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¥. . AMALENDU DAS & OTHERS . January 6 1984 . [A.P. Sen AND M.P. THakkar, JJ]
Constitution of India 1950, Articles 136 & 226. s
| §LIGURI MUNICIPALITY & OTHERS |
High Court—Proceedings under Article 226—Validity of tax or here gues. tioned—Stay, of recovery of tax or levy claimed—Factors to be cousifered by Higk Court before grant of interim stay. :
Supreme Court—Interference with interlocutory order of High Court raring stay of recovery of tax—When arises, : :
The appellant Municipality in ity Appeal by Special Leave impugned te interlocutory order of the High Court restraming the Municipality from rocosetirg a graduated consolidated rate on the annual value of the holdings in terms of te amended provisions in sections 123 and [24 of the Bengal Munie:pal Act, 2» amended by the Bengal Municipal (Amendment) Act, 1950,
Allowing the Appeal,
HELD ; J. The High Coun should not in proceedings under Article 226 of the Constitution grant any stay of recovery of x save uMder very excepaoa circumstances, The grant of stay in such matters, should be an exception and 0 a rule. (345F] :
2. The levy or impost does not become bad as suon as dl Writ Penlot 8 instituted to avail the validity of the levy. There is no warrant for prosuimes | fevy to be bad at the very threshold of the proceudings, The main purper® Passing an interim order is to evolve a workable formula of a workable arrange
_ Misnt to the extent called for by the demands of the situation. Thy only come tion at that juncture is w ensure that no Prejudice is occasioned to the ne ne in case they ultimately succeed. This object can be attained hy requirly authority levying the impos tu givoun undertaking to refund or adjust the Ki" asiount bgsinst future dues, in the event of the entire levy or a past the ullimately held to be invalid by the Court.” [745 G-H; 346 Al
: ’ : orhatis fi 3. The main purpow of passing an interim order iselo evolve 2 a orinuld of.a workable arrangement to the extent called for by the demands
Muation Keeping ia mind the presumption regarding. the constitutionally ® leyiclition and the vulnerability of the challe i or that no ieee? injury is occanoned, ieee hag ae ulighe a The Court has therefure to strike a delicate ae oot ¥ ering the Pros and cons of the matter lest larger public inter Jeopardized and institutional eMbarussinent is eschywed. [346H; 347A)
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Ar eee ~.
SILIGURI MUNICIPALITY y. A. DAS ( Sen, J.) 345
4, The Court has to show awareness of the fact that in the case ofa unicipality it cannot function or meet its financial obligations if Us source of ue is blocked by an interim order restraining it from recovering the taxes as the impugned provision, The Municipality has to maintain essential civic services. run public institutions, purchase supplies and pay the salaries of its employees ic The grant of an interlocutory order would paralyze the administration and gstocate the entire working. These Serious ramifications were lost sight of by the High Court in the instant case while making the impened order: (346 C-D]
M cit Aprettate Jurispicrion: Civi! Appeal No, 762 of 1984.
Appeal by sp2cial leave for an interlocutory order dated August 25, 1983 of the Calcutta High Court.
KK. Venugopal, N.N. Gooptit and HX. Puri for the Appellants. S.L. Ancja for the Respondent.
The Order of the Court was delivered by .
Sey, J. Tais appeal by spzcial feave is directed against an interlucutory order duted August 25, 1983 passed by the Calcutta High Court restraining the Siliguri Municipality, the appellant herein, from recovering a graduated consolidated rate on the annual value of the holdings in terms of the amended piovisicns in ss. 123 and 124 of the Bengal Munizipat Act, 1932, as amended by the Bengal Municipal (Amznlment) Act, 1980.. “et ae We are constrained to make the observations which follows as Hi 0 feel dismayed at the tendency on the part of some of the m4 Courts to grant jaterlocutory orders for the mere asking. Nor- * Sip High Courts should not, as a rule, in proceedings under by * Aa the Constitution grant any stay of recovery of tax save: Matters 9? fXeePtional circumstances, The grant of stay in such should bz an exceptien and nots rule.
2 needless to stress that a levy or impost does not become S900 AS t writ petition is instituted in order to assail the validity dd nt ioe ae also there is no warrant for presuming the levy to be that a, Very threshold of the proceedings. The only consideration Jncture is to ensure that no prejudice is occasioned to the
Tue Day srs 7 : Pisces “FS iN case they ultimately succeed at the conclusion of the auih ity te This object can be attained by requiring the bedy er .
levying the impost to give an undertaking to refund or
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"the extent called for by the demands of the situation keeping
ESPORTS
346 . aan couRT sa {1984] 2se_ adjust against future dues, the levy of tax or rate or a as the case may be; in the event of the entire levy or a Part th being ultimately held to be invalid by the Court withouy a the tax-payers to institute a civil suit in order to claim the me already recovered from them. On the other hand, the Court Sou be unmindful of the need to protect the authority levying the ti for, at that stage the Court has to proceed on the hypothesis that the challenge may or may not succeed. The Court has to show .awareness of the fact that in a case like the present a Municipality cannot function or meet its financial obligations if its source of revenue is blocked by an interim order restraining the. municipality from recovering the taxes as per the impugned provision. And that the
Part thereoe
- municipality has to maintain essential civic services like water supply, street lighting and public streets etc., apart from running public institutions like schools, dispensaries, libraries etc. What is moze, supplies have to be purchased and salaries have to be paid. The grant of an interlocutory order of this nature would paralyze the administra- tion’and dislocate the entire working of the municipality. . It seems that these serious ramifications ‘of the matter were lost sight of while making the impugned order, ,
We will be failing in our duty if we do not advert to a featur which causes us dismay and distress. On a‘ previous occasion, 2 Division Bench had vacated an interim order “passed by a learned Single Judge on similar facts in a similar situation. Even so when # similar matter giving rise to the present appeal came up again, the same learned Judge whose order had been reversed earlier, granted a net spsaking interlocutory order of the aforesaid nature.. This ont was in turn confirmed by a Division Bench without a speaking on articulating reasons for granting a stay when the earlier Bench hs vacated the stay. We mean no disrespect to the High Court 2 cmphasizing the nevessity for self-imposed discipline in such matter In abeisance to such weighty institutional considerations like i need to maintain decorum and comity, So also we mean no a pect to the High Court in stressing the need for self-discipline 0° | part of the High Court in ‘passing interim orders without entering into the question of amplitude and width of the powers of the ee Court to grant interim relief, The main purpose of passing an ie order is to evolve a workable formula or a workable arrangeme™ the’ presumption regarding the slatio? and the vuloerability of the challen injury is occasioned, The Court constitutionality of the |8! ‘ ge, only in order that NO isco hag therefore to strike 4 as ee eect |
SILIGURI MUNICIPALITY ¥. A. DAS ( Sen, J.) 347
: halance after considering the pros and cons of the matter lest larger _public interest is not jeopardized and institutional embarassment js eschewed.
" . Bor these reasons, the appeal must bg allowed. The order passed
- by the High. Court dated August 25, 1983 restraning the Siliguri
Municipality from recovering a graduated consolidated rate on the annual value of the holdings in terms of the amended provisions contained in Ss. 123 and 124 of the Bengal Municipal (Amendment) Act, 1980 is set aside. We wish to place on record that Shri Venugopal appearing with Shri Naro Narayan Gooptu has given an undertaking on behalf of the Siliguri Municipality that the municipality shall refund the difference between the revised and the old rates within three months of the order of the High Court in case the writ petition © is finally allowed by the High Court, -
There shall be no order as to costs.
NV.K. Appeal allowed.
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