LexMUNSHI RAM AND ORS. versus MUNICIPAL COMMITTEE, CHHEHARTA
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..,._ • ' • • -,., ~ • ---i ~-~ • • MUNSHI RAM AND ORS. v. MUNICIPAL COMMITTEE, CHHEHARTA March 6, 1979 [R. S. SARKARIA, P. S. KAILASAM AND 0. CHINNAPPA REDDY, JJ.j Punjab Municipal Act. 1911, Sections 84,86- Jurisdiction of the Civil Court, of levy of profession tax on the firm and also its partners-Punjab General Clauses Act Sec. 2(40) and Cqnstitution Art. 276(2) . Punjab, Municipal Acf, 1911, Sections 84-86-Juri.sdictiori of the Civil Court, whether a bar to hear and deternzine suit relating to levy of profession tax under the Act. Under section 61(1)(b) of the Punjab Municipal Act, 1911 the responde<>t by its Notification dated May 15, 1946 levied a profession tax ot Rs. 15/- per annum on each of th'e partners of a firm. Bharat Industries Chheharta i.e. the appellants in the appeal. By the Notification dated July 4, 1958 the tax was rai5ed to Rs. 200/- per annum. The validity of the demand made by the respondent at the rate of Rs. 200 /- from each of the partners of the firm was A B c challenged, pleading that the Municipal Committee in levying the tax on the D individual partners had exceeded its statutory powers under section 61 ( 1) (b) of the Municipal Act in as much as the term 'person' occurring in section 61 (I) (b) of the Punjab Municipal Act, 1911, const111ed in the light of the definition given in sectioo 2(40) of the Punjab General Oauses Act included a 'firm' and since the trade carried on by the firm is one, the tax could be levied only on the firm, and not on the partners individually. The Trial Court dismissed the suit. First appellate court reversed the decree llnd the High E Court in Second Appeal confirmed it. A Letters Patent ·Appeal, preferred by the respondent was allowed and the Trial Court's decision dismissing the suit was restored. Dismissing the appeal by special leave, the Court HELD: 1. It is clear, from 2' plain reading of Section 61(1)(b) that a tax leviable under clause (b) is in terms, a tax on 'persons', which expression F includes natural persons. Its incidence falls on individuals, who belong to a class practising any profession or art, or carrying on 10.• trade or calling in the municipality. To hold that persons who are collectively carrying on a trade in the municipality cannot be taxed .individually, would be to read into the statute words which are not there. There are no words in c1ause (b) or else\\'here in the stntute which expressly• or by necessary implication, exclude or exempt persons carrying on a trade collectively in the municipality from G being taxed as individuals. To attract liability to a tax under this clause it is sufficient th6'1 the person concerned is carrying on a trade in the municipality, irrespective of whether such trade is being carried on by him individually or in partnernhip with others. [467G, 468H, 469A-B] 2 'Partnership' as defined in Section 4 of the Indian Partnership Act, 1932, is the relation between persons who have agreed to share the profits of a business carried on by all or any of them for the benefit of alt. A firm or partnership is not a legal entity separate and distinct from the partners. Firm 11}-253SC1/79 463 H 464 SUPREME COURT REPORTS [1979] 3 s.c.R. A is only a compendious description of the individuals \Yho 1;ompose the firm. The business being carried on by all or any of the partners, all of them are jointly and severally responsible for the liabilities incurred in the course of the business as each one is considered as an agent of the other. Such partner5 can be taxed as persons, in their individual. [468 D-H] 3. In order to be authorised a tax under clause (b) of Section 61(1) must B satisfy two conditions : First. it must be a tax on persons. Second, such persons must b'e practising any profession or art or carrying on any trade; or calling in the municipality. Both the conditions necessary for levying a tax under clause (b) of sub-section (1) of Section 61 of the Municipal Act existed in this case. The appellants are 1persons 1 and they are carrying on a trade in Chheharata Municipality. [467H, 468A-CJ , C 4(i) Where a Revenue Statute provides for a person aggrieved by an assess- ment thereunder, a particular remedy to be sought in a particular forum, in a particular way, it must be sought in that forum and in that imnner, and an other forumSo and modes of seeking it are excluded. [470D-E] (ii) From a conjoi
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