eiIoenI. <If:l'.oSt ll Bangalore Bangaloref l'0_."-~ 1'.:_I__ s 'I ...PETlTIONER (By Shré, S; AND: r 'E . BangzIlvo.re «I"\/Iahanagara Palike, _ HfidSI)n'«Circ1e, Bangalore " I R'e-p_r'esenI"e'd by its Commissioner. 2;' Assistalntilllevenue Officer, M'ahai'akshm.ipura Region, Br_L__IlIat Bangalore Mahanagar Palike, ii '*-._Opp. Sampige Theatre, Rajamill, Sheshadripuram, Bangalore-20. ...RESPONDENTS
(Byill/I/S Ashok Haranahalli Associates, Advocates) >?=>l=vE<>l<=£< Z This Writ Petition is filed under Articles 226 and 22.7 of the Constitution of India, praying to call for records whichv.ulti'1n_ateiy resulted in passing order Annexure--A by the respondent IN WP. 10799 OF 2006 (LB--BMP) BETWEEN:
Senior Superintendent of Post ()>ffices,Vl"--.A Bangalore West Division, ' V "
Bangalore--- 10. '.~..1é'E*i'I'r;oNER (By Shri. S. Prakash Shetty";
AND: A A 1 . Bruhat B§.3tflg:éi'iiOf€.Ni:al'i3ilag£1t'£i.I5filVil(é;; Hudson C1rc:le';' 3Ban'gaj~1.gre. "
Represemed its_Con1Amis_sioner.
2. Assis--tant Reyeniie. Officer, ' Mahnlétlgshlinipnre R'egi'o:'1", Bruhet--..Bavngal.()re._l\/fiihianagar Palike, ; Opp. Sant-pige 'The'ati'e, 4':"¢R§ljf;.llnVll1, Shesvhn..di'ipur2im, Bzinlgzilore W 20. r ...RESPONDENTS Advocate for Respondent No.1 and
2) ' ¥.<=l<>i<>E=>.'= " ._This Writ Petition is filed under Articles 226 and 227 of the _ 'Constitution of indie, praying to call for records which ultimately resulted in passing order Annexure--A and C from the respondent and etc., 3 These petitions having been heard and reserved on 24.06.2010 and coming on for pronouncement of ordersiethisyday, the Court delivered the foi1owing:-- "
These petitions are heard t0gether;'as..they,are:"f'ilied"-by'Vthe same authority, involving identical"-~.circuri*rstances_..V Heard the learned counselyforitlteipetition'er~and/the learned counsel for the respondents. ' 0
2. The are' i'eievant _are.as follows:
The petiti--<31t3:eVr re'prer.e'nt_s:vf the Post and Telegraph Departrrient;- 'It. is*sfta.t:ed,itl'iat"f'ost Offices of the department are established Thunder the__ln:iiiti:ti~~'Post Office Act. The depaitment is ._»estab:Ii'sl1ed' and co'n'tr'o-lied by the Union of India. The controversy lSvl7I1i0I'C:'S[i)tE'.ClZi of levy of "service charges" sought to be imposed byitheiBruhat:--.E3angalore Mahanagara Palike (hereinafter referred to as 'the.v__E3BMP', for brevity) on the premises comprising Post _'Osffices5 at Bangalore, within the jurisdiction of the competent officer of the BBMP. The BBMP is a statutory Cerporation Z constituted under the Karnataka Municipal Corporations Act, I976 (hereinafter referred to as ' the KMC Act' for
3. It is contended that in terms of Artiic1e_:':28i5--i(:i).of Constitution of India, the property ofithe Urnioniiis ie=xem'psa';r:pii:,a'11 taxes imposed by a State or by=any_Vauthority within..,a=S,tate. it further contended that Section I the exempts Property Of the Central City from payment of propperéig-,r___tztx:,"iiigrespotident -- BBMP having questi'on'e«d of service C1'131'a'%eS<,:iii3i)i'iii«*€iiiiiieiiipetiitioner pointed out that the petitioneiris! of tax. in response to the same,; an order was ipassed directing the petitioner to pay the is'er.\'/ice due, in terms of a Notification issued by the wherein, it was notified that those i ii . propiertiesfifiaiiiing within the jurisdiction of the BBMP, which are ii;-otherwiseiexempt from payment of property taxes, wouid however betliiaiaiie to pay 25% of the said taxes, as service charges, with 3
b) Mimicipai Corgmrcztimz, A;-2'zrit.s'(zr 1.1.3'. Senior Superii:z_IendenI of Post 0}fic'e.s*,An-zritsar Division and anoriier, [ ( 2i'j)U'4}'3y_ SC C 92]
5. On the other hand, the».__ ie:i1'n..ed :f"or""1:ihe respondents would admit that the"'--i?fost Office. is idepartment of V the Union of India, but furthVe_ri.i:c:onte'n_tpion is sought to be imposed on the is disputed. The nature ofdemanci, is It is pointed out that the BBMP insofar as maintaining the city which fofifginigigiciixéity, incidentally, it coliects revenue and service charges for the services_yrendiered. 'levy of property tax by the State '' ocycr£mc'riz is in terinsiioi'Entry~49 of List~II appended to the V11 iSehie.dui1e.i'Co'nstitution. The Entry enumerates the subject on whi.ch..__t'h'e-Sitate Government could impose tax namely, land buildiinés. The charging Section in respect of such impost is i.i_jptoi3ei'found under the KMC Act as provided under section 103(1)) ,6' ofthe Act. While Section I10 ofthe KMC Act deals with general exemptions and that the Commissioner, BBMP is empowered to grant exemptions, in respect of Kant! and buiIdings_entimesra'ted therein from payment of property tax. More partic-Li:lai'l,yw, V' no mg') and Section 119(2) are relevaintii * rte i:earfiea,, would submit that from a reading of the above.yiprovigsionsfs.
buildings or lands belonging to the_xiCentral'Government or the State Government used f'()--f_iZi'.€ pi_urp-os'es--.._of's'uch Government, not being used for residential vovrvc.otnmerc.iali cannot be made subject to payment p_roper_ty- tax..._.-Therefore, it would follow that the properties VVof,«r~thei ,Ce;n'tvral' -'Government being used for residential or__ comm_ercia'l.,purposes are not exempted from paymejt of property .te_>_t,.vHowever, it is admitted that the BBMP Vi'-_,car1,not,impose«.ta):._on property of the Union of India when it is used for the hp_z1r'poses of the Government. In any event, the i'd_,emand e.nd:. the controversy is not in respect of property taxes, but V' "thevirrip1osition of service charges, for services rendered. There is 'ii"'--i.ii,no__§provision under the KMC Act under which the Central 3 Government can claim exemption from payment of sucheharges. It is in that context that the demand has arisen. The--uServ.ice charges payable are at the rate of 25% of the propettye would be attracted in respect of any 'c«'uil.d'ingfio't la-ttdiVbe--§'o.ngiing to the Union Government or other properties. whichifaire exernptedrtcp from payment of tax. SinCei'i"i'i».:iV%1.2'()_05 itlteiirespdndeints are collecting 25% of the alnottnt as service charges for providing the Act has been amended,_vv;he{.¥e:biy' a:ndS:ch'eduIe--IIi of the KMC Act are e""£:gI'T1I3etence to levy and collect service exempted from payment of property tax'.c4__'iThei'efore;w.t'here is statutory sanction for the t.,.respondents to levy 'anr:i__covilect the service charges. In the absence V"-of ac'ltaiie.nige'_"to"the said amendment, it cannot be contended that theden'iand_ is'iivv_iteh<>t1tjurisdiction. Article 285 of the Constitution IndiaH°tIeals with exemption of property of the Union Goxteyrnrnent from State Taxation, but the service charges which be collected cannot be characterised as a tax and the 3 10 the reference to property tax is only to provide a ready measure of the reasonable service charges attracted. Hence, theuemand cannot be deemed as iilegal and without authority -' i"
The learned Counsel would place .relian'ce ' . 2 of the Apex Court in Union of India chin/d}:2ti/*ii?r2s' ii>;s',_A' Stateflrrar Pradesh , 2007(2) SCC 324,' 'tvhich aecordi--ng_"v_:tdttie' learned counsel, would squarely,ap.p1y tothe the present case. The learned Counsel for the§re,sp'oridents_ has also produced receipts in respect of c:olllleC'tilon_llo.f>service'charges from other entitiesfl which are"-.yotheiw_is'e exempted under the provisions of the KMC }\c.t_viti'oni property taxes.
i:In_iilorder to appreciate the rival contentions, the reievarit ii'p_roiv_isio'iis"_~may;"lie noticed and they are extracted hereunder for ready re'ferei'it:e.
[inder Chapter~X of the KMC Act, Section 103 which lprolvlides for the taxes that may be imposed and Section 1 10 which ll provides for Generai exemptions in respect of property tax, read as f0liows:~ "I03 -- Taxes which may be imposed. --« Sub_ier:ty_t'o.V£he.i.:l' general or special orders of' 'A"G'o*-..te'rri.ment,_TV'"A V V' Cor oration shail,- I 1 A P
(a) xxxx;
(b) (at rates not exceeding---tljosie'"s:.pecil'ie'd"in this Act} levy any.._oi1e' or n;3ovre'=oft following (axes.-
(i) or both) iiituatéedflxxyiitthinj"tile.eity.:.(heirgi'nef'ter referred to __ -
(ii)K vnxxpxx; V'
(iii) 'iX':txx'; pp (V)-,_ xix";
- 'V advertisement; '' on certain transfers of property in the enape of an additional stamp duty; V ' :,4'(viii') xxxx; ' --. fix) xxxx;"' §
intended to be used for residential or commercia.-i__ purposes shall be binding on the Corporation. (2) Notwithstanding the exemptions granted"
this section, it shall be ope_n,to_the collect service charges for, i 2.2 .i amenities and for generalIor'--special,Jigservices';ii"
rendered at such rates' be presc'ribeduf--;viiiV (Subsection (2) inserted i3y____/u\i:cvt__t+liov.3i ot"«200l.,_ivith effect from l9.l 1.2001, vide Notificati_on No.UDD 89 AHD 2000(Pt-E), dates 12, i--.t.2t)ot)"*+ * M Further, undfir SC'hedtiIe--IIl_:e.o1i° Act, which provides for been inserted by Notification NotEID__U6§'M'?iE_{j--2D02 dated 27.2.2004 with effect from 9.3.2on4.it V A Iris by rec.otirse_to these provisions, that the BBMP seeks toiiieyy .gervic.e""charges in respect of the Post Offices which are properties ioiiftfhe' Union Govern ment.
i~nso;3"ar as the contention of the petitioner that Article of the Constitution of india, providing for exemption of Z property of the Union from State Taxation is concerned, the Article reads as follows» y "285. (1) The property of the Union'-- i"
save in so far as Parliament may by provide, be exempt from all lattes it or by any authority within a State.
(2) Nothing in Clause (:)i";'s~e»:§;_i1'1, untiliiiFarlir;maent:§by Law otherwise "'provides}"" 'p'ife;\*eVnt.._ any i'auumi~::y within a State froih 'ilie"vyii'agyi'iany any property of the Union was immecliateiiyribeforefthe ieomtnenecment of this v"C0rtsti'tutioiif:.;l'iab'le»or t1'eateu"as liable, as long as that tax eon't.iAnue'si'toy be levied in that State." The question,thereioreforyiieonsideratiora would be, whether the is___in posii'tio.n_._.to levy service charges, though not called as tax," the itioner.
A' .__iiFro_Ina-yeading of the above Article, it is clear that both
-'««___i'~»Sub~clauvs_e*s (1) and (2) of Article 1285, provide overriding power _i't0"the.iA?arliarnent to make a law contrary to what is provided in the =-A-rticle name} , the immunit ' anion ro ert from State 3' Y P P Y taxation provided by clause(l) may be withdrawn if Parliament makes a law to that effect.
Secondly, the existing right of a Eocal authority toV:t'aS{--u'iii,on property under Clause (2) may similarly be made by the Parliament.
The phrase "save in so ,. far as'..Par_liameii.t_:r'r'iay by "lalws, otherwise provide" would sugge'st:ti'iat the ~P_arli--amenI may by law, permit the State or at1y'~a.uth'orityviwithin'the State to impose a tax on union property. The object Vot':._(jtause' therefore not to prevent the State or::11iloeal,taxati_'on iu niolnlproperty altogether, but to bi'ingS*it uncierllthe-~soi:trol,of the Parliament and the words used "all taxes" would have to be... interpreted in a wide sense including 'V..,anyv.':i:fnppsition or"ie'v--y--«i'n the nature of tax, for otherwise, the ,State"GoveVrrivnie_ot:.,would be able to do something indirectly what it 'Cannot,.doihdilrectly. This would also follow from Article 366 which has defined several expressions, used _ 'in_vthe='body of the Constitution of India, defines 'taxation' under S " ~C'iause~28 as follows:--
5 16
"(28) 'taxation' includes the imposition of any tax or impost, whether generai or local or special, and 'tax' shall be construed accordinglyj' It is well settled that the word "Tax", in its._wi.dest'usenise,i'* includes all money raised by taxatiohiiiinciisding .;ta.>iges._leVv'ie'd by the Union and State Legisl_atures; _rates'or other char.ges"lev'--ie(lt local authorities under statutory powers._-- (Se'6."'VVG'ri£:()L£.i';? vs. State of Kerala, AIR 1980 SC Pamtsiyt ~ Further, -Art:i_cle;_ ?.:85,'«.tihe'.jexeInptiion relates not only to tax i%.nposed~by the,VSt2i'teA..i'tself, .bat also by separate bodies like, Municipai.._Corpo1*atioins "'ether Local authorities, who cannot possibly' a-.la'rg'er bowler than the State itself by which they dare _ei:'eate.tAi. _ " « .__ A Tht?-.'fIJaf:Tiil.€l' question that would arise is whether the service V"»»chargesV.V_that are sought to be imposed would fall outside the ~d'efin.i'tion of 'tax', the KMC Act defines 'tax' under section 2(4I) 'V follows:
8 17
"Tax includes, toll, rate, cess, fee or other irnpost levi-able under this Act"
Though "service charges" are absent from the_.defr'i«nitien, "service charges" are not defined elsewhere uiidertlie Under Rule 7-A, there is an i11dication:that-- sgeiwflieevchargeis are the consideration for rovidincr "civic arnenities" in ..re's.,ect'._o'f. the building which is exempted fror'r';i.;ij1-operiy*..r:ax;.:"TheiTe§{pressioii' "civic amenities" are not"ide_f:inedVi1'n_der the°A'ct. There is no dictionary definition whichccitiid:be*"a;5plIi*ed.'---as being relevant, as for instance, several' .dicti'enaries referred to, the Black'sgLavv--Dicvt"i0«t1_a1<y 89}? iEd_it.ioi: carries the following:-
i"Service"*Chargeihilaiiits charge assessed for the 'V _performing'i'ofi*a"service, such as the charge htassvessediiiby """ bank against the expenses of 'v._irna_intjaii1_ing or servicing a custo1rter's checking '' 'aceount;'V The sum of(l) all charges payable by the buyer and imposed by the seller as an incident to the extension of credit and (2) charges incurred for investigating the coliateral or creditworthiness of @ 18 the buyer or for commissions for obtaining the credit.
The Chambers Dictionary defines 'service cha_rge7f_a'as' he'in,g V' a charge made for service in a restaurant goijh'otel,'*us,ual'ly a percentage of the bill.
The Bangalore Devieiopmelnt 'A,t1thotfi_ty Act,"~l9'76, defines 'amenity' and 'civic amenity'~3as fo'l'loi2vs.:,--_i" ii "2(b)x f:__iVFfAnieni.ty'i5:,'aj-includes} road, street, lighting, idira1'tiragie, puhl1'c ahdisucih other conveniences as Hthe 4Go\xer:ilfn.g;riir.niay,"by notification, specify to be an anzenitty for the,ipu.r.poses of this Act; 2 it amenity" means.-
' rv,.aiii.harket, a post office, a telephone exchange, a i ielbank, a fair price shop, a milk booth, a school, a dispensary, a hospital, a pathological laboratory, a maternity home, a child care centre, a library, a gymnasium, a bus stand or a bus depot;
6 Station of the Corporation or the Bangalore
(ii)
(iii)
(iv) 19 a recreation centre run by the Government or the Corporation;
a centre for educational, social and cultural««_V"'*.,A activities established by the ..2'_f:'¢:'iii;r';1iii. :.- ' Government or the State Government'.xo1'».i.:Sby_ body estabiished by the::Celntr'ai ,Cio_ve.~iiii}ie7n_i the State Government;
A centre for educitit.i:ori»al, cultural acti.vities&..o'r' t;o:r- phiianthropic service run by a Co4ope.rati_vVe.lSoeie,t'y..'Registered under the,.Karnatal<a..Coroperative"Societies Act, 1959 i{'Ktit;v1,tttak2t._Act=':ll"*ol'*:.°1~9.5_9fl or a Society C Fiegietered the Karnataka Societies E960 (Karnataka Act 17 of 4" _ I960)' Cor Trust Created wholly for * Criaiiitabl"e, Eiducationzii or Religious purposes; a PoliceiiStation, an Area Office or a Service lfwlater Supply and Sewerage Board or the Karnataka Electricity Board; and "'(§}i) Such other amenity the Government may, by notification, specify."
5 20 According to the above definition, a "Post Office'.?"isi:'it.seVif a civic amenity.
Insofar as the case law on the suE)j'e'c't~o.f taxation off' f31*operty of the Central Government by a State lG.o\}er_nmentv_-or"othelr--,entity_ is concerned, the following is the"':3.t1rnmary of tl1e..'.law.; laid down V under the several decision's».l_of tiiheV_ape._x..'Court which would be relevant.
In Urzi.-on l:V.S';--.:E'V§Ll'i'!1j'Cl'llM:£tfii(g'tpa[ Council and Others (1992) Jftto, 1j'rn§n of i'I'ndia had challenged a demand made by the Purna, towards "service charges"
for a period sll[l5re£:idot¢'er S-ixldysears, before the Bombay High Court. lndia hladllclaimed that the demand was opposed to lmi¢teii285«.gi' t.he'l"Constitution of India read with Section 135 of V . the Raillways Act, 1890. The High Court had opined that in l:jteirrns._.A <)l'"l Article 285(2), the liability to pay the taxes 'until ' Parliament by law otherwise provides', reliance placed on Section 2 B5 of the lndian Railways Act was negatived on the footing that the said provision cannot have any overriding effect a.gaii1's_t*t_he continuance of such law, under which the levy was authorized by Article 285 (2) of the Con'stitutio1li'.' ii the Railways Act was not an Act miadehby the'V_--v_P?ar!i21rrien't~dasau contemplated under Clause 2 of A*ri:i'c1_e 285" C'onstitution.ll Reversing the decision of held that Section 135 permitstaxationoi.the_lraVi1waylsi'iby.. local authority , in the was permissible if the in the Official Gazette had declared. ,adrnin.is't1'r1tion to be liable to pay the tax. The Central"'Guovern'melr;t the controlling and the regulating l_auth_ority: pern1ittin"g«li_a_bility at a given point of time , its extent antl.ilrr3agni~..e:r'.r :v"'Fhle--Zndian Railways Act being a Central enactment has roilgelito play in sub--article (2) of Article 285, for that is a 3"-wdsphere ii1.VV__iwhich the State legislation operates. The reasoning of ii Court to oust the applicability of Section B5 of the = indian Railways Act on the test of sub-article (2) of Article 285 5 was totally misplaced , also not venturing to create room for it in subwarticle (1) of Article 285. The interplay 's'of»s.the constitutional and legal provisions being well cut and;"wel'lV'~Llelln.ed. requires no marked elaboration to stress the p0iI1{';~'F,. .. i In Municipal Corporation, 7..Am_rit.sarlV_"_;Aiks. ' Sé'r:.io'r, Superintendent of Post Oficiws, /li'r::fz'tisar Di:ri.si'r;;é-I arid another, (2004) 3 SCC 92 - there swag a'_ide.rnan._;i.fo:fppayment of service charges, by the Municipal...Corporati.on".lrnadle,V-on the respondent therein, for h.ai;'.ing;%p_rovidedz._yar_iouslservices ~-- such as water supply, jstreet;li.\i<;ifl1_tinl§f,drainage, roads to the property of the respondems. ' _'l"h:e._re'spo»ncient claimed exemption from all taxes émtler 285 (ii!) the Constitution of India. The High and , inter alia , held that the demand of iser'vii.ce c"na1igesl.i'Vrn'ade by the Corporation was violative of Article
-- 28S.i°'The: questions that arose before the Supreme Court for deter-mination were follows :
3
(a) Whether the demand for service charges so made by the Corporation against the respondents is by way "service charge" or by way of ''tax'' ''2
(b) if it is held that the demand so made "tax" , whether the same is violati_ve..oi_'_Article'28«5j{lii)'=oi' _ the Coiistitution of India 'I' The apex Court held that regard to the services rendereclijito theiniireispopnde-npts' Department, like water supply, street--lighting,V'i'd.raih_age arid' roads to the land and buildyihigs¥£~'li_n eounte:_f,A.ih'ei respondents averred that they were payiriggforii th'eiii"sier.v:ic'es iigreindered by the appellant Corporation' wayiifof and sewerage charges and power charges separate'ly, 'pit w_as'~.--ailso averred that no specific services r__V./6l'e...hei,_ng p1fovided""to"the respondents, for which the tax in the lsliarpeicof:"s.er.i£eeV"charges could be levied and realized from the respo_ndent::r}'i There was no provision in the Municipal H V.'Corpora'ti--on Act for levying service charges. The only provision ii 'was way of tax. It was held that there was no dispute that the 2 "Corporation was collecting tax from the general public for water § supply, street~lighting and approach roads etc. Thus it was held that it was tax that was sought to be imposed in the garb of "service charges". It was further held that it was not competence of the Corporation to impose tax on property» the Union of India, the same being vi;aii;itive~ gflaaicitéaas(oar the Constitution. it was also observed thatlthe vie.w.e'xp'res1sedi in;
Puma Municipal case supra, whiichhwas rei't-erpate':d if; Union of India v. Ranclzi Municipafi.Ch»rpdfCzti:).iiI996) 7 SCC 542, cieariy covered the issues.» .
In []lVlfl'_U'I"?'1(:','j' 'L'FJlfId".('i}P:[1€f':.§' as. 'State of U. P. and Others - the Union of' challe----nged recovery proceedings initiated against it for by the }al Sansthan, Allahabad, as ._water}'«:andiV'seVweri ci*'iarges; The Allahabad High Court had rejected tlie petitivoln by the appellant.
Tlieiplesa of the appellants was that they were holding the V' "..f..pirop-ertyfllof the Centrai Government and hence service charges ' wereflnot payable under Article 285 of the Constitution of india as 6 such charges were in the nature of a tax. On the ether hand, the Eat Sansthan contended that sthe ciaim towards the sewer Charges was not a tax.
The apex court held that thcu estabiished under the Ai1aha'oad_JaI Water Suppiy and Sewerage Ac't;te«t..V:i'9.75. H It._had the duties of suppiy of watezrgand from the Municipality. Prior to thisiythe for services like water suppfy tn ytjheethven'Mttinicipaiity and hence the quest_iQni was whether service charges:"t_Qw.a1'<iiiisViisveiyieesyi=i'it{e~sup;:§iy of water and sewerage couid be said to beahtax en of the Union of India. The apex ~ . y_ c0u3*i'§',:whiie dFflWAiI1g__£_tlI¢i1ti0n to the distinction between a tax and a.-fee; necessary to ascertain the nature of the Ievy, nanjeiy , whether it was in the nature of tax or whether it was in Hthe nature-'iof a fee for services rendered by any instrumentaiity of t'he.,S:tiate like the Jai Sansthan. It was held that as it was apparent V. the Eat Sanstan was maintaining the water suppiy and 5 26 seweragze system and it was that entity who bore all the expenses for the maintenance ofthe same, and it had to create its own funds
--- the levy under the above said Act was held as being was further held that though the expression 'tax' ha'd:'bee.n' the Act, it was in fact in the nature of 'fee"1°o«rp_services'renderedig The apex took note of tlie_v'*d.ecisio~nVin. Sr§};2a»~.iC~.'z.anc£'i Oalf Committee vs. State of Mqi1ara.:i:.;.fci;'-(2005)2i "whet-ein the question was whether leivypef" for renewal of moneylender's 1_ice:ne.e valid o:r"~n'ot__. l'Itgw'as held that the fee cliargecliwias '1're._§a1_1ato:i'y in'~n;a'ture tofiirtlier the objects of the Act and it had Va'rnexusplwijthiit'%neii"s«ei*vices rendered to money lenders. However it wasobsie1'ved that a service to be rendered was not a icondiiitionfprecedent ,only there should be a reasonable relationship iiibetween"tli'e,,l_levy»"of fee and services rendered and in that context V -V the the levy of a fee under the Bombay Money Lenders v.Ac't;- .1 was affirmed.
G' 27 It was also noticed that in Vzjczyalczksizmi Rice Mill and others vs. Commercial Tax O}_')'icers, Palakol and 0rher.sj,"(2_'0£?é)A6 SCC 763, the distinction between fee, cesses V' considered. It was held that ordinarilyi"a"*tax generates igeneralp revenue and is not necessarily coliectedi'.for'.any ser_vic'ev Iende1=ed;~_ But the nomenclature is not important. Sotnetinies be in reality a fee, dependingibupon wasilobserved that the earlier conceptof feeiihadlchange and the rendering of a of a fee was no longer tghelllevy, provided there is a broad and between the totality of the fee imposed andithyeitotziilityi 'o_f"th;_e.'s'expenses on the service rendered. wit would appear from..__t.h€3 decision in Puma Mtmicipal Council V'-cas:e.i,"refe'rted;'toAViabove, that the apex Court has treated "service charges " as at , though it is not apparent from the report as to ~«.__"the naturefliof service provided to the Railways by the Municipal yCo1*poration.
3 it would appear from the decision in Mtmicigiczl Corpmrrrtion Amritsar, that the present case on hand is covered on ail fours by the same. As it is evident that from a reading of the defiln'itiori'vz)f "tax" under the KMC Act and the enumeration o'f__ltzi:<jesl'wlhiclh may be imposed under Section 103 of whicih duties, rates, and did include cesses too; and at rates. :s"pecif'iiedein'=, the Schedules to the Act. Serviciewi.._ch21rgesll beilng: solujght to be levied at 25% of the property tax is .cillea_rly"ap demand which can only be characterized a..t21'x;. The va'gue'~~.'i.ndication that it is collected towards services __rcnriere.d""'lin providing "civic amenities?' is' rtothiri._rcsepec:t'"--o1' any particular special services provided tolllltheii petiti.on'e_r," .i_y:ri_.'r'o1'der that the decision in Union of of UP~co_u.l.:i be applied to sustain the demand. The lii'i::/1:541-lahabad, which may be likened to the Bangalore Supplyahd Sewerage. Board win Bangalore, was claiming l""~.__l'~charges" payable for particular services rendered in that case. it may be true that the BBMP incurs a huge expenditure in l * providing and maintaining "civic amenities" and all of which may 5 not even be abie to be met out of the entire property tax collected. the demand for even a nominal measure of the tax'~.paya~b1e towards such general expenditure, is impermissibleby reciciriii-se:"'t-:3 * the amended Section 110 read with t,h'e""ainend_4me_atfto_Sicheduiie V 111, Part £1, Ruie 7A thereto insofar petivt-itoAner«. property of the Union Goyetrnraent i's._:'eonce'rned. The nomenclature "service any iess an impost in the nature of to any special services rendered providing access to the whether a tax payer or otherwiae. he too far off when the BBMP may be inpo.sitii'o.na'to"leyy a fee for specific services to be H_owe\}e'r,...th_evpi'esent impost impugned herein clearly foiu'i~..¢:;:f 258 (1) of the Constitution of India. 5 30 Accordingly, the Writ Petitions are allowed and the impugned annexures are hereby quashed insofar as the..ps:fit.i_{):1v¢r is concerned.