Holding

The 1881 Notification authorises the Municipal Corporation to levy octroi in the cantonment at the rates specified in the 1963 Octroi Rules, and the 1918 notifications neither superseded nor impliedly repealed it, rendering the collection lawful.

Summary

The Municipal Corporation of Pune collected octroi duties from the Poona Cantonment under a 1963 schedule of octroi rules, which the respondents challenged as illegal. The Supreme Court examined whether the 1881 Government Notification authorising octroi collection allowed rates and articles to be varied over time, and whether later 1918 notifications superseded or impliedly repealed the 1881 notification. The Court held that the 1881 notification was intended to permit collection at rates "for the time being", thus covering the 1963 rates, and that the 1918 notifications did not supersede or repeal it concerning octroi. The doctrine of desuetude was rejected as inapplicable. Consequently, the collection of octroi at the 1963 rates was lawful, and the procedural objections under section 62 were not applicable. The appeal was allowed and the High Court’s writ orders dismissed.

Issues considered

The scope of the 1881 Notification: whether it permits octroi collection at rates and on articles not specified at the time of its issuance.
Whether the 1918 Notifications (Nos. 4160‑4163) superseded or impliedly repealed the 1881 Notification regarding octroi.
The applicability of the doctrine of desuetude to the 1918 Notifications.
Whether the Municipal Corporation needed a post‑1963 agreement with the Cantonment Board under section 45(1)(b) of the Cantonments Act, 1924 and section 32(4) of the Bombay Provincial Municipal Corporations Act, 1949.
Whether the delegation of power to set octroi rates constituted impermissible legislative delegation.
Whether the procedure under section 62 of the Cantonments Act, 1924 (objection to tax) was required for the 1963 rate enhancement.

Legislation cited

Bombay District Municipal Act, 1873
Bombay Municipal Act, 1872
Bombay Provincial Municipal Corporations Act, 1949s. 32(4)
Cantonment Act, 1910s. 15(1), s. 15(2)
Cantonment Act, 1924s. 45(1)(b), s. 60, s. 61, s. 62, s. 63
Constitution of Indias. Article 21, s. Article 265
General Clauses Acts. 21

Subjects

octroicantonmentstatutory interpretationdesuetudedelegation of legislative powertaxationmunicipal corporationnotificationsupersessionimplied repealprocedural compliance

Judgment

A THE MUNICIPAL CORPORATION FOR
CITY OF PUNE AND ANR.
v.
BHARAT FORGE CO. LTD. AND ORS.

lvlARCfl 10, 1995
B
[KULDIP SINGH, B.L. HANSARIA AND S.B. MUJMUDAR, JJ.]

Doctrine of desuetude-Disuse of a statute for a long duration; and
contrary practice in use-The statute becomes a dead letter may be taken as
C replaced. ·

Cantonment Act, 1910-Ss.60-62-0ctroi Rules 1963-Whether 1881
resolution pennitted collection of octroi duties at the rates specified in Octroi
Rules of 1963-Whether any obstacle in law in allowing the same--Held.· No.

D Wordr & Phrases : Contemporanea expositio'-Meaning of.

The Government of Bombay, by its Resolutfoo adopted on 26.li1881 +
approved the levy of Octroi in the Cantonment on the same articles and
at the same rate as in Poona City and it approved the proposal to divide
E the proceeds on certain terms. The Government of India conveyed its
sanction to the levy of Octroi in the Cantonment and issued notification.
The Municipality started collection of Octroi duties for the Cantonment
from that year itsrlf.

After the Cantonment Act 1910 came into force, the Cantonment
F wanted a new method of apportionment as it thought that the agreement
that existed was unjust. The State Government did not agree and the
disagreement was conveyed to the Cantonment. The Municipality
proposed to revise its Schedule ef Octroi Rules in 1917 by enhancing the
same, which was opposed by the Cantonment Committee. The Government
G approved the reVised Octroi Schedule. This order required the General
Officer Commanding of the Cantonment to be informed that the Govern-
ment saw no reason to modify its earlier decisioa.

Io 1963 new Octroi Rules were framed by the appellant which en-
~anced the rates of Octroi and included new articles in the schedule and
-H it started collecting octroi accordingly form all concerned. The respoo-
716
MUN. CORPN. FOR CITY OFPUNE v. BHARAT FORGE CO. LTQ. 717

~ dents filed writ petitions challenging the legality of the collection of the A
octroi made as per the 1963 Schedule to the Octroi Rules framed by the
appellant, before High Court. The Respondents contended that the 1881
Notification did not permit the collection and even i~ factually the· Notifica-
tion were to so permit, the appellants could not have done so in law. The

,r -r
High Court accepted both the contentions and allowed the writ petitions.
Hence these present appeals.

Allowing the appeal, this Court
B

HELD: 1. The 1881 Notification was meant to impose Octroi duties
1 not only at the rates prevailing when the Notification was i5$Ued nor was
confined to the articles on which octroi.was then leviable, but these could
c
be collected at th~.rates..Jrigher than those prevailing at the time of issuance
-of the Notification, or could be le-ried on articles then not subject to octroi.
(725-D-E]
2. It would not be a correct reading of Notification No. 4160 of ~7th D
June, 1918 to hold that it .supersede t~e Notification of 12th March, 1881
in its entirety. 'fhe supersession has to be confined to taxes mentioned in
Notification No. 4160, Octroi being not one of these taxes, so the notifica·
tion did not supersede 1881 Notification qua octroi. This conclusion
receives support from what has been stated in Notification No. 4162of17th
June, 1918 whicli has specifically _dealt with imposition of octroi duties and E
trade registration fees. (726-F]

3. Notification No. 4162 which is the subject of imposition of octroi
duties has been supplemented by Notification No. 4163 dealing with the
assessment, collection and recovery of octroi duties. This aspect has been F
dealt with by section 15(2) of the Cantonment Act, 1910; the imposition
~;'
being covered by Sub- section (1) of this section. These Notifications were
issued with the previous sanction of the Governor-General in Council, and
by issuing Notifications No. 4162 and 4163, the issuing authority did
impliedly repeal Notification of 1881 dealing
.
with octroi. (726-H, 727-A]
.
G
. 4. The Notification of June 1918 relating to Octroi duties were not
acted upon, and so, it would not be justified in allowing the Local Govern·
ment, or even the Governor-in-Council, to undo a notification issued with
the previous sanction of the Governor-General. The only legal way in which
Notifications No. 4162 and 4163 could have been rescinded was by issuance H
r

718 SUPREME COURT REPORTS [1995) 2 S.C.R.

A of another Notification in the like manner and subject to like sanction
prevailing as when those were issued. It would alo be hazardous to allow an
executive authority to obliterate a statutory Notification, especially when a
subject which fell not within the domain of the Provincial Government, but
the Central Government, as did the subject of cantonment. (728-B-D]

B 5. The principle 'contemporanea expositio' is not decisive or control-
ling of the question of construction; it has only persuasive value. If
occasion arises, such interpretation may be even disregarded an in a clear
case of error, court would without hesitation refuse to follow such con-
struction. (728-H, 729-A]
c Deshbandhu Gupta v. Delhi Stock Exchange, (1979) 3 SCR 373, relied
upon.

Polestar Electronics (P) Ltd. v.Addl. Commissioner Sales Tax, (1978)
1 sec 636, referred ,to.
D
6. Though in India the doctrine of desuetude does not appear to have
been used so far to hold that any statute has stood repealed because of this
process, there could be no objection in principle to apply this doctrine to
our statutes as well. This is for the reason that a citizen should know
whether, despite a statute having been in disuse for long duration and
E instead a contrary practice being in use, he is still required to act as per
the 'dead letter'. It would advance the cause of justice to accept tlie applica-
tion of doctrine of desuetude in our country also. Our soil is ready to accept
this principle; indeed, there is need for its implantation, because persons
residing in free India, who have been assured fundamental rights including
F what has been stated in Article 21, must be protected from their being, say,
prosecuted and punished for violation of a law which has become 'dead
letter'. A new path is, therefore, required to be laid and trodden. (731-F-G]

Brown v. Magistrate of Edinburgh, (1931) SLT (Scots Law Times
Report) 456458;/ohnstone v.Scott, [1802) 4 Pat274 andBuckoke v.Greater
G London Council, (1971) Ch 655, referred to.

Craies's Statute Law, 7th Edn. p.75 and Repeal and Desuetude by
Aubrey L. Diamond printed in Cu"ent Legal Problems, (1975) Volume 28,
referred to.

H 7. Notificatfon No 4162 dated 17th June, 1918 has stood repealed
MUN. CORPN. FOR CITY OF PUNE v. BHARAT FORGE CO. LTD. 719

'quasily' by the time new Octroi. Rules came to be framed in 1963, which A
were applied to realise octroi form the respondents. [732-D]

Westem India Theatres Y. Cantonment Board, Pune, [1959] Suppl. 2
63, referred to.

8. As a matter of policy there should be no difference in taxing the B
__,.., residents of cantonment areas and those residing in municipal areas, in
view of the fact that the former have ceased to be a separate and exclusive
colony for armed personnel. The 1881 Notification cannot be assailed on
the ground of impermissible delegation. [736-D-E]

f~ In re Delhi Laws Act, [1951] SCR 747 and Rajanarain Singh v.
c
Chainnan of Patna Demonstration Committee, [1951] 1 SCR, 290, Commit-
tee.

Bagalkot State Municipality v. Bagalkot Cement Company, [1963]
Suppl. 1 SCR 710; B. Shama Rao v. Union of Territory of Pondicherry, D
[1967) 2 SCR 650; Gwalior Rayon Silk Mfg. (Wvg.) Company Ltd. v. The
~
Assistant Commissioner of Sales Tax; M.P. Papaiah v. Excise Commissioner,
[1975) 1SCC492;A.K Roy v. Union of India, [1982) 1 SCRandBrij Sunder
Kapoor v. First Addi. District Judge, [1989) 1 SCR 561, referred to.

9. The notice required to be published by section 61 of the Canton- E
ment Act specifying, interalia, "the rate at which the tax is to be levied" of
which mention has been made in clause (c) refers to the tax to be levied,
and not which has already been levied. Clause (a) makes it clear that the
publication required by section 61 is about the tax which is proposed to

1- be imposed. These provisions would show that the objection which is to be
solicited, pursuant to the mandate of section 62, has to be regarding the
tax proposed to be imposed and the rate at which it is to be levied. The
opening sentence of section 61 mentions about the proposal of the Board
"to impose a tax" and so the imposition of which section 60 speaks of, is
F

~ of a tax proposed to be imposed by the Board, and not a tax which had
G
already been imposed by the time the Act came to be enforced. (740-C-D]

10. The 1881 Notification did in fact permit the appellant to collect
octroi duties at the rate specified in 1963 Octroi Rules framed by the
appellant; and there was no obstacle in law in allowing the appellant to do
~ s·o. (740-F]
H
7'1JJ SUPREME COURT REPORTS [1995) 2 S.C.R.

A CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2550 of ,......_
1981 etc.etc.

From the Judgment and Order dated 19.12.79 of the Bombay High
Court in S.C.A. No. 527 of 1969.

B T.R. Andhyarujine, Adv. Genl. K.J. Presswala, S.K. Agnihotri, D.M.
Nargolkar and Ms. V.D. Khanna for the Appellants.

Anil B. Divan and Shanti Bhushan, S.M. Thakore, Shyam A. Divan,
Prasant Patnaik, Ms. Meeta Sharma, B.V. Desai, Pallav Sisodia, Ravinder
C Narain and Ms. Amrita Mitra, for JBD and Co. for the Respondents.

The Judgment of the Court was delivered by

HANSARIA, J. The journey to decide the fate of these appeals has
to start form 1881 as it was on 12th March of that year that Notification
,D No. 165 was gazetted stating inter alia that octroi duties in the Cantonment
of Poona would be imposed at the rates "for the time being" leviable and
in respect of the several articles "for the time being" dutiable in the .
Municipality of Poona, when such articles would enter into the cantonment
from any place situate without the limits of the said Municipality. The
E Poona Cantonment Board authorised the Municipality to collect the octroi
which had become so leviable and thereafter .Jg divide the proceeds as
agreed upon. The Municipality of PooruMi;ving become a Corporation
under the Municipal Corporation 1950, it ,continued to collect octroi on
the strength of the aforesaid Notification and agreement. The respondents
challenged the legality of the collection of the octroi made as per 1963
F Schedule to the Octroi Rules framed by the appellant. This was done by
approaching the Bombay High Court by filing petitions under Article 226
of the Constitution which have come to be allowed by the impugned
judgment. Hence these appeals by the Municipal Corporation for the City
of Pwie, hereinafter referred as the Municipal Corporation.
G 2. The challenge to the collection was broadly on two counts :-

'{1) The 1881 Notification does not in fact permit the collection; and

, (2) even if factually the Notification were to so permit,, the appellant
H could not have done so in law.
MUN. CORPN. FOR CITY OF PUNEv. BHARAT FORGE CO. LTD. [HANSARIA, J.J 721

3. The High Court accepted both the contentions, the correctness of A
which has been assailed in these appeals.

Factual matrix

4. Poona Cantonment (the Cantonment) came into existence in 1817. B
The Bombay Municipal Act, 1872, provided for levy of taxes including
octroi. Similar was the provision in Bombay District Municipal Act, 1873.
Poona City Municipality started levy and recovery of octroi form 1875-76.
The Cantonments Act, 1880 was enacted on 5th February, 1980. Section 21
of this Act permitted imposition by the Local Government, with the
previous sanction of the Governor-General in Council, by notification in C
the Official Gazette, any tax which could be imposed in a Municipality.
Section 22 of this Act permitted the Local Government by no.tification in
Official Gazette to apply and adapt to any cantonment provisions and rules
in force under any enactment for assessment and recovery of any tax in
Municipality. D

5. The Government of Bombay by its Resolution No. 234 adopted on
26.1.1881 approved the levy of octroi in the Cantonment on the same
articles and at the same rate as in Poona City; and it approved the proposal
to divide the proceeds on some terms, the details of which are not required
to be noted. The Government of India conveyed its sanction to the kvy of E
octroi in the Cantonment by its telegram dated 4.3.1881. Thereafter came
the aforesaid Notification of 12th March, 1881 and the Municipality started
collection of octroi duties for the Cantonment from that year itself.

6. The aforesaid arrangement smoothly continued till 1912 by which p
year the Cantonments Act of 1910 had come into force. The Cantonment
then wanted a new method of apportionment as it thought that the existing
agreement relating to apportionment was unjust to it. The State Govern-
ment did not, however, agree and the disagreement was conveyed to the
Cantonment. The Municipality proposed to revise its Schedule of Octroi
Rules in 1917 by enhancing the same, which was opposed by the Canton- G
ment Committee. On the matter being examined by the Government, it
approved the revised Octroi Schedule as mentioned in its Order No. 6649
dated 25th September 1918. This Order required the General Officer
Commanding of the Cantonment to be informed that the Government saw
no reason to modify its earlier decision. H
722 SUPREME COURT REPORTS [1995) 2 S.C.R.
/
A 7. In the meantime, the Government had issued four Notifications
bearing Nos. 4160 to 4163 dated 17th June, 1918 which were gazetted on
June 20, 1918. Notification No. 4160 had been issued in exercise of powers
conferred by section 15(1) of the Cantonments Act, 1910 and it imposed
taxes mentioned in this Notification in the Cantonment of Poona "in
supersession of the notifications of the Government noted on the margin
B and all other notifications on the same subject". Notification No. 4162 had
also been issued in exercise of the same power and it dealt inter alia with
octroi duties. Notification No. 4163 was, however, in exercise of powers
conferred by section 15(2) of the aforesaid Act and applied to the Canton-
ment of Poona in an adapted form the rules of the Poona City Municipality "
C mentioned in Notification relating to assessment, collection and recovery
of octroi duties.

8. After the aforesaid Notifications had been issued, the Canton-
ments Act, 1924 was enacted. Chapter V of this Act is on the subject of
D 'Taxation'; and sections 60 to 63 of this Chapter set out the power and
procedure of imposition. of any tax in any cantonment. (A part of this Act
was repealed in 1927).

9. In 1963 new Octroi Rules were framed by the appellant which ,
enhanced the rates of octroi and included new articles in the schedule and
E it started collecting octroi accordingly from all concerned.

Submissions

10. In the backdrop of aforesaid broad facts, the respondents chal-
lenged the collection of octroi by appellant as per revised Rules of 1963
F contending that neither in fact nor in law the appellant had 'authority of
law' required by Article 265 of the Constitution to carry on the work of
collection of octroi from them as per 1963 schedule which enhanced the
rates of octroi and included new articles in the schedule.

11. The factual aspects of the submission were:-
G
(1) The 1881 Notification having stated that octroi duties at the rates
"for the time being" leviable in respect of the article "for the time being"
dutiable, are imposed, the rates which were prevailing on 12th March, 1861
and the articles on which octroi was leviable on that date alone could be
H collected by the appellant; and not at the rates mentioned in the Schedule
MUN. CORPN. FOR CITY OF PUNEv. BHARAT FORGE CO. LTD. [HANSARIA, J.) 723
,
of 1963 Octroi Rules, nor on articles added by those Rules. A
(2) The 1881 Notification, in any case, stood superseded by the
fasciculus of Notifications dated June 18, 1918 which had heen duty
gazetted.

(3) If the later Notifications did not supersede the 1881 Notification, B
the same, in any case, impliedly repealed the former.

12. The legal afirmity of the collection was assailed on these counts:-

(1) The appellant not having entered into an agreement with the
Cantonment as required by section 45(1)(b) of the Cantonments Act, 1924, C
so also by section 32(4) of the Bombay l>rovincial Municipal Corporations
(
Act, 1949, after new Octroi Rules were framed in 1963, it had no authority
to collect octroi on behalf of the Cantonment.

{2) If the Notification of 1881 were to be held to permit levy and D
collection of octroi not only on the rates and articles as prevailing on 12th
March, 1881 but on articles other than those and/or at rates higher than
those, the notification is unsustainable being a product of impermissible
delegation.

{3) The procedure contemplated by section 62 of the Cantonments E
Act, 1924 having not been followed while enhancing the rates of octroi
duties by 1963 Rules, collection of the same at the enhanced rate would be
against 'authority of law'.

13. We propose to deal with these submissions seriatim.
F
Reach of the 1881 Notification

14. The basic point which would need our consideration to answer
this question is to find out what was meant by the expression "for the time
being" used twice in the aforesaid Notification. According to S/Shri Shanti
Bhushan and Anil Divan, learned Senior Advocates appearing for the G
respondents, this expression refers to the rates of octroi which were
prevailing at the time when the Notification was issued; and octroi on the
articles or at the rates which became effective after the Notification saw
the light of day cannot be imposed or collected with the aid of this
notification. H
724 SUPREME COURT REPORTS (1995) 2 S.C.R.

A 15. In support of this submission, reliance has been placed on a
judgment of this Court, to which one of us (Kuldip Singh, J.) was a party,
in Jivendra Nath Kaul v. Collector/Distlict Magistrate and another, (1992) 3
SCC 576. In that case, this Court was concerned to find out the purport of
this expression used in section 28(1) of the concerned provision, which
B dealt with the question as to when a motion of no-confidence can be said
to be carried out. The section required support of more than half of the
total number of members "for the time being". The contention advanced
was that as the Zila Parishad was constituted of 62 members, but as 31
valid votes had been cast in favour of the no-confidence motion, which
number was not more than half of 62, the In:otion could not be said to have
C been carried out as required by the statutory provision. This Court stated
'that the expression "for the time being" meant "at the moment or existing
position"; and as at the time no-confidence motion was taken up, the total
number of members of the Zila Parishad was 56, it was held that the
requirement of law was satisfied.
D 16. Learned Advocate General of Maharashtra appearing for the
appellant, however, contends that the aforesaid expression has no fixed
. connotation and is capable of different interpretation according to the
context. This is what been stated at page 267 of Volume 2 of "Words and
Phrases" (Second Edition). According to the statement made there, this
E expression in one context may point to "one single period of time"; and in
another context to "succession of periods".

17. That the aforesaid expression means, as is the contention on
behalf of the appellant, receives support from what was pointed out by a
Constitution Bench in the case of Madhav Rao Scindia Bahadur v. Union
F of India, (1971) 1 SCC 85. In that case, to which our attention has been
invited by the learned Advocate General, while dealing with the meaning \.--- f
of the word "Ruler" as defmed by Article 366 (22) of the Constitution,
which had stated at that time that it included any person "for the time
being" recognized by the President as the successor of the Ruler with whom
G any agreement had been entered into and who had been so recognised by
the President, it was observed in paragraph 112 that the expression "for the
time being" predicates that there shall be a Ruler of Indian State and that
if the first recognised Ruler dies, or ceases to be a Ruler, a successor shall
be appointed, and that there shall not be more Ruler than one at a given
' \ \

time. This observation indicates that the recognition given by the President
H is not one time recognition, but the same could be from time to time.
' MUN. CORPN. FOR CITY OF PUNEv. BHARAT FORGE CO. LTD. [HANSARIA J.J 725

18. That the intention of the concerned authorities while issuing the A
Notification at hand was not confined to the rates prevailing or articles
'"""' subjected to octroi on the date of Notification is apparent, according to
the learned Advocate-General, from what has been recorded contem-
poraneously in the Government file, a zerox copy of relevant notings of
which has been made available to us by him. At page 13 of this collection
we find mention of the fact that rates of octroi duties to be imposed and
B
the articles on which octroi is to be imposed in the Cantonment were to
be so as enforced in the Municipality "from time to time". There is also
l.,.,, enough material on record to show that octroi at rates prevailing sub-
sequent to the date of aforesaid notification had come to be collected by
the Municipality on behalf of the Cantonment for a sufficient long period c
"' - after the issuance of 1881 Notification. Thus, all :oncerned persons had
accepted the aforesaid Notification to mean that the rates (so also the
articles) need not be those which prevailed when the Notification was
issued.
I)
19. In view of .all the above, we hold that the 1881 Notific-dUOn was

•..-._
meant to impose octroi duties, not only at the rates prevailing when the
Notification was issued, nor was confined to the articles on which octroi
was then leviable, but these could be collected at rates higher than those
prevailing at the time of issuance of the Notification, or could be levied on
articles then not subject to octroi. E
Supersession of 1881 Notification

20. The submission relating to supersession is advanced on the
strength of what was stated in Notifications Nos. 4160-4163 dated 17th
i
--J June, 1918. Shri Divan was very emphatic that if these four notifications F
are read as a whole, as they are required to be, there would be no manner
of doubt that the 1881 Notification relating to octroi stood superseded. This
_,,.
contention is equally emphatically challenged by the learned Advocate
General.
1
21. We have closely perused the aforesaid Notifications and we do G
agree with Shri Divan that they form a complete scheme in themselves
>-I
relating to tax in the Cantonment of Poona; and what has been stated in
these Notifications would prevail insofar as taxes to be imposed in the
Cantonment is concerned, in preference of earlier Notifications on the
subject. Question, however, is whether it can be said on the language of H
SUPREME COURT REPORTS [1995) 2 S.C.R.

A the 1918 Notifications, that the 1881 Notification relating to octroi stood
superseded. It deserves mention that Notification No. 4160 alone, of the
four Notifications, expressly stated about supersession of the Notifications
mentioned in the margin of this !')lotification.. Shri Divan draws our atten-
tion that of the four Notifications mentioned in the margin, one is Govern-
B ment Notification No. 481 dated 18th September, 1891, which had
superseded Government Notification No. 574 of 5th December, 1883,
which in its turn had superseded Notification No. 165 of 12th March, 1881.
Relying on this historical setting, it is urged that Notification No. 4160 must
be held to have superseded the Notification of 12th March, 1881 relating
to octroi also .
.c 22. The learned Advocate General joins issue and submits that
Notification No. 4160 having not dealt with the subject of octroi, what can
reasonably be said to have been superseded by this Notification qua the
Notification of 12th March, 1881 had dealt not only with the octroi duties
. hntProperty Rates also, is that the supersession of which Notification No.
D 4160 mentioned, is-of·those taxes which.were-the subject or'that Notifica-
tion. It is contended that this Notification stated about supersession of
notifications "on the same subject", which, accor~_to learned Advocate
General, means the subject dealt with by that Notification. ·

E 23. We do find sufficient force in this submission and, according to
us, it would not be a correct reading of Notification No. 4160 to hold that
it superseded Notification of 12th March, 1881 in its entirety. In our view,
the supersession has to be confined to truces mentioned in Notification No.
4160. Octroi being not one of these truces, we hold that that Notification
did not supersede 1881 Notification qua octroi. This conclusion of ours
F receives support .from what has been stated in Notification No. 4162 which
has specifically dealt with imposition of octroi duties and trade registration
fees.

Implied repeal of 1881 Notification relating to octroi

G 24. The alternative sub~sion of Shri Divan in this context is that,
in any case, Notification No. 4162 has to be read to have impliedly repealed
1881 Notification relating to octroi duties. We find no difficulty in accept-
ing this submission, because Notification No. 4162 which is on the subject
of imposition of octroi duties has been supplemented by Notification No.
H 4163 dealing with the assessment, collection and recovery of octroi duties.
MU~.CORPN. FORCITYOFPUNEv. BHARAT FORGE CO. LTD. (HANSARIA,J.) 727

This aspect has been dealt with by section 15(2) of the Cantonments Act, A
1910; the imposition being covered by sub-section (1) of this section. As
'"""""(
these Notifications were issued with the previous sanction of the Gover-
nor-General in Council, we have no hesitation in stating that by issuing
Notifications No. 4162 and 4163, the issuing authority did impliedly repeal
Notification of 1881 dealing with octroi.
B
25. The learned Advocate General does not really contest this legal
"1
position. What, however, has been urged by him is that the Notification No.
'
of 1918 dealing with the imposition of octroi and rates thereof had not been
( acted upon and a decision had in fact been taken to formally cancel these
Notifications, which, however, did not actually happen. Despite non-can- c
...,.,, cellation of these Notifications as required by section 21 of the General
Clauses Act, as per which provision any addition, amendment, variation or
rescission of any notification has to be "in the like manner" and "subject to
the like sanction" as the issuance of notification, the contention is that if
we were to bear in mind the practical construction given to these Notifica- D
lions, it would be apparent that they were not sought to be acted upon.
Another related submission is that these Notifications should be deemed
""__.., to have stood effected because of disuse for almost 50 years by 1963, as
permitted by the legal process known as "desuetude".

E
26. Shri Divan and Shri Shanti Bhushan would not agree with the
learned Advocate General, because, according to them a statutory notifica-
tion could not be set at naught by any executive decision, which is the basis
of the first sQbmission of the. learned Advocate General relatable to
practical construction. The learned counsel for respondents submit that the F
Local Government knew that even an, amendment of these Notifications
could be made only by publication in official gazette, because of which the
little omission which had occurred iri the Notification No. 4163 has been
supplied by a corrigendum published in official gazette. Our attention is
inv:l.ted to what was stated on this subject in Mahender Lal Jaine v. State of
Uttar Pradesh, [1963] Supp. 1 SCR 912 at page 951. In the written submis- G
j sions of the respondents filed on 31st January, it has been mentioned, and
.J rightly, that administrative practice (and for that matter, administrative
order) cannot supersede or override statutory rule or Notification. Some
decisions have also been mentioned in this regard to which we are not
adverting, because this legal proposition is well settled. H
SUPREME COURT REPORTS [1995) 2 S.C.R.

A 27. As we are agreeing with the learned counsel for the respondents
on the legal aspect, we do not propose to burden the judgment with the
long factual facts, highlighted by the learned Advocate General by referring
to Government Order No. 6649 dated 25th September, 1918 (at page 472
to 482 of Part-II of the Paper Book) that the Notifications of June 1918
B relating to octroi duties were not acted upon. We would not be justified in
allowing the Local Government, or even the Governor-in-Council, to undo
a notification issued with the previous sanction of Governor-General in
Council. According to us, the only legal way in which Notifications No.
4162 and 4163 could have been rescinded was by issuance of another
Notification in the like manner and subject to like sanction prevailing as
C when those were issued. It would also be hazardous to allow an executive
authority to obliterate a statutory Notification. We would take this view,
more so, being concerned with a subject which fell, not within the domain
of the Provincial Government, but the Central Government, as did the
subject of cantonment.

D 28. What has been stated relating to "executive const~uction" or
"practical construction" in Crawford's 'Interpretation of .Laws; at pages 393
· to 401, which has been relied on by the learned Advocate General, would
not persuade us to agree with him in this submission, though it may be
permissible to take note of post-enactment history to find out as to how an
E enactment was understood on the principle of 'contemporanea expositio",
of which mention have been made at pages 551 et. seq. of Francis
Bennions' "Statutory Interpretation" {1984). The learned Advocate General
is not relying on the statements made in the aforesaid Government Order
for the purpose of interpreting the two Notifications, but for contending
F that the Notifications had stood effaced because of what had been stated
therein.

29. On the principle of 'contemporanea expositio' also, which is
available to find out how a statutory provision has been understood by
those whose duty it is to construe, execute and apply, as mentioned at pages
G 659-60 of Polestar Electronics (P) Ltd. v. Addi. Commissioner, Sales Tax,
(1978) 1 SCC 636 and at page 383 of Deshbandhu Gupta v. Delhi Stock
Exchange, [1979) 3 SCR 373 (to which our attention has been invited by \.
the Advocate General through his written Arguments filed on 23.1.95), we
have two observations to make. First, this principle is not decisive or
H controlling of the question of construction; it has only persuasive value. If
MUN. CORPN. FOR CITY OF PUNE.-. BHARAT FORGE CO. LTD. [HANSARIA. J.) 729

occasion arises, such interpretation may be even disregarded and in a dear A
''"""(
case of error court would without hesitation refuse to follow such construe-
tion. (See observations of Mukherji J. in Balaeswar v. Bltagiratlti, ILR 35
Cal.701 noted in Deshbandhu's case). Secondly, as already stated, reliance
is being placed on the notings in the file, not to interpret t,he Notifications
in question, but to declare then as dead. This is not permissible. Not only
B
this, Shri Divan has objection to the reliance on the notings made in the
/
file even for the purpose of interpretation of the Notifications, in support
~

r of which submission he has referred to what was stated in para 39 of
Doypack Const1Uction Pvt. Ltd. v. Union of India, [1988) 2 SCC 299. As to
the reliance on the decision in Polestar Electronics' case, it has been
~ . mentioned in the written submissions filed on behalf of the respondents
c
that in that case itself it was stated at page 660 that the view of the
Department as to the meaning of a statute administered by it is not
admissible as an aid to construction because "wrong practice does not make
the law". It has been further argued that the present was, in any case, not
a case of a statutory provision being interpreted by the Department, in D
.... ..... which case it may be that the interpretation put upon it has some sanction.
if there be long acquiescence by the legislature, as mentioned in Maxwells'
'Interpretation of the Statutes', noted in the aforesaid decision at page 660.

Quasi-repeal of 1918 Notifications due to desuetude. E

30. Learned Advocate-General's another submission relating to im-
plied repeal is that the 1918 Notifications having not been acted upon must
be taken to have become a dead letter because of its long disuse and the
--........
same stood repealed because of the legal process known as desuetude. He F
draws our attention to what has been stated in this regard in Francis
Bennion's 'Statutory Interpretation' where this. matter has been dealt at
·pages 441 and 442 of 1984 Edition. It is stated there that desuetude is a
legal process by which, through disobedience and lack of e':lfo~cement over
a long period, a statute may loose its force without express or implied
I repeal. This doctrine has not, however, been accepted in United Kingdom G
../ for the reason that otherwise an inquiry would be needed before the subject
could know whether or not an enactment would bind him. Under Scots
Law, however, this doctrine has been applied. As to the English Law the
further commentary is that though this doctrine has no application, an Act
may in practice be 'dead letter', which would be so if the Act falls into H
730 SUPREME COURT REPORTS (1995) 2 S.C.R.

A disuse or is not applied as intended. In this connection Bacon's dictum:
'.... let penal laws, if they had been sleepers for long.....be ....confined in the
execution' is quoted. Reference has also been made to what happened to
the Limitation Act, 1623, apart form mentioning about the refusal to act
according to Sex Disqualification (Removal) Act, 1919, despite which
B enactment a peeress was denied the right to sit in the House of Lords, vide
Committee of Privileges, Viscountess Rhonddas' Claim 1922-2-AC 339.
(HL). The judicial emasculation of the first Act had caused Lord Sumner
to lament the difficulty of extracting' .......anything that deserves to be called y -.
a principle from the decisions of three centuries, which have been directed
to what is afterall the task of decorously disregarding an Act of Parliament'. '\
31. In Craies's Law' 'Statute Law' (7th Edition) it has been stated
at page 7 that desuetude is a process by which an Act 'of Parliament may
lose its force without express repeal. It does not, however, consist merely
of obsolescence or disuse: there must also be a contrary practice, which
must be of some duration and general application. Lord Mackay's view in
D Brown v. Magistrate of Edinburgh, [1931) SLT (Scots Law Ti:nes Reports)
456 ( 458) has also been noted, which is as below

"I hold it clear in law that desuetude requires for its operation
a very considerable period, not merely of neglect, but of contrary
E usage of such a character as practically to infer such completely
established habit of the community as to set up a counter law or
establish a quasi-repeal".

A perusal of this judgment shows that Lord Mackay ventured to prefer the
F Scottish system to that of England regarding which Lord Eldon, as a
member of House of Lords, had stated thus in Johnstone v. Scott, (1802] 4
Pat 274 at p.285:-

"The English lawyer feels himself much at a loss here; he cannot
conceive at what period of time a statute can be held as commenc-
G ing to grow in desuetude, nor when it can be held to be totally
worn out. All he can do is to submit to what great authorities have
declared the Law of Scotland to be."
\
Lord Mackay thereafter enunciated the afore-quoted test of desuetude for
H it to permit quasi-repeal.
{

MUN.CORPN. FORCITYOFPUNfa. BHARAT FORGE CO. LTD. [HANSARIAJ.j 731

32. It would be useful to note what has been stated in this regard in A
the chapter headed 'Repeal and Desuetude of Statutes' by Aubrey L.
Diamond, printed in Current Legal Problems (1975), Volume 28 at page
107 to 124. Diamond has quoted on this subject what Lord Denning M.R.
observed in Buckoke v. Greater Lo11do11 Council, (1971J Ch.655 at page 668,
which reads:-
B
"It is a fundamental principle of our constitution, enshrined in
the Bill of Rights, that no one, not even the Crown itself, has 'the
power of dispensing with laws or the execution of law'. But this is
subject to some qualification. When a law has become a dead
letter, the police need not prosecute, nor need the Magistrates C
.punish. They can give an absolute discharge."

33. Diamond has thereafter referred to the Scottish approach to
desuetude at pages 122 and 123 and has noted some decisions wherein an
Act of Scottish Parliament was not enforced because of desuetude. It
would be of interest to note that when an argument was advanced that the D
particular Act (which was of 1606) had been left unrepeated by the Statute
Law (Repeals) Act, 1906, and must, therefore, be regarded as. still in force,
the reply given by one of the law Lords was that "it was for the Court and
not for the Statute Law Revision (sic Repeal) Act to determine whether
Act of 1606 was or was not in desuetude." E
34. Though in India the doctrine of desuetude does not appear to
have been used so far to hold that any statute has stood repealed because
of this process, we find no objection in principle to apply this doctrine to
our statutes as well. This is for the reason that a citizen should know
- I whether, despite a statute having been in disuse for long duration and F
instead a contrary practice being in use, he is still required to act as per
the 'dead letter'. We would think it would advance the cause of justice to
accept the application of doctrine of desuetude in our country also. Our
soil is ready to accept this principle: indeed, there is need for its implan-
tation, because persons residing infree India, who have assured fundamen- G
tal rights including what has been stated in Article 21, must be protected
J from their being, say, prosecuted and punished for violation of a law which
has become 'dead letter'. A ne"". path is, therefore, required to be laid and
trodden.

35. In written submissions filed on behalf of respondents, it has been H
\-

732 SUPREME COURT REPORTS [1995) 2 S.C.R.

. A stated that the theory of desuetude can have no application to the facts of
the present case, since the challenge by the respondents is to be levy and
calculation under the 1963 schedule, and not to the rates enforceJ since
1918. This submission has been characterised as "most important". As to
this we would observe that if Notification of 1818 were to prevail despite
B 1918 l:'lotifications, the fact that some changes were made in the schedule
in 1963 has no legal bearing on the question under examination. The theory
of desuetude has been pressed into service by the appellant only to take
care of relevant 1918 Notifications. If those Notifications can be said to
stand eclipsed, the fact that changes were made in the rates etc. in 1?63
cannot stand in the way of application of the theory of desuetude.
c
36. Coming to 1918 Notifications, we find materials on record to
show that it has not been implemented till date; and in fact what has been
done was contrary, and.that too for long period. So, we hold that Notifica-
tion Nos. 4162 and 4163 dated 17th June, 1918 had stood repealed 'quasily'
by the time new Octroi Rules came to framed in 1963, which were applied
D to realise octroi from the respondents. The statement made in the written
submissions filed on behalf of the respondents that this Court had treated
Notification No . 4160 as operative in the case of Western Indiu. Theatres v.
Cantonment Board, Pune, [1959) Suppl. 2 SCR 63, does not affect the view
taken by us relating to quasi-repeal of Notification Nos. 4162 and 4163
E inasmuch as the field of operation of Notification No. 4160 is different from
· that of two later notifications, as already noted.

Legal objections

37. Being satisfied that 1881 Notification held the field even by 1963,
F the legal objections relating to its applications may now be dealt with.
These objections as already noted, are (1) lack of agreement as required
by law; (2) impermissible delegation; and (3) non-compliance with the ·
procedure mentioned in section 62 of the Cantonments Act, 1924. '-.

38. We shall deal with these objections as well seriatrim.
G
Lack of agreement as required by law

39. That such an agreement is required is not disputed by the learned
Advocate General. His stand is that such an agreement had in fact been
H entered into between the Poona Cantonment Board and: Poona City·
.·,-; / .
·:-.---.;---;:.,,,r:- -,,,, :, \
- ·:,; ! ( .l ~. ·~~
',·.
.. -,, .. ,,; ~." . I.
- • MUN.poRPN.FORCITYOFPUNEv. BllARATFORGE=Lm. [HANSARIA,J.J 733
-
-'
·~
.
Municipality in 188l and the same was being renewed from time to time, A
·---~-·-·------

as \vould appear from the resolutions of the Cantonment board, copies of
which have been printed in Appeal Paper Book (ii) at pages 245-428. As
we have held that the 1881 Notification held the field by 1963, the fact that
no agreement was entered ii.to after the Octroi Rules of 1963 were framed
by the appellant, as had been done between Poona Municipal Corporation
and Kirkee Cantonment oo.Jd, is not relevant. We, therefore, do not find · B
any legal infirmity in enforcement of 1963 Octroi Rule~ on the ground of
. lack of agreement with the Poona Cantonment Board after these rules
came into force. -· ·- -- · ·

Impermissible delegation c
40. Shri Shanti Bhiishan has taken painS. to impress upon us that if
. we were to' read the expression 'for the time being' fmding place in 1881
Notification to mean 'from time to· time',. that notification has tO be struck
down because of the delegation of an essential feaatte of the statute, which
is not permisSI'ble in law. D
41. On the question of permiSSI'ble extent of delegation the leading
judgment is one rendered by a 7-Judge Bench of this Court in In Re Delhi
Laws Act, · 1951 SCR 747. The ratio of that decision came to be applied to
a taxing statute in Rajnarain Singh v.' Chairman, of Patna Demonstration
Committee, (1955] 1 SCR, 290. It was· held there by the majority that a E
•delegatee has no power to chllnge a policy. of the statute; and imposition
of tax without observing the formalities presen'bed by the statutewas held
to be a change in the legislative policy. The -statute which had come to be
examined in that case had 'required an opportunity to be given to raise
objection; but the notification issued by the delegate which had the effect F
of levying tax, had been done without inviting objection. The same was,
therefore, was struck down as ultra vires. ·

- 42. Shri Shanti Bhushan contends that the octroi collected by the
appellant being from persons residing in Poona Cantonment, opportunity
was required to. be given to them to have their say if they have objection G
to the enhancement or rate of cidl'l>i .or. for imposition of octroi on new
0

· articles as the 1963 Rules purporteil to dq, It is urged that becau5e of the
special importance of cantonmen~ . the-. ¢entral Government _ has been
conferred with the p(Jwer to control these areas; and it is because of this
that the Cantonments Act of l~ required by its section 62 to seek . H .
734 SUPREME COURT REPORTS [1995] 2 S.C.R.

A objection before imposing any taxation which had admittedly not been
done in the present case; and so, octroi could not have collected by the
appellant at least after coming into force of the 1924 Act. (As we would
point out later, section 62 has no application to the facts of the present
case. The non-inviting of objection has therefore introduced no legal
B infirmity).

43. In support of his submission, Shri Shanti Bhushan has further
referred to Bagalkot State Municipality v. Bagalkot Cement Company, [1963)
(Slipp.) 1 SCR 710 wherein the stand of the municipality that octroi duty
had beeome automatically realisable from that area which had come to be
C included within the municipal limits following the enlargement of the limit,
was held to be not sustainable. What had been stated in that case has no
applieation, because here the appellant is not trying to realise octroi from
the residents of the Poona Cantonment because of enlargement of the
limit of Poona Municipality.
D
44. Shri Shanti Bhushan then places reliance on B. Shama Rao v.
Union Territory of Pondicherry, [1967] 2 SCR 650. There, the particular Act
of Pondicherry Legislative Assembly was held to be an abdication or
effacement by the law making authority inasmuch as it had by the Act in
question allowed the amendments to be made in the parallel Madras
E statute to prevail in Pondicherry without knowing what those amendments
would be Shri Shanti Bhushan contends that same would be the position·
- here if the 1881 Notification were to be read, as contended by the appel-
lant, as that would permit changes in the rates of octro~ without knowing
what the same would be, to prevail in the Cantonment area also.
F
45. Learned Advocate General has contended that the case of Shama
Rao was distinguished in Gwalior Rayon Silk Mfg. (Wvg.) Company Ltd. v.
The Assistant Commissioner of Sales Tax, [1974) 2 SCR 879. In this con-
nection what was stated by Khanna, J. at pages 885-6 and by Mathew J. at
pages 908-9 has been brought to our notice. In that case the validity of
G section 8(2)(b) of the Central Sales Tax Act, 1956 was assailed on the
ground that it suffered from the vice of excessive delegation inasmuch as \
it stated that the rate of central sales tax in case of goods other than ~-
declared goods shall be calculated at the rate of 10%, or at the rate
applicable to the sale or purchase of such goods inside the appropriate
H State, whichever is higher. The Constitution Bench rejected the contention
' MUN. CORPN. FOR CITY OF PUNEv. BHARAT FORGE CO. LTD. (HANSARIA. J.J

because of clear legislative policy being discernible in what has been
735

A
provided in the impugned section. This shows that merely because the
matter of rate at which tax is required to be imposed is left to be deter-
mined by some authority other than the one which imposes it; the same
would not be impermissible in law.

46. Still another decision pressed into service by Shri Shanti Bhushan B
in this context is that of Atlas Cycle Industries v. State of Haryana, [1971) 2
SCC 564: A perusal of this decision shows that it too was on a different
point. There, the effort of the Municipality of Sonipat to realise octroi on
the force of Notification which had been issued earlier was not upheld,
because the relevant section did not take care of Notifieation, but had C
mentioned about rules,. bye-laws, orders, directions and powers.

47. To buttress his submission, the learned Advocate General brings
to our notice the decision in MK Papaiah v. Excise Commissioner, [1975} 1
sec 492, in which it was held that if the legislature retained its control
over its delegate by excising its power of repeal, the. same would meet the D
objection relating to excessive delegation, for which purpose the test to be
applied is not whether the legislature has delegated any matter relating to
essential policy. It is contended that what was stated in Papiah's case by a
three-Judge Bench through Mathew, J. was accepted as correct by a
Constitution Bench in A.IC Roy v. Union of India, (1982] 1SCC271. E
48. What was held in Brij Sunder Ka.poor v. First Addi. District Judge,
[1989] 1 SCC 561 is more relevant for our purpose, because in that case a
two-Judge Bench of this Court had upheld the delegation as contained in
section 3 of Cantonment (Extension of Rent Control Laws) Act, 1957, by
which the Central Government by a notification in official gazette could F
extend to any cantonment any enactment relating to control of rent which
was in force in the State in which the cantonment is situated. The Bench
disginuished Shama Rao's case and held that the delegation was valid,
including that part of it by which amendments in the concerned State
legislation were allowed to become effective in the cantonment area as well. G
,) 49. What was stated in Brij Sunders' case about the typical situation
of cantonment in para 25 is more important for our purpose. The same is
as below:-

"These cantonment were located in the heart of various cities H
r

736 SUPREME COURT REPORTS (1995) 2 S.C.R.

in the different States and unlike the position that prevailed iq
A .,....
early years, had ceased to be a separate and exclusive colony for
army personnel. It was, therefore, but natural for Parliament to
decide, as a matter of policy, that there should be no difference,
in the matter of housing accommodation, between persons residing
in cantonment. areas of a State and those residing in other parts
B of the State and it is this policy that was given effect to.... Having
decided upon this policy, it was open to Parliament to do one of
two things: pass a separate enactment in respect of the cantonment
areas in each State or to merely extend the statutes prevalent in
other parts of the respective States by a single enactment. The
c second course was opted upon...~ .."

50. What was stated relating to cantonments in the aforesaid excerpt
qua housing accommodation should apply, according to us, to levy of taxes
as well on persons residing in cantonment areas. It can well be said that as
a matters of policy there should be no difference in taxing the residents of
D cantonment areas and those. residing in municipal areas, in view of the fact
that the former have ceased to be a separate and exclusive colony for
armed personnel, as pointed out in the aforesaid case.

51. This being the legal position, we hold that the 1881 Notification
E cannot be assailed on the ground of impermissible delegation. The second
legal infirmity also, as canvassed by the learned counsel for the respon-
dents, therefore, does not exist.

Non-compliance with the procedure mentioned in section 62 of the
Cantonment Act, 1924. \ .._....,._-
F
52. That the procedure contemplated by section 62 has not been
followed is not in dispute. The stand of the appellant is that procedure was
not required to be followed. The respondents have serious objection to this
stand of the appellant.

G 53. The objection is founded on the legal proposition that enhance- I

ment of rates by the Octroi Rules of 1963 have to be taken as imposition ~
of octro~ which would have required invitation of objections, of which
mention has been made in section 62. The question for determination is
whether enactment of rates of octroi can be said to be imposition of octro~
·H in which case alone. section 62 would get attracted, because of what has
' MUN. CORPN. FOR CITY OF PUNEv. BHARAT FORGE CO. ·LTD. (HANSARIA J.)

been stated in sections 60 and 61. That this is so is very strenuously A
737

contended by Shri Anil Divan by placing reliance on two decisions of this
Court, one of which is of Constitution Bench: 171e Amalgamated Coal
Fields Ltd. v. Janapada Sabha Chhindwara, (1963) Supp. 1 SCR 172; and
another by a two-Judge Bench: in Dharangadhara Chemicals Works Ltd. v.
State of Gujarat, (1973) 2 SCC 345.
B
54. In Amalgamated Coal Field's case the legality of levy of the tax
imposed on coal at 9 pies per ton by the Janapada Sabha of Chhindwara
was assailed on the ground that the same was in violation of section 51(2)
f of the concerned Act (noted at page 191 of the Report) which had laid
down that the 'first imposition' of any tax shall be the subject to the C
previous sanction of the Provincial Government. The tax on coal had not,
however, been imposed for the first time on the residents of the Janapada
Sabha. What the Janapada Sabha had done was that the tax which was
earlier being levied by a Mining Board (whose successor the Sabha was)
at the rate of 3 pies per ton had been enhanced to 9 pies. The appellant D
took a stand that though the Janapada Sabha had only enhanced the rate
of tax, the same could have been done only with the previous sanction. of
the Provincial Government, as laid down in section 51(2), despite the
section having required this for 'first imposition'. The Constitution Bench
upheld this contention. Mr. Divan, therefore, contends that the enhance-
mtont of rate of octroi duties by 1963 Rules could have been done only in E
accordance with the provisions contained in sections 60 to 63 of the
Cantonments Act, 1924.

55. Learned Advocate General, however, submits that what was held
by the Constitution Bench in the aforesaid case may not be taken to mean F
I
that every case of enhancement of rate would be first or fresh imposition
of tax. According to the learned counsel, the Constitution bench had
regarded the imposition of the levy at the altered rates as 'first imposition'
only in the context (this word has been used at page 193 of the Report) of
what had happened; and it is because of this that the altered rates were
'deemed' (page 194) to have been .included in the expression 'first G
impositon'. The context, as per the learned counsel, was that the J anapada
Sabha had levied the tax for the first time and it is because of this that it
was taken to be first imposition qua the Sabha residents. Learned Advocate
General submits that if what was held by the Constitution Bench were to
be taken literally, even if the rate of any tax were to be enhanced, say, even H
738 SUPREME COURT REPORTS [1995) 2 S.C.R.

A by 1%, the same would required the procedural aspect relating to imposi-
tion of tax to be gone through whole hog, which could not have been the
intention of the Constitution Bench.

56. We have duly considered the rival submissions. Nothing really
turns on the rate of change, according to us. It cannot be that if the change
B be significant (say, 100%) then only the same would be a case of fresh
imposition, but if it be insignificant (say, 1% as mentioned by the Advocate
General), the same would not be a case of fresh imposition. Even so, what
has been contended by the learned Advocate General seems to have force,
as in Amalgamated Coal Field's case this Court did deal with a levy which
C had been imposed for the first time by the J anapada Sabha.
57. Shri Divan urges that what was held by the two-Judge Bench in
Dharangadhara Chemicals' case (supra) would not leave anything to doubt
that increase in rate of tax has to be taken to be a case of imposition of
tax. But in that case also the Municipality's increase of octroi was its first
D act, because of which what has been urged by the learned Advocate
'
General qua.
Amalgamated
.
Coai Field's case would apply to this case also.

58. The case of Visakhapatnam Municipality v. K Nukaraju, [1976) 1
SCR 544, which was cited by Shri Shanti Bhushan in some other context,
is more relevant in the present context. There, what happened was that no
E ·opportunity to object was given to the persons of the area, which had come
to be included in the municipality subsequently, before callmg upon the
residents to pay tax in question. Though the municipality in that case lost
on some other ground, what bad been stated about the need to call ·for
objections is relevant inasmuch as it was st~ted that even for impositio.n of
F tax as new rate objection is required to be invite~. This stand was taken,
according to us, because the proviso to section 81(2) of the concerned Act
(noted at page 548) had stated that before passing a resolution imposing a
tax for the first time or increasing the rate of an existing tax the council shall
publish a notice in the prescribed manner declaring the requisite intention.
G It is because of this requirement that the need for calling objections for
increased rate as well was held obligatory.

59. This is not propose to say on this importap.t facet of the appeals.
We think that if sections 60 to 63 of the 1924 Act are read closdy it would
appear that for change in the rate of tax already in operation, objections
H are not required to be invited. To bring home this, let sections 60 to 63 of
' Mt)N.CORPN. FORCITYOFPUNE~:· BHARAT FORGE CO. LTD. )HANSARIAJ.J 739

the Act, which together form a chain, be noted:- A
"60. General power to taxation -

(1) The Board may, with the previous, sanction of the Central
Government, impose in any cantonment any tax which under any
enactment for the time being in force, may be imposed in any B
municipality in the State wherein such cantonment is situated:

(2) Any tax imposed under this section shall take effect from the
date of its notification in the official Gazette, or where any later
date is specified in this behalf in the notification from such later
date. · C

61. Framing of preliminary proposals -

When a resolution has been passed by the Board proposing to
impose a tax under section 60, the Board shall in th<! manner
pre"crihed in section 255 publish a notice specifying - D
(a) the tax which it is proposed to impose;

(b) the persons of classes of persons to be made liable and the
description of the property or other taxable thing or circumstance
in respect of which they are to be made liable; and E
(c) the rate at which the tllX is to be levied.

62. Objections and (JiSposal thereof -

F
' (1) Any inhabit of the cantonment m_ay, within thirty days from the
publication of the notice under section 61, submit to the Board an
objection #1 writing to all or ~my of the proposals contained therein
and th~ Board shall take such objection into consideration and
pas$ orders thereon by special resolution.

(2) Unless the Board decides to abandon its proposals contained G
in the notice published under section 61, it shall submit to the
Centra't Government through the Officer Commanding in-Chief,
the command, all such· proposals alongwith the objections, if any,
received in connection therewith together with its opinion thereon
and any modifications proposed in accordance with such opinion H
740 SUPREME COURT REPORTS [1995] 2 S.C.R.

A and the notice published under the said section.
.,.._,
63. Imposition of tax -

(1) The Central Government may authorise the Board to impose
the tax either in the original form or, if any objection has been
B submitted in that form or any such modified form as it thinks fit."

60. The aforesaid shows that the notice required to be published by
section 61 specifying, inter alia, "the rate at which the tax is to be levied",
of which mention has been made in clause (c), refers to the tax to be levie~,
and not which has already been levied. Clause (a) makes it clear that the
C publication required by section 61 is about the tax which is proposed to be
imposed. These provisions would show that the objection which is to be
solicited, pursuant to the mandate of section 62, has to be regarding the
tax proposed to be imposed and the rate at which it is to be levied. The
opening sentence of section 61 mentions abut the proposal of the Board
D "to impose a tax"; and so, the imposition of which section 60 speaks of, is
of a tax proposed to be imposed by the Board, and not a tax which had
already been imposed by the time the Act came to be enforced. .

61. We, therefore, do not find any infirmity in the collection of octroi
by the appellant at the enhanced rates, mentioned in the schedule of 1963
E Rules, without there having been compliance of what was required by
section 62 of the aforesaid Act.

Conclusion

62. For the reasons aforesaid, we hold tha.t _the 1881 Notification did 1
\-
F infact permit the appellant to collect octroi duties ~t the rates specified in
1963 Octroi Rules framed by the appellant; and there was no obstacle in
law in allowing the appellant to do so.

63. The appeals are allowed accordingly by setting a.-.ide the im-
G pugned judgment, with the result that the writ petitions filed in the High
Court by the respondents stand dismissed. On the facts and cirC\lmstances
of the case, we do not make any order as to costs.

K.S.D. Appeal allowed.

I