Madhya Pradesh High Court
Indore Bhed-Bakra Vikreta Sangh And ... vs The Municipal Corporation And Ors. on 29 July, 1991
Equivalent citations: AIR1992MP134, 1992(0)MPLJ781, AIR 1992 MADHYA PRADESH 134, (1992) JAB LJ 34 (1992) MPLJ 781, (1992) MPLJ 781
ORDER 1. The following order of the Court was delivered by V.S. Kokje, J.
2. The petitioners have challenged in this petition the right of the Municipal Corporation to auction the right to recover tax/fee from the dealers engaged in sale and purchase of cattle. The petitioners have also contended that the Municipal Corporation has no authority to impose a tax on sale or purchase of cattle and the levy is totally without authority of law. However, the relief claimed in the petition is issue of appropriate writ or direction quashing the tender notice Annexure-A, whereby respondent No. 3 was authorised to collect the tax from the purchasers of cattle in the Gafoor-Khan Ki Bazaria, Indore. The relief for declaration as to levy of the tax or fee to be unconstitutional has not been sought. In view of this, we will confine our order to the first point alone that is whether the respondent Municipal Corporation can auction the right to collect tax from the purchasers of cattle in the market of Gafoor-Khan Ki Bazaria, Indore.
3. In its return, the Indore Municipal Corporation has contended that it has appointed respondent No. 3 not as a contractor but as an agent for recovery of fees. According to the Corporation the object of granting such an agency was to receive maximum fees without any leakages. It is contended that the respondent No. 3 issues receipts on behalf of the Corporation and the arrangement cannot be said to be illegal or unauthorised. The Corporation has also relied on a letter Annexure-6, which is said to be a suggestion by the State Government for recovery through the agents. However, on a perusal of the Annexure-6, it is obvious that the letter does not relate to any such thing.
4. The petitioners have annexed to the petition a publication issued by the Indore Municipal Corporation containing conditions of the contract for recovery of fees as Annexure-A. A perusal of the document would show that right to recover fees has been auctioned for a lumpsum to the contractor and the contractor is given a right to recover one rupee per transaction of sale of cattle from the area of the market named Gafoor-Khan Ki Bazaria, Indore. The respondents have not shown any authority of law for entering into such an arrangement. Their only contention is that in order to get maximum monetary benefit from the recovery of market fees, the agency has been auctioned.
5. Section 86 of the M.P. Municipal Corporation Act, 1956 (for short 'the Act') provides for creation of a Municipal fund and also provides that such a fund shall be held in Trust by the Corporation for the purpose of the Act subject to the provisions contained therein. Section 87 of the Act provides for what has to be credited to Municipal fund. It is specifically provided in clauses (a) (e) and (f) of Sub-Section (1) of Section 87 of the Act that all monies received by or on behalf of the Corporation under the provisions of the Act, or any other law for the time being in force or under any contract, or monies raised by any tax levied for the purpose of any Act and all fees payable and levied under the Act or any rules or bye-laws made thereunder shall be credited to the Municipal fund. Thus, it is obligatory under the Act for the Municipal Corporation to see that every paisa realised as tax or fees is credited to the Municipal fund. Admittedly, in this case under the arrangement arrived at with the contractor, he has to deposit a lumpsum with the Municipal Corporation and has to realise a fixed fees on every transaction of sale or purchase of cattle in the market. The contractor is under no obligation to account for or to pay to the Corporation the fees realised over and above the amount which he has paid to the Corporation under the arrangement. Obviously, any one entering into such an arrangement with the Corporation would do it with a view to earn some profit. The lumpsum amount which he would agree to give to the Corporation would be lesser than the expected recovery. He has to recover expenses of recovery also apart from profits. It is, therefore, clear that the contractor has been given a right to recover fees in excess of the lumpsum on the payment of which he has been given a right to recover market fees. It is also clear that the contractor is entitled to keep all such money received in excess of the payment made by him and is not obliged to deposit it with the Municipal Corporation. What every such contractor realises from the public is in the form of market fees and he gives receipts to the persons paying fees also in the name of the Corporation, towards market fees. Under the Scheme of the Act every paisa realised as market fees has to first go to the credit of the Municipal Corporation fund and it can be expended only in accordance with the provisions of the Municipal Corporations Act, especially Section 88 thereof. What the Municipal Corporation has done by arriving at the arrangement with the contractor is to permit the contractor to retain in violation of Section 87 of the Act all the amount which is realised as market fees, in excess of sum paid by him. Such an arrangement being contrary to the provisions of the Act itself cannot be upheld.
6. We, therefore, declare the action of the Corporation of auctioning the right to recover market fees on the transactions of sale or purchase of cattle in the Gafoor-Khan-Ki-Bazaria, Indore as illegal and against the provisions of the Municipal Corporation Act. We accordingly quash Annexure-A and also the grant of contract of respondent No. 3 on the basis of Annexure-A. The respondents Nos. 1 and 2 are directed to take account of the entire market fees received by respondent No. 3 from the public and get it credited to the Municipal fund. The respondent No. 3 shall be entitled to claim from the Municipal Corporation, Indore a reasonable amount spent by him on recovery of the market fees under the aforesaid illegal arrangement. The amount paid to the respondent No. 3 towards the contract shall be adjusted in the amounts of tax or fees recovered by him from the public, which would now be payable by him to the Corporation.
7. As already observed, since the petitioners have confined the relief to quashing of Annexure-A and the appointment of the respondent No. 3 as contractor for the year 1991-92, we have not gone into the questions of whether the levy is fee or tax and whether the Corporation has authority to impose it or increase the rate of levy. We also have not gone into the question as to whether the procedure for increase of tax or fees had to be followed and has been followed or not According to us though these questions were argued but they do not arise in the case in view of the relief asked for, these questions shall remain open if agitated in an appropriate case in appropriate circumstances. The petition is allowed with costs. Counsel's fees Rupees 1500/-. Security deposit be refunded.