PRAKASH ROADLINES (PVT.) LTD. versus UNION OF INDIA & ANOTHER

Citation: [1989] 3 S.C.R. 650 · Decided: 01-08-1989 · Supreme Court of India · Bench: G.L. OZA · Disposal: Dismissed

Judgment (excerpt)

A 
B 
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PRAKASH ROADLINES (PVT.) LTD. 
v. 
UNION OF INDIA & ANOTHER 
AUGUST I, 1989 
[G.L. OZA AND K.N. SAIKIA, JJ.] 
Delhi Municipal Corporation Act, 1957: Sections 59, 463, 464 
and 491-Whether penalty could be imposed without conviction by 
Court-Delegation of powers to taxing authorities to impose penalty-
Whether valid. 
The appellant, a transporter, brought some goods to Delhi with-! 
out paying terminal tax. Under Section 464 of the Delhi Municipal 
Corporation Act, 1957, a penalty of ten times the amount of terminal 
~­
tax was demanded from the appellant. The demand was challenged 
before the High Court by way of a Writ Petition. The High Court 
D considered the question as to whether the penalty imposed under 
section 464 of the Act could be imposed by the taxing authority without 
a prosecution having been filed before a competent magistrate, and 
answered It In the affirmative. This appeal by special leave is against the 
High Court's judgment. 
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On behalf of the appellant, it was contended that Section 464 of 
the Act gives a wide discretion to impose penalty upto ten times of the 
tax payable and as such is a judicial function which cannot be left to the 
executive authority and hence the authority who imposed the penalty 
was not competent to do so. 
.>,-
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The respondents contended that Section 464 iJoes not pertain to any 
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offence and penalty levied under this section is not punishment; that -4 
section 463 provides for punishment after conviction and so, for imposi-
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lion of penalty under Section 464, the prosecution of the appellant 
before a competent magistrate is not at all necessary. It was also con-
tended that Section 59 confers very wide powers on the Commissioner 
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and he is also authorised to delegate the functions, and under such 
delegated authority the penalty has been imposed under Section 464. 
Dismissing the appeal, 
HELD: I. Penalty under Section 464 of the Delhi Municipal 
H 
Corporation Act, 1957 could be imposed without a conviction by a 
650 
I· 
PRAKASH ROADLINES v. U.0.1. 
651 
criminal court. The different phraseology used in sections 463 and 464 
A 
clearly go to show that where the ingredients of Section 463 are not in 
doubt it is open to the corporation authorities to launch a prosecution 
against the person who introduces the goods without payment of termi-
nal tax and in this event the person, on conviction only, can be punished 
and the punishment is also imprisonment, but the highest limit of fine is 
limited to Rs. J ,000 whereas under Section 464 neither there is any 
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reference to a conviction nor any reference to the Court of a Magistrate 
and the only penalty provided is monetary which may extend to ten 
times. It is therefore clear that Section 463 refers to a criminal offence if 
committed, could only be tried by a competent criminal court and on 
conviction alone the punishment could be imposed but Section 464 is in 
the nature of a revenue provision where non-payment of tax could be 
remedied by imposition of penalty and the limit of penalty has been 
prescribed at ten times of the tax which is payable. In view of different 
language used in the two sections and also the language used in the 
marginal note it is clear that the two cannot be said to be same or 
similar. [657E, F; 655B-E] 
c 
D 
2. It is no doubt true that as regards the offences, a specific 
provision has been made in Section 469 for appointment of a Municipal 
Magistrate but in respect of penalties there' is no specific provision 
authorising any officer or authority to exercise jurisdiction under the 
section where for evasion of tax, penalty could be levied, like Section 
464, but it could not be doubted that Section 59 gives a very wide power 
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to the Municipal Commissioner either to exercise these powers himself 
or to delegate. It is not in dispute that in exercise of powers under 
Section ·59 the Municipal Commissioner had the authority, and exercis-
ing the powers under Section 491 of the Act, by notification dated 
September 17, 1973 he delegated the functions under Section 464 to the 
taxing authorities. Hence the taxing authorities were competent under 
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the scheme of this Act to impose the penalty to the tune of ten times of 
the tax which is payable. [655G-H; 656A, Bl 
CIVIL APPELLA1E JURISDICTION: Civil Appeal No. ISOO(N) 
of 1974 
:1; 
From the Judgment and Order dated 2.11.73 of the Delhi High 
Court in C.W. No. 906of 1973. 
' 
S.N. Mehta for the Appellant. 
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