1. ' KH. MUHAMMAD YUSUF SARAP, C. J.--The Petitioners, Forest Lessees, have been transporting timber, extracted in Kundal Shahi, Muzaffarabad, to Mangla lake through river Jhelum. The bank of the lake which is the terminus point for the timber so transported is within the territorial limits of the Mirpur Municipality.
2. ' It seems from the writ petitions that the Municipal Committee had, at first on their representation that the timber was meant for export to Jhelum, been content with issuing transit visas, but after sometime, full octroi duty was sought to be realised, In these writ petitions, the power of the Municipality to impose octroi duty on the said timber is challenged on two grounds, namely:-
(I) That the Committee has no legal sanction to collect octroi duty; and
(2) The timber being meant for export is not available for such duty.
3. ' Under the Adaptation of Laws Act, 1959, the Jammu & Kashmir Municipal Act of 1970 Bikrami was replaced with the Punjab Municipal Act of 1911 but although the Punjab Octroi Act has not been enforced, the Jammu & Kashmir Octroi Act of 1958 Bikrami shall, in the light of Notification No, 3316 dated 26th December 1949 as laid down in PLD 1973 Azad J & K 51, be deemed to have continued to remain in force.
4. ' The change brought about by the enforcement of the Punjab Municipal Act is that while under section 39 of the pre-1947 Municipal Act, the Municipalities could not levy any tax whatsoever, without the prior approval of the Government, now, they can in exercise of powers vested in them under section 61 subsection (1), impose taxes enumerated therein. Under sub-clause (2) the Municipalities can, with the previous sanction of the Provincial Government, impose any other tax which the Provincial Legislature is competent to impose in the Province. It is not the Municipality's case that the duty in question is covered by section 61.
5. ' The power of a Municipality or a Town Committee to impose octroi duty on goods imported within its limits, is enjoyed under the Jammu & Kashmir Octroi Act. The relevant sections 4 and 5 are reproduced below:- "4. The Government may from time to time in the manner hereinafter laid down, impose in the whole or any part of any town specified by notification in the Government Gazette, an octroi on animals or goods or both brought within the octroi limits for consumption and use therein.
5. The said octroi shall be leviable after due notification in the "Jammu Kashmir Government Gazette" on such animals and goods and at such rates as the Government may from time to time determine."
6. Consequently, in accordance with these sections, the following Government Notification was published in an extraordinary issue of the Gazette No, 15, on 11th November 1968 : - "The Azad Government of the State of Jammu and Kashmir is pleased to accept the recommendation of the Mirpur Municipal Committee and sanctions the new rates of Octroi for Mirpur Municipality with effect from 18th of July 1968, the details of which are herewith affixed as an Appendix."
7. ' Items Nos. 93 to 95 cover different categories of timber. On 16th October 1973, the Schedule was cancelled and a new rate Schedule, published in an extraordinary issue of the Gazette under No, 19, Issue 47, on 12th December 1973 enforced. Under Serial No, 118, different categories of timber have been bracketed together for purposes of octroi and made chargeable at the rate of 20 paisa per maund. Item No, 153 is an omnibus clause, laying down that any article not specifically covered by the Schedule and which, at the same time had not been exempted (Appendix B), shall be charged at the rate et Re. 1 per maund. Thus it is clear that timber is liable to octroi duty and therefore the argument that there was no Octroi Act in force or that the timber was not liable for the samet has no force and is rejected.
8. ' It has been urged on behalf of the Municipal Committee that apart from the fact that the timber was actually sold within Municipal limits and that the claim of its export to Jhelum was a smokescreen to escape payment of duty, once the timber entered the Municipal limits of the town, it was chargeable with octroi duty and if it was really intended for export and not for local use or consumption, nothing prevented the petitioners from immediately removing the same to Jhelum on payment of a transit visa fee.
9. ' If any goods enter the Municipal limits, we think the Municipal Committee is initially entitled to assume that it is intended for local consumption and use. If it is not really meant for consumption and use in the locality the same must be proved being within the exclusive knowledge of the owners and it is for them to claim exemption from the duty on that account.
10. ' It is true that the taxing statutes should receive a strict construction which means that unless imposition of a duty clearly comes within the for-corners of an Act, the benefit should go to the tax- prayer but nonetheless when on a plain construction of the statute, the duty is leviable, the Courts cannot go into the question of hardship or inconvenience for the tax-payer. In AIR 1921 Pat. 206, a case arising out of Court Fees Act, the learned Judges have quoted Lord Cairns as having laid down the rule of interpretation with regard to fiscal legislation in the case of Partington v. The Attorney-General' (1) in the following words: "I am not at all sure that, in a case of this kind-a fiscal case-form is not amply sufficient; because, as I understand the principle of all fiscal legislation, it is thus: If the person sought to be taxed comes within the letter of the law he must be taxed, however great the hardship may appear to the judicial mind to be. On the other hand if the Crown, seeking to recover the tax, cannot bring the subject within the letter of the law, the subject is free, however, apparently within the spirit of the law the case might otherwise appear to be. In other words, if there be admissible, in any statute what is called an equitable construction, it is not admissible in a taxing statute, where you can simply adhere to the words of the statute."
11. ' The point was also considered by a Full Bench of the Madras High Court in AIR 1924 Mad.
420. The case has been treated as of great importance by the Editors of the A. I. R. The case related to the power of Madras Municipality to levy a tax on the appellant-Company. It was held by the Court that:- "The principle of construction to be applied to a taxing statute is that, if the words of the statute are capable of two otherwise equally opposite constructions, the construction to be adopted is that in favour of the tax-payer: but, to ascertain whether the two possible constructions are equally apposite, the ordinary rules of construction of statutes are to be applied. As pointed out by Rowlatt, J., in Cape Brandy Syndicate v. Inland Revenue Commissioners the maxim that clear words are necessary in order to tax the subject does not mean, as often contended.
12. "That words are to be unduly restricted against the taxing authority. It simply means that in a Taxing Act, one has to look merely at what is clearly said. There is no room for any intendment.
13. There is no {{FOOT NOTE}}
(1) (1869) 4 H L 100(122) = 21 L T 370 {{FOOT NOTE}} equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used."
14. ' That was enunciating no new principle, and I think the matter was clearly stated by Lord Russel, C.
15. J. In Attorney-General v. Carlton Bank, when he said:- "I see no reason why special cannons of construction should be applied to any Act of Parliament, and I know of no authority for saying that a Taxing Act is to be construed differently from any other Act. The duty of the Court is, in my opinion, in all cases the same, whether the Act to be construed relates to taxation or to any other subject, namely to give effect to the intention of the Legislature as that intention is to be gathered from the language employed, having regard to the context, in connection with which it is employed. The Court must no doubt ascertain the subject-matter to which the particular tax is by the statute intended to be applied, but when once that is ascertained, it is not open to the Court to narraw or whittle down the operation of the Act, by seeming considerations of hardship or of business convenience or the like. Courts have to give effect to what the Legislature has said."
16. ' We, therefore, hold that the Municipal Committee, Mirpur is legally entitled to claim octroi duty on all timber that is brought within the Municipal limits but the petitioners are entitled to claim exemption from the normally chargeable duty on such timber if it is not meant for local use and consumption but a mere passage through the Municipal area. In or view, the Municipal Committee is also entitled to fix reasonable time within which the timber not meant for local use or consumption should be removed from within the Municipal Limits and to charge normal octroi duty if it is not so removed within such time.
17. ' With these observations, we see no force in these writ petitions which are hereby dismissed with costs. revisions by the competent authorities. Therefore, it is advisable to consult the official sources or legal professionals for the most up-to-date and accurate information.