M.S. Sonak, J.@mdashRule. With consent of the parties, Rule is made returnable forthwith. In this batch of writ petitions, the petitioners challenge a circular dated 12th December, 2011 (impugned circular) issued by respondent No. 3, the Municipal Corporation of Gr. Mumbai as also the respective entries in the schedule appended thereto, thereby questioning the levy of ''trade refuse charges'' and the rates therefor.
2. The petitioners in Writ Petition Nos. 212, 2913, 172, 885, 837 of 2013 and Writ Petition (L) No. 504 of 2013 are carrying on business of warehouse keepers, godown keepers, bank mukadam, carriers of stores, material and goods required to be stored and kept safe from insects ants, rodents, moisture, rain, heat, fire etc. For this purpose, the petitioners from time to time have been obtaining trade licenses issued u/s 394 of the Mumbai Municipal Corporation Act, 1888 (the said MMC Act). According to the petitioners, the respondents recover ''trade refuse charges'' (hereinafter referred to as TRC), by making the payment thereof a condition for renewing the trade licenses under the MMC Act on a yearly basis.
3. In the year 2008, respondent No. 2 issued a circular dated 14th January, 2008, raising the TRC by almost 300% of the trade license fees and stated that TRC would be collected at the time of renewal of the license u/s 394 of the MMC Act, which were then due to expire on 31st December, 2009.
4. Aggrieved, the petitioners and several other parties made representations to the respondents urging reconsideration of the rates. In fact, the petitioners preferred Writ Petition Nos. 502, 512 and 516 to 523 of 2010 before this Court impugning the rates prescribed by the circular dated 14th January, 2008. By an order dated 12th April, 2010, the petitions came to be disposed of upon the statement being made on behalf of the respondents that they shall reconsider the rates of TRC and take an appropriate decision in the matter.
5. Upon reconsideration, the respondents issued the impugned circular dated 12th December, 2011 revising the TRC rates effective from 1st January, 2008. In fact, in so far as trade/business of ''warehousing'' is concerned, there is a very significant reduction in rates, which is evident from the relevant entry No. 6 in the Schedule appended to the impugned circular, which is to the following effect:
6. The petitioners are dissatisfied even with the substantially reduced TRC. They contend that they merely receive goods from the customers for purposes of safe custody and upon receipt of the prescribed charges, return such goods to the customers in the same conditions. For this purpose, they provide adequate space, security and safeguards'' against fire, rain, water etc. In the process, neither any solid waste, nor any trade refuse is generated. In the circumstances, they contend that levy of TRC upon them and that too with retrospective effect i.e. from 2008 is illegal, arbitrary, unconstitutional, ultra-vires and null and void
7. Dr. Tulzapurkar, the learned Senior Advocate appearing for the petitioners has raised the following contentions in support of the petition:-
(A) That the petitioners, who are engaged in the warehousing business do not generate any trade refuse and in the event TRC constitutes a ''tax'' there is no taxable event for imposition of tax in the form of TRC.
(B) Similarly, if TRC is to be regarded a ''fee'', then, on account of the circumstance that the petitioners generate no trade refuse at all, there is no element of ''quid pro quo''. In the circumstances, levy of fee in the form of TRC is illegal and invalid;
(C) The term ''trade refuse'' implies solid waste, which may be generated by any industry involved in manufacturing process. There is a difference between ''refuse'' and ''trade refuse'' which is recognized in sections 367 and 358(5) of the MMC Act. In imposing TRC however, the difference is ignored and TRC is sought to be levied upon the petitioners, who infact, generate no ''trade refuse'' at all.
(D) In any case, the rate fixed for levy of TRC is arbitrary, unreasonable and violates Articles 14 and 19(1)(g) of the Constitution of India;
(E) Inasmuch as the TRC is levied in addition to the normal license fees for issue of trade licenses u/s 394 of the MMC Act, there is double charging. This is arbitrary and unreasonable, particularly, qua the petitioners, who do not generate any ''trade refuse''.
(F) The levy of TRC with effect from the year 2008, amounts to giving retrospective effect to the impugned circular dated 12th December, 2011, which is clearly impermissible. Therefore, the levy of TRC between the years 2008 and 2011 is ex facie incompetent.
(G) The linking of payment of TRC with renewal of trade licences u/s 394 of the MMC Act, is illegal, invalid and therefore, renewal of trade licences u/s 394 of the MMC Act ought to be granted, irrespective of whether the petitioners pay TRC or not.
8. In order to appreciate the challenge and the response thereto, reference is required to be made to the relevant provisions of the MMC Act, which are as follows
3(yy) "trade refuse" means and includes the refuse of any trade, manufacture or business"
Section 367-Provision and appointment of receptacles, depots and places for refuse, etc.-
The Commissioner shall provide or appoint in proper and convenient situations public receptacles, depots and places for the temporary deposit or final disposal of-
(a) dust, ashes, refuse and rubbish;
(b) trade refuse;
Section 368. Duty of owners and occupiers to collect and deposit dust, etc.-(1) It shall be incumbent on the owners and occupiers of all premises to cause all dust, ashes, refuse, rubbish and trade refuse to be collected from their respective premises and to be deposited at such times as the Commissioner, by public notice, from time to time prescribes in the public receptacle, depot or place provided or appointed under the last preceding section for the temporary deposit or final disposal thereof.
(2)...
(3)...
(4)...
(5) Notwithstanding anything contained in this section, it shall be incumbent on the owner or occupier of every trade premises to seek the Commissioner''s permission to deposit trade refuse collected daily or periodically from the premises, temporarily upon any place appointed by the Commissioner in this behalf. When such permission is granted by the Commissioner, the applicant shall be allowed to deposit the trade refuse accordingly on payment of charges as the Commissioner may, from time to time, fix for temporarily depositing trade refuse upon the place appointed under sub-section (2) and also such charges as the Commissioner may, from time to time, fix, for transporting and depositing the said trade refuse to the place provided or appointed u/s 367 for the final disposal of such trade refuse:
Provided that, the owner of occupier of any trade premises shall not deposit trade refuse at any place other than the places appointed by the Commissioner under sub-section (2) of this section or provided or appointed by him u/s 367, as the case may be.
Section 394.-Certain articles (or animals) not to be kept, and certain trades, processes and operations not to be carried on, without a licence; and things liable to be seized, destroyed, etc., to prevent danger or nuisance.-(1) Except under and in accordance with the terms and conditions of the licence granted by the Commissioner, no person shall-
(a) Keep, or suffer or allow to be kept, in or upon any premises,
(I) any article specified in Part I of Schedule M; or,
(II) any article specified in Part II of Schedule M, in excess of the quantity therein specified as the maximum quantity (or where such article is kept along with any other articles or articles specified in that Schedule, such other maximum quantity as may be notified by the Commissioner) of such article which may at any one time be kept in or upon the same premise without a licence;
(b) keep, or suffer or allow to be kept, in or upon any premises, for sale or for other than domestic use, any article specified in Part III of Schedule M;
(c)...
(d)...
(e) carry on or allow or suffer to be carried on, in or upon any premises;
(I) any of the trades specified in Part IV of Schedule M, or any process or operation connected with any such trade;
(II) any trade, process or operation, which, in the opinion of the Commissioner, is dangerous to life, health or property, or likely to create a nuisance either from its nature or by reason of the manner in which, or the conditions under which, the same is, or is proposed to be carried on;
(f) carry on within [Brihan Mumbai] or use or allow to be used any premises for, the trade or operation of a carrier
(2)...
(3)...
(4)...
(5) It shall be in the discretion of the Commissioner.
(a) to grant any licence referred to in subsection (1), subject to such restrictions or conditions (if any), as he shall think fit to specify, or
(b) for the purposes of ensuring public safety, to withhold any such licence;
Provided that, the Commissioner when withholding any such licence shall record his reasons in writing for such withholding and furnish the person concerned a copy of his order containing the reasons for such withholding;
Provided further that, any person aggrieved by an order of the Commissioner under this sub-section may, within sixty days of the date of such order, appeal to the Chief Judge of the Small Cause Court, whose decision shall be final.
Section 479. Licences and written permission to specify condition etc., on which they are granted. -
(1) Whether it is provided in this Act that a licence or a written permission may be given for any purpose, such licence or written permission shall specify the period for which, and the restrictions and conditions subject to which, the same is granted and shall be given under the signature of the commissioner or of a municipal officer empowered u/s 68 to grant the same.
(2)...
(3)...
(4)...
9. Dr. Tulzapurkar''s first and main submission is based on the presumption that the activities undertaken by the petitioners do not generate any trade refuse.
In this regard, it is pertinent that the petitioners and other affected parties represented to the respondents against the rates of TRC notified by an earlier circular dated 14th January, 2008. The petitioners, eventually, filed petitions before this Court to challenge the TRC rates. The respondents constituted a ''core committee'' to revise the rates of TRC and the matters connected therein. A Survey of various trade premises came to be conducted, which includes inter-alia warehousing premises belonging to Thamalmal Karanmal, Tair Pvt. Ltd. Jettha Drums and Contn. Pvt. Ltd. and Gateweill Bio Therapist. The extract of Survey Reports have been placed on record by the respondents alongwith their affidavit-in-reply. The same indicates that ''trade refuse'' is generated even by warehousing units like that of the petitioners. Taking into consideration the quantity, and perhaps the quality of such trade refuse, the impugned circular slashes down the rates of TRC by almost 65% as compared to the 2008 rates.
10. Dr. Tulzapurkar, however, contended that the cargo/containers of their clients are merely stored and then removed at the end of the term of storage. This activity cannot according to him generate any refuse. The only refuse in such premises would be the odd bits of waste paper used by the staff. He cited some illustrations and submitted that removal of packaging for purposes of effective storage or some refuse on account of stray breakages or disposal of some wrappings in dustbins or dust, rubbish per se cannot qualify as ''trade refuse''. The respondents, according to him, are wrong in treating every kind of refuse as ''trade refuse'' and on the said incorrect premise imposing TRC upon the petitioners. Then he also contended that ''trade refuse'' should mean and imply some solid waste generated by an industry involved in manufacturing process. He placed reliance upon sub-clauses (a) and (b) of section 367 and sub-clauses (1) and (5) of Section 368 of the MMC Act and submitted that the term "refuse" and the term "trade refuse" have been dealt with separately and that this is indicative that every kind of refuse cannot be qualified as "trade refuse".
11. We do not find the submissions well founded. Firstly, the MMC took an informed decision after appointing a core committee which conducted a survey. Secondly, it is not at all improbable that while loading and unloading the consignments and storing and removing the same refuse will be generated. It may be residual from the packages. There may be cases where the packages are opened for some reason. The material used for the main activities of loading and unloading, storing and shifting in and removing from the premises large parcels, cargo and consignments may be discarded as and when worn out. Miscellaneous refuse generated by the staff, visitors and customers is therefore not the only refuse that is generated even in a warehouse. Even such miscellaneous refuse is in the course of the petitioners business activity and therefore constitutes albeit to a smaller extent, trade refuse. After all the MMC does not deal with such miscellaneous refuse differently. As far as the MMC is concerned, it is refuse from the trade and deals with it accordingly.
12. The circumstance that sub-clauses (a) & (b) of section 367 and sub-clauses (1) and (5) of section 368 deal with the subject of ''trade refuse'' on one hand and ''dust, ashes, refuse and rubbish'' on the other hand separately, is by itself, no reason to conclude that the petitioners do not generate ''trade refuse''. The illustrations suggested by Dr. Tulzapurkar are of no assistance in statutory interpretation. In any case, we do not find that the illustrations were quite apposite to the context. In fact, section 3(yy) of the MMC Act defines ''trade refuse'' to mean and include refuse of any trade, manufacture or business. Since the act itself defines this term, it is not possible to accede to the submission that illustrations as aforesaid be taken into consideration for the purposes of defining or interpreting the said term. The definition makes it clear that refuse from even trade or business shall qualify as ''trade refuse''. Therefore this term cannot be restricted only to refuse generated by an industry involved in a manufacturing process. As per the Oxford English Dictionary, the term ''refuse'' means "matter thrown away as worthless". We are unable to accept the submission that packaging material or breakages thrown away by warehousing units do not constitute refuse from trade or business and consequently do not qualify as ''trade refuse''. Accordingly, in the light of definition clause and attendant circumstances, we see no merit in the submission that the term ''trade refuse'' is to be restricted only to solid waste generated by an industry involved in manufacturing process alone. The sections 367 and 368 of the MMC Act have dealt with the subject of ''refuse'' and ''trade refuse'' separately, because no TRC is leviable upon dust, ashes, refuse or rubbish not generated by any trade, manufacturer or business.
13. In any case, the question as to whether the petitioners generate ''trade refuse'' or not is a disputed question of fact, which cannot be adjudicated in proceedings under Article 226 of the Constitution of India. The MMC Act does not require the respondents to address themselves to the precise fact situation of every trader, manufacturer, or businessman. This would obviously be almost impossible. It must be left to the MMC to take an appropriate policy decision in this regard. This the MMC has done by stipulating different rates for various activities including for warehouses. The policy is not absurd, illogical or irrational. There arises no question of interference with the same.
14. The first two contentions of Dr. Tulzapurkar proceed upon the erroneous premise that the petitioners generate ''no trade refuse'' at all and that it is inherent from the nature of the petitioners business-warehousing that they generate ''no trade refuse'' whatsoever. In any case, TRC is not a tax, but a charge for the collection and disposal of ''trade refuse'' generated by trade, manufacturer or business. The traditional concept of ''quid pro quo'' in a fee has undergone considerable transformation.
In the case of
though the fee must have relation to the services rendered, or the advantages conferred, it is not necessary to establish that those who pay the fee must receive direct or special benefit or advantage of the services rendered for which the fee is being paid. If one who is liable to pay receives general benefit from the authority levying the fee the element of service required for collecting fee is satisfied.
In the case of
the broad correlationship between the imposition of fee and the nature of the service rendered to the entire textiles industry satisfied the test of quid pro quo, though no specific service was rendered to the payer of the fee. The administrative expenditure incurred by the Committee from the fund was held to be integral component of the fund.
In the case of
correlationship between the levy and the services rendered is one of general character and not of mathematical exactitude. All that is necessary is that there should be a reasonable "relationship" between levy of the fee and the service rendered. This test of "correlationship" or "correspondence" has been repeatedly used to uphold the levy of fee on the basis that it was reasonable for the requirement of the authority for fulfilling its statutory obligation.
In the case of
it is not necessary that the services to be rendered by collecting authority should be confined to the contributories alone. If the levy is for the benefit of the entire industry, there is sufficient ''quid pro quo'' between the levy recovered and services rendered to the industry as a whole.
In the light of these judgments, we do not find any merit in the contention that the levy of TRC is invalid, because according to the petitioners there is no element of ''quid pro quo''. In the aforesaid circumstances, we see no merit in the first three contentions raised by and on behalf of the petitioner.
15. The fourth contention regards arbitrariness, or unreasonableness of the rates also does not appeal to us. In the first place, there are hardly any pleadings worth the name in support of such a plea. Even otherwise, scope of judicial review in so far as fixation of rates/charges, is extremely limited. Unless, rates/charges fixed are absurd, unreasonable, or palpably unconscionable, no interference in exercise of powers of judicial review is warranted. In the present case, there is substantial reduction in rates in comparison to 2008 TRC rates. Accordingly, the rates as fixed cannot be said to be violative of Articles 14 and 19(1)(g) of the Constitution of India.
16. In the context of the challenge based upon unreasonableness and arbitrariness, we also note that in pursuance of the ''core committee report'', the respondents have in the impugned circular dated 12th December, 2011 fixed different rates in respect of different trades, manufacturers and businesses. There is application of mind as regards the nature and quantum of ''trade refuse'' that may be generated by respective trades, manufacturers and businesses and the TRC rates have been determined accordingly. This is not a case of uniform levy without any regard to the nature of the activity and the quality and quantity of ''trade refuse'' that may be generated. This is also not a case where some uniform rate has been fixed based only upon the area of the establishment. In such circumstances, we are unable to find merit in the challenge based upon arbitrariness, unreasonableness and violation of the Articles 14 and 19(1)(g) of the Constitution of India.
17. The fifth contention regarding ''double charging'' also lacks merit. In the first place, the purpose of the two levies i.e., license fee and TRC is different and distinct. Secondly, the averments in the petition suggest that the basic complaint of the petitioners was against double charging of the TRC by various departments of the respondents responsible for issuance of trade licenses, particularly in cases where establishments required more than one trade license. Even this complaint/grievance does not appear to be justified particularly in the light of the circular dated 20th March, 2009, which clarifies that where an applicant is required to obtain two or more licenses, then only one licence department should collect the TRC, i.e., the department which has imposed higher TRC. The remaining departments should refrain from collecting TRC unless there is a short fall. In case, there is over charging, then credit should be offered at the stage of further renewal. In these circumstances, we see no merit in the contention concerning double charging or over charging of TRC.
18. From a perusal of the material on record, we do not find that there is any retrospectivity involved in the implementation of the impugned circular dated 12th December, 2011. If the contention is upheld it is the petitioners, who would suffer a higher TRC. As stated earlier, there was a steep increase in the rates of TRC vide circular dated 14th January 2008 itself. Aggrieved by this, several parties including the petitioners made representations demanding a revision in the rates. The petitioners also filed petitions in this Court, impugning the circular dated 14th January, 2008. Upon consideration of the representations as also the report of the core committee constituted to revisit the issue of TRC, the respondents issued the impugned circular dated 12th December, 2011 substantially reducing the rates of TRC atleast in so far as warehouses are concerned. The benefit of such reduced rates was made available retrosectively from the year 2008. The impugned circular dated 12th December 2011 states that it revises/amends the rates of TRC with effect from the year 2008. This is a provision made for the benefit of the parties liable to be pay TRC. The petitioners are certainly benefited, in as much as they have been called upon to pay TRC at reduced rates with effect from the year 2008. It is not the petitioners'' case that they have paid TRC between the year 2008 and 2011 as per the rates prescribed in the year 2008. In the circumstances, there is no retrospectivity as such involved. In any case, even if there is any retrospective reduction of rates, then it is obviously for the benefit of the petitioners. The petitioners, accordingly, cannot contend that they are not liable to pay TRC even at the revised/reduced rates from the year 2008 and that the revised/reduced rates shall become payable only from the year 2011. In the circumstances, we find no merit in the sixth challenge based upon alleged retrospective application of revised/reduced rates as per the impugned circular dated 12th December, 2011.
19. On the aspect of the linking of payment of TRC with the issue of renewal of license, Mr. Kamdar placed reliance upon the provisions of Sections 368(5), 394(5) of the MMC Act, the relevant portions of which have already been transcribed earlier. Mr. Kamdar also placed reliance upon circulars issued by the MMC, which according to him incorporate general conditions that all the taxes, levies and charges, including TRC should be collected at the time of renewal of trade licences issued u/s 394 of the MMC Act.
20. The provisions of sections 368(5) and 394(5) read with Section 479 of the MMC Act, in our view, entitle the respondents to impose restrictions and conditions at the time of grant of licence. The same principle will be applicable even at the stage of renewal of licences. The linkage which is challenged by the petitioners in the present petition is more concerned with the manner of recovery of TRC and not competence of the respondents to recover TRC. In deciding the manner, we are once again of the opinion that this is a policy matter and sufficient free hand is required to be conceded to the respondents in formulation of such policy. The respondents are right in submitting that it is not possible to monitor each and every establishment for purposes of determining the precise quantity and quality of ''trade refuse'' generated. So also the respondents are right in contending that there is nothing illegal, arbitrary or unconstitutional in respondents recovering TRC at the stage of renewal of licences. From the averments made by the petitioners themselves, it appears that this has always been the manner in which the respondents have been collecting TRC. In matters of policy, merely because some other system of collection may be better, is no ground to exercise power of judicial review. As long as it is not demonstrated that the manner of collection is ex-facie, absurd, unreasonable or disproportionately oppressive, we are unable to uphold the seventh challenge as to the linking. We find nothing absurd, unreasonable or disproportionately oppressive in the policy adopted by the respondents or the manner of collection of TRC.
21. We have already held that there is nothing illegal, arbitrary, unreasonable or unconstitutional in the levy of TRC by the respondents. In these circumstances, we are not inclined to exercise the jurisdiction under Article 226 of the Constitution of India in order to assist the petitioners, who desire to either postpone or avoid payment of TRC and at the same time enjoy the benefits of a renewed licence. Upon grant of renewal, the MMC shall have to initiate fresh proceedings in order to recover TRC, thereby giving the petitioners opportunity to resist or delay in the payment of the same. The extra-ordinary jurisdiction under Article 226 of the Constitution of India cannot be exercised for such purposes.
22. The learned counsel Mr. Mishra appearing in Writ Petition No. 885 of 2013 placed reliance upon a decision of a learned Single Judge of this Court in the case of
The decision rendered by the learned Single Judge was on the basis of the unamended section 368(5) which read as under:-
(5) Notwithstanding anything contained in this section, if the owner or occupier of any trade premises desires permission to deposit trade refuse, collected daily or periodically from the premises, temporarily upon any place appointed by the Commissioner in this behalf, the Commissioner may, on the application, and on payment of such charges as the Commissioner may, from time to time, fix, allow the applicant to deposit the trade refuse accordingly.
By virtue of section 182(2) of the Maharashtra Act 10 of 1998, sub section 5 of section 368 of the MMC Act, 1888 was substituted with the following:-
(5) Notwithstanding anything contained in this section, it shall be incumbent on the owner or occupier of every trade premises to seek the Commissioner''s permission to deposit trade refuse collected daily or periodically from the premises, temporarily upon any place appointed by the Commissioner in this behalf. When such permission is granted by the Commissioner, the applicant shall be allowed to deposit the trade refuse accordingly...
There is a substantial difference in the phraseology employed in section 368(5) after its substitution in the year 1998. The unamended section made provisions for an owner or occupier of trade premises to apply for permission to deposit trade refuse, ''if they so desire''. In contrast, the amended section 368(5) of the MMC Act 1888 makes it incumbent upon the owner or occupier of every trade premise to seek the Commissioner''s permission to deposit trade refuse. In the circumstances, we are of the opinion that no reliance can be placed upon the decision of the learned Single Judge as the same was rendered in accordance with the unamended section 368(5) of the MMC Act, 1888.
23. The petitioners in Writ Petition No. 756 of 2013 are engaged in the business of storage of packaged photo chemicals. They contend that they are importers of photographic solution/chemicals from Malaysia. Upon import, the chemicals are temporarily/stored till they are distributed to the wholesellers. The photo chemicals are packed in plastic. The photo chemicals are packed in plastic containers, which in turn are packed in cardboard cartons. The photo chemicals are distributed in the same conditions in which they are received. In short, on the basis of these averments, the petitioners in this petition contend that they do not generate any ''trade refuse''. In effect therefore the case of the petitioners in the present petition is not appreciably different from the case of the petitioners engaged in the activity of ''warehousing''.
24. The petitioner in Writ Petition No. 1263 of 2013 is a Cooperative Society registered under Maharashtra Societies Act, 1960. Its Members are engaged in various activities, which they carry out at the Kandivali Industrial Estate. The petitioner gives instance of members, who generate ''trade refuse'', but it is their case that such ''trade refuse'' is recycled or sold to scrap dealers for the purposes of recycling. Some members, according to the petitioners do not generate any ''trade refuse'' at all.
25. Substantially, therefore, the case of the petitioners in Writ Petition No. 1263 of 2013 is not qualitatively different from the case of the petitioners, who are engaged in ''warehousing''. In fact, in this case the members of the petitioners are generating ''trade refuse'', but it is their case that the same is not required to be collected by the respondents. In the light of the provisions of Section 368(5) of the MMC Act, we are unable to accept the submission that such members should be exempted from payment of TRC.
26. The petitioners in Writ Petition Nos. 756 of 2013 and 1263 of 2013, undoubtedly are engaged in the activity of trade, manufacturer or business. Any challenge to the levy of TRC cannot be sustained upon fact situation in a particular case. This shall give rise to disputed question of fact. Besides, as long as the petitioners or their members belong to a class engaged in trade, manufacturer, or business, the levy of TRC upon them cannot be assailed by them upon the premise that some of them do not generate sufficient ''trade refuse'' or that they treat their own ''trade refuse'' separately. For the reasons indicated earlier, we see no merit in these petitions as well. In the result, the above Writ Petitions are hereby dismissed. Rule is discharged.
The interim order, if any, to continue for a period of eight weeks from today.
The petitioners, in W.P. No. 756/2013, are at liberty to pursue any other remedy in respect of reliefs other than those dealt with in this judgment.
There shall be no order as to costs.
