JUDGMENT
Binod Kumar Roy and
Onkareshwar Bhatt, JJ.
1. The petitioners have come up with a prayer to quash the New Okhla Industrial Development Area (Levy of Amenities Tax) Regulations, 1992 (hereinafter referred to as ‘the Regulations’) as contained in Annexure-11, on the ground that it ultra vires provisions of the Constitution of India and the U. P. Industrial Area Act, 1976 (hereinafter referred to as ‘the Act’). Their further prayer is to command respondent No. 4 NOIDA not to enforce the Regulations against the lease holders of Residential and Industrial sites including buildings situate within its territorial limits.
The Submission :
2. Mr. B. B. Paul, learned counsel of the petitioners, contended that the impugned Regulations ultra wires Article 265 of the Constitution of India as well as Section 19 of the Act. Since NOIDA had realised development charges from the petitioners and others, therefore, it cannot levy tax under Section 11 of the Act aforementioned. There is a well-settled distinction between levy of tax and imposition of tax as pointed out by the Supreme Court in Kewal Krishna Puri v. State of Punjab, AIR 1980 SC 1008. Since the earlier scheme of NOIDA was enacted under 20 Points Programme, thus it has to function on no loss no profit basis.
3. Mr. Awasthi, learned counsel appearing on behalf of respondent No. 4, contended that neither the Regulations ultra vires Article 265 of
the Constitution of India nor of Section 19 of the Act. Section 11 of the Act confers powers in respondent No. 4 to levy tax and Section 19 confers Jurisdiction in Respondent No. 4 to make such Regulations with the previous approval of the State Government consistent with the provision of the Act and thus, there is no merit in either of the two contentions urged by Sri Paul. He further contended that Section 11 of the Act in particular authorises the authority to levy tax for the purposes of providing, maintaining or continuing any amenities in the Industrial Development Area as it may consider necessary in respect of any site or building on the transferee or occupier thereof. The development charges collected were found insufficient and hence amenity tax. The decision relied upon by Sri Paul has no bearing on the question Involved in this case. Under Section 11 of the Act the imposition of tax. however, cannot exceed 25%, and in fact the tax not having been imposed till date the petitioners have got no cause of action to move this Court rather they ought to have waited till the imposition of tax. Thus, this writ petition is liable to be dismissed with costs.
4. The learned standing counsel. Sri H. R. Misra, appearing on behalf of the respondent Nos. 1 to 3 also contended that there is no merit in any of the submissions of Sri Paul and the writ petition is fit to be dismissed with cost.
Our Findings :
5. In order to appreciate the rival contentions of the parties, it is necessary to remember that there Is a statutory presumption of correctness of the Statute, Rules and Regulations and the onus lies on the person who assails them as ultra vires and he has to come up with specific pleadings to show how the Statute. Rules or Regulations ultra vires the Constitution of India or the Act.
6. Article 265 of the Constitution of India reads thus :
“265. Taxes not to be imposed save by authority of law.–No tax
shall be levied or collected except by authority of law.”
7. Section 11 of the Act, as it was then, reads thus :
“11. Levy of tax.–(1) For the
purposes of providing,
maintaining or continuing any
amenities in the industrial
development area, the authority
may with the previous approval of
the State Government, levy such
taxes as it may consider
necessary in respect of any site
or building on the transferee or
occupier thereof, provided that
the total incidence of such tax
shall not exceed twenty-five per
cent of the annual value of such
site or building.
Explanation.–In this subsection, the expression ‘annual value1 shall have the same meaning as in Section 174 of the U. P. Nagar Mahapalika Adhiniyam. 1959.
(2) If the State Government considers it necessary or expedient in the public interest it may. by a general or special order, exempt wholly or partly, any such transferee or occupier or any class thereof from the taxes levied under sub-section (1).”
On a bare reading of Section 11 of the Act, it is crystal clear that NOIDA has the authority to levy taxes. It may be mentioned that sub-section (1) of Section 11 stands amended by U. P. Act 18 of 1995, with effect from 15.5.1995. according to which the total incidence of such tax cannot exceed one per cent of the market value of such site Including the site of the building and that the expression ‘market value’ means, the amount of consideration. In the case of sale or premium, in the case of lease or the minimum value determined as per the rules made under the Indian Stamp Act, whichever is more.
8. To us it appears that this submission has been made merely to be noted and rejected by us. In fact, in none of the grounds set-forth in the writ petttion, there is any specific
pleading that NOIDA lacks authority of law in this regard.
9. Section 19 of the Act reads thus :
“19. Power to make regulations.–(1) The authority may with the previous approval of the State Government, make Regulation not inconsistent with the provisions of this Act or the rules made thereunder for the administration of the affairs of the authority.
(2) In particular, and without prejudice to the generality of the foregoing power, such Regulation may provide for all or any of the following matters, namely :
(a) the summoning and holding of meeting of the authority the time and place where such meeting are to be held, the conduct of business at such meetings, and the number of members necessary to form a quorum thereat ;
(b) the powers and duties of the Chief Executive Officer ;
(c) the form of register of application for permission to erect a building ;
(d) the management of properties of the authority ;
(e) fees to be levied in the discharge of its functions :
(f) such other matters as are to be provided for in Regulation.”
A perusal of the aforementioned provisions leaves no manner of doubt that NOIDA, with the approval of the State Government, can make Regulations consistent with the provisions of the Act or the Rules made therein for administration of its affairs. A perusal of the Regulations, which was published vide Notification No, 4142-H-l/XVIII-130(N)-89. August 11, 1992, in the Official Gazette U. P.. copy of which has been appended by the petitioners as Annexure-11, recites that in exercise of the powers under Section 19 of the U. P.
Industrial Area Development Act, 1976 (U. P. Act No. 6 of 1976) read with sub-section (1) of Section 11 of the said Act. the New Okhla Industrial Development Authority, with the pervious approval of the State Government, hereby makes the following Regulations for the levy, assessment and recovery of amenities tax on the sites and buildings within the New Okhla Industrial Development Area for providing, maintaining and continuing amenities within that Area, and for matters connected therewith or incidental thereto. Thus, there is no merit even in the second submission made by Sri Paul.
10. In fact, the allegations made by the petitioners have been dented in the counter-affidavit filed by
respondent No. 4, NOIDA. The counter-affidavit has been sworn by the Law Officer of NOIDA. who claims himself to be fully acquainted with the facts of tf.e case. In the counter-affidavit, it has been stated, inter alia, that the authority had in the Initial years of its existence fixed premium and lease rent on preliminary cost estimates, which were periodically examined on the basis of actual cost of acquisition and development ; as such, the rates of premium were revised periodically to cover the enhanced cost ; the premium charged by the authority is meant by deferring costs relating to the acquisition of land and development which includes providing roads, drains, sewerage disposal system, water supply, tube-wells, pumping stations, rising mains, overhead tank distribution network, development of parks, construction of community centres, roadside plantation, construction of internal/external drains, sport facilities ; these infrastructure facilities which would be required to be augmented, strengthened and replaced during the current year of the lease period of 90-99 years : the maintenance of the recurring expenses on account of amenities such as sewage disposal, water supply, maintenance of roads, maintenance of parks, street-light, maintenance of community centres. sanitation, machines of sport
facilities cannot be made out of one time income from the premium and the nominal amount of lease rent received year to year which shall hardly be sufficient to upgrade the Infrastructure. In paragraph 17 of the counter-affidavit, the amenities provided and the expenditure Incurred in the years 1989-90. 1990-91 and 1991-92 have been shown which does not include the expenditure of regular grade, functional and supervisory staff of which expenses are included in the revenue expenses. In paragraph 18 of the counter-affidavit it has been further stated that the purpose of imposing amenities tax is only to recover expenses Incurred by the authority on providing, maintaining and continuing the amenities, detailed earlier and the authority cannot afford to maintain and continue the amenities without getting reimbursement by way of amenities tax. It is also stated in the counter-affidavit that the authority has been providing amenities to the industrialists and residents of the area like their counterpart in other towns without paying for it, during the last few years.
11. The facts stated as above speaks for themselves.
12. Now we proceed to consider the Keval Krishna Puri v. State of Punjab and others, AIR 1980 SC 1008. The distinction between levy of fee and imposition of tax is well known and needs no repetition. The question here is whether NOIDA can impose tax or not? The development charges which the petitioners have paid earlier, has been found to be insufficient. It is well within the domain of the authority to impose amenities tax. We have also gone through the petitioner’s rejoinder-affidavit. We are not at all impressed by the statements made therein. We are of the considered view that the Regulations enacted by respondent No. 4, with prior consent of the State, does not ultra vires the Constitution of India or the Act.
13. We fail to appreciate as to how in view of the categorical statements made in the counter-affidavit, it can be said that the
imposition of amenities tax, which cannot be beyond 25%, the NO1DA wants to earn profit therefrom.
14. Thus, we do not find merit in any of the submissions of Mr. Paul.
The Result :
15. For the reasons
aforementioned this writ petition is
dismissed.
16. In the peculiar facts and circumstances, however, we make no order as to cost.
17. The office is directed to handover a copy of this order within two weeks to Shri H. R. Misra, learned standing counsel, for its intimaiion to the authority concerned.