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Burmah Shell Oil Storage & Distributing ... vs Licensing Officer Of Tamluk ... on 17 May, 1955
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The Commissioner, Hindu Religious ... vs Sri Lakshmindra Thirtha Swamiar Of Sri ... on 16 April, 1954
In my opinion, it is not so. The object of taxation is to raise revenue, and one of the ingredients of this power is that the tax is levied according to the paying capacity of the tax-payer (see, 'Commissioner Hindu Religious Endowments, Madras v. L. T. Swamiar' . In this, it is distinguishable from a pure licensing fee, which has no relation to the paying capacity of the tax-payer. Thus, if the imposition of a trade-tax is permissible, I do not see why more should not be raised from a Company which has a greater paid-up capital, and therefore presumed to have the capacity of paying more taxes, than a Company which has a less paid-up capital and might be expected to have a lesser capacity for paying taxes. The analogy of income-tax naturally comes into one's mind. Mr. Das has argued that there is a clear distinction between income-tax and a trade-tax, inasmuch as, in income-tax it is the quantum which is taxed. That may be so, but similar arguments would apply so far as graduated or block-rates are concerned. If the provision of Article 14 apply, the realisation of income-tax at block-rates would not be permissible. As I have stated above, the foundation for this action lies in the nature of taxation, which permits revenue to be raised according to the capacity of the person paying. It is of course a fundamental principle of discrimination that it can only apply amongst equals.
Article 226 in Constitution of India [Constitution]
Taracharan Mukherjee vs B.C. Das Gupta And Anr. on 18 February, 1953
Reference may be made to List 2 of the Seventh Schedule, Item Nos. 5 and 60. It has now been held that the Legislature in suitable cases might delegate powers to other bodies, and in this instance it seems that it has delegated the power of levying trade-tax within the jurisdiction of a particular Municipality to tile Commissioners of that Municipality. The circumstances under which such powers of delegation can be exercised have been discussed by me in detail in the case of -- 'Gopal Chandra Mukherjee v. B.C. Das Gupta' 93 Cal LJ 304 (C). I have explained there how the power of delegation is a necessary incident to the exercise of legislative power, and is based on the Legislature's lack of time and convenience to shape all legislative details in respect of certain kinds of legislation. By such delegation, the Legislature cannot of course delegate its essential legislative functions, but as long as it keeps control over a particular piece of legislation in which power is delegated, it comes within the competence of the Legislature to delegate. This is the kind of legislation which is known as "subordinate legislation". It is clean that the Legislature in this instance has provided for a great deal of control. For example, by Section 215, the State Government may make rules regulating any matter relating to taxes, tolls, fees or rates. In Schedule IV, the rates at which the trade-tax is to be imposed, has been laid down. Under Section 557, the State Government has been given the power to alter, add to or cancel any rule or modify the schedules. The Legislature can at any time, alter modify the provisions of Sections 123 and 182, upon which is based the power of the Commissioners of the Municipality to impose the taxation. In short, the Act contemplates an imposition of tax on trades. The rate is fixed, and the procedure by which a licence has to be taken out in respect of a trade is laid down in the Act. Only the power is given to the Commissioners to decide as to whether in a particular Municipality, the tax is to be levied. That of course will depend upon the necessity for raising revenue, and so far as this is concerned, the Commissioners would be the best persons to judge as to whether an occasion has arisen for the imposition of the tax. In my opinion, such a delegation is permissible and that Sections 123 and 182 or Schedule IV of the Act are not ultra vires. The two constitutional points having been decided against the petitioner, this application must fail.
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