# [1974] 2 S.C.R. 827

- **Citation:** [1974] 2 S.C.R. 827
- **Court:** Supreme Court of India
- **Decided:** 1973-12-20
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/1974-2-s-c-r-827-6198
- **Pages:** 5

## Headnote

r .
I
I
0
[
827
KAMTA PRASAD AGGARWAL ETC
V,
.
EXECUTIVE OffiCER, BALLABGARH & ANR..
December 20, 1973
(A. N. RAY, C.J., H. R. KJ-~sA, K. K. MATIIEW
AND P. N. BHAGWAT[, JJ.) • A. AtAG!R!S\VAM~
Comtirutioll oj lntlia, 19SO, Art. 27~cop 1 I
o/ the omhorities mcntio11td In Article can lmr>o:e ~a- Yl .. th.r .srore and ••ell.
:x up to a l•m•t of IU. 258 •
. Under the Punjab Professions, Tr~lles Callio
·
ACt
1~56, n profcs.sion~ tax on a t:r.d<~ >Cal~ ""g. Employment Taxaooo
Rs. '2s0 per ~nnum, bad been a nd Wlls being collc.; c~u bl«t to a lll:lXlll!um of
The Panchayat. S:uniti, Ball~bgorb, in H~r•11.1. ;.,ued ay ;;,sta~~ of H31y.,...
10 lcVV PIO(CSSIOOaJ t:JX nt the maximum rate of fU. 200
~ e
Jl II. IDI<oded
to the Scbcdulcd lPCCified under the Gram Paocbayat s.rru:J: lll"dl.J"' ~ceo~,~
Act. 196.1.
T~~ oppclla.nts • . in ~rit pelit.ions io the thgh Court," co'::;~nded
that the .tmposttton. was tn Vtolalton of Article 276 or the Constitution ;0 thu
the m:u.tmum ltmtt of· R>. 2SOImeot•oaed i_n the Arti<le applies eo rb'
rotaltty ot the tax recovered by all. th~ autborrlles mentioned in tbe Article
tal;cn logetber. Tite H11lh Court dtSmi>Sed the petitions.
·
Dismissin~ the ~ppc:lls to this Couct,
HELD : Tbe H ish Court W:IS rigbt in reachioc the coD<Iusioo that tho
Sl4te as well ~s the authorities mentioned in the Article can cJch imp01e
r;u up to a limit of Rs. 250. [830 G-HJ
. (I) The power o( tile St.lto to levy the U.t is derived from Entry 60 of
ti,t l! o f lito V!l Schedule ro tl.te Coruriturian dealin~ "'rb ta.tes an profco·
>H.>Il'o, lr...Jes, cal!in!;O and employments. The SlaLo ~ture is therefore,
competent to legislate nnJ levy '"''"" o n professions. lr.IJes and employment<
••d ""'Y also by law, confer a similar authority on a loc:>l authority. [828 F}
12) A tax on profession can be imposed if a p<ooo c:m~es an • prol033ion'"
Su.:h a r;u on pcofe,;ion ,. irrc::spccri•·c of tho quouon of l.QCOtD<. (829 G)
13) The wor<.ls in the Article that ll•e total amount payoble to tlte State
or to aoy o ne Municipality, o i.trict Bo:<Id. Loco! ~oord or loc-al outbonrr
c:~nnot mean that the wnrd 'or' is used in a coojunch•"C scnst as ~ substttute
lor the word •and'. This is clear from the proruo t<? "rtic!e 27612) whic
0
11.
provi<Jc, that if before the romruen~ment of the Consurutton any State or • Y·
authority hod impo>ed a tux earning the limit of Rs.
1
25~ '~·c\
~po":~
conrinue; and tbls indicates rhnt both c:>n tax scpanre Y to
c tml .
· :
hy rhc Article. [830 Ill
(
, .
tlt
,\rricle arc useJ io juxt>PQSirioo
. 4) The wor<U 'aoy one person
1R
e ·
rsan moy be en.gaJcJ
1Htb aoy one municir>ality e tc.
One nnd 1117 s~m,e ~6 nod there may bo
~n more thnn one or the items su~ge_,tcd m / ~rd "tot.U" rtlate:s to 2•
'"'PO'i.tiou of to.t on more than one •!emit ;;;;;hc,.ities put to&<ther. (830 D}
;,ruthonty
levyin~ various ta:tts und not to :l
•
coed R• '<01- as contendc4
($) If the total ot the l:UN should 001 ex;.
ayi~q "profes<ioD'I tax of
by Ute nppellant tl will meoa that •f a I'C~on~ Pon him a similor tox onlY
K,, Hll lo the State the !<JC'~I authortiY can t:;' . tb a!IOmalau• consequcnc:cs,
u~to the balance of Rs. t0t1. Tbi. "!'uuld lea ~ e ,.,.; .. ~<ilb lower iowme•.
na~><·ly fu) ono uf the nutlto ririe• will hove
1~ and '7b) if one outhorilv wnl
.,htla tho,e with hirher incom .. woll ~('ca~. lo<rint the '" imPo"d bv the . .
•mno,c • tu of Ute h:l!on<e •um left •. ter C\tbe r:t..<es. {830 FJ
: ...
Stutc, ull lite other putborilics 01ay not tmpaso
··~
i.
'828
SUPREME COURT RBPOilTS
[1974] 2 s.c.R.
.CrviL APPELLATE JuRISDICTION Civil Appeals Nos. 2427·2428j6!S
A
, From the Judgment and Order dated tlte 25th August, 1967 and
~7th May 1968 of the Punjab nnd Huryana High Court in C.W. Nos .
.355 and 354 of 1967.
Brlj Bans Kishore and M. M. Kshatrya, for the appellants.
S. K. Mehta, K. R. Nacardja, M. Qumniarudclin and Vinocl Dlrawan,
.for respondents No. 1.

## Text

r .
I
I
0
[
827
KAMTA PRASAD AGGARWAL ETC
V,
.
EXECUTIVE OffiCER, BALLABGARH & ANR..
December 20, 1973
(A. N. RAY, C.J., H. R. KJ-~sA, K. K. MATIIEW
AND P. N. BHAGWAT[, JJ.) • A. AtAG!R!S\VAM~
Comtirutioll oj lntlia, 19SO, Art. 27~cop 1 I
o/ the omhorities mcntio11td In Article can lmr>o:e ~a- Yl .. th.r .srore and ••ell.
:x up to a l•m•t of IU. 258 •
. Under the Punjab Professions, Tr~lles Callio
·
ACt
1~56, n profcs.sion~ tax on a t:r.d<~ >Cal~ ""g. Employment Taxaooo
Rs. '2s0 per ~nnum, bad been a nd Wlls being collc.; c~u bl«t to a lll:lXlll!um of
The Panchayat. S:uniti, Ball~bgorb, in H~r•11.1. ;.,ued ay ;;,sta~~ of H31y.,...
10 lcVV PIO(CSSIOOaJ t:JX nt the maximum rate of fU. 200
~ e
Jl II. IDI<oded
to the Scbcdulcd lPCCified under the Gram Paocbayat s.rru:J: lll"dl.J"' ~ceo~,~
Act. 196.1.
T~~ oppclla.nts • . in ~rit pelit.ions io the thgh Court," co'::;~nded
that the .tmposttton. was tn Vtolalton of Article 276 or the Constitution ;0 thu
the m:u.tmum ltmtt of· R>. 2SOImeot•oaed i_n the Arti<le applies eo rb'
rotaltty ot the tax recovered by all. th~ autborrlles mentioned in tbe Article
tal;cn logetber. Tite H11lh Court dtSmi>Sed the petitions.
·
Dismissin~ the ~ppc:lls to this Couct,
HELD : Tbe H ish Court W:IS rigbt in reachioc the coD<Iusioo that tho
Sl4te as well ~s the authorities mentioned in the Article can cJch imp01e
r;u up to a limit of Rs. 250. [830 G-HJ
. (I) The power o( tile St.lto to levy the U.t is derived from Entry 60 of
ti,t l! o f lito V!l Schedule ro tl.te Coruriturian dealin~ "'rb ta.tes an profco·
>H.>Il'o, lr...Jes, cal!in!;O and employments. The SlaLo ~ture is therefore,
competent to legislate nnJ levy '"''"" o n professions. lr.IJes and employment<
••d ""'Y also by law, confer a similar authority on a loc:>l authority. [828 F}
12) A tax on profession can be imposed if a p<ooo c:m~es an • prol033ion'"
Su.:h a r;u on pcofe,;ion ,. irrc::spccri•·c of tho quouon of l.QCOtD<. (829 G)
13) The wor<.ls in the Article that ll•e total amount payoble to tlte State
or to aoy o ne Municipality, o i.trict Bo:<Id. Loco! ~oord or loc-al outbonrr
c:~nnot mean that the wnrd 'or' is used in a coojunch•"C scnst as ~ substttute
lor the word •and'. This is clear from the proruo t<? "rtic!e 27612) whic
0
11.
provi<Jc, that if before the romruen~ment of the Consurutton any State or • Y·
authority hod impo>ed a tux earning the limit of Rs.
1
25~ '~·c\
~po":~
conrinue; and tbls indicates rhnt both c:>n tax scpanre Y to
c tml .
· :
hy rhc Article. [830 Ill
(
, .
tlt
,\rricle arc useJ io juxt>PQSirioo
. 4) The wor<U 'aoy one person
1R
e ·
rsan moy be en.gaJcJ
1Htb aoy one municir>ality e tc.
One nnd 1117 s~m,e ~6 nod there may bo
~n more thnn one or the items su~ge_,tcd m / ~rd "tot.U" rtlate:s to 2•
'"'PO'i.tiou of to.t on more than one •!emit ;;;;;hc,.ities put to&<ther. (830 D}
;,ruthonty
levyin~ various ta:tts und not to :l
•
coed R• '<01- as contendc4
($) If the total ot the l:UN should 001 ex;.
ayi~q "profes<ioD'I tax of
by Ute nppellant tl will meoa that •f a I'C~on~ Pon him a similor tox onlY
K,, Hll lo the State the !<JC'~I authortiY can t:;' . tb a!IOmalau• consequcnc:cs,
u~to the balance of Rs. t0t1. Tbi. "!'uuld lea ~ e ,.,.; .. ~<ilb lower iowme•.
na~><·ly fu) ono uf the nutlto ririe• will hove
1~ and '7b) if one outhorilv wnl
.,htla tho,e with hirher incom .. woll ~('ca~. lo<rint the '" imPo"d bv the . .
•mno,c • tu of Ute h:l!on<e •um left •. ter C\tbe r:t..<es. {830 FJ
: ...
Stutc, ull lite other putborilics 01ay not tmpaso
··~
i.
'828
SUPREME COURT RBPOilTS
[1974] 2 s.c.R.
.CrviL APPELLATE JuRISDICTION Civil Appeals Nos. 2427·2428j6!S
A
, From the Judgment and Order dated tlte 25th August, 1967 and
~7th May 1968 of the Punjab nnd Huryana High Court in C.W. Nos .
.355 and 354 of 1967.
Brlj Bans Kishore and M. M. Kshatrya, for the appellants.
S. K. Mehta, K. R. Nacardja, M. Qumniarudclin and Vinocl Dlrawan,
.for respondents No. 1.
The Judgment of the Court was delivered by ·
RAY, C.J.-These appeals are by certificate from the judgment
·dated 17 May, 1967 of the Full Bench of the High Court of Punjab
and Haryana.
The appellants in writ petitions in the High Court challenged the
legality of notices issued by the Executive
Authority, Ballabgarh
Panchayat Samiti claiming Rs. 200/- on account of profession tax for
the year 1963-64. The notice was issued under section 76 cif th~
Gram Panchnyat Snmitis and Zila Parishads Act, 1961 referred to us
.the 1961 Act.
The appellants contended that the claim under section 76 of the
1961 Act was in violation of Article 276 of the Constitution because
a similar professional tax on a graded scale subject to a maximum
limit of Rs. 250/- per annum had been and was being collected by the"
State of Harynna.
·
The Full Bench of the High Court upheld the contention of the
respondents that the recoveries can be made by each one of the authorities mentioned in Article 276 of the Constitution to u maximum sum
of Rs. 250/· per annum.
The power of the State to levy tax is derived from Entry 60 of
List IJ in the Seventh Schedule of the Constitution. The Entry speaks
of taxes on professions, trades, callings and employments.
The State
legislature is, therefore, competent to legislate and levy taxes on professions, trades and employmedts.
The State legislature may also by
Jaw confer a similar authority on a Municipality, District Board, Local
Board or other local authority.
The appellants contended that the maximum limit of· Rs. 250/-
mentioned in Article 276 applies to the totality of the tax recovered
by all the authorities mentioned in the Article taken together. It was
said that each authority could not levy tax up to a limit of .Rs. 250/-.
It was said th;lt the opening and the concluding portions of Artich:
276(2) should be construed conjunctively to repr.esent the total amount
payable in respect of any person to the authorities enumerated in
the Article by way of taxes on professions, trades, callings and employments not exceeding Rs. 250;: per annum.
The Punjab Professions, Trades, Callings and Employment Taxa-
~ion Act, 1956 referred to as the 1956 Act by section 3 imposed liabi8
D
E
H
K .. P. AGGAR.WAL v~ EXECUTIVE OFFICER (Ray, C.J.)
829
A
Jity on persons who carried on trade or who foUowed profession or
eating or. Wh!> was in employment to pay tax in respect of such
prOfession, trade, callings or employment at rates specified in the
Schedule. Income below Rs. 6000/- was exempted from tax. Income
between Rs. 6000/- and Rs. 8500/· was subjected to a tax of Rs. 120/-
per annum. The maximum sum of Rs. 250/- per annum was levied
on income exceeding Rs. 2500/.. The appellants were paying Rs. 250 I8
per annum to the State by way of professional tax. Under section 5 of
the Punjab Temporary Taxation Act, 1962 the Schedule to the 1956
Act was altered. Income between Rs. 1800/- toRs. 3000/- was sub.
jected to a tax of Rs. 28/- per annum. Income exceeding Rs. 11,500/.
was subjected to a tax of Rs. 250/- per annum. By Punjab Act 6 of
1967 the 1956 Act Wa$ repealed. There is now no professional tax
so far as the reorganised State of Punjab is concerned. The provisions
C
of the 1956 .. Act however continued to be applicable to the State of
Haryana and also to the Union Territory of Chandigarh under the relevant provisions of law .
. The Panchayat Samiti, Ballabgarh issued a notice on 19 Septemb~r,
J 962 that it intended to levy professional tax at the maximum rate of
Rs. 200/ • per annum according to the Schedule specified under the
D
1961 Act. It may be stated here that the District Boar<is in the State
of Punjab had imposed a tax on professions, trades, callings and
emllloyment. . The DistriCt. Boards were abolished in consequence of
the 1961 Act.
There was however a saving provision in the 1961
Act. Section 64 of the 1961 Act provided that a Panchayat Samiti
shall be. deemed to have imposed tax at the rate at which immediately
.before the commencement of the Act it was lawfully levied by the
E · District Board of the Distrjct in which the Panchayat Samiti is situate
until a provision to the contrary is made by the Panchayat Samiti with
the previous sanction of the Government. The rates which were adopted by the Panchayat Samiti were different rates on different slabs of
income. Income exceeding Rs. 10,000/- was subjected to a tax of
Rs. 200/w per annum. It is this 1evy of additional professional tax
against which the appellants complaint.
·
F
The contention of the appellants that the imposition of tax by the
Panchayat Samiti amounts to double taxation· and is, therefore, illegal
is unsound. A tax on profession is not necessarily connected w~th
income. This is clear from the tax on professions imposed by several
ntunicipal authorities at certain rates mentioned in the relevant statutes.
A tax on income can·be imposed if th~rc is income. A tax on profession can be imposed if a person carries on a profession. Such a
G
tax on profession is irrespective of the question of income.
Article 276(2) as well as the proviso has the combined effect which
precludes a challenge on the HJ'OUDd that the tax on profession is a ~x
on incomo or that it ·~xceeds Rs. 250/~ per annum. The proVISO
saves existing taxes. 'ale proviS&· states that .notwithstatJ:ding that a
profession tax exceeds Rs. 250/· per annum tt can. continue to be
levied until provision to the contrary is made by Parliament by Iaw.
H
The ptovisions in Article 276t2) were co~tended by counsel. for
the appellants to indicate that the total of taxes 1mposed on professzons,
830
SUPREME COUll T REPORTS
[1974] 2 s.c.R.
tradel, callings and employments by the State, Municipality or any
other authority should not exceed Rs. 250/- per annum.
It was said
that Ute words "total ainount by way of taxes''
shall not
exceed
~s. 250/-. That is t~tally misreading the Article. It cannot be de·
med that the State Legislature has power to impose taxes.
The words
in Artical 276 that the total amount payable to the State or to any
one Municipality, District Board, local board or other local authority
cannot mean that the word 'or' is used in a conjunctive sense as a sub~
stitute fo~ the word. 'and'.
The word 'or' is used in a disjunctive sense.
The prov1so to Arucle 276(2) not only supports that construction but
also makes the provision clear. In the proviso to Article 276(2) h
is mentioned that if before the ·commencement of the Constitutiop. any
State or any municipal board or authority had imposed a tax .exceeding
the limit of Rll. 250/~ such tax may continue. Therefore, when the
proviso speaks of any State or any such municipality it indicates that
. both can tax separately to the- limit imposed by the Article.
Again, the language of Article 276(2) shows that the Constitu~
tion · uses the words "any one person" in juxtaposition with any one
municipality, district board, local board or other authority. The provisions are clear in their effect that the word "or" occurring between
the words "the State" and the words "to any one municipality" cannot
be. read as the word "and" in a conjunctive sense.
.
The words "the total amount payable in respect of any one person
to the State or to any one municipality, district board, local board or
other authority" mean that tax of and up to the sum of Rs. 250/- can
be imposed by any one of the. authorities mentioned. If the Consti-·
tution wanted the total taxes to be imposed by the State and other
authorities to be Rs. 250/- the Constitution would have said that the
total amoun·t payable in respect of any one person by way of tax on
professions, trades, callings and other employments shall not exceed
Rs. 250/- per annum whether imposed by the State, municipality,
district board, local board or other local authority. Further, if the
total of the taxes be a sum of Rs. 250/- as contended for by counsel
for the appellants it will mean that if a person is paying professional
tax of Rs. 150/- to the S~te, the local authority can impose on hi11l
a similar tax up to the balance sum of Rs. 100/-
That may lead to
two consequences.
One is that one of the authorities will have to tax
persons with lower income while those with higer income will escape
any payment of :tax.
The other is that if one authority will impose a
tax of the balance sum left after considering the antount imposed by
the State all the au•horities may not impose t9.xes. That will be entire-.
Jy a wrong construction. The High Court was right in reaching the
conclusion that the State as well as the authorities mentioned in Article
276 of the Constitution can each impose tax up to a limit of Rs. 250/~,
One arid the same person may be engaged iri more than one of the
items suggested in Article 276, namely, professions, trades, callings and
employments.
Such imposition of tax on more than one item in respect of one and the same person cannot be anything ibut taxes. The
word· "total" relates to an authority levying various taxes and not to
all authorities put together.
A.
B
c·
D
E
F
G
H
K, P. AGGAR.W~L v. EXECUTIVE OFPICER. (RQ)', C.l.)
8 31
A
For the1e reasons the judpent .of the Hip Court is upheld. Thl
appeal• are, therefore, dilmialed. The parties will pay and bear their
own costs as they did in the High Court.
·
Appeals dismissed.
B
V.P.S.
13 -748SCI/74