Bharat Petroleum Corporation ... vs Thane Municipal Corporation And ...
2004 Latest Caselaw 396 Bom

JUDGMENT

V.G. Palshikar, J.

1. By this petition, the petitioner which is a Government of India undertaking has challenged charging of fees for temporary detention of their goods meant for eventual export.

2. Bharat Petroleum Corporation Limited, which is the petitioner, is a Government of India undertaking deals in manufacturing and supply of liquified petroleum gas meant for domestic use. For this purpose it has to undergo several functions. One of the requiring function is to test the empty gas cylinder for safety and one such plant of testing is within the local limits of Municipal Corporation of Thane.

3. Thane Municipal Corporation charges 6.25% of the value of cylinders as fees for services rendered. The contention of the petitioner is that the Corporation cannot use the power under the Octroi Rules meant for temporary detention and transit of octroi leviable goods for the purposes of charging fees or tax for temporary detention of goods to the eventual export. According to the petitioner, therefore, the action of levy and recovery of this fees is liable to be struck down as beyond the competence of the Municipal Corporation both under the Bombay Provincial Municipal Corporation Act 1949 and the Rules framed thereunder as what they are charging is the fee for temporary detention of goods, and cannot be justified under the Rules meant for temporary transit deposit or payment of tax or levy of octroi duty. The learned counsel appearing an behalf of the petitioner therefore submitted that the power meant for one purpose cannot be exercised for another purpose and in that view of the matter the levy and the fee as contended by the Corporation is improper and illegal and therefore liable to be struck down.

4. Mr. Pradhan the learned counsel appearing on behalf of the respondent justified the levy and recovery of fees as according to him, the Corporation has to do sevetral things for the purposes of permitting the petitioner to detain temporarily the goods meant for eventual export and for exercising those functions, certain monies are required. The fee is therefore levied for that purposes which accordingly rendered. He therefore justified the levy and prayed for dismissal of the petition.

5. Rule 24 of the Rules pertaining to the procedure for temporary tax on dutiable goods meant for eventual export provides the manner in which such detention or detention of goods temporarily is to be carried out. It is stipulate that in case of machinery imported for repairs only and for the export the importer, in the present case, the Corporation, shall obtain the sanction from the superintendent of octroi in writing for importing such goods for the same purpose. Such sanction shall be issued by the superintendent on payment of such security under the council by general special Resolution prescribed.

6. Thane Municipal Corporation accordingly passed a Resolution No. 42 on 5-1-1983 in this connection. It took into consideration the provisions of Section 147 of the Bombay Provincial Municipal Corporation Act 1949 and Maharashtra Municipality Octroi Rules 1968, and then proceeded to impose the fees for the recovery of the charges involving in the procedure of temporary detention of goods. It was stipulated as 6.25% and the deposit made shall be detained by the Corporation and the rest would be refunded on the export factually taken place. This resolution and the action in pursuance thereto is impugned by the petitioner on the ground that recourse cannot be taken by the Corporation and it provides for refund of octroi when what is being factually done is charging of fees for services rendered. He therefore prayed that the action and the resolution be quashed.

7. Perusal of the Resolution dated 5-1-19B3 will show that it was passed solely with a view to facilitate charging of fees for services rendered in connection with goods temporarily imparted for mentioned purposes. It specifically says that the Resolution is passed to provide fees for supervision in relation to temporary import of goods for specified purpose. Even earlier there was Resolution No. 360 on 29-11-1980 which provided to such deposit and by that Resolution it was categorically informed to the petitioner that the request for giving bank guarantee cannot be accepted.

8. The communication dated 14-5-1990 is liable to be noted in this connection where a clear reference is made by the Corporation that the petitioner being a Government of India undertaking, deposit in proportion to the octroi payable on goods to be imported temporarily is not being taken from the company. It is required as contemplated by Section 62 of the 1949 Act and the Resolution dated 5-1-1983 to pay 6.25% as service charges for rendering services of supervision etc. in the matter of temporary import of goods for eventual export on repairs. There is therefore no substance in the contention of the petitioner that what is being levied is an octroi.

9. Even under Rule 24 on which reliance was placed by the petitioner, it will be seen that sanction to import for repairs and export will be given by the superintendent of octroi in writing on a deposit is being made for such security as the council may determine by the Resolution. The deposit on the security is towards the work done like supervision, counting of cylinders, providing space for temporary detention etc.

10. It is settled position in law that mere wrong mention of the provision for which the authority to do something eminates cannot render the action or resolution bad, if factually power can be pressed for a source of law. Merely because Municipal Corporation has in its place referred to as octroi or refund it do not take the colour of it being an octroi tax as the duty to levy such fees is squarely traceable to Rule 24 of the Rules. That being so mere incorrect mention of some other provision will not vitiate the resolution. The petition therefore is liable to be dismissed.

11. In the result the petition is dismissed. There is no order as to costs.