Allahabad High Court
Bharti Airtel Ltd.,Thru. Its ... vs State Of U.P., Thru. Secretary, Urban ... on 21 October, 2010
Author: Pradeep Kant
Bench: Pradeep Kant, Ritu Raj Awasthi
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
Court No.1
1.Writ Petition No.7848 of 2010 (M/B)
Bharti Airtel Limited
through it's Authorised Signatory
Versus
State of U.P. and others.
2. Writ Petition No.1965 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
3. Writ Petition No.1968 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
4. Writ Petition No.1970 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
5. Writ Petition No.1971 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
6. Writ Petition No.1972 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
7. Writ Petition No.1974 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
8. Writ Petition No.1975 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
9. Writ Petition No.1976 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
10. Writ Petition No.1979 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
11. Writ Petition No.1982 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
12. Writ Petition No.1983 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta (Tax)
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
13. Writ Petition No.2745 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
14. Writ Petition No.2746 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
15. Writ Petition No.2747 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
16. Writ Petition No.2748 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
17. Writ Petition No.2749 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
18. Writ Petition No.2750 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
19. Writ Petition No.2751 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
20. Writ Petition No.2752 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
21. Writ Petition No.2753 of 2010 (M/B)
Unitech Wireless East Private Limited through
Authorised Signatory
Versus
State of U.P. Through Secretary,
Urban Development.
22. Writ Petition No.1969 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta.
Versus
State of U.P. Through Secretary, Ministry of
Urban Development.
23. Writ Petition No.1978 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta.
Versus
State of U.P. Through Secretary, Ministry of
Urban Development.
24. Writ Petition No.1980 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through Deepak Gupta.
Versus
State of U.P. Through Secretary, Ministry of
Urban Development.
25. Writ Petition No.654 of 2010 (M/B)
Vodafone Essar Digilink Limited, New Delhi
through Deepak Gupta.
Versus
State of U.P. Through Secretary, Ministry of
Urban Development and others.
26. Writ Petition No.7849 of 2010 (M/B)
Bharti Airtel Limited
through it's Authorised Signatory
Versus
State of U.P. Through Secretary, Urban-
Development and others.
27. Writ Petition No.10172 of 2010 (M/B)
Vodafone Essar Digilink Limited, New Delhi
through it's Authorised Signatory.
Versus
State of U.P. Through Secretary, Ministry of
Urban Development, Lucknow.
28. Writ Petition No.10172 of 2010 (M/B)
Vodafone Essar Digilink Limited, New Delhi
through it's Authorised Signatory.
Versus
State of U.P. Through the Secretary, Ministry
of Urban Development, Lucknow.
29. Writ Petition No.10117 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through it's Authorised Signatory.
Versus
State of U.P. Through the Secretary,
Ministry of Urban Development, Lucknow.
30. Writ Petition No.10179 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through it's Authorised Signatory.
Versus
State of U.P. Through the Secretary,
Ministry of Urban Development, Lucknow.
31. Writ Petition No.10181 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through it's Authorised Signatory.
Versus
State of U.P. Through the Secretary,
Ministry of Urban Development, Lucknow.
32. Writ Petition No.10183 of 2010 (M/B)
Vodafone Essar South Limited, New Delhi
through it's Authorised Signatory.
Versus
State of U.P. Through the Secretary,
Ministry of Urban Development, Lucknow.
AND
33.Writ Petition No.7850 of 2010 (M/B)
Bharti Airtel Limited through it's
Authorised Signatory.
Versus
State of U.P. Through Secretary,
Urban Development and others.
***
Hon'ble Pradeep Kant,J.
Hon'ble Ritu Raj Awasthi,J.
We have heard the learned counsel Shri Bharat Ji Agarwal, Senior Advocate assisted by Shri Ashish Mishra , Shri Raghvendra Singh, Senior Advocate and Shri Sanjeev Singh for the petitioners and Shri H.P.Srivastava, Addl.Chief Standing Counsel for the State, also learned counsel for Nagar Palika Parishad, Nanpara, Bahraich in Writ Petition No.7848 of 2010 (M/B) and also learned counsel for the parties in the connected writ petitions.
This is a bunch of writ petitions which raises common question of facts and law and in fact pure questions of law regarding the authority of the Nagar Palika Parishads /Nagar Panchayats to impose Advertisement Tax on Hoardings/Signboards and Glow-signs affixed above the shops and at other places which are not the shops of the Nagar Palika Parishads/Nagar Panchayats nor such Hoardings/Signboards and Glow-signs stand affixed at any public place or land belonging to the State Government.
The respondents Nagar Palika Parishads/Nagar Panchayats have awarded separate contracts to the Astha Vigyapan Agency, LDA Colony, Kanpur Road, Lucknow, Tiranga Vigyapan Agency, 4/9 Vaibhav Khand, Gomtinagar, Lucknow, Raja Vigyapan Agency, New Hyderabad, Lucknow and New Glazy Advertising, Maya Ram Ka Hata, Maqboolganj, Lucknow in all the aforementioned writ petitions for realization of tax from the petitioners. By different orders the Advertisement Agencies have been given contracts for a period of three years.
A preliminary objection has been raised by Shri Manu Saxena regarding maintainability of the writ petitions at Lucknow, against the Astha Vigyapan Agency, LDA Colony, Kanpur Road, Lucknow, Tiranga Vigyapan Agency, 4/9 Vaibhav Khand, Gomtinagar, Lucknow, Raja Vigyapan Agency, New Hyderabad, Lucknow and New Glazy Advertising, Maya Ram Ka Hata, Maqboolganj, Lucknow, they being private concerns. Further, argument is that most of the Nagar Palika Parishads /Nagar Panchayats are situated out side the territorial jurisdiction of this Court sitting at Lucknow for which the appropriate Forum would be at Allahabad instead of Lucknow and that the Astha Vigyapan Agency, LDA Colony, Kanpur Road, Lucknow, Tiranga Vigyapan Agency, 4/9 Vaibhav Khand, Gomtinagar, Lucknow, Raja Vigyapan Agency, New Hyderabad, Lucknow and New Glazy Advertising, Maya Ram Ka Hata, Maqboolganj, Lucknow are the private companies and if, the petitioners are aggrieved by any action of theirs, then the remedy lies is civil court and not by filing writ petitions.
The petitioner-companies are situated in Lucknow . The notice has been issued by the Astha Vigyapan Agency, LDA Colony, Kanpur Road, Lucknow on behalf of all the Nagar Palika Parishads/Nagar Panchayats, at Lucknow and the Advertisement Tax is also being collected at Lucknow. Therefore, it can very well be said that the cause of action atleast partly has arisen within the territorial jurisdiction of this Court sitting at Lucknow. So, is the case in all the petitions, therefore, the writ petitions are maintainable at Lucknow.
In regard to the plea that against the Astha Vigyapan Agency, LDA Colony, Kanpur Road, Lucknow or for that matter against all such agencies, a civil suit should have been filed, suffice would be to mention that the aforesaid agencies only in consequence to the award of the contract by the Nagar Palika Parishads/Nagar Panchayats for collecting and realising the tax have taken steps for realising/collecting the said tax. Therefore, if this Court finds that the very imposition or levying of tax itself is illegal or without sanction of law and without authority, the consequence of such imposition of tax , can very well be seen under Article 226 , making the writ petition maintainable against these agencies also.
In fact, it is the very award of the contract by the Nagar Palika Parishads/Nagar Panchayats to the private agencies which is under challenge alongwith the action of the Nagar Palika Parishads/Nagar Panchayats of imposition of such a tax, which challenge undisputedly is fully amenable to writ jurisdiction of this Court. Thus the writ petitions are maintainable and the aforesaid plea of the respondents has no force.
Before adverting to the issues involved in the writ petitions, it would be appropriate to mention that all the respondents are served but only few of them have chosen to file counter affidavits . The dispute is one and the same, therefore, with the consent of the parties counsel we have proceeded to hear the arguments and decide writ petitions.
It is also pertinent to mention here that out of so many respondents, only few respondents have framed bye-laws in respect of imposition of Advertisement Tax on Hoardings/Signboards and Glow-signs affixed to over the shops which carry on the business of the petitioners' companies.
The main thrust of challenge to the imposition, collection and realization of Advertisement Tax on the advertisement aforesaid is that there is no provision under the U.P. Municipalities Act, 1916 which governs the Nagar Palika Parishads/Nagar Panchayats either to impose such a tax or to collect it nor there is any such power to frame any such bye-law. That being so, the entire action of the respondents is without authority and cannot be sustained in law.
Section 128 of the U.P. Municipalities Act, 1916 is the provision which confers powers upon the Municipalities to impose tax. No tax can be imposed/ levied or collected or realised by the Municipalities namely; Nagar Palika Parishads/Nagar Panchayats which does not have its' genesis from Section 128 of the U.P. Municipalities Act, 1916.
Section 128 of the U.P. Municipalities Act, 1916 falls under Chapter V under the Heading of 'Municipal Taxation' Imposition and alteration of taxes . The aforesaid Section is being reproduced as under :-
" 128. Taxes which may be imposed.--(1) Subject to any general rules or special order of the State Government in this behalf, the taxes which a Municipality may impose in the whole or part of a municipality are .---
(i) a tax on the annual value of building or lands or of both; (ii) a tax on trades and callings carried on within the municipal limits and deriving special advantages from,or imposing special burdens on municipal services; (iii) a tax on trades, callings and vocations including all employments remunerated by salary or fees; [(iii-a) a theatre tax which means a tax on amusements or entertainments;] (iv) a tax on vehicles and other conveyances playing for hire or kept within the municipality or on boats moored therein; (v) a tax on dogs kept within the municipality; (vi) a tax on animals used for riding, driving, draught or burden, when kept within the municipality; (vii) [***] (viii) [***] (ix) a tax on inhabitants assessed according to their circumstances and property; (x) a water-tax on the annual value of buildings or lands or of both; [(x-a) a drainage tax on the annual value of buildings leviable on such buildings as are situated within a distance, to be fixed by rule in this behalf for each municipality from the nearest sewer line;] (xi) a scavenging tax; [(xii) a conservancy tax for the collection, removal and disposal of excrementious and polluted matter from privies, urinals, cesspools;) (xiii) [***] (xiii-A) [***] [(xiii-B) a tax on deeds of transfer of immovable property situated within the limits of the municipality;] (xiv) [***]
(2) Provided that taxes under clauses (iii) and (ix) of sub-section (1) shall not be levied at the same time [***] [nor shall the taxes under clauses (x-a) and (xii) of sub-section (1) be levied at the same time;] [Provided further that no tax under clause (xiii-B] of sub-section (I) shall levied on deeds of transfer of immovable property situated within such area of the municipality as forms part of the local area of any Improvement Trust created under Section 3 of the U.P.Town Improvement Act, 1919 (U.P.Act No.VIII of 1919];
Provided also that no tax under clause (iv) of sub-section (1) shall be levied in respect of any motor vehicle.
(3) Nothing in this section shall authorise the imposition of any tax which the [State Legislature] has no power to impose in the [State] under [the Constitution].
Provided that a [Municipality] which immediately before the commencement of the Constitution was lawfully levying any such tax under the section as then in force, may continue to levy that tax until provision to be contrary is made by Parliament."
A perusal of the aforesaid provision regarding 'Municipal taxation' clearly reveals that the Nagar Palika Parishads/Nagar Panchayats can impose Tax only with respect to the items enumerated therein and not beyond the items specified therein. Section 128 does not any where provide that the Advertisement Tax can be imposed, collected or realised by the Nagar Palika Parishads/Nagar Panchayats on Hoardings/Signboards and Glow-signs which are affixed/placed on a private shop. Therefore, in the absence of such a statutory provision, the Nagar Palika Parishads/Nagar Panchayats would not be competent to either impose levy , collect or realise such Advertisement Tax.
In the case of Ahmedabad Urban Development Authority Versus Sharad Kumar Jayanti Kumar Pasawalla and others, reported in AIR 1992 Supreme Court 2038 the Apex Court observed that in a fiscal matter it will not be proper to hold that even in the absence of express provision, a delegated authority can impose tax or fee and in our view, such power of imposition of tax and /or fee by delegated authority must be very specific and there is no scope of implied authority for imposition of such tax or fee. The delegated authority must act strictly within the parameters of the authority delegated to it under the Act and it will not be proper to bring the theory of implied intent or the concept of incidental and ancillary power in the matter of exercise of fiscal power.
In the same context, in the case of Bimal Chandra Banerjee Versus State of Madhya Pradesh and others reported in 1971 Income Tax Reports,105(equivalent to 1970(2)SCC 467) their Lordships of Supreme Court considering plea of the appellant held that no tax can be imposed by any bye-law or rule or regulation unless the statute under which the subordinate legislation is made specially authorises the imposition, even if it is assumed that the power to tax can be delegated to the executive. The basis of the statutory power conferred by the statute cannot be transgressed by the rule-making authority. A rule-making authority has no plenury power; it has to act within the limits of the power granted to it.
Looking to Section 128 of the U.P.Municipalities Act,. 1916, it causes no ambiguity that Section 128 is the substantive provision which confers power upon the Municipalities to impose a tax and also the scope of the said power. Taxes which may be imposed by the Municipalities have been detailed in the aforesaid provisions and no such tax can be imposed/levied or realised under any other 'head' unless it falls within the definition given under Section 128 of the U.P.Municipalities Act,. 1916.
There can be no delegation with regard to imposition, demand or collection of any taxes in view of Schedule I attached to the Act which does not confer any power of delegation to the Municipalities in the matters relating to taxation. Needless to say that Section 128 of the U.P.Municipalities Act, 1916 does not confer power for levying ,imposing or collection of Advertisement Tax on Hoardings/Signboards and Glow-signs affixed above the private shops and properties.
Learned counsel for the respondents next submitted that in view of Section 293-A of the U.P.Municipalities Act,1916 the aforesaid Advertisement Tax is not a tax but a fee imposed by the Nagar Palika Parishads/Nagar Panchayats which is permissible under the law.
Even if, for arguments sake, we accept the plea of the learned counsel for the respondents that the aforesaid tax is actually a 'fee' imposed, question again arises whether any such fee can be levied by the Nagar Palika Parishads/Nagar Panchayats in respect of the private shops and private property not belonging to the Nagar Palika Parishads/Nagar Panchayats where these advertisements through Hoardings/Signboards and Glow-signs are affixed for advertising the products of the petitioners-company.
Sections 293 and 293-A read as under :-
" 293. Fees for use, otherwise than under a lease of municipal property.--(1) The [Municipality] may charge fees to be fixed by bye-law or by public auction or by agreement, for the use or occupation (otherwise than under a lease) of any immovable property vested in, or entrusted to the management of the [Municipality] including any public street or place of which it allows the use or occupation whether by allowing a projection thereon or otherwise.
(2) Such fees may either be levied alongwith the fee charged under Section 294 for the sanction, licence or permission or may be recovered in the manner provided by Chapter VI.
293-A. Power to impose fees.-- A [Municipality] may with the previous sanction of the State Government impose and levy fee for use of any place to which the public is allowed access and at which the [Municipality] may provide sanitary and other facilities to the public.
Putting of Hoardings/Signboards and Glow-signs above the private shops firstly, is not a place to which the public is allowed to access nor can be allowed access and secondly, the Municipality is not supposed to provide any facility also.
In case, it is a public place where the Hoardings/Signboards and Glow-signs are affixed, or is a place to which the public is allowed access , the Nagar Palika Parishads/Nagar Panchayats may have a right to impose/ levy fee but since the aforesaid issue is not before us, we leave it open.
We thus, are of the opinion that Section 293-A cannot come to the rescue of the Nagar Palika Parishads/Nagar Panchayats for imposing Advertisement Tax which is now sought to be termed as 'fee' , as no fee can be imposed for putting signboards, Hoardings or Glow-signs etc on private shops.
An alternate argument has also been raised that licence fee can be charged under Section 294 of the U.P.Municipalities Act, 1916 therefore the present imposition can be saved by taking it as license-fee.
Section 294 which relates to the licence-fee reads as under :-
"294.Licence fees, etc.-- The [Municipality] may charge a fee to be fixed by bye-law for any licence, sanctioned or permission which it is entitled to required to grant by or under this Act."
Foremost requirement for realising such licence fee is that there must be a requirement of sanction or permission under the provisions of the Act or the Bye-laws for placing the endorsement etc. on the private shops. Unless such permission or sanction is required under the provisions of the Act, there will be no occasion to realise the licence fee and consequently, the Nagar Palika Parishads/Nagar Panchayats would not be entitled to realise the licence-fee.
For putting Hoardings/Signboards and Glow-signs over the private shops, no permission is required to be taken from the Nagar Palika Parishads/Nagar Panchayats. That being the position, the question of realisation of licence fee would never arise.
We therefore, conclude that the Nagar Palika Parishads/Nagar Panchayats-respondents have no authority to impose tax on the Hoardings/Signboards and Glow-signs affixed/placed over the private shops or other private places by the Company for advertising their products and where the company business is carried on.
In view of the fact that we have held that the imposition of tax aforesaid is illegal being without authority, the question whether it can be recovered through the private Agencies does not require any answer but in view of the judgement of the Apex Court in ICICI Bank Versus Prakash Kaur {2007 (2) SCC 711} such a practice cannot be appreciated.
The other plea of the respondents is that unless the Nagar Palika Parishads if, have framed the bye-laws, imposing such a tax, they can realise the same.
In regard to the powers of the Municipality to make a Bye-law, one has to look to the provisions of the Act, which confers such power to make a Bye-law.
Section 298(1) provides that a [Municipality] by a special resolution may, and where required by the State Government shall, make, bye-laws applicable to the whole or any part of the [municipal area], consistent with this Act and with any rule, for the purpose of promoting or maintaining the health, safety and convenience of the inhabitants of the [municipal area] and for the furtherance of municipal administration under this Act and Section 298(2) provides that in particular, and without prejudice to the generality of the power conferred by sub-section (1), the [***][Municipality], wherever situated, may, in the exercise of the said power, make any bye-law, described in List I below and the [***] [Municipality], wholly or in part, situated in a hilly tract may further make, in the exercise of the said power, any bye-law described in List II below.
Sub-section (1) lays down the guidelines for making bye-laws. The Act means, the U.P.Municipalities Act and Rules means the Rules framed thereunder. Since the Act itself does not authorise the imposition and collection of such tax (Advertisement Tax) under the Act, no such bye-law can be framed in the teeth of Sub-section (1) aforesaid.
Sub-section (1) gives power to the Municipality on specified subjects which have been notified under one Head under List I, Schedule-H viz. "Public safety and convenience".Whereas Sub-clause (f) of Schedule-H specifies "for the regulation of the posting of bills and advertisements".
Framing of Bye-laws would not mean nor cannot be taken to mean conferment of power to impose any such tax.
One of the Nagar Palika Parishads namely;Kiratpur, Bijnore has filed their bye-laws as Annexure no.CA-1 in support of the plea that such tax can be levied but a perusal of the same does not support the said plea, wherein such tax finds mention.
Lastly, the respondents have placed reliance on the judgment by this Court at Allahabad in Writ Tax No. 612 of 2010 in U.P.Advertiser Association and another Versus Union of India and others decided on 20.09.2010 where the main question involved was "whether money charged by the Cantonment Board, Kanpur (the Board) for granting permission to use its land for putting up advertisement hoarding is a tax and can it be auctioned".
In the said case, the Board was not charging any money on Hoardings/Signboards and Glow-signs affixed/ placed on the private shops. The land of Cantonment Board is not a private land. There the permission was to be granted for using the land of the Board and not of a private person.
The facts of the present cases are entirely different than the facts of the case cited above.
For the reasons aforesaid, the action of the respondents imposing/levying Advertisement Tax and thereafter awarding contract to the private agencies for collecting/realising the same on the Hoardings/Signboards and Glow-signs affixed/placed on the private shops by the Company for advertising their products where the company's business is carried on, cannot be sustained which is hereby, declared invalid and consequently, the notices issued by the respondents are hereby quashed.
Accordingly, all the above mentioned writ petitions are allowed . Costs easy.
21.10.2010 RK/*