Full Judgment Text
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PETITIONER:
THE DHARANGADHRA CHEMICAL WORKS
Vs.
RESPONDENT:
DHARANGADHRA MUNICIPALITY ANOTHER.
DATE OF JUDGMENT03/09/1985
BENCH:
TULZAPURKAR, V.D.
BENCH:
TULZAPURKAR, V.D.
KHALID, V. (J)
CITATION:
1985 AIR 1729 1985 SCR Supl. (2) 757
1985 SCC (4) 92 1985 SCALE (2)669
ACT:
Bombay District Municipalities Act 1901 sections 60, 61
and 62. Gujarat Municipalities Act, 1963 section 279. The
Saurashtra Terminal Tax and Octroi Ordinance 1949 & The
Dharangadhra Municipalty octroi Rules and Octroi Bye-laws.
Rule 3 and Bye-law 3.
Dharangadhra Municipality - Levy and collection of
octroi duty - Whether legal and valid.
Interpretation of Statutes.
Repeal by implication - When arises - Effect of.
HEADNOTE:
The Saurashtra Terminal Tax and Octroi Ordinance No. 47
of 1949 was promulgated and brought into force with effect
from 31.8.1949, to enable the State Government to levy and
collect octroi duty in specified cities and towns and other
local areas of the State and to pass on the duty so
collected to those cities and towns, until Municipalities
therein were constituted under the Bombay District
Municipalities Act, 1901 and those Municipalities made their
own rule and bye-laws enabling them to levy and collect
octroi. Section 3 of the Ordinance empowered the State
Government to impose octroi duty in towns and cities
specified in Schedule I thereto, and the town of
Dharangadhra came to be included therein subsequently under
a notification with effect from 26.12.49.
The respondent-Municipality by its Resolution dated
30.3.53 enhanced the prevailing rate of octroi duty by 50%
without complying with the provisions of sections 60 to 62
of Chapter VII of G the Bombay District Municipalities Act,
1901. The appellant challenged the enhancement in the rate
of octroi duty by filing a writ petition, and also filed a
suit for refund of the excess amount recovered from it for
the period ending September 30, 1961. The High Court
dismissed the petition and upheld the enhancement, taking
the view that while enhancing the rate of
758
octroi, the Respondent-Municipality had followed the
procedure prescribed by the Bombay Act for imposing the
octroi and that the enhanced imposition was not under
Ordinance No. 47 of 1949.
On appeal, this Court held that the enhanced imposition
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of duty by the Respondent-Municipality was illegal as the
mandatory provisions of sections 60 to 62 of the Bombay Act,
had neither been complied with or could the enhanced levy be
justified under Ordinance No. 47 of 1949, because the State
Government alone had the power thereunder to impose the duty
or prescribe its rate and not the Respondent-Municipality.
To get over the effect of this Court’s decision a validating
Act being Gujarat Act No. 6 of 197 was passed where under
the imposition of octroi levy and collection thereof prior
to 30.4.65 was validated.
During the pendency of the writ petition in the High
Court, the Respondent-Municipality proceeded to frame its
own octroi Rules and Bye-laws under the Bombay Act after
complying with all the procedural steps. The Respondent-
Municipality passed a Resolution on 17.12.63 approving the
draft Rules and Bye-laws. The Divisional Commissioner
sanctioned the draft Rules and Bye-laws, However, on March
10, 1965 the State Government issued a Corrigendum to the
sanction that had already been accorded with a view to
rectify certain printing or typographical errors that had
come to the notice of the Respondent-Municipality.
Thereafter, the Respondent-Municipality passed a General
Board Resolution dated 29.3.1965 resolving to bring into
force these Rules and Bye-laws called: "The Dharangadhra
Municipality Octroi Rules and Octroi Bye Laws" with effect
from 1.5.65, and the requisite Notification was published.
By the aforesaid Octroi Rules and Bye-laws, 1965 the
Respondent-Municipality increased the octroi rates by
12.1/2% on all the goods brought within the Municipal limits
of Dharangadhra and also made some changes in the
classification of goods so brought in; and issued bills of
octroi payable every month. Feeling aggrieved by this action
of the Respondent-Municipality, the Appellant filed a writ
petition in the High Court challenging the levy of Octroi at
the enhanced rate, which was dismissed.
In the appeal to this Court it was contended on behalf
of the appellants: (1) That since the exemption from the
operation of the Octroi Ordinance No. 47 of 1949 as
contemplated by Rules 3 as well as Bye-law 3 was not granted
by the State Government, the Municipal Octroi Rules and
Octroi Bye-Laws 1965 could not be said
759
to have come into force, and the Respondent-Municipality had
no authority or power to bring them into force with effect
from 1.5.65, and therefore, the levy to the extent of the
enhanced rate was bad in Law. (2) That the impugned Octroi
Rules and Bye-Laws were framed by the Respondent-
Municipality under the Bombay Act, and sanction thereto had
also been accorded by the Divisional Commissioner under the
Bombay Act on 22nd April 1964, but since the Bombay Act was
repealed by Section 279(i) of the Gujarat Act with effect
from 1.1.65, and since these Octroi Rules and Bye-Laws were
not brought into force before the repeal of the Bombay Act
they would have no force of law as sub-section (2) of
section 279 of the Gujarat Act does not save them, because
under clause (vi) of sub-section (2) of section 279 only
such Rules and Bye-Laws framed under the Repealed Act which
were immediately in force prior to 1.1.65 would stand saved.
(3) That the Corrigendum to the Octroi Rules and Bye-Laws
issued by the Gujarat Government on 10.3.65 was not by way
of purely correcting typographical or printing errors but
virtually amounted to a modification of the Rules and Bye-
Laws without following the procedure de novo and, therefore,
the impugned Octroi Rules and Bye-Laws could not be said to
be valid and could not be brought into force.
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Dismissing the appeal,
^
HELD: 1.(a) It cannot be disputed that the subject
matter dealt with by the Ordinance and the Government Rules
framed thereunder was levy and collection of octroi duty and
the subject matter dealt with by the Bombay Act and the
Municipal Rules and Bye-laws framed thereunder is also levy
and collection of octroi duty. Both the pieces of
legislation, validly enacted and intended to operate within
the Municipal limits of the Respondent-Municipality, dealt
with the same subject matter. In such a situation of there
18 repugnancy between the two pieces of legislation, to such
an extent that both cannot stand together and operate
simultaneously, the later will have the effect of impliedly
repealing the former. [766 A-C]
Repeal by implication 18 not ordinarily favoured by the
Courts But the principle, on which the rule of implied
repeal rests, is that if the provisions of a later enactment
are 80 inconsistent with or repugnant to the provisions of
an earlier one that the two cannot stand together, the
earlier is repealed by the later enactment is applied. [766
D]
Kutner v. Phillips,[1891] 2 Q.B. 267 at 272. Zaverbai
Amaidas v. The State of Bombay [1955] 1 S.C.R. 799 referred
to.
760
In the instant case, the two pieces of legislation are
so inconsistent with or repugnant to each other that both
cannot stand together and such repugnancy arises from (a)
the conferal of power to levy duty on two different bodies,
namely, the State Government under the Ordinance, and the
municipality under the appropriate Act, and obviously the
exercise of the power concurrently by both the bodies would
be incongruous and entirely destructive of the object for
which the power was conferred, and (b) the enhanced rate of
duty prescribed by the Municipal Rules and Bye-laws. Having
regard to such repugnancy obtaining between the two pieces
of legislation dealing with the same Subject matter the
later in point of time will have the effect of displacing
the former by necessary implication. That such implied
repeal or displacement was within the contemplation of the
legislative authority which issued the Ordinance of 1949 is
amply clear if regard is had to the object with which the
Ordinance came to be promulgated to enable the State
Government to levy and collect octroi duty, in the state of
Saurashtra and to pass on the duties so collected by it
those towns and cities until Municipalities therein were
constituted under the appropriate Act and those
Municipalities made their own Rules and Bye-laws enabling
them to levy and collect octroi and other usual Municipal
taxes. [767 D-H]
2.(a) The Municipal Octroi Rules and Bye-laws were
validly made by the respondent Municipality on 17.12.63 by
following the procedure prescribed by the Bombay Act,
whereafter these were forwarded to the Divisional
Commissioner who made some suggestions which were accepted
by the respondent-Municipality and ultimately by order dated
22.4.64 sanctioned the Rules and Bye-laws. Up to this stage
everything was validly done under the Bombay Act prior to
its repeal on 1.1.65. Under clause (vi) of sub-section (2),
any order made and which was in force immediately before the
commencement of the Gujarat Act has been saved, inasmuch it
was provided that such order shall be deemed to have been
made under the Gujarat Act and will continue to operate
until modified or rescinded by another order passed under
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the Gujarat Act. [770 E-G]
(b) What is saved by the order of sanction dated
22.4.64 are the sanctioned Rules and Bye-laws. Clause (vi)
uses both the expressions, ’order’ and ’Rule and Bye-law’
separately and distinct from each other but such separate or
distinctive use is conceivably made to cover different
situations. In a case where the order that is saved happens
to be an order sanctioning rules and Bye-Laws, the two will
have to be regarded as part and parcel
761
of a single INSTRUMENT which is saved in its entirety. What
is saved under clause (vi) of sub-section (2) of section 219
are the sanctioned MunicipaI Octroi Rules and Bye-laws 1965.
[771 B]
3. The material on record clearly shows that the
Corrigendum dated 10.3.1965 was issued with a view to
rectify typographical errors or mistakes that bad crept in
the typed copies of the Rules and Bye-laws forwarded to the
Divisional Commissioner which had come to the w dice of the
Respondent-Municipality. Even the omission of sub-rule (5)
of Rule 5 in the copies forwarded appears to be an
inadvertent typographical mistake. 1772 E
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1225 of
1972.
From the Judgment and Order dated the 21st January,
1971 of the Gujarat High Court in Special Civil Application
No. 786 of 1965.
B. Seth, Kamal Mehta, K.S. Nanavati and Mrs. A.K.
Verma for the Appellant.
Soli J. Sorabjee, P.M. Raval, M.P. Goswami and H.N.
Salve for Respondent No.1.
S.T. Desai, Girish Chandra and R.N. Poddar for
Respondent No.2.
The Judgment of the Court was delivered by
TULZAPURKAR, J. This litigation in which the
Appellant has challenged the levy of Octroi Duty imposed by
the respondent Municipality under its Octroi Rules and Bye-
laws framed under the Bombay District Municipal Act, 1901
(as adopted by the Government of Saurashtra) and continued
under the Gujarat Municipalities Act 1963. (as adapted and
applied to the State of Saurashtra) has a chequered history.
Briefly stated the facts leading to the present appeal
are these. The Appellant is a Company registered under the
Indian Companies Act carrying on business of manufacturing
Soda Ash in its factory at Dharangadhra within the Municipal
limits of the Respondent-Municipality. Originally the
Respondent-Municipality being a District Municipality was
governed by the provisions of
762
the Bombay District Municipal Act, 1901, as adapted and
applied to the State of Saurashtra, (for short the Bombay
Act) but with effect from 1.1.1965 it is governed by the
Gujarat Municipalities Act, 1963 (for short the Gujarat
Act).
An Octroi Ordinance called the Saurashtra Terminal Tax
and Octroi Ordinance No. 47 of 1949 was promulgated by the
Rajpramukh and brought into force with effect from
31.8.1949. The object of the Ordinance was to enable the
State Government to levy and collect octroi duty in
specified cities and towns and other local areas of the
State and to pass on the duty so collected by it to those
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cities and towns until Municipalities therein were
constituted under the Bombay Act and those Municipalities
made their own Rules and Bye-laws enabling them to levy and
collect octroi and other Municipal taxes. To achieve this
object s. 3 of the Ordinance empowered the State Government
to impose octroi duty in towns and cities specified in
Schedule I thereto, in which Schedule the town of
Dharangadhra came to be included subsequently under
notification with effect from 26.12.1949. Section 4 of the
ordinance authorised the State Government to make Rules for
the imposition and collection of octroi duty but under the
Rules so framed the Municipality of the concerned city or
town was to be the collecting machinery. After the inclusion
of the Dharangadhra town in the Schedule I octroi was being
levied in that town by the State Government under its Rules
but the same was being collected through the machinery of
Respondent Municipality.
It appears that the Respondent Municipality by its
Resolution dated 30.3.1953 enhanced the prevailing rate of
octroi duty by 50% without complying with the provisions of
sections 60 to 62 of Chapter VII of the Bombay Act. The
appellant challenged this enhancement in the rate of octroi
duty by filing a writ petition (No. 769 of 1962) in the High
Court of Gujarat and also filed a suit for refund of the
excess amount recovered from it for the period ending
September 30, 1961 after serving a statutory notice on the
respondent Municipality. The High Court dismissed the writ
petition and upheld the enhancement on the view that while
enhancing the rate by its Resolution dated March 30, 1953
the Respondent Municipality had followed the procedure
prescribed by the Bombay Act for imposing the octroi and
that the enhanced imposition was not under the Ordinance No.
47 of 1949. Un appeal, this Court by its judgment dated
20.9.1972 held that the enhanced imposition of duty by the
Respondent Municipality was illegal as the mandatory
provisions of ss. 60 to 62 of the
763
Bombay Act had not been complied with nor could the enhanced
levy A be Justified under Ordinance No. 47 of 1949 because
the State Government alone had the power thereunder to
impose the duty or prescribe its rate and not the Respondent
Municipality. To recover the effect of this Court’s decision
a Validating Act being Gujarat Act No. 6 of 1978 was passed
whereunder the imposition of octroi levy and collection
thereof prior to 30.4.1965 was validated. We are not,
however, concerned with the Validating Act inasmuch as that
Act has nothing to do with the imposition of levy for the
period on and after 1.5.1965 with which the present: appeal
is concerned.
It appears that during the pendency of the aforesaid
writ petition in the Gujarat High Court the Respondent-
Municipality proceeded to frame its own Octroi Rules and
Bye-laws under the Bombay Act and after complying with all
the procedural steps, such as publishing the draft Rules and
Bye-laws, inviting and considering objections thereto, etc.
the Respondent-Municipality passed a Resolution on
17.12.1963 approving the said draft Rules and Bye-laws
whereafter these were forwarded through the Collector to the
Divisional Commissioner, Rajkot; the Divisional Commissioner
made some suggestions to the Respondent-Municipality which
were accepted by it; ultimately by his order dated 22.4.1964
the Divisional Commissioner sanctioned the draft Rules and
Bye-laws; however, on March 10, 1965 the State Government
(as in the meantime the post of the Divisional Commissioner
was abolished) issued a Corrigendum to the sanction that had
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already been accorded With a view to rectify certain
printing or typographical errors that had come to the notice
of the Respondent-Municipality and thereafter the
Respondent-Municipality passed a General Board Resolution
dated 29.3.1965 resolving to bring into force these Rules
and Bye-laws called "The Dharangadhra Municipality Octroi
Rules and Octroi Bye Laws with effect from 1.5.1965. The
requisite Notification bringing these into force on and from
1.5.1965 was issued under s. 103 of the Gujarat Act. It may
be stated that in the meantime the Bombay Act had been
repealed by the Gujarat Act which had come into force with
effect from 1.1.1965
By the aforesaid Octroi Rules and Bye-laws, 19h5 the
Respondent Municipality increased the octroi rates by 12-
1/2% on all the goods brought within the Municipal limits of
Dharangadhra and also made some changes in the
classification of goods so brought in; pursuant thereto it
issued bills of octroi payable every month. Feeling
aggrieved by this action of the Respondent Municipality the
Appellant filed a writ petition (No. 786 of
764
1965) on 20.7.1965 in the Gujarat High Court challenging the
levy of octroi at the enhanced rate under the said Octroi
Rules and Bye-laws on several grounds and sought an order
restraining the Respondent-Municipality from levying and
collecting and/or enforcing the recovery thereof in
any manner. The High Court by its judgment and order dated
the 21st January 1971 negatived all the grounds of challenge
and dismissed the writ petition but by its order dated
8.10.1971 granted a certificate of fitness for appeal to
this Court under Art. 133 (l)(a) and (b) of the Constitution
and hence the instant appeal by the appellant.
Though the levy of octroi duty at the enhanced rate
under the impugned Octroi Rules and Bye-laws 1965 was
challenged on several grounds in the High Court, counsel for
the Appellant in this appeal has raised only three
contentions on the basis of which the invalidity of those
Octroi Rules and Bye-laws has been pressed into service
before us. namely:
(i) Since the exemption from the operation of the
Octroi Ordinance No. 47 of 1949 as contemplated by
Rule 3 as well as by Bye-law 3 was not granted by
the State Government the Municipal Octroi Rules
and Octroi Bye-laws 1965 could not be said to have
come into force and the Respondent Municipality
had no authority or power to bring them into force
with effect from 1.5.1965 and therefore, the levy
to the extent of the enhanced rate is bad in law.
(ii) That the impugned Octroi Rules and Bye-laws
were framed by the Respondent-Municipality under
the Bombay Act and sanction thereto had also been
accorded by the Divisional Commissioner Rajkot
under the Bombay Act on 22nd April 1964 but since
the Bombay Act was repealed by s. 279(1) of the
Gujarat Act with effect from 1.1.1965 and since
these Octroi Rules and Bye-laws were not brought
into force before the repeal of the Bombay Act
they would have no force of law as sub-s. (2) of
s. 279 of the Gujarat Act does not save them
because under clause (vi) of sub-s.(2) of s. 279
only such Rules and Bye-laws framed under the
Repealed Act which were immediately in force prior
to 1.1.1965 would stand saved.
(iii) That the Corrigendum to the Octroi Rules and
Bye laws issued by the Gujarat Government on
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10.3.1965 was
765
not by way of purely correcting typographical or
printing errors but virtually amounted to a
modification (like inserting Sub-Rule (j) in Rule
(5) or the Rules are Bye-laws without following
the procedure de novo, and, therefore, the
impugned Octroi Rules and Bye-Laws could not be
said to be valid and could not be brought into
force.
In our view there is no substance in any of these
contentions and we proceed to give our reasons for our view
in regard to each presently.
As regards the first contention raised by counsel for
the appellant it will be necessary to see what Rule 3 and
Bye-laws, of the Municipal Octroi Rules and Bye-laws, 1965
provide; both are in identical language and purport to and
purport to deal with the commencement of these Municipal
Rules and Bye-laws and state these Rules and Bye-laws:
"shall come into force after an exemption is
granted by the Government from the Saurashtra
Terminal Tax and Octroi Ordinance No. 47 of 1949
and the Rules frames thereunder which are at
present in force.
Counsel pointed out that admittedly prior to 1.5.1965 when
these Municipal rules and Bye-laws where purportedly brought
into force L no exemption from the Octroi Ordinance No. 41 f
1949 and the Rules framed thereunder was granted By he State
Government as contemplated by the aforesaid provision which
could and ought to have been done by issuing a C
Notification withdrawing or deleting the Dharangadhra town
and its Municipality from Schedule I to that Ordinance.
Counsel urged that ill view of the Clear Language of the
above provision the granting of such exemption must be
regarded as a condition precedent to the coming into force
of these municipal Octroi Rules and Bye-Laws and since the
condition precedent was not compiled with these Rules could
not be said to have come into force and the levy at the
enhanced enhanced rate would be bad in law. Counsel urged
that the high Court has erroneously treated the insertion.
of Rules 3 Bye-Law which relate to the commencement these
Rules and Bye-laws to be a mere surplusage.
In Our View The contention proceeds upon a
misconception of the legal position in the matter and
ignores and the object with which the ordinance of 1949 had
been, promulgated as also the
766
object of inserting Rule 3 and Bye-law 3 in the Municipal
Octroi Rules and Bye-laws 1965. It cannot be disputed that
the subject matter dealt with by the Ordinance and the
Government Rules framed thereunder was levy and collection
of octroi duty and the subject matter dealt with by the
Bombay Act and the Municipal Rules and Bye-laws framed
thereunder (and said to be continued under the Gujarat Act)
is also levy and collection of octroi duty; in other words
both the pieces of legislation, validly enacted and intended
to operate within Municipal limits of the Respondent-
Municipality, deal with the same subject matter. In such a
situation if there is a repugnancy between the two pieces of
legislation, to such an extent hat both cannot stand
together and operate simultaneously, the later will have the
effect of implied repealing the former.
It is true that repeal by implication is not ordinarily
favoured by the Courts but the principle on which the rule
of implied repeal rests has been stated in Maxwell on
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’Interpretation of Statutes’ (Twelfth Edition) at page 193
tuhs:
"If, however, the provisions of a later enactment
are so inconsistent with or repugnant to the
provisions of an earlier one that the two cannot
stand together the earlier is abrogated by the
later . (vide Kutner V. Phillips)[1891] 2 Q.B. 267
at 272.
In Zverbhai Amaidas v. The State of Bombay [1955] 1 S.C.R.
799, this Court has approved, the above principle in the
context of two pieces of legislation, namely, The Essential
Supplies (Temporary Powers) Act, 1946 as amended by Act LII
of 1950 ( a Central Act) and Bombay Act No. XXXVI of 1947
the provisions whereof in the context of enhanced punishment
were repugnant to each other. The Court held that the
question of punishment for contravention of orders under the
Essential Supplies (Temporary Powers) Act both under the
Bombay Act and the Central Act constituted a single subject
matter and in view of Art. 254(1) of the Constitution Act
LII of 1950 (Central enactment) must prevail. The Court
quoted with approval Lord Goddar’s observations in Smith v.
Benabo 1937 1 K.B. 518, namely It is a well settled rule of
construction that if a later statute again describes an
offence created by a previous one, and imposes a different
punishment, or varies The procedure, the earlier statute is
repealed by the later statute. After quoting these
observations the Court went on to say:
"It is true, as already pointed out, that on a
question under Art. 2541) whether an Act of
Parliament
767
prevails against a law of the State, no question
of repeal arises; but the principle on which the
rule of implied repeal rests, namely, that if the
subject matter of the later legislation is
identical with that of the earlier, so that they
cannot both stand together, then the earlier is
repealed by the later enactment, will be equally
applicable to a question under Art. 254(2) whether
the further legislation by Parliament is in
respect of the same matter as that of the State
law. We must accordingly hold that section 2 of
Bombay Act No. XXXVI of 1947 cannot prevail as
against sec. 7 of the Essential Supplies
(Temporary Powers) Act No. XXXIV of 1946 as
amended by Act No. LII of 1950."
The aforesaid principle of implied repeal has been approved
and applied in a couple of other decisions of this Court,
particularly in T. Barai v. Henry Ah Hoe and Another [1983]
I S.C.R. 905. D
In the instant case the two pieces of legislation are
so inconsistent with or repugnant to each other that both
cannot stand together and such repugnancy arises from a) the
conferal of power to levy duty on two different bodies,
namely, the State Government under the Ordinance and the
Municipality under the appropriate Act and obviously the
exercise of the power concurrently by both the bodies would
be incongruous and entirely destructive of the object for
which the power was conferred, and (b) the enhanced rate of
duty prescribed by the Municipal Rules and Bye-laws - a
situation similar to enhanced punishment provided by a later
enactment. Having regard to such repugnancy obtaining
between the two pieces of legislation dealing with the r
same subject matter the later in point of time will have the
effect of displacing the former by necessary implication.
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That such implied repeal or displacement was within the
contemplation of the legislative authority which issued the
Ordinance of 1949 will be amply clear if regard is had to
the object with which the Ordinance came to be promulgated.
The avowed object of the Ordinance was to enable the State
Government to levy and collect octroi duty in towns and
cities of the erstwhile State of Saurashtra and to pass on
the duties so collected by it to those towns and cities
until Municipalities therein were constituted under the
appropriate Act and those Municipalities made their own
Rules and Bye-laws enabling them to levy and collect octroi
and other usual Municipal taxes; clause (9) of the Ordinance
made express provision for making over such collections to
concerned
768
towns and cities. That such was the object of the Ordinance
has been clearly stated by this Court in Mulchand Odhavji v.
Rajkot Borough Municipality, A.I.R. 1970 S.C. 685. In other
words the Ordinance and the Government Rules framed
thereunder were a stop gap measure, being transitional in
character which would automatically cease to operate no
sooner the concerned Municipality (here Dharangadhra
Municipality) made and published its own Octroi Rules and
ye-laws under the appropriate Act.
To counter Act the inference of implied repeal, strong
reliance was placed by Counsel for the appellant on the
language used in rule and Bye-law 3 which state that these
Rules shall come into force after the exemption from the
Ordinance and the Rules thereunder has been granted and
according to Counsel such Language negative any suggestion
of implied repeal. In our view rule 3 as well as Bye-law
proceed on a mistaken assumption of law that the exemption
from the Ordinance and the rules framed thereunder was
necessary before the Municipal Rules and Bye-laws could be
enforced. Once the Municipal Rules and ye-laws are validly
made and also validly brought into force by following the
requisite procedure prescribed in that behalf under the
appropriate Act the earlier Government Rules would stand
pro-tanto repealed notwithstanding what is contained in Rule
3 or Bye-law 3. The legal effect of such a provision (as is
contained in Rule 3 or Bye-law 3) would not be and is not to
restrain or prevent the municipalities from bringing into
force its Rules and Bye-laws by following the prescribed
procedure. The real aim and object of Rule 3 or Bye-law 3
sees to be to prevent double taxation. If the insertion of
Rule 3 or Bye-law 3 was because of a wrong belief or
assumption made in the matter of the legal position the
Court has to disregard such belief or assumption, for, it is
well settled that the beliefs or assumptions of those who
frame Acts of Parliament cannot make the law’ (vide Lord
Radcliffe in Inland Revenue V. Dowdell O’Mahoney & Co. Ltd.
1952 All England Law Reports 531 at 544). Therefore, the
Municipal Rules and Bye-laws 1965 having been validly
brought into force after following the prescribed procedure
in that behalf, the Government Rules under the Ordinance got
impliedly repealed.
Counsel for the appellant also raised the question as
to whether the Municipal Rules and Bye-laws being
subordinate piece of legislation could repeal either
expressly or by implication the Ordinance promulgated by
Rajpramukh and the Rules framed thereunder by the State
Government and urged that the Municipal Rules or ye-laws
could not do so; he further urged that for
769
effecting such repeal the Municipal Rules and Bye-laws, 1965
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A should have at least been raised to the status of parent
legislation by deeming them to have been incorporated in the
Statute as is done in some cases like the Town Planning Acts
which provide that as soon as a final town planning scheme
comes into force it shall be deemed to have been
incorporated in the Act itself. The contention as formulated
really misses the vital aspect that the effective charge and
levy of the octroi is imposed by the rules and not by the
parent legislation, be it an Ordinance or the appropriate
Municipal Act. The parent legislation merely confers power
on the specified body or authority to frame Rules for the
purpose of levying and collecting octroi duty. Under the
Ordinance of 1949 it was the State Government on whom such
power had been conferred while under the appropriate Act
such power has been conferred on the concerned Municipality;
in either case the levy and collection of the duty is by
means of subordinate legislation and if such subordinate
legislation is validly enacted by following the prescribed
procedure under the parent legislation there is no reason
why such subordinate legislation should not have the effect
of impliedly repealing the earlier subordinate legislation
and no question of one named body or authority being lower
than the other can arise; in other words the status or
character of the Rule making body would be irrelevant. In
this view of the matter there would be no necessity of
raising the Municipal Rules and Bye-laws to higher status to
the parent Legislation as contended by the Counsel for the
appellant. The first contention therefore fails.
Having thus rejected the first contention of the
appellant for the reasons indicated above it is unnecessary
for us to consider the effect of deletion of Rule 3 and Bye-
law 3 from these Octroi Rules and Bye-laws done by the
respondent Municipality and which deletion was sanctioned by
the State Government on 13.4.1966 as such action was clearly
taken ex major cautela and the operation of these Rules and
Bye-laws cannot on that account be postponed but these will
have to be regarded as having come into force with effect
from 1.5.1965. G
The second contention relates to the effect of the
repeal of the Bombay Act under s. 279(1? of the Gujarat Act.
The question is what has been saved under sub-s. (2) of s.
279 after effecting such repeal. Counsel for the appellant
referred to clause (vi) of sub-s. (2) which runs thus:
"(2) Notwithstanding the repeal of the said Acts,-
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(vi) any appointment, notification, notice, tax,
fee, order, scheme, licence, permission, rule,
bye-law, or form made, issued, imposed, or granted
in respect of the said boroughs or districts and
in force immediately before the date of the
commencement of this Act shall in so far as they
are not inconsistent with the provisions of this
Act be deemed to have been made, issued, imposed
or granted under this Act in respect of the
borough and shall continue in force until it is
superseded or modified by any appointment,
notification, notice, tax, fee, order, scheme,
licence, permission, rule, bye-law, or form made
issued, imposed or granted under this Act;
Relying upon the words "and in force immediately before the
date of the commencement of this Act" occurring in the above
provision counsel urged that the Municipal Octroi Rules and
Bye-laws in question had been merely framed and at the most
had been sanctioned under the repealed Act (the Bombay Act)
but these had not been brought into force immediately before
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the date of the commencement of the Gujarat Act, namely,
1.1.1965 and, therefore, could not be said to have been
saved under the aforesaid provision. Counsel pointed out
that the aforesaid clause (vi) uses both the expressions
"order" and "Rule and Bye-law" separately and therefore,
Rules and Bye-laws cannot be confused with the order of
sanction passed herein by the Divisional Commissioner on
22.4.1964. It is not possible to accept this contention for
more than one reason. In the first place admittedly the
Municipal Octroi Rules and Bye-laws were validly made by the
respondent Municipality on 17.12.1963 by following the
procedure prescribed by the Bombay Act, whereafter these
were forwarded to the Divisional Commissioner made some
suggestions which were accepted by the respondent
Municipality; and ultimately by his order dated 22.4.1964
the Divisional Commissioner sanctioned these Rules and Bye-
laws. In other words up to this stage everything was validly
done under the Bombay Act prior to its repeal on 1.1.1965.
Under clause (vi) of sub-6. (2) any order made and which was
in force immediately before the commencement of the Gujarat
Act has been saved, inasmuch as it is provided that such
order shall be deemed to have been made under the Gujarat
Act and will continue to operate until modified or rescinded
by another order passed under the Gujarat Act. If the
Divisional Commissioner’s order sanctioning the Rules and
ye-laws is thus saved that order cannot be looked at
divorced from what was sanctioned thereunder; what was
sanctioned would be a part and parcel of the order of
sanction.
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To say that merely the order of sanction dated 22.4.1964 is
saved A and not the Rules and Bye-laws is to view the order
of sanction in the air. In substance what is saved are the
sanctioned Rules and Bye-laws. It is true that clause (vi)
uses both the expressions ’order’ and ’Rule and Bye-law’
separately and distinct from each other but such separate or
distinctive use is conceivably made to cover different
situations. In a case where the order that is saved happens
to be an order sanctioning Rules and Bye-laws the two will
have to be regarded as part and parcel of single instrument
which is saved in its entirety. In other words what is saved
under clause (vi) of sub-s. (2) of s. 279 are the sanctioned
municipal Octroi Rules and Bye-laws, 1965.
Secondly the question could be considered under s. 7(b)
of the Bombay General Clauses Act, 1904. Section 7 deals
with the effect of repeal an reads thus:
"7. Where this Act or any Bombay Act or Gujarat
Act made after the commencement of this Act,
repeals any enactment hitherto made or hereafter
to be made, then unless a different intention
appears, the repeal shall not-
(a) xx xx xx
(b) affect the previous operation of any enactment
so repealed or anything duly done or suffered
thereunder;"
The Divisional Commissioner’s order according sanction is
obviously saved thereunder but even Rules and Bye-laws could
be covered by the expression "anything duly done- occurring
in clause (b) above inasmuch as the expression ’anything
duly done-’ would be comprehensive enough to take in not
only the things done but also the effects or legal
consequences flowing therefrom. In M/S Universal Imports
Agency and Another v. The Chief Controller of l ports and
Export & Others, [1961] 1 S.C.R. 305, while interpreting the
expression "things done" occurring in para 6 of the French
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Establishments’ (Application of Laws) Order, 1954, this
Court has taken the view that such expression is
comprehensive enough to take in not only things done but
also the effects or the legal consequences flowing
therefrom. In so interpreting the said expression the Court
followed the English decision in The Queen v. Justice of the
west Riding of Yorkshire, [1876] 1 Q.B.D. 220, where the
notice was given by a Local Board of Health
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of intention to make a rate under the Public Health Act,
1848, A and the amending Acts but before the notice had
expired thee Acts were repealed by the Public Health Act,
1875 which contained a saving of "anything duly done" under
the repealed enactments, but the Local Board, in ignorance
of the repeal, made a rate purporting to be under the
repealed Act, and it was held that as the notice was given
before the repealing Act the making of the rate was also
saved by the words "anything duly done" under the repealed
enactment. This Court pointed out that the English decision
was illustrative of the point that it is not necessary that
an impugned thing in itself should have been done before the
Act was repealed but it would be enough if it was integrally
connected with and was a legal consequence of a thing done
before the said repeal. Therefore, it is not possible to
accept the contention that merely the order of sanction was
saved and not the Municipal Octroi Rules and Bye-laws, 1965.
As regards the last contention it is difficult to
accept that the Corrigendum dated 10.3.1965 amounts to
modification of the Rules and Bye-laws. The material on
record clearly shows that corrigendum was issued with a view
to rectify typographical errors or mistakes that had crept
in the typed copies of the Rules and Bye-laws forwarded to
the Divisional Commissioner which had come to the notice of
the Respondent-Municipality. Even the omission of sub-rule
(5) of Rule 5 in the copies forwarded appears to be an
inadvertant typographical mistake. Besides, 80 far as the
Rules are concerned the High Court has rejected the
contention on the basis that the corrigendum even if lt is
held to amount to modification in regard to sub-rule (5) of
Rule 5 the same cannot be held to be outside the powers of
the Government. The contention i, therefore, rejected.
In the result the appeal fails and is dismissed. There
will be no order as to costs.
N.V.K. Appeal dismissed.
773