Bihar Vs. Rajni Ranjan  INSC 424
(12 October 1993)
R.M. (J) SAHAI, R.M. (J) ANAND, A.S. (J) CITATION: 1994 SCC Supl. (2) 567
only question that arises for consideration in this appeal directed against judgment
and order of the Patna High Court is if it committed any error of law in
quashing the notification dated January 7, 1976 issued by the State Government
in exercise of powers conferred on it under Section 9 of the Bihar Cinemas
(Regulation) Act, 1954 (Bihar Act XV of 1954).
Reason for quashing the notification enhancing the licence fee for the cinemas
was absence of any quid pro quo and claim of the State that the levy was not
fee but a tax.
true that since the decision given by this Court in 568 Kewal Krishan Puri v.
State of Punjab1 the requirement of correlation between the payer of the fee
and service rendered has considerably been broadened yet the basic distinction
between tax and fee has not been obliterated.
the State Government attempted to justify as a tax the High Court, in our
opinion, did not commit any error of law in quashing the notification. In
absence of any material that the State rendered any service either to the
respondent individually or to the class generally, the order of the High Court
cannot be said to suffer from any error of law.
the result the appeal fails and is dismissed. But there shall be no order as to