MUNICIPAL CORPORATION OF GREATER BOMBAY versus MAFATLAL INDUSTRIES AND ORS., ETC.

Citation: [1996] 2 S.C.R. 1015 · Decided: 23-02-1996 · Supreme Court of India · Bench: KULDIP SINGH · Disposal: Appeal(s) allowed

Judgment (excerpt)

l 
MUNICIPAL CORPORATION OF GREATER BOMBAY 
A 
v. 
MAFATLAL INDUSTRIES AND ORS., ETC. 
FEBRUARY 23, 1996 
[KULDIP SINGH AND G.B. PATTANAIK, JJ.) 
Bombay Electricity Duty Act, 1958: Schedule-Part A and Part B-1981 
Tariff: Guest house in city maintained by Company-Whether meant for .ex-
clusive use as private residential premises-Whether tariff Category 'R' ap-
plicable. Held, no. 
Statutory constrnction: Expression "exclusively used as private residen-
tial premises"-Meaning of-Category 'R' 1981 Tariff-Schedule Part A, Bom-
bay Electricity Duty Act, 1958. 
B 
c 
Section 3(1) of the Bombay Electricity Duty Act, 1958 provided for D 
levy of electricity duty on the units of energy consumed at the rates 
specified in the Schedule to the Act. In the Schedule, Part A provided the 
tariff for premises used for residential purposes and Part B provided the 
tariff for premises used for business, trade, commercial undertaking or 
· professional purposes. Category 'R' of the 1981 tariff applied to premises E 
exclusively used as a private residential premises, and Category 'C' ap· 
plied, as a residuary category, to premises which did not come within 
categories R, S, RC(LV) and SL. 
The respondent company had been maintaining guest houses in 
Bombay City for occupation of its employees. The said premises having F 
been treated as Category 'C' in the bill raised under the 1981 tariff, the 
company filed writ petition in the High Court seeking a direction to treat 
the said guest houses as falling under Category 'R'. 
The Single Judge took the view that Category 'R' was restricted to 
premises used as private residence by a family for permanent or longer G 
occupation and would not apply to flats provided for transitory periods to 
·outstation officers. The Division Bench, however, in the appeals, construed 
that the word 'private' in the expression "exclusively lised as a private 
residential premises' must be read as opposed to 'public', and came to the 
conclusion that since the company was using the premi~s ·as guest house H 
1Q15 
1016 
SUPREME COURT REPORTS 
[1996) 2 S.C.R. 
A without any intention to make profit and it was not the business of the 
company to run a guest house, it must be held that the premises was 
exclusively used for its own purpose and accordingly tariff rate meant for 
Category 'R' should apply. 
B 
c 
Allowing the appeals, the Court 
HELD: 1. The Division Bench of the High Court committed serious 
error in applying the test of profit making as well as the test of use of the 
word 'private' in contradistinction to 'public' for interpreting the expres-
sion "exclusively used as a private residential premises". [1020-C] 
2. It is a cardinal principle of construction of a statute that the words 
must be given their natural meaning and must be understood in their 
ordinary or popular sense and each word must have its play. Natural and 
ordinary meaning of the words should not be departed from unless it is 
shown that the context in which the words are used requires a different 
I> meaning. [1019-D-E] 
3. In the instant case, on a plain literal meaning being given to each 
of the words in the· expression "exclusively used as a private residential 
promises", it cannot be said that the guest house maintained by a company 
or commercial undertaking would come within that expression. The said 
E expression connotes that the premises in question must be exclusively used 
as a residential premises, which, in other words, would mean the premises 
which is used by any person privately for his own residence for a sufficiently 
continued period and not a premise where a person can come and spend a 
day or a night and then go back. The guest houses maintained by company 
F 
or commercial undertaking, on the other hand, are part of its commercial 
venture, and, as such, cannot be held to be meant for exclusive use as 
private residential premises. The word 'exclusively', occurring in the 
aforesaid expression, also must be given a rational meaning. [1020-C-DJ 
Viewed from that angle, the. context in which the expression "ex-
G elusively used as a private residential premises" has been used for deter-
mining the 1981 tariff under the Bombay Electricity Duty Act, 1958, it can· 
only apply when any premises is U'"ed as a private residential premises. 
(1020-A·CJ . 
4. Since th~ guest ho.use maintained by a company o~ comfuerciai 
H undertaking in the cities cannot be held a premise which is exclusively used, 
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