Corporation of Greater Bombay Vs. Bombay Tyres International Ltd.
& Ors  INSC 185 (27 March 1998)
Thomas S. Rajendra Babu S. Rajendra Babu. J.
C.A. 1179/94 & SLPS (C) Nos.
15507/87. 853/88 and 14587/87.
this batch of cases, the appellant is Municipal Corporation of Greater Bombay,
which has made provision for Water Charges by framing appropriate Rules and
Bye-laws pursuant to Section 141 and Section 169 of the Bombay Municipal
Corporation Act, 1888. The scope of these provision was considered in Municipal
Corporation of Greater Bombay, vs., Nagpal Printing Mills & Anr. 1988 (3)
SCR, 274, by this Court and the view of the Bombay High Court that Rule III (d)
(i) to be invalid and beyond the rule making power Corporation was upheld. It
was made clear by this Court in the said decision that the said provisions of
the Act would empower the Corporation to levy charge only in respect of water
that has in fact been supplied to and consumed by the consumer and it is to be
levied on the basis of measurement or estimated measurement. It is also noticed
that an estimated amount could be fixed on the basis of sound guidelines and
the power given to the Commissioner to fix a gupta has no guidelines. On the
basis of this decision, the High Court disposed of several matters.
the correctness of those decisions these appeals have been preferred before
this Court contending that the decision in Nagpal's case required
reconsideration and the provision of the Municipal Corporation Act considered
earlier have been relied upon to contend that the appellant has competence to
frame Rule III (d) (i) while the respondents have reiterated the view expressed
in Nagpal's case. On hearing this aspect, a Bench of two learned Judges
referred this matter to a larger Bench for consideration on the correct scope
of the provisions that were considered in Nagpal's case. Thus the matter is
not think there is any good reason to reconsider the decision in Nagpal's case.
The view taken by this Court in Nagpal's case is a plausible on and
subsequently that Rule having been deleted is now replaced by a new rule. We
respectfully follow the view expressed by this Court in Nagpal's case and
uphold the order made by the High Court.
Shri S.K. Dholakia, learned Senior Advocate for the appellant submitted that at
any rate this Court had not occasion to examine the scope of the quota rule,
and, therefore tit need not have made the observations to the following effect:-
"The bye-laws made in 1968 here empower the Commissioner to fix a quota.
But no guideline in indicated. That is bad and unwarranted.
aspect also need not be re-examined because subsequently by the rules framed in
1994 the definition of quota has been altered and whether this present rule
answers the objections noticed by this Court in Nagpal's decision need not be
examined as the new Rules are not in question before us.
High court having allowed the petitions has directed the refund of the amounts
with certain rates of interest and if those amounts have already been refunded
to the parties concerned, we do not think it appropriate to allow the
appellants to recover such amounts again but if, however, such amounts have not
been refunded and are retained by the Corporation, such amount shall not be
refunded. We are making this order being conscious of the fact that the rule
had been struck down not on the ground that it was incompetent to frame such
Rule but on account of clear provisions not having been framed. Further, we are
not sure in the absence of investigation as to whether the respondents had
included in their prices structure the amounts paid to the Corporation pursuant
to the demand raised under the invalidated rules and whether the burden had
been passed on to the consumers, in which event it will be wholly inequitable
to allow respondents to claim such amounts back from the Corporation.
therefore, partly allow appeals to the limited extent to allowing the
appellants to remain amounts not refunded to the respondents, at the same time
making it clear that they shall not recover any amount on the basis of demands
arising under the invalidated rules. In other respects, appeal stands
dismissed. Ordered accordingly, No costs.
Leave Petition (C) 9620/95 The petitioner had claimed for refund of amount in a
writ petition filed under Article 226 of the Constitution.
petitioner is running a mill and consumes water. In the writ petition filed on 20th January, 1989, the petitioner sought for refund
of the amounts in respect of the consumption of for the period commencing from
March 1984, ending with May 1985, September, 1979, ending with January 1978. January
1976, ending with June 1987. On the basis that water charges were recovered without
authority of law as the Rules relevant thereto had been nullified by the High
Court and upheld by this Court in Municipal Corporation of Greater Bombay vs. Nagpal
Printing Mills., & Anr,. SCR 1988(3) 274, the petitioner contended that the
Corporation was bound to refund said amounts and when such a claim had been
made before the Corporation, the same had been rejected on imperishable
learned Single Judge who disposed of the writ petition held that the petition
does suffer from undue delay and consequently the claim to refund from vice of laches
but in spite of such laches, relief could be granted in respect of a period
prior to three years from the date of filing of the petition in respect of the
charges paid from January 28, 1986 onwards and directed the Corporation to
compute the said amount and refund the same. On appeal to the Division Bench
the Bombay High Court took the view that the relief granted by the learned
Single Judge could not be sustained.
reasoning adopted by the High Court is that the rule was struck down by the
High Court is that the rule was struck down by the Division Bench of the High
Court on 16th September, 1987 which was subsequently upheld by this Court on
17th March, 1988. The application for the refund had been made on October 23.
29+ ad writ petition had been filed only on January 11. 1990, long after the
last charges paid in December, 1986. In those circumstances, the Court was of
the view that there were laches on the part of the petitioner in making the
this finding, the learned counsel for the petitioner relied upon the decisions
of this Court in Salghah Tex Company Ltd. vs. Superintended of Taxes Nowgong
& Ors. etc. 1988 (2) SCR 474, and Mahabir Kishore & Ors, vs. State of
Madhya Pradesh 1989 (3) SCR 596, and submitted that levy of water charges
itself being illegal, the recoveries made pursuant to that provision could not
be retained but refunded in which event and principles of limitation or laches
would not apply. This is not a case where the provision of the rule which
enabled the levy of water charges was struck down on the ground that it was
incompetent out on a ground that such rule had been framed inarticulately and
was not clear enough. Payments made by the petitioner should be treated as
having been made by mistake but once a declaration of law had been made by the
Bombay High Court on 16th September, 1987, it was open to the petitioner to
claim for recoveries and the same should have been made within a reasonable
time thereafter., On ascertaining what is reasonable time for claiming refund,
the courts have often taken note of the period of limitation prescribed under
the general Law of Limitation for filing of suits for recovery of amount due to
them. In the present case also that standard adopted by the High Court is the
same in ascertaining whether there has been laches on the part of the appellant
in seeking relief in due time or not.
finding clearly recorded is that long after the charges had been paid and law
had been declared by the Court, the writ petition has been filed and,
therefore, such a refund should not be allowed. We do not think such a view
taken by the High Court calls for interference under Article 136 of the
Constitution. Hence we dismiss the petition.