1989SCMR1612 (PLP)

SAAD SAOOD JAN, J.‑‑This is a petition for special leave to appeal whereby the intra‑Court appeal of the petitioners from the order of the learned Single Judge in a Constitutional petition was dismissed.

2. The petitioners are residents of Shah Kot which falls within the limits of the Town Committee of that name. On 15‑7‑1980, the Provincial Government issued a notification under section 3(l), the Punjab Urban Immovable Property Tax Act, 1958, imposing property tax in a number of areas including Shah Kot The petitioners challenged the legality of the notification in writ jurisdiction in the. High Court. The petition was dismissed and their intra‑Court appeal also failed. They now seek leave to appeal from this Court.

3. In support of this petition, learned counsel has referred to sections 4 and 137 of the Punjab Local Government Ordinance and sections 3 and 3‑A of the Punjab Urban Immovable Property Tax Act 1958. Section 4 of the Punjab Local Government Ordinance reads as follows:‑ The provisions of this Ordinance shall take effect notwithstanding anything inconsistent therewith contained in any law. Section 137 is expressed in the following terms‑ A local council subject to the provisions of any other law may, and, if directed by Government, shall levy all or any of the taxes enumerated in the second schedule. Item 11 of the second schedule referred to in the above section empowers Urban Local Council to levy taxes on the annual rental value of buildings or land. Section 3 of the Punjab Urban Immovable Property Tax Act states; (1) Government may by notification specify urban areas where tax shall be levied under this Act * * * **** (2) Subject to the provisions of subsections (3) and (4), there shall be levied, charged and paid, a tax on the annual value of buildings and lands in a rating area at the rate of twenty per cent of such annual value************************************* Section 3‑A of the Act runs as follows:‑‑ Out of the tax collected under this Act from within the limits of a Municipal Committee, a Town Committee or a Cantonment Board, the Government shall, after retaining five per cent thereof as collection charges, pay 85% of the balance to such Municipal Committee, Town Committee or Cantonment Board as the case may be.

4. The main contention of the petitioner is that under section 137, Punjab Local Government Ordinance 1979, read with the Second Schedule, the power tot impose tax on buildings and lands vests in the local municipal bodies. Section 4 of, the Ordinance gives an over‑riding effect to the provisions of the Ordinance in reference to other laws; in the circumstances, the provisions of the Punjab Urban Immovable Property Tax Act cannot be invokved to levy the said tax within the Municipal areas. This contention is clearly misconceived. It will be noticed that A despite the provisions of section 4 of the Ordinance, the power to tax as conferred by section 137 on local bodies has been expressly made subject to other laws. It cannot, therefore, be said that the provisions of section 3(1) of the Punjab Urban Immovable Property Tax Act stand eclipsed by section 137 of the Ordinance.

5. Learned counsel for the petitioner then contends that by Section 3‑A of the Act, 85 per cent of the property tax collected by the Provincial Government is to be paid to the local bodies. Thus, the Provincial Government merely acts as an agent of the local bodies. In this case the Town Committee has disapproved the levy of property tax in its area. That being so, the Provincial Government being an agent of the Town Committee, cannot impose the said tax. This contention is without any merit. The foundation of the power of the Provincial Legislature to B impose property tax is the Constitution. The mere fact that the Legislature has provided in section 3‑A that a major part of the fax collected should be paid to the local bodies does not make the Provincial Government an agent for the local bodies in that regard.

6. No other point was raised in this petition This petition is without any merit and is hereby dismissed. M.A.K./G‑194/S Petition dismissed