Madhya Pradesh High Court
The State Of M.P. & Ors. vs Vinod Kumar Gupta & Ors. on 30 November, 2016
Author: Sanjay Yadav
Bench: Sanjay Yadav
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First Appeal No.677/2000
HIGH COURT OF MADHYA PRADESH : JABALPUR
BEFORE HON'BLE SHRI JUSTICE SANJAY YADAV
First Appeal No.677/2000
State of M.P. and others
versus
Vinod Kumar Gupta
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Shri Vikram Johri, Panel Lawyer for the petitioner-State
of Madhya Pradesh and its functionaries.
None for the respondent.
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JUDGMENT
(30.11.2016) This appeal under Section 96 of the Code of Civil Procedure, 1908, is directed against the judgment and decree dated 16.2.2000 passed in Civil Suit No.21-A/1998.
2. The suit for declaration and permanent injunction by the respondent-plaintiff was directed against the demand of Rs.1,29,726/- raised by the Excise Department, State of Madhya Pradesh under the M.P. Entertainments Duty and Advertisements Tax Act, 1936 (for short '1936 Act') towards the entertainment tax for the period from 1.4.1991 to 12.4.1999. The case of plaintiff was that being a licencee and proprietor of an entertainment by 51 C.M. video cassette recorder operating within Umaria Municipal Area since :: 2 ::
First Appeal No.677/2000
4.1.1983 and was regularly paying the entertainment tax @ Rs.2347/-, was informed vide communication No.Abkari/Mano/ 96/784/4 dated 14.6.1996 of his liability to pay enhanced rate of tax at the rate of Rs.4500/- w.e.f. 1.2.1991 as the population of the town was 20269 (i.e. between 20001 to 50000). It was contended that the population of Umaria Town being less than 20000, the liability of the plaintiff to pay the entertainment tax was @ Rs.3375/- which was regularly paid.
The plaintiff further contended that the claim of tax @ Rs.4500/- per month was contrary to the provisions contained under Section 3 of the Act of 1936.
3. Defendants, present appellants, contradicted the stand by the plaintiff. It was contended inter alia that the population of Umaria Town as per census 1991 being over 20000, the Department was justified in raising the demand of tax @ Rs.4500/- per month.
4. Trial Court framed following issues :
1- D;k vizSy 1991 esa mefj;k 'kgj tgka ij oknh dk ohfM;ksa pyrk gS] dh dqy tula[;k 17537 FkhA ;fn gkW rks izHkko \ 2- D;k vkcdkjh foHkkx us bl mefj;k 'kgj dks tula[;k fcuk fdlh vk/kkj ds 20267 vkdfyr djds Hkwy dh gS \ 3- D;k oknh ls 129726@& #i;s dh jkf'k voS/k #i ls olwy dh tk jgh gS \ :: 3 ::First Appeal No.677/2000
4- D;k okn dkykojksf/kr gS \ 5- D;k oknh us mfpr U;k;'kqYd ugha iVk;k gS \ 6- okn O;; ,oa vuqrks"k \^^
5. The trial Court taking into consideration the evidence led on behalf of the plaintiff by PW2 Panchamlal Soni, Head Clerk, Municipal Council Umaria who deposed that in order to confer the status to that of Parishad two new wards were created by including the population of Village Chhatan, Lalpur, Bhagha and Loharganj and with the inclusion, the population was 20269, otherwise the population of the Municipal area in the year 1991 was 17537. The trial Court on a finding that the provisions contained in the Act of 1936 was for urban agglomeration; concluded that the population of Municipal Town was 17537 i.e. less than 20000. And, further taking into consideration the insertion of definition of 'Population' at clause (dd) of Section 2 of 1936 Act w.e.f. 1.5.1999. And, taking into consideration further amendment in Section 3 of 1936 Act, held that it is only w.e.f. 12.4.1999, the plaintiff will be liable to pay the tax @ Rs.4500/- per month as it is from said date that the entire municipal area has been brought within the ambit of charging Section 3 of 1936 Act.
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6. Accordingly, the plaintiff has been held liable for entertainment tax @ Rs.3375/- from 1.2.1991 to 11.4.1999 and from 12.4.1999 @ Rs.4500/-.
7. The appellant takes exception to the interpretation by the trial Court to various provisions of 1936 Act. It is urged that as per the census 1991 the population of Umaria being more than 20000, the trial Court patently erred in construing less than 20000.
8. Considered the rival submissions and perused the record.
9. It is not in dispute that the plaintiff is governed by the provisions of 1936 Act. It is also not in dispute that within the Municipal Council Area including Ward No.1 and 2, the population as in the year 1991 was 20259. However, the trial Court has construed it as 17537 on the basis of the statement by a Municipal Clerk Pancham Lal Soni (PW2). The evidence of PW2 is first taken note of.
10. In paragraph 1, 2, 6 and 9 of his deposition, PW2 states :-
^^1- eSa uxj ikfydk ifj"kn~] mefj;k esa eq[; fyfid ds in ij dk;Zjr gWwA uxjikfydk ifj"kn~] mefj;k dh tula[;k o"kZ 1991 ds vuqlkj 17537 gSA ;g tula[;k :: 5 ::First Appeal No.677/2000
'kgj {ks= dh gSA bl tula[;k esa xzkeh.k okMZ Ø0 1 ,oa 2 dh tula[;k 2722 dks ugha tksM+k x;k gSA okMZ Ø0 1 ,oa 2 tksfd xzkeh.k gS oks mefj;k 'kgj ls 1 ls ysdj 3 fdyksehVj nwjh ij gSA 2- uxjikfydk dk;e djus ds fy;s vklikl ds xkao dh tula[;k uxj ikfydk esa tksM+ nh xbZ gS ftlls uxj iapk;r u gksdj uxj ifj"kn cus jgsA 'kklu ds vuqlkj 20 gtkj dh de ikiqys'ku ij uxj iapk;r gksrh gS vkSj 20 gtkj ls Åij uxj ikfydk ifj"kn gksrh gSA
---
6- xzke NVu] ykyiqj] Hkxgk] yksgkjxat ;s mefj;k 'kgj ds varxZr ugha gS ;s vyx xkao gSa tks 'kgj ds utnhd gSa ijUrq bUgsa okMZ cukdj uxj ikfydk ds fy;s mefj;k esa 'kkfey dj fy;k gSA 9- lkaf[;dh foHkkx ds vuqlkj mefj;k dh vkcknh 20259 gS bl vkcknh esa xzkeh.k okMksZa dks feyk;k x;k gSA^^
11. Thus, evident it is that PW2 admits that area of village Chattan, Lalpur, Bhagha and Loharganj included within Municipal Area.
12. Section 5 of M.P. Municipalities Act, 1961 (for short "1961 Act") envisages that there shall be constituted a Municipal Council for a smaller urban area and a Nagar Parishad for a transitional area, that is to say, an area in transition from a rural area to an urban area. Two provisos appended with sub-section (1) of Section 5 stipulate :
"Provided that a Municipal Council or a Nagar Parishad, as the case may be, may not be constituted in such urban area or part thereof as :: 6 ::First Appeal No.677/2000
the Governor may, having regard to the size of the area and the municipal services being provided or proposed to be provided by an industrial establishment or a group of such establishments in that area and such other factors as he may deem fit, by public notification specify to be an industrial township:
Provided further that when an area is notified to be a transitional area, the Gram Panchayat having jurisdiction over such area shall continue to function until a duly elected Nagar Parishad is constituted under this Act."
13. Thus, once a Nagar Parishad is constituted, the area of village within Gram Panchayat becomes the part of Nagar Parishad. Present is not the case that in the year 1991 Umaria Nagar Parishad was not constituted. Rather, the evidence of PW2 establishes the fact that the Parishad was very much in existence. In that case, exclusion of four villages for taking into consideration the population of Municipal Area is not proper and is contrary to the statutory stipulations contained under 1961 Act.
14. In Bagalkot City Municipality vs Bagalkot Cement Co. AIR 1963 SC 771 [see also : Atlas Cycle Industries Ltd. vs State of Haryana AIR 1972 SC 121 and Gajra Gears, Dewas :: 7 ::
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vs The President, Dewas Municipality, Dewas 1975 MPLJ 147], it has been held :
"29. ... If it frames a by-law in such a way as to be immediately effective in the area newly, added to its limits, it cannot be said to be exceeding its jurisdiction. just as the Act contemplates the extension of the limits of the municipal district and the application of its various provisions therein, the by-laws made applicable within the area of the municipal district will be applicable to the extended area the moment any fresh area is added to the municipal district. We do not find anything in the Act or rules which disables the, municipality to fix the octroi limits in this way, or, in other words, which makes it incumbent on the Municipality to fix the octroi limits as frequently as the area of the municipal district is altered by a notification of the Government under Section 4.
...
39. We are of opinion that the extension of the limits of the municipal district connotes that the area newly added to the municipal district comes not only under the control of the municipality, but also becomes subject to such laws, rules and by- laws which be in force within the municipal district."
15. Now coming to the provisions of 1936 Act.
16. "Entertainment Duty", as per Section 2(c) of 1936 Act :: 8 ::
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means a duty levied under Section 3. Section 3 underwent amendment in the year 1991 (w.e.f. 1.4.1991 by MP Act No.3 of 1991)) and in 1992 (w.e.f. 13.3.1992 by MP 8 of 1992).
Thereafter, in the year 1999 (w.e.f. 1.5.1999 vide MP Act 6 of 1999) and in the year 2003 (w.e.f. 1.5.2003 by MP Act 9 of 2003). For the period from 1.2.1991 till 12.3.1992, Section 3 was in the following terms : -
"3. Entertainment Duty -
(1) Every Proprietor of-
(a) an entertainment other, than entertainment
by Video Cassette Recorder (hereinafter referred to as V.C.R.), or Video Cassette Player (hereinafter) referred to as V.C.P.) shall in respect of every payment for admission to the entertainment pay to the State Government a duty at the rate of 75 per centum thereof: Provided that no duty shall be payable in respect of any payment for admission to an entertainment not exceeding fifty paise except when such payment is for admission to a cinematograph exhibition in a permanent structure: Provided further that no duty shall be chargeable for the extra charge upto ten paise per ticket charged by the proprietor of an entertainment for providing the facility of air conditioning and air cooling during the period commencing from 1 st March to 30th September in a calender year;
(b) an entertainment by V.C.R. Held in the town with population mentioned in column (1) of the Table below and on such screen size as mentioned :: 9 ::First Appeal No.677/2000
in the said Table, shall pay to the State Government a duty per month at the rate specified in the corresponding entry in columns (2) and (3) thereof:-
Table Population Screen Size Upto 51 C.M. 1[above 51 C.M.] (Rs. Per month) (Rs. Per month) (1) (2) (3)
1. Upto 10,000 *(A) 2625.00 (A) 3937.00 *(B) 1125.00 (B) 1687.00
2. From 10,001 upto 20,000 (A) 3375.00 (A) 5062.00 (B) 1687.00 (B) 2530.00
3. From 20,001 upto 50,000 (A) 4500.00 (A) 6750.00 (B) 2250.00 (B) 3375.00
4. From 50,001 upto 1,00,000 (A) 6000.00 (A) 9000.00 (B) 3000.00 (B) 4500.00
5. More than 1,00,000 100 percent on all 100 percent on all classes on the sale classes on the sale of each ticket of each ticket Note - *(A) Where there is cinema.
(B) Where there is no cinema.
.............. ..............
17. The "Population" as it appears in sub-clause (b) of sub- section (1) of Section 3, is defined under clause (dd) of Section 2 as under :
[dd] "population' shall mean the urban agglomeration population according to the latest official census of the place, city, town or the locality concerned;
18. Previously, it was the 'town' which carried its meaning from clause (cc) of Section 2 (inserted w.e.f. 1.4.1991 vide MP Act 3 of 1991) which was the determining factor. Clause (cc) :: 10 ::
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envisages that -
[cc] "Local Area" shall mean a Municipal Area/Notified Area/Town Area within the meaning of the Madhya Pradesh Municipalities Act, 1961 (No. 37 of 1961) of Special Area within the meaning of the Madhya Pradesh Nagar Tatha Gram Nivash Adhiniyam, 1973 (No. 23 of 1973) or a Cantonment within the meaning of the Cantonment Act, 1924 (No. 2 of 1924) or a village within the meaning of the Madhya Pradesh Land Revenue Code, 1959 (No. 20 of 1959)];
19. Combined reading of Section 5 of the M.P. Municipalities Act, 1961 and Section 3 of 1936 Act existed prior to 13.3.1992 and thereafter, leaves no iota of doubt that the villages which is brought within the area of municipality becomes the part of it and the population of such village constitute population of municipal area/town/urban agglomeration.
20. The trial Court was thus not justified in excluding the population of the area of Village Chhatan, Lalpur, Bhagha and Loharganj from the population of Municipal Area Umaria. Since as per population census 1991 the population of Municipal Area Umaria exceeded 20000, the respondent-plaintiff was charged the entertainment duty @ Rs.4500/- from 1.2.1991 to 12.4.1999.
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21. In view whereof, the appeal is allowed. While setting aside the judgment and decree dated 16.2.2000 passed in Civil Suit No.21-A/1998, the suit filed by respondent-plaintiff is dismissed. Parties to bear their own costs.
Let a decree be drawn accordingly.
(SANJAY YADAV) JUDGE 30.11.2016 vinod