BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED:
31. 10.2014 CORAM THE HONOURABLE MR.JUSTICE R.MAHADEVAN W.P(MD)No.6216 of 2011 W.P(MD)Nos.6216 and 6217 of 2011 and M.P(MD)Nos.2 and 2 of 2011 W.P(MD)No.6216 of 2011: Virudhunagar District Bus Owners Association, represented by its Secretary, No.1/291, Pravin Sarvin Complex, Collectorate Post, Virudhunagar ?. 626 002. : Petitioner Vs. 1.The Government of Tamil Nadu, represented by its, Principal Secretary, Municipal Administration and Water Supply (MCII) Department, Fort St. George, Chennai ?. 600 009. 2.The Commissioner of Madurai Corporation, Arignar Anna Maligai, Madurai ?. 625 002. : Respondents (R.1 amended as per the order of this Court dated 09.06.2014 made in M.P(MD)No.1 of 2014 in W.P(MD)No.6216 of 2014.) PRAYER: Writ Petition is filed under Article 226 of the Constitution of India for the issue of a Writ of Certiorarified Mandamus to call for the records of the first respondent made under G.O.Ms.No.29, Municipal Administration and Water Supply (MC II) Department, dated 31.01.2011, and quash the same and direct the second respondent to refund the amount collected from the members of the petitioner Association from 01.12.2005 till date and further forbear the second respondent from collecting any toll fee for using the mechanically propelled vehicle for using inner ring road in Madurai city by the members of the petitioner Association. !For Petitioner : Mr.M.Palani ^For Respondents : Mr.T.S.Mohammed Mohideen, Additional Govt. Pleader for R.1 Mr.G.R.Swaminathan for R.2 * * * * * W.P(MD)No.6217 of 2011: Madurai District Bus Owners Association, represented by its President, 153, North Veli Street, Madurai ?.
1. : Petitioner Vs. 1.The Government of Tamil Nadu, represented by its, Principal Secretary, Municipal Administration and Water Supply (MCII) Department, Fort St. George, Chennai ?. 600 009. 2.The Commissioner of Madurai Corporation, Arignar Anna Maligai, Madurai ?. 625 002. : Respondents (R.1 amended as per the order of this Court dated 09.06.2014 made in M.P(MD)No.1 of 2014 in W.P(MD)No.6216 of 2014.) PRAYER: Writ Petition is filed under Article 226 of the Constitution of India for the issue of a Writ of Certiorarified Mandamus to call for the records of the first respondent made under G.O.Ms.No.29, Municipal Administration and Water Supply (MC II) Department, dated 31.01.2011, and quash the same and direct the second respondent to refund the amount collected from the members of the petitioner Association from 01.12.2005 till date and further forbear the second respondent from collecting any toll fee for using the mechanically propelled vehicle for using inner ring road in Madurai city by the members of the petitioner Association. For Petitioner : Mr.M.Palani For Respondents : Mr.T.S.Mohammed Mohideen, Additional Govt. Pleader for R.1 Mr.G.R.Swaminathan for R.2 * * * * * :COMMON
ORDERThese writ petitions have been filed seeking a Writ of Certiorarified Mandamus to call for the records of the first respondent made under G.O.Ms.No.29, Municipal Administration and Water Supply (MC II) Department, dated 31.01.2011, and quash the same and direct the second respondent to refund the amount collected from the members of the petitioner Association from 01.12.2005 till date and further forbear the second respondent from collecting any toll fee for using the mechanically propelled vehicle for using inner ring road in Madurai city by the members of the petitioner Association.
2. Since the issue involved in these writ petitions is similar, both the writ petitions are taken up together for hearing and disposed of, by this common order.
3. Brief facts necessary for the disposal of these writ petitions, are as follows:
3. 1. The members of the petitioner Associations are the stage carriage operators operating either within Virudhunagar District or on inter-district route between Madurai District and Virudhunagar District. The Government had established an Integrated Bus Stand at Mattuthavani, Madurai, and an inner ring road had been formed on the northern side of Madurai, to ease the traffic congestion and it was opened for public and vehicular operation from 01.11.2000, by virtue of G.O.Ms.No.149, Municipal Administration and Water Supply (MC.II) Department, dated 23.10.2000 and toll fee was fixed for using the said road. According to the petitioners, no notification was issued by the first respondent authorizing the second respondent Corporation to collect the toll fee on the expiry of five years period of notification. Challenging the same, the petitioners filed W.P(MD)Nos.3161 and 3162 of 2010 seeking a writ of Mandamus to forbear the second respondent Corporation from collecting or demanding the toll fee in terms of the notification, dated 23.10.2000. This Court, by common order dated 03.12.2010, dismissed the said writ petitions. Aggrieved over the same, the petitioners filed W.A.(MD)Nos.41 and 42 of 2011 before this Court. Pending the said writ appeals, the first respondent had ratified the collection of toll for the period from 01.12.2005 to 31.10.2010, by G.O.Ms.No.29, Municipal Administration and Water Supply (MC II) Department, dated 31.01.2011. However, this Court allowed the writ appeals, by setting aside the common order passed by the learned Judge of this Court. The present writ petitions have been filed challenging the ratification made by the first respondent. 3.2. In the counter affidavit filed by the second respondent, it is contended that as per the clause 10(a) of the Government Order dated 23.10.2000, the second respondent Corporation is entitled to collect toll fee and that the collection of toll fee would be in force for 15 years with an annual rate of 8% for the first five years. There is no statutory prohibition for giving retrospective approval by the Government towards the collection of toll fee by the second respondent Corporation and further, the Government had passed G.O.Ms.No.15, Municipal Administration and Water Supply (MC II) Department, dated 19.01.2014, granting permission for collection of toll fee upto 31.10.2014 with increase of 8% and therefore, the second respondent prayed for the dismissal of the writ petition.
4. Mr.M.Palani, learned Counsel for the petitioners submitted that the ratification given by virtue of the impugned Government Order in G.O.Ms.No.29, Municipal Administration and Water Supply (MC II) Department, dated 31.01.2011, is not tenable in the eye of law and that the same could not be given retrospective effect and having failed to obtain prior approval of the Government, the second respondent Corporation had erred in collecting the toll fee without any authority of law and therefore, the impugned order passed by the Government warrants interference at the hands of this Court.
5. He further contended that though the Hon'ble Division Bench of this Court in W.A.(MD)Nos.41 and 42 of 2011, held that after the expiry of the period of the notification, the second respondent was collecting the enhanced toll fee which is against the provisions of law and no person is entitled to collect any amount from the public without any proper authority of law, the ratification done by way of the impugned order is illegal and since the impugned order was not under challenge before the Hon'ble Division Bench of this Court, the same could not be upheld. According to him, the toll fee has to be fixed by the Government by issuing a notification and the Government could not ratify the action of the second respondent in collecting the toll fee from 01.11.2005 to 31.10.2010 and as per Section 2(2) of the Indian Tolls Act, 1851, the tolls shall be levied only at such rates and for such period as the State Government may by notification in the Official Gazette declare to be necessary and in the case on hand, the second respondent had violated the said provisions of law and the Government had also issued the impugned order ratifying the illegal action of the second respondent in collecting the toll fee without any authority of law and therefore, the judgment of the Hon'ble Division Bench of this Court is not binding on this Court as the said judgment would be per incuriam because it had been passed without reference to the aforesaid provision of law. Hence, he prayed for allowing these writ petitions.
6. In support of his submissions, he placed reliance on the following decisions: (i) Municipal Corporation of Delhi v. Gurnam Kaur reported in (1989) 1 Supreme Court Cases 101. Paragraph 11 would read thus: ".11. Pronouncements of law, which are not part of the ratio decidendi are classed as obiter dicta and are not authoritative. With all respect to the learned Judge who passed the order in Jamna Das case [Writ Petition Nos.981-982 of 1984]. and to the learned Judge who agreed with him, we cannot concede that this Court is bound to follow it. It was delivered without argument, without reference to the relevant provisions of the Act conferring express power on the Municipal Corporation to direct removal of encroachments from any public place like pavement or public streets, and without any citation of authority. Accordingly, we do not propose to uphold the decision of the High Court because, it seems to us that it is wrong in principle and cannot be justified by the terms of the relevant provisions. A decision should be treated as given per incuriam when it is given in ignorance of the terms of a statute or of a rule having the force of a statute. So far as the order shows, no argument was addressed to the Court on the question or not whether any direction could properly be made compelling the Municipal Corporation to construct a stall at the pitching site of a PG NO939pavement squatter. Professor P.J.
Fitzgerald, editor of the Salmond on Jurisprudence, 12th edn. explains the concept of sub silentio at p. 153 in these words: ".A decision passes sub silentio, in the technical sense that has come to be attached to that phrase, when the particular point of law involved in the decision is not perceived by the court or present to its mind. The Court may consciously decide in favour of one party because of point A, which it considers and pronounces upon. It may be shown, however, that logically the court should not have decided in favour of the particular party unless it also decided point B in his favour; but point B was not argued or considered by the court. In such circumstances, although point B was logically involved in the facts and although the case had a specific outcome, the decision is not an authority on point B. Point B is said to pass sub silentio.". (emphasis added.) (ii) State of Orissa v. Mamata Mohanty reported in (2011) 3 Supreme Court Cases 436. Paragraphs 37, 56, 57, 68 (xix), are produced hereunder: ".37. It is a settled legal proposition that if an order is bad in its inception, it does not get sanctified at a later stage. A subsequent action/development cannot validate an action which was not lawful at its inception, for the reason that the illegality strikes at the root of the order. It would be beyond the competence of any authority to validate such an order. It would be ironic to permit a person to rely upon a law, in violation of which he has obtained the benefits. If an order at the initial stage is bad in law, then all further proceedings consequent thereto will be non est and have to be necessarily set aside. A right in law exists only and only when it has a lawful origin. (Vide Upen Chandra Gogoi v. State of Assam [(1998) 3 SCC381, Mangal Prasad Tamoli v. Narvadeshwar Mishra [(2005) 3 SCC422 and Ritesh Tewari v. State of U.P. [(2010) 10 SCC677.". (iii) Municipal Corporation of Greater Mumbai, through Commissioner v. Anil Shantaram Khoje [Civil Appeal No.2918 of 2014, decided on 28.02.2014].. Paragraph 10 reads as follows: ".10. We are immediately reminded of the observations made in Babu Verghese v. Bar Council of Kerala (1999) 1 SCR1121 when this Court was called upon to consider a case under the Advocates Act. While doing so, we applied the principles earlier enunciated in Taylor vs Taylor (1875) 1 ChD426and in Nazir Ahmad v. King Emperor AIR1936PC253 The Court observed as follows: ?.It is the basic principles of law long settled that if the manner of doing a particular act is prescribed under any statute, the act must be done in that manner or not at all.?. (emphasis supplied.) (iv) Chairman-cum-M.D., Coal India Ltd., and others v. Ananta Saha and others [Civil Appeal No.2958 of 2011, decided on 06.04.2011].. Paragraph 30 would run thus: ".30. It is a settled legal proposition that if initial action is not in consonance with law, subsequent proceedings would not sanctify the same. In such a fact-situation, the legal maxim ".sublato fundamento cadit opus". is applicable, meaning thereby, in case a foundation is removed, the superstructure falls.". (v) Dipak Babaria and another v. State of Gujarat and others reported in (2014) 3 Supreme Court Cases 502. (vi) Tvl. N.V.S. Agro Derivatives v. The Commercial Tax Officer (Circle I) reported in 2006 (1) CTC449 Paragraphs 27 and 28 are reproduced hereunder: ".27. In Furest Day Lawson Ltd. v. Jindal Exports Ltd., 2001 (6) SCC366 while considering the plea of per incuriam raised therein the Supreme Court has referred its earlier decision in Mamleshwar Prasad v. Kanhaiya Lal, 1975 (2) SCC232 and extracted the relevant portion in paragraph 19 of the judgment which reads as follows: ".7. Certainty of the law, consistency of rulings and comity of Courts - all flowering from the same principle - converge to the conclusion that a decision once rendered must later bind like cases. We do not intend to detract from the rule that, in exceptional instances, where by obvious inadvertence or oversight a judgment fails to notice a plain statutory provision or obligatory authority running counter to the reasoning and result reached, it may not have the sway of binding precedents. It should be a glaring case, an obtrusive omission.".
28. In this case also the decision was rendered without taking into consideration of the relevant provisions of the statute which were obtaining at the time of deciding the case. With great respect to the learned Judge, I am not able to follow the judgment as it comes within the meaning of per incuriam. For the very same reasons, I am of the view that the matter need not be referred to a larger Bench.". (vii) Union of India v. Manik Lal Banerjee reported in (2006) 9 Supreme Court Cases 643. (viii) Vijay Narayan Thatte and others v. State of Maharashtra and others reported in (2009) 9 Supreme Court Cases 92. (ix) State of U.P v. Devi Dayal Singh reported in (2000) 3 Supreme Court Cases 5. (x) MSK Projects India (JV) Limited v. State of Rajasthan reported in (2011) 10 Supreme Court Cases 573. (xi) Ashok Lanka v. Rishi Dixit reported in (2005) 5 Supreme Court Cases 598. (xii) Shree Sidhbali Steels Limited v. State of Uttar Pradesh reported in (2011) 3 Supreme Court Cases 193. (xiii) Delhi Development Authority v. Joint Action Committee, Allottee of SFS Flats reported in (2008) 2 Supreme Court Cases 672. (xiv) Gujarat Urja Vikas Nigam Ltd., v. Essar Power Ltd., reported in (2008) 4 Supreme Court Cases 755. (xv) Tamil Nadu Electricity Board v. Status Spinning Mills Limited reported in (2008) 7 Supreme Court Cases 353. (xvi) Godavari Sugar Mills Limited v. State of Maharashtra reported in (2011) 2 Supreme Court Cases 439. (xvii) Bar Council of Maharashtra and Goa v. Manubhai Paragji Vashi reported in AIR2012SUPREME COURT135 (xviii) Chief Information Commissioner v. State of Manipur reported in AIR2012SUPREME COURT864 (xix) Ritesh Tewari v. State of U.P. reported in (2010) 10 Supreme Court Cases 677. (xx) Rosary Matriculation Higher Secondary School v. Government of Tamil Nadu reported in 2014 (1) CTC626 (xxi) Dayaram v. Sudhir Batham and others reported in (2012) 1 Supreme Court Cases 333.
7. Per contra, Mr.G.R.Swaminathan, learned Counsel for the second respondent Corporation contended that though the collection of toll fee had been subsequently ratified by the Government, it could not be stated to be illegal as the Hon'ble Division Bench of this Court in W.A.(MD)Nos.41 and 42 of 2011 had observed that the collection of toll fee from 01.11.2005 to 31.10.2010 could not be held to be illegal in view of the ratification. He further contended that a subsequent Government Order had also been issued granting permission for collection of toll fee upto 31.10.2014 with an increase of 8% and hence, he prayed for the dismissal of the writ petitions. In support of his contentions, he relied on the following decisions: (i) Shri Malaprabha Coop. Sugar Factory Ltd., v. Union of India reported in (1994) 1 Supreme Court Cases 648. (ii) Ashok Kumar Das and others v. University of Burdwan and others reported in (2010) 3 Supreme Court Cases 616. (iii) Virudhunagar District Bus Owners Association v. Government of Tamil Nadu reported in (2011) 5 MLJ62 8. I have carefully considered the rival submissions and perused the materials available on record.
9. It is pertinent to reproduce Section 2(2) of the Indian Tolls Act, 1851, hereunder for ready reference: ".Section 2(2): The tolls shall be levied only at such rates and for such period as the State Government may by notification in the Official Gazette declare to be necessary:- (a) in the case of tolls levied under clause (a) of sub-section (1) for the recovery of the amount expended upon the road or bridge or such portion of such amount as the State Government may determine, together with interest thereon at such rate as they may fix; and (b) in the case of tolls levied under clause (b) of sub-section (1), for the recovery of the amounts expended upon the road or bridge- (i) by the State Government; and (ii) by the local body or bodies otherwise than from its or their ordinary revenues, or such portions of such amounts as the State Government may determine, together with interest on such amounts or such portions, as the case may be, at such rate or rates as they may fix.".
10. Here, the petitioners had challenged the Government Order passed in G.O.Ms.No.29, Municipal Administration and Water Supply (MC II) Department, dated 31.01.2011, whereby the collection of toll fee by the second respondent without authority had been ratified by the Government. The specific plea of the petitioners is that the Government could not ratify the illegal action of the second respondent, by not adhering to the legal procedures as contemplated under the Indian Tolls Act, 1851 and it would ultimately prejudice the rights of the petitioners.
11. A perusal of the records would go to show that the said ring road had been thrown open for the public on 01.11.2000, in pursuance of G.O.Ms.No.149, Municipal Administration and Water Supply (MC.II) Department, dated 23.10.2000, in and by which, though the second respondent had been empowered to collect the toll fee for 15 years, it was restricted only for five years. On the expiry of the said period, a separate notification ought to have been issued by the Government for the remaining period of ten years. However, no such notification had been issued by the Government, for the subsequent period to collect the toll fee.
12. The Hon'ble Division Bench of this Court in Virudhunagar District Bus Owners Association v. Government of Tamil Nadu reported in (2011) 5 MLJ62 held thus: ".14. A reading of the above portion of the said Government Order would make it manifestly clear that in the year 2000, the Government had issued the said order authorizing Madurai Corporation to collect toll fee from 1.11.2000 to 31.10.2005 for the use of newly built 27.20 Kilometers inner ring road and the second respondent Corporation was permitted to collect toll fee for 15 years with an annual increase at the rate of 8% for the first five years and after five years, depending upon the potentiality of the traffic and annual income, 8% increase can be made and such a decision will be taken by the Government after five years. However, after the expiry of the period of the said notification, the second respondent-Corporation has been collecting the enhanced toll fee, which is against the provisions of law. No person is entitled to collect any amount from the public without any proper authority of law.". However, in paragraphs 16 and 18 of the said decision, it is further held as follows: ".16. ... Therefore, in our considered opinion, the earlier toll fee already fixed with increase in one stage of 8% levied and collected by the second respondent Corporation cannot be said to be illegal, in view of the ratification given by the Government in G.O.Ms.No.29, Municipal Administration and Water Supply (MN-2), Department, dated 31.1.2011. However, the second respondent Corporation is entitled to collect toll fee, which was regularised by the Government in G.O.Ms.No.29, Municipal Administration and Water Supply (MN-2), Department, dated 31.1.2011 from 1.11.2010, till it is enhanced by the Government. It is made clear that Madurai Corporation is entitled to collect toll fee as on 31.10.2005 with 8% increase. ***** ***** ***** ***** 18. The purpose of construction of over bridges is to avoid the congestion in the city. In the case on hand, for laying of the ring road, the expenditure was stated to be Rs.47.35 crores. Therefore, in our considered opinion, the collection of toll fee from the public, who use such over bridge, cannot be held to be against the provisions of law. But, before enhancing the toll fee, prior approval from the Government has to be obtained. Now, the Municipal Corporation has already applied to the Government for ratification and for extension of the period from 1.11.2000. Until it is approved, it is made clear that the second respondent is permitted to collect the toll fee as as 31.10.2005 with 8% increase until further orders from the Government, with immediate effect.".
13. The learned Counsel for the petitioner has relied upon the judgment of a Hon'ble Division Bench of this Court in Rosary Matriculation Higher Secondary School v. Government of Tamil Nadu reported in 2014 (1) CTC626and contended that the directions in the earlier order of the Hon'ble Division Bench in Virudhunagar District Bus Owners Association v. Government of Tamil Nadu reported in (2011) 5 MLJ62 can only be termed as an ?.Obiter?.. This Court finds some force in the contention. The Hon?.ble Division Bench in the judgment in Rosary Matriculation Higher Secondary School v. Government of Tamil Nadu reported in 2014 (1) CTC626 has held as follows: ".21. Needless to say that a fundamental right guaranteed and conferred on the minority institutions under Article 30(1) of the Constitution of India cannot be taken away by any Government Orders. Any restriction, which in effect, amounting to interference with the right of the administration of minority institutions, would certainly violate the right guaranteed under Article 30(1) of the Constitution of India. Therefore, what is observed at Paragraph (135) is only the reiteration of the fundamental rights guaranteed under Article 30(1) of the Constitution of India on the minority institutions and the principles laid down by the Hon'ble Supreme Court in various decisions. Certainly, the Government cannot take advantage of any general or passing observation, when right of the minority institutions and the power of the Committee in imposing restriction on the staff strength have been specifically spelt out in detail without any ambiguity under Paragraphs (133) to (135) & (155). The last observation made at Paragraph (139) cannot be taken to mean that the Government can pass orders restricting the staff strength of minority educational institutions irrespective of the other findings made at Paragraphs (132) to (135) & (155).
22. Therefore, we clarify that the observation made at Paragraph (139) that ".any such restriction regarding strength of teaching and non-teaching staff in Minority schools is subject only to Government Orders". cannot be construed as conferring a right on the Government to pass orders to restrict the staff strength without reference to the findings rendered at Paragraphs (132) to (135) & (155). Certainly an observation made within the same judgment cannot go contra to the law declared or ratio decided in other part of it. If any observation is so made, an over all reading of the entire judgment has to be made to find out the actual mind of the Court in declaring the law. A law declared is the ratio decidendi and binds the parties, whereas an isolated passing observation not in consonance with the law so declared is obiter.
23. At this juncture, it is useful to refer to the decision reported in State of Haryana Vs. Ranbir alias Rana, 2006 (3) CTC48(SC) :
2006. (5) SCC167 In the said case, the Hon'ble Supreme Court has observed that a decision is an authority for what it decides and not what can logically be deduced therefrom . At paragraph 12, the Apex Court has held as follows: ".12. ...... A decision, it is well settled, is an authority for what it decides and not what can logically be deduced therefrom. The distinction between a dicta and obiter is well known. Obiter dicta is more or less presumably unnecessary to the decision. It may be an expression of a viewpoint or sentiments which has no binding effect. (See ADM, Jabalpur Vs. Shivakant Shukla (1976 (2) SCC521. It is also well settled that the statements which are not part of the ratio decidendi constitute obiter dicta and are not authoritative. (See Divisional Controller, KSRTC Vs. Mahadeva Shetty, 2003 (7) SCC197".
24. In another decision reported in Girnar Traders Vs. State of Maharashtra and Others, 2007 (7) SCC555 the Hon'ble Apex Court has observed as follows: ".53. ..... Thus, observations of the Court did not relate to any of the legal questions arising in the case and, accordingly, cannot be considered as the part of ratio decidendi. Hence, in light of the aforementioned judicial pronouncements, which have well settled the proposition that only the ratio decidendi can act as the binding or authoritative precedent, it is clear that the reliance placed on mere general observations or casual expressions of the Court, is not of much avail to the respondents.".?. The ratio laid down by the Hon?.ble Division Bench is squarely applicable to the present case. This Court is not inclined to accept the contention of the learned Counsel for the respondents that in view of the decision of the Division Bench of this Court, the impugned notification was upheld and hence, the present writ petitions are not maintainable. The writ petition was earlier filed by the petitioner seeking a mandamus to forbear the 2nd respondent from collecting or demanding toll fee. The said writ petition was dismissed on 03.12.2010. Admittedly, there was no notification as contemplated under the Indian Tolls Act, on that date. The Hon'ble Division Bench in the earlier round though in paragraph 14 observed that the collection is against the provisions of law and no person is entitled to collect any amount from the public without any proper authority of law, ultimately, allowed the appeals with certain directions permitting the 2nd respondent to collect the same levy in public interest as per notification that was published, pending the appeals on 31.01.2011. Though the Hon?.ble Division Bench permitted the collection, in clear and unambiguous terms, held that the respondents are not entitled to collect the toll in the absence of any notification fixing the rate. The validity of the notification was neither the subject matter before the Hon'ble Division Bench nor it was agitated by the parties or considered on merits by the Hon'ble Division Bench. The Hon'ble Division Bench also did not consider whether the notification was in consonance with the provisions of the Act or the earlier enabling notification. The directions and the observations regarding the notification dated 31.01.2011 cannot be isolated from the ultimate decision of the Hon'ble Division Bench that there cannot be any levy or collection of toll in the absence of any notification fixing the rate. Hence, the findings regarding the notification in the impugned Government order can only be termed as ?.obiter?. and not ?.ratio decidendi?..
14. In the present cases, the challenge is to the notification by which, the 1st respondent has ratified the collections made by the 2nd respondent without any authority. Even more, the Hon'ble Division Bench had also condemned the conduct of the respondents and directed that they must not repeat the illegality in future. However, despite the directions, the 1st respondent time and again has not published the notification in time and has only ratified the collection by notifying the rate with retrospective effect. Hence, it has become imperative for this Court to decide the issue on merits.
15. Therefore, this Court is of the view that the decision of the Hon'ble Division Bench would not affect the right of the petitioner to challenge the validity of the notification on merits. There can be no quarrel or a different view with regard to the contention that when a judgment is rendered without considering the express provisions or earlier judgment of the Hon'ble Apex Court, the judgment would not prevent the parties to challenge any of the proceedings which violate the provisions of the Act.
16. The further issues to be decided are whether the notification is bad in law and whether any act done in violation of the express provisions can be ratified at a later date with retrospective effect?.
17. Upon perusal of the State Amendment to Section 2(2) of the Tolls Act, the following are the procedures as contemplated therein: (a) There must be notification by the Government; (b) The notification must contain the rate or amount proposed to be levied; (c) The period for which such toll could be collected; and (d) There must be a reasoning as to why such levy is necessary.
18. From the above, it is clear that the notification is mandatory before collection and it must not only contain the rates, period but also as to why such levy is necessary for such period and at such rate, as the society we are living in is a welfare state and it is the duty of the state to lay and maintain the roads, which is bestowed in the fundamental and constitutional rights of our constitution.
19. On a mere reading of the notification dated 23.10.2000, the following are evident: (i) It was decided to levy toll for 15 years from 01.11.2000; (ii) There will be an annual increase @ 8% for first five years; (iii) A decision to continue with the same rate of 8% increase or otherwise would have to be taken after five years; (iv) While taking the decision, it is incumbent upon the 2nd respondent to consider the adequacy of the income to meet its debt and the rate of increase is to be calculated at same percentage or reduced; and (v) The toll to be collected from 6th year to 15th year must be notified based on the decision regarding rate of increase or reduction.
20. Admittedly, there was no notification after the initial five years and a notification was effected only in 2011 ratifying the collection at the same rate from November 2005 onwards.
21. In the following decisions relied upon by the learned Counsel for the petitioner in, (i) State of Orissa v. Mamata Mohanty reported in (2011) 3 Supreme Court Cases 436. (ii) Municipal Corporation of Greater Mumbai, through Commissioner v. Anil Shantaram Khoje [Civil Appeal No.2918 of 2014, decided on 28.02.2014].. (iii) Chairman-cum-M.D., Coal India Ltd., and others v. Ananta Saha and others [Civil Appeal No.2958 of 2011, decided on 06.04.2011].. (iv) Dipak Babaria and another v. State of Gujarat and others reported in (2014) 3 Supreme Court Cases 502. (v) Chief Information Commissioner v. State of Manipur reported in AIR2012SUPREME COURT864 (vi) Ritesh Tewari v. State of U.P. reported in (2010) 10 Supreme Court Cases 677. (vii) Delhi Development Authority v. Joint Action Committee, Allottee of SFS Flats reported in (2008) 2 Supreme Court Cases 672. (viii) Gujarat Urja Vikas Nigam Ltd., v. Essar Power Ltd., reported in (2008) 4 Supreme Court Cases 755, the ratio laid down by the Hon'ble Apex Court is that when a particular procedure is contemplated under the statute, there cannot be any violation of the same and any action taken in violation of the express provisions of a statute would be void ab initio and all subsequent actions taken based on the initial illegal action would also fall as a consequence. The ratio in the aforesaid decisions are squarely applicable to the case on hand and following the same and in the facts of the case, this Court terms the collection of tax at the increased rate from November 2005 to Januarly 2011 as illegal. The right of the 2nd respondent to collect the toll would commence only after the notification of the 1st respondent fixing the rate. There cannot be any ratification of an illegal act. Hence, the impugned notification is bad in the eye of law.
22. That apart, upon perusal of the impugned notification, what this Court could understand, is that the Corporation had availed loan from private parties to save the payment of interest and clear the initial loan from the Tamil Nadu Urban Development Fund (in short ".TNUDF".). It appears that the fund was raised from private parties without approval and later, the action seems to have been ratified. As a result, the Corporation had to incur the additional expenses of payment of interest to private parties and to TNUDF. The notification is silent as to when the loan with TNUDF was cleared and how much interest was paid to them. If the Corporation had to incur additional expenses towards interest, it is only because of their illegal act of obtaining loan without approval. Public cannot be burdened with the same. Further, the notification is also silent as to when the loan with private parties were acquired, what was the collection from toll for the first five years or average collection for each year. This is the purpose for which, the rate was decided to be notified later for the 6th year onwards. The notification apparently fails to meet out the requisite mandates.
23. In the judgments relied upon by the learned Counsel for the petitioner in State of U.P v. Devi Dayal Singh reported in (2000) 3 Supreme Court Cases 5 and MSK Projects India (JV) Limited v. State of Rajasthan reported in (2011) 10 Supreme Court Cases 573, the Hon'ble Apex Court has laid down the law that the levy of toll must be proportionate to the expenses incurred in construction, repair or maintenance of the road and such collection in cases of new roads must be for a specific period or only until the settlement of the debt incurred for construction. The judgments are applicable to the present facts of the case on all fours.
24. In the case on hand, the 2nd respondent has committed an illegal act of raising funds without approval and as a result, it had to incur payment of additional interest till the closure of the loan from TNUDF. The above act has in fact occurred due to the misconduct of the officials and if at all any action is to be taken, it is only as against those officials and not against the public. Therefore, the reasons for approving the rate of annual increase at 8% is not justifiable and not in consonance not only with the earlier notification but also with the provisions of Section 2 (2) of the Act. Nevertheless, the notification is also not in public interest.
25. Insofar as fixing the rate with retrospective effect in the impugned notification, the learned Counsel for the petitioner has relied upon the paragraph 42 of the decision in Tamil Nadu Electricity Board v. Status Spinning Mills Limited reported in (2008) 7 Supreme Court Cases 353, which reads as under: ".42. A statute, even a subordinate legislation, may have to be construed reasonably. A subordinate legislation ordinarily would not be given a retrospective effect. Retrospective effect can be granted only if there exists any power in that behalf. There is nothing to show that such a power has been conferred upon the State in terms of the Act. While saying so, we are not oblivious of the situation that the State has a statutory power to fix the tariff. It may also be true that when a statutory power is conferred, the State would have power to amend, alter, modify or rescind the same. The Court must also bear in mind that it may not cause undue hardship. What we mean to say that if construction of a statute is possible as a result (sic whereof) hardship is avoided, vis-a-vis, an undue hardship would be created, the court will prefer the former interpretation". In the above case, the Hon'ble Apex Court has held that fixation of tax with retrospective effect is bad unless there is an express provision.
26. The learned Counsel for the 2nd respondent has relied upon paragraph 110 of the decision in Shri Malaprabha Coop. Sugar Factory Ltd., v. Union of India reported in (1994) 1 Supreme Court Cases 648, which reads as under: ".110. Though normally we would have quashed the notifications mere quashing of the notifications would lead to nebulous situation during the interregnum till the refixation of price we are obliged to give the above direction. In this connection we may usefully quote the following passage occurring at page 294 of Judicial Remedies in Public Law by Clive Lewis: ".The courts now recognise that the impact on the administration is relevant in the exercise of their remedial jurisdiction. Quashing decisions may impose heavy administrative burdens on the administration, divert resources towards re-opening decision, and lead to increased and unbudgeted expenditure. Earlier cases took the robust line that the law had to be observed, and the decision invalidated Whatever the administrative inconvenience caused. The courts nowadays recognise that such an approach is not always appropriate and may not be in the wider public interest. The effect on the administrative process is relevant to the courts' remedial discretion and may prove decisive.".". The Hon'ble Apex Court in the above judgment has refused to quash the notification after terming it as illegal as a nebulous situation would arise until fixation of price and therefore, in public interest issued certain directions. Pointing out to the same, the learned Counsel for the 2nd respondent contended that the right to collect was always there and only the rate was to be notified.
27. The learned Counsel has also placed reliance upon the decision of the Hon'ble Apex Court in Ashok Kumar Das and others v. University of Burdwan and others reported in (2010) 3 Supreme Court Cases 616 to contend that approval is sufficient and prior approval is not what is contemplated under the Act and therefore, ex post ratification is permissible.
28. This Court has already held that the impugned notification even as on the date of publication is not in consonance with either the provisions or the earlier notification. Any levy of toll/tax/charge or fee cannot be made except with the authority of law. This Court has already held that the ratification is bad in law. Similarly, any levy for the first time cannot be imposed with retrospective effect. However, it is evident from notification and the provisions of the Act that the respondents are entitled to levy toll fee for 15 years or until the repayment of the construction cost and there has been a collection from 2000 onwards and hence, the levy cannot be circumvented as the notification is with retrospective effect. In the facts and circumstances of the case, the levy is not without any authority of law. Only the fixation of the rate with retrospective effect is illegal. In the above circumstances, this Court is of the view that the impugned notification is liable to be struck down and the respondents have to redo the entire process of fixation by applying their mind.
29. Now, coming to the claim of refund, the learned Counsel for the petitioner has relied on the decision in Godavari Sugar Mills Limited v. State of Maharashtra reported in (2011) 2 Supreme Court Cases 439 to drive home the point that the members of the petitioner association are entitled to refund of the amount paid by them and that this Court has jurisdiction to direct the refund of the levy collected without authority.
30. No doubt, this Court certainly has powers to order refund of the amount collected without authority, however, considering the facts of the present case, this Court is not inclined to do so as the respondents are entitled to collect toll charges for 15 years from 1.11.2000 or until closure of the debts incurred for construction. Hence, the plea of refund is rejected.
31. It is also pertinent to mention here that even in G.O.Ms.15 dated 29.01.2014, where the same rate of increase has been decided to be extended till 31.10.2014, there is a non-application of mind as well as purpose of levy has not been adhered to. Ratification of an illegal act performed in violation of procedures prescribed under law is a serious threat to 'Rule of Law'. It would lead to lawlessness permitting violation of law at many levels and would also pave way for corruptions.
32. In the result, both the writ petitions are partly allowed and the impugned notification in G.O.Ms.No.29, Municipal Administration and Water Supply (MC II) Department, dated 31.01.2011, stands quashed. Further, the 2nd respondent is directed to furnish the necessary particulars to the first respondent regarding the loan availed from TNUDF, private parties, the date of closure of the loan with TNUDF, interest paid to TNUDF and private parties, period during which double interest was paid and the amount of excess interest paid, average collection between 2000 to 2005, 2005 to 2011 and from 2011 onwards, within a period of two weeks from the date of receipt of a copy of this order and the 1st respondent shall evaluate the same and fix the rate, keeping in mind the fact that the intention can only be to clear the debts and not to use it as a tool for generating revenue to the 2nd respondent, within a period of four weeks thereafter, taking note of the fact that this order only effectually extends the time for publication of the notification for the period between 1.11.2014 to 31.10.2015 in the peculiar circumstances . If factually, the loan had been cleared long back, the 1st respondent shall publish a notification to that effect. If the loan has not been discharged, the 1st respondent shall continue to collect at the existing rate until the fresh notification is published within six weeks. If no notification is published within six weeks, the 2nd respondent shall not be entitled to collect the toll fee. With the above directions, the writ petitions are partly allowed. Consequently, the connected miscellaneous petitions are closed. No costs. To 1.The Principal Secretary, Government of Tamil Nadu, Municipal Administration and Water Supply (MCII) Department, Fort St. George, Chennai ?. 600 009. 2.The Commissioner of Madurai Corporation, Arignar Anna Maligai, Madurai ?. 625 002.