SWASTIK RUBBER PRODUCTS LTD. ETC. ETC. versus MUNICIPAL CORPORATION OF THE CITY OF POONA & ANR.

Citation: [1982] 1 S.C.R. 729 · Decided: 16-09-1981 · Supreme Court of India · Bench: D.A. DESAI · Disposal: Dismissed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

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SWASTIK RUBBER PROQUCTS LTD. ETC. ETC. 
v. 
MUNICIPAL CORPORATION OF THE CITY OF 
POONA & ANR. 
September 16, 1981 
[D.A. DESAI, A.D. KOSHAL AND R.B. MISRA, JJ.J 
729 
Bombay Provincial Manicipal Corporation Act 1949, Ss. 127 (2), 149 and 
Rule 62B and Octroi Rules 1962, Rule 5(8)-Scope and ejftct of. 
The Bombay Provincial Municipal Corporations Act, 1949 came into opera· 
lion in the city of Poona on 15th of February, 1950. Section 127(2) thereof 
authorised the Corporation to impose octroi and other taxes, while section 149 
prescribed the procedure to be followed in levying taxes. 
In the year 1957, the Corporation in order to boost industrial development 
and to encourage the industrialists to establish industries in the city, decided to 
give certain concession in the nature of ex~mption from octroi duty. Pursuant 
to this objective the Corporation made rule 62-B in Chapter VIII to the Schedule 
of the saici Act in 1957, which envisaged the creation of an "Industrial Estate or 
Area", by which was meant the area which the Corporation may from time to 
demarcate as the area in which industries can be suitably located in the interest 
of industrialisation of the city. Under this rule no levy of octroi was to be made 
for a period of twelve years. Later on, the Corporation framed extensive new-
octroi Rules under their resolution dated 7th of August, 1962. Rule 5(8) of the 
new Rules provided for exemption in respect of levy of octroi. 
The Corporation had been levying octroi on the materials received by the 
appellants. The appellants sought exemption under rule 5(8). The Corporation 
rejected their claim for exemption of octroi on the ground that exemption can 
only be granted if the area within which the concern was situated was _declared 
as industrial area and demarcated for the purpose. 
Being aggrieved, the appellants filed petitions under Article 226 of the 
Constitution in the High Court for the issue of a writ of MandamllS requiring 
the respondent Corporation to define and demarcate the area where their facto· 
ries were situated as industrial area, within the meaning of rule 5(8), and to 
exempt them from payment of octroi. During the pendency of these petitions 
rule 5(8) was repealed. The appellants amended the writ petitions and further 
contended that (!) that 1he repeal of rule 5(8) was illegal and/or ultra vires and, 
therefore, rule 5(8) still continues to be effective and (2) that in any event they 
were entitled to get the benefit of rule 62-B which had not been repealed. The High 
Court repelled both the contentions and held that old rule 62-B)nd the new rule 
A 
B 
c 
D 
E 
F 
G 
H 
A 
B 
c 
730 
SUPREME COURT REPORTS 
[1982] I S.C.R. 
5(8) were repealed and that there was no legal flaw. It however took the view that 
despite the repeal of Ru JC 5(8) the appellant could stiJI get the relief under rule 
5(8) because if the proviso attached to the repealing rule the area in question 
was not demarcated as industrial estate or area for the purpose of rule 5(8) and 
that it was solely in the discretion of the Corporation to demarcate an area as 
industrial estate. It consequently dismissed the writ petitions. 
In the appeals to this Court it was contended on behalf of the appellants 
(1) that the disputed area had been included in the development plan under the 
Bombay Town Planning Act, 1954 before the promulgation of rule 5(8) and had 
thus autornaticalJy become an industrial estate or area for the purposes of that 
rule. (2) The Corporation had refused to grant exemption to the appellants on 
the arbitrary ground that the concern of the appellants was not a new one. (3) 
There had been vio1ation of Article 14 of the Constitution in as much as some 
industries in similar situations have been granted exemption while the appellants 
have been deprived of the benefit of rule 5(8) and (4) While denying the benefit 
of rule 5(8) the Corporation had taken into consideration extraneous or irrelevant 
considerations. 
Dismissing the appeals 
D 
HELD : 1 (i) 
No area had been declared as industrial area under the 
E 
F 
G 
H 
Development plan before 1957 and in fact it was only after the enforcement of 
the development plan on 15th of August, 1966 that the disputed area became 
an industrial area under the Bombay Town Planning Act. [735 C-D] 
(ii) A bare perusal of rule 5(8) makes it apparent that for the purpose of 
the exemption from octroi, an industrial estate or area means the area which the 

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