Committee Vs. Allied Motors Pvt. Ltd. & Ors  INSC 569 (17 October 1995)
M.M. Punchhi, M.M. Singh N.P. (J) Punchhi, J.
1996 AIR 388 1995 SCC Supl. (4) 150 JT 1995 (7) 460 1995 SCALE (6)37
appeal by special leave is directed against the judgment and order dated May
21, 1981 of the High Court of Delhi at New Delhi passed in Letters patent
Appeal No.121 of 1973, upturning the decision of a learned Single Judge, as a
result of which Civil Writ Petition No.653-D of 1963 stands allowed, and sequally
the demand of Advertisment Tax quashed.
appellant is the New Delhi Municipal Committee. In exercise of its powers under
the provisions of Section 188(v) and 199 of the Punjab Municipal Act, 1911, the
committee appellant, after following the statutory procedure, framed Bye-laws,
providing for the control and regulation of advertisements, which inter alia
provided as follows:
Every person who erects, exhibits, fixes, paints, carries or retains upon or
over any land, building, wall, scores, boarding, structure or vehicle any
advertisement within the limits of the New Delhi Municipal Committee and as
mentioned in the Chief Commissioner's notification No.F.3(56)/56-LSG dated the
23rd January 1958, shall be liable to pay advertisement tax on the same
according to the schedule of rates appended to the said notification. This
schedule of rates is reproduced in Appendix 'A' to these Bye-laws.
person shall fix up, erect or exhibit any advertisement without paying the
entire amount of tax due in advance.
Tax shall not be payable on the following categories of advertisements :
19.2.1971) (After ( 19.2.71) (a) Name boards Name boards display- displayed by
the ed by the traders on traders on their their own premises own premises
provided they do not provided the board contain any item of is purely a name
advertisement other board and it does than the name of the not contain any
trade that may be item of advertise- carried out at the ment. premises.
(c) xxxxx (d) xxxxx (e) Advertisement which relates to the trade, profession or
business carried on within the land or building upon or over which such
advertisement is exhibited or to any sale or letting of such land or building
or any effects therein or any sale, entertainment or meeting to be held on or
upon or in the same.
that exemption under this item shall apply only to one board displayed by the
owner or his agent.
Advertisement which relates to the name of the land or building upon or over
which the advertisement is exhibited or to the name of the owner or occupier of
such land or building.
(h) xxxxx EXPLANATION - The word advertisement' means any word, letter, model,
sign, placard, notice, device or representation, whether illuminated or not, in
the nature of and employed wholly or in part for the purpose of advertisement,
announcement or direction." The writ-petitioners before the High Court are
the respondents herein. The first respondent M/s. Allied Motors Pvt. Ltd.
carries on business of sale, purchase and repairs etc. of motor cars, Lambretta
Scooters, and truck chasis and also deals in the sale of Burshane Gas. The
second respondent is its Managing Director. The third respondent is an
Association of Traders having their business place in the territorial area of
the Committee. The Respondent No.1 exhibits eight neon signs boards on its
premises, those being:
"Allied Motors Private Ltd. " Board being of a paerticular size
"Perkings" Board being of a particular size
view of exhibitilon of these nenon-signs, the appellant-Committee rasided a demand
raised a demand against the said respondents for payment of advertisement tax.
aggrieved, the respondents moved the High Court of Delhi by was of a writ petition
challenging the imposition of tax on a veriety of grounds. A learned Single
Judge, who got to grips with the matter posed three questions for
determination, out of whom two relating to the constitutionality of the measure
do not survive as they stand dropped, for they were answered against the writ-
petitioners by the learned Single Judge and those were not raised again before
the Letters Patent Bench. The Third question was as follows:
the Boards displayed by the Petitioners are not "advertisement"
boards but merely sign-boards of the items in which the petitioners deal"
Holding that the boards displyed by the respondents were in the nature of advertisments
the learned Single Judge dismissed the writ petition. Before the Letters Patent
Bench the third question got subsided and then came to the forefront claim of
the respondents for exemption under clauses (a) of Bye Law 7. The Letters
Patent Bench accepted the appeal on the interpretaion given by it to clause (a)
of Bye-Law 7 to the effect that the boards displayed by the respondents were
purely nameboards, containing no item of advertisement except the trade name of
the articles suggested to be offered for sale. This has given rise to this
appeal by the Committee as the respondents now stand absolved from payment of
we garner our minds to discover how certain advertisements are exempted from
taxation, it needs to be priorly accepted that those would be advertisements,
as covered and concerived of by Bye-law 1. If the act attracting taxation does
not come within the scope of 'advertisement' within the meaning of Bye-law 7
any exemption from payment of tax on exempted advertisements does not arise.
But if the act comes within the scope of advertisement, unguestionably and
undeniably, then alone can resort be had to bye-law 7 to discover whether the
advertisement is such a one to which any exemption can be attracted. It is in
this light that we see that Clause (a) of Bye-law 7, provides that tax shall
not be payable on nameboard displayed by the traders on their own premises,
provided the board is purely a nameboard and it does not contain any item of
advertisement. It is plain therefore that it shall intitially by an
advertisement but would be exempted from taxation if
displyed by a trader,
his own premises,
as a name board as such and
purity maintained by not containing any other item of advertisement.
is the pre-amended Bye-law with which we are instantly concerned. In contrast
Clause (f) specifically takes out advertisements which relate to the name of
the land or building upon or over which the name of the land or building upon
or over which the advertisement is exhibited or relating to the name of the
owner or occupier of such land or building. By process of contrast and
exclusion, advertisements so exhibited, which related to the name of the land
or builiding or to the name of its owner or occupier is a category apart and
distinct from advertisement by means of nameboards. Even distinct are the
advertisements, as conceived of in Clause (e) of Bye-law 7, which relate to the
trade, profession or business carried on within the land or building upon or
over which such advertisement is exhibited or to any sale or letting of such
land or building or any effects therein or any sale, entertainment or meeting
to be held on or upon or in the same; provided that exemption under this item
shall apply only to one board displayed by the owner or his agent.
being the state of bye-laws, we would be causing violence to the spirit of
Clause (a) of of Bye-law 7, in splitting the expression "nameboard"
into two separate words i.e. name and board and depleting the provision of its
intent. Apparently this is a term of art, finding its way to the alleys of law
by subordinate legislation. Necessarily, we need to seek help from English
dictionaries and cannot go by just impressions. According to The Random House
Dictionary of the English language, the expression "name.board"
(perhaps hyphenated) means a sign-board that identifies a place or object; it
is a name painted, stenciled, etc. on something, as on the side of a ship.
+ Board). According to Webster's Third New International Dictionary, the word
"nameboard" (as one word) is meant as an identifying signboard (as
for a station, a shop or a ship) ; also an identifying name displayed (as on
the side of a ship) other than on a board. The nameboard (be it called a single
word, or combination of two words, or an expression) thus in the English
diction a distinct meaning which cannot be mutilated by splitting the same into
two separate words of 'name' and 'board', discovering their individual meanings
and then tying them up. It would rather be safe to rely on the aforesaid two
dictionary meanings to deduce that even though under Clause (a) of Bye-law 7
two words, i.e. 'name' and 'board' are used in succession, what is intended to
mean is that these go to make one word or a combined word, in order to exempt
advertisement by displaying of the name-board by the trader on his ownpremises,
provided the board is purely a name-board and does not contain any item of advertisment.
Significantly, in the in-built proviso, the word "name-board" in its
pristine purity, reflects something more than a board and in that manner
distinctive. This adds to our analysis that the words 'name' and 'board' are
not separate so as to be given separate meanings anf then coalescing them up.
Rather, in our view the name-board is one word, as recognised separately, on
its own strength, in the dictionaries. And according to those dictionaries, the
identifying name so displayed pertains to the place or object, not the name of
the trade or the owner. A name-board thus plays the part of the identifier, if
the place/premises has a name, by display of such name. To demonstrate and
clarify it further, we say that if by means of paint or structural signs an
identifying name is engrafted over a building, as an identifying measure, thenm
it is a name board. because becoming a part of the premises it makes the
premises self introductory by name.
case of the respondents being that they use neon- lights to disply the names of
commodities they sell would fall since those advertisements cannot be called
name-boards or even as identifying the name of any object in which the trader
was doing his business that being barely barely descriptive of the commodity.
It would be more apt to say that the name-board relates to the objest and not
to the subject. This marked distinction takes out the case of the respondents
from seeking exemption under Clause (a) of By- law 7. The Division Bench of the
High Court apparently was misled to discover separate meaning of the word
'name' and then of the word 'board' whereafter to put them into a combination,
assigning a meaning to 'name-board' as if covering trade description of
commodities offered for sale and granted relief to the responedents on that
basis. This in our view was a wrong approach leading the judgment to be view
was a wrong approach leading the judgment to be vulnerable.
respondents did not claim any exemption under Clause (e) of Bye-law 7. The said
provision has been adverted earlier in passing. It is to be seen that
advertisement as relating to the trade, profession or business carried on
within the land or building upon or over which such advertisement is put are to
be exempted. Equally exemption is claimable for such land or building or any
effects therein. Like-wise adertisments relating to any entertainment or
meeting to be held on or upon or in the same is to be exempted; provided that
exemption is valid to the owner or agent for one board. Thus advertisement
which has nexus with the trade profession or business would qualify for
exemption if relating to the named activites.
respondents succeeded before the Letters Patent Banch of the High Court only on
the basis of clause (a) of Bye law 7.
bench when called upon by the present appellant to give favourable
interpretation to clause (a) of Bye laws 7 on the basis of clause (e) observed
that it appears to them that clause (e) observed that it appears to them that
clause (e) would apply to those adertisements which relate (only) to the trade,
profession or business or something more than mere name boards. The respondents
herein (the appellants there-at) did not build their case on the envil of claiuse
(e) of Bye laws 7 and any attempt herein, in the absence of the views of the
High Court, would negate proper handling.
would therefore leave the matter at that. This course is all the more necessary
when there is an amendment in clause (a) of Bye laws 7 effective from 19-2-1971
whereunder a name-boards remains as such displayable by the traders on their
own premises provided they do not add any item of advertisement thereto other
than the name of the trade that may be carried out at the premises. But, as
said before, we are concerned with the period prior to that requiring us not to
give a positive opinion.
the foregoin reasons we are of the considered view that the judgment and order
of the Latter Patent Bench deserves to be set aside. We accordingly allow this
appeal, set aside the same dismissing the civil writ petition of respondent 1
to 3, upholding the damand of advertisement tax. Parties to bear their own