TATA IRON AND STEEL CO. LTD. & ANOTHER versus STATE OF BIHAR & OTHERS

Citation: [2017] 12 S.C.R. 517 · Decided: 15-12-2017 · Supreme Court of India · Bench: JASTI CHELAMESWAR · Disposal: Disposed off
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Judgment (excerpt)

[2017] 12 S.C.R. 517 
TATA IRON AND STEEL CO. LTD. & ANOTHER 
A 
v. 
STATE OF BIHAR & OTHERS 
(Civil Appeal No. 5360 of 2005 etc.) 
DECEMBER 15, 2017 
[J. CHELAMESWAR AND S. ABDUL NAZEER, JJ.] 
Constitution of India: 
B 
Art.265 and 366(28) - Large chunk of land allocated to · c· 
appellant-Company by the State - Water of the river which flew 
past that parcel of land was used by the company - Dam constructed 
on the river by the State - Demand by the State against the appellant-
Company towards bill for water drawn from the river - Writ petition 
challenging the demand - Dismissed by High Court - On appeal 
plea of the company that demand was violative of Art.265 - Pleas 
D 
of State that the demand was 'fee' and the expression 'tax' in Art.265 
would not take within its sweep 'fee' - Alternative plea of State that 
demand was justified under Bihar Irrigation Act, 1997 or Bihar 
Public Irrigation and Drainage Works Act, 1947 - Held: Expression 
'fee' is comprehended in the expression 'tax'for the purpose of 
Art.265 and even for collection of 'fee' authority of law (i.e. 
E 
legislative support) is mandatorily required - Alternative plea since 
is raised for the first time before this Court, would not be gone into 
by this Court - Matter remitted to High Court for examination of 
the questions raised in alternative plea - Bihar Irrigation Act, 1997 
- Bihar Public Irrigation and Drainage Works Act, 1947. 
F 
Plea: 
New plea - Involving question of law - Raising of. for the 
first time before Supreme Court - Held: Supreme Court will not be 
averse to examine a pure question of law raised for the first time -
G 
However, it is not bound/obliged to examine in every case where q 
question of law is raised - Questions of law arising out of the 
application and interpretation of a local law ought not to be normally 
entertained by Supreme Court unless such questions are intertwined 
with substantial questions of interpretation of the Constitution. 
H 
517 
518 
SUPREME COURT REPORTS 
[2017] 12 S.C.R. 
A 
Disposing of the appeals and remitting the matter to High 
Court, this Court 
HELD: 1.1 The expressions "taxes" and "duties" are to 
be found in many provisions of the Constitution. The expression 
"fee" finds a place in Article 110(2) and 199(2), which are in pari 
B 
materia. Both the Articles recognise the existence of two kinds 
of fees. Fees for licences and fees for services. Each one of the 
three lists contained in the Seventh Schedule have entries which 
employ the expression "fees" (Entry 96 of List I, 66 of List II 
and 47 of List Ill). 
Article 366 contains definitions of various 
C 
expressions employed in the Constitution. Article 366(28) defines 
the expression "taxation". The expressions "fee" and "duty" 
are not defined.·under the Constitution. Article 366(28) employs 
another expression "impost". [Paras 18, 19] [526-B-E] 
1.2 The expression "fee" is also comprehended in the 
expression "tax" for the purpose of Article 265 and even for the 
D 
collection of a "fee", authority of law (i.e. legislative support) is 
E 
F 
G 
H 
mandatorily required under the Constitution. [Para 21] [526-F] 
Jindal Stainless Ltd. & Another v. State of Haryana & 
Others 2016 (11) Scale 1 - followed. 
Commissioner oj Income Tax, Udaipur, Rajasthan v. 
McDowell and Company Limited (2009) 10 SCC 755 : 
[2009] 8 SCR 983 - relied on. 
Kewal Krishun Puri v. State of Punjab and Ors. 
(1980) 1 SCC 416 : [1979] 3 SCR 1217 ; Municipal 
Corporation of Delhi and Ors. v. Mohd. Yasin (1983) 3 
sec 229 : [1983] 2 SCR 999 ; Sreenil'CISU General 
Traders and Ors. 1< State of A.P. and 01:5. 1983 (4) SCC 
353: [1983] 3 SCR 843 ; State of A.P. and Ors. v. 
0Shivalik Agra Poly Products and Ors. (2004) 8 SCC 
556 : [2004] 4 Suppl. SCR 393 - referred to. 
2.1 Insofar as the alternative submission made before this 
Court that the impugned demand could be justified under. the 
Bihar Irrigation Act 1997 (Act 11 of 1998) there was neither any 
clear pleading before the High Court nor a submission. 
Therefore, this Court would not examine the abovementioned 
TATA IRON AND STEEL CO. LTD. & ANOTHER v. STATE OF 
519 
BIHAR & OTHERS 
two submissions as the court of first instance. [Paras 25, 26] 
A 
[528-F-G] 
2.2 No doubt that it has been repeatedly held by this court 
that this court would not be averse to examine a pure question of 
law, (but not argued in the High Court) raised for the first time 
before this Court. This court only asserted its jurisdict
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