LexCITY CORPORATION OF CALICUT versus THACHAMBALATH SADALINAN & ORS.
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A B c E F G ti 1008 CITY CORPORATION OF CALICUT v. THACHAMBALATH SADALINAN & ORS. February 26, 1985 (D. A. DESAI AND AMARENDRA NATH SEN, JJ.) Constitution of India 1950, Article 265 Tax andfee-Quldpro quo·-Whether an essential element for fee Kera/a Municipal Corporation Act 1961 (Act 30 of 1961) Section 299 & Schedule JV-Use of premises and land for soaking Coconut husks-Levy of licence fee by Corporation-Whether valid. The appellant-Corporation levied licence fee for use of premises and land for soaking coconut husks under Schedule IV of the Calicut City Municipal Act 1961, Subsequently restyled as the Kerala Municipal Cor- poration Act l96l. The respondents were carrying on the trade of soaking coconut husks, and as the)' bad not taken out the requisitd' licence, the Commissioner of the Corporation issued notices to show cause why they should not be prosecuted. The respondents challenged the validity and legality of the notices in Writ Petitions to the High Court, contending that if the licence fee is levied as a fee, no service is readered or special advantage or favour is conferred by the Corporation for collecting such fee and that there is no quid pro quo and that the relevant provision'! of the Act do not enable the Corporation to levy such a fee. It was further contended that if the levy is treated is a tax, it is beyond the taxing powers of the Corporation. The Corporation contested the Writ Petitions justifying the fee as licence fee and that it bad the power to levy a tax of the nature levied by it. A Single Judge of the Hi1h Court allowed the Writ Petitions, and quashed the impuqoed licence fee as not legal in the absence of conferment of special benefits in respect of persons who so::;.k coconut husks. It was further held that the power to levy the various taxes conferred on the Corporation .under Chapter V of the 1961 Act did not comprehend the impugned levy and consequently the ta• was not valid and legal. The writ appeals of the Corporation were dismissed. -- ' I CllY CORPORATION v. T. SADASIVAN 1009 Allowing the Appeals, this Court HELD : By numerous recent decisions of tbis Court it is well-settled that the traditional concept in a fee of quid pro quo is under&oing a trans- formation and that though the fee mu"t have relation to the services ren- dered or the advantages conferred, such relation need not be direct, a mere casual relation may be enough. It is not Ot!cessary to establish that those who pay the fee must receive direct benefit of the services rendered for which the fee is being paid. If one who is liable to pay receives general benefit from the authority levying the fee the element of service required for collecting ft:e is satisfied. It is not necessary that the persons liable to pay must receive some special benefit or advantage for payment of the feo. (1012 E·F] In the instant case, it is incontrovertible that the appellant-Corpo- ration is rendering numerous services to the persons within its areas of operation and that ~herefore the levy of the licence fee as fee is fully justified. Soaking coconut husks emit foul odour and contaminates environ- ment. The Corporation by rendering scavangiog services, carrying on operations for cleanliness of the city, to make habitation tolerable is render- ing general service of which amongst other& respondents are beneficiaries. The decisions of the Single Judge and of the Division Bench are set aside and the Writ Petitions of the respondents are di•missod. [1012 G-H] Municipal Corporation of Delhi & Ors. v. Mohd. Yasin & Anr. (1983) 3 SCC 229, Sreenivasa General Traders and Others v. State of Andhra Pradesh and Others (1983) 4 SCC 353 & M/s. Amarnath Om Prakash and Others v. State of Punjab & Or.·. (1985! I SCC 345 referred to. CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 13 & 14of1971 B c a From the Judgment & Order dated 2. 7. 68 of the Kerala High Court at Emakulam in Writ Petition Nos. 107 & 108/68. F A. S. Nabiar and P. Parmeswaran, for the Appellant. N. Sudhakaran, P. K. Pallai, V. J. rrancis, N. M. Popli A. G. Pudissary for the respondents. The Judgment of the Court was delivered by. DESAI, J. The respoudents in these two appeals filed Original Petitions Nos. 2892-3073 of 1965 challenging the validity of the licence fee levied by the appellant 'The City Corporation of Calicut' to be paid for use of the land or premises for soaking of coconut hu
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