AHMEDABAD URBAN DEVELOPMENT AUTHORITYversusSHARAD KUMAR JAYANTIKUMAR PASAWALLA & ORS.

A        AHMEDABAD URBAN DEVELOPMENT ~UTHORITY
                            v.
        SHARAD KUMAR JAYANTIKUMAR PASAWALLA & ORS.

                                    MAY 15, 1992

B              [M.M. PUNCHHI, S.MOHAN AND G.N. RAY, JJ.]

          Gujarat Town Planning and Urban Development Act, 1976-Sections
    119(1) and 119(2 )(c )-Levy and recovery of development fee-Whether valid
    and authorised-Specific provision whether necessary.
c         Constitution of India, 1950-Articles 14, 19, 21-Consiitutional validity
    of sections 119(1) and 119(2)(c) of the Gujarat Town Planning and Urban
    Development. tct, 1976-Levy and recovery of development fee-'-Validity of.

          The respondents filed a writ petition in the High Court challenging the
D Constitutional validity of Sections 119(1) and 119(2) (c) of the Gujarat Town
    Planning and Urban Devopment Ac!, 1976 and the regulations made under
    the Act, contending that levy ofdevlopment fee was not authorised by the
    statute and therefore the action of respondent No.1 in collecting various
    amounts from the petitioners in the form of development fee was not
    authorised; that no development fee could be charged even by the State
E   Gonrnment because there was no provision in any Entry in List II of
    Schedule 7 to the Constitution; that the levy of development fee was ultra vires
    as the same did not fall under Section 119 of the Town Planning Act and the
    regulations made by the Development Authority were unauthorised, illegal
    and voil; and that even if there was any power to levy such fee by the State
    Legislature in the absence of delegation of such power, the Development
F   Authority could not impose any development fee.

        The High Court allowed the writ petition holding that as there was
  no express provision for imposition of fee and the State Government had
                                                                                       +
  not delegated any such power to the Development Authority to impose fees
G for development, the regulations framed for such imposition of fees and
  the demands made therefore were wholly unauthorised and illegal.

          The appellant, the Development Authority, in its appeal by special
    leave, made against the High Courts's judgment, contended that for im-             ;.

    plementing various schemes of development, the development or better-
H   ment fee was require'd to be imposed and collected, such imposition of fee,
                        l
                                       328
                  DEVELOPMENT AUTHORITY v. PASAWALLA                           329

     therefore, must be held be incidental to the development activities; that in     A
     such state of affairs, even if, there was no specific provision for imposition
     of betterment or development fee, such power must be held to be implied
     under the Act; that the development authority could impose such fee and
     such power to impose fees was ancillary to the development activities and
     was implied in the Act; that if the State Legislature was competent to           B
     impose fees, the Development Authority by virtue of the delegated legisla-
     tion also could impose betterment fee or the development fee and simply
     because imposition of such fee by the Development Authority was not
     specifically mentioned, it could not be held that the Development Authority
     could not impose any betterment fee or development fee even though such
     fee was essential for the development activities and had been imposed with       C.
--   reference.to development effected; that the High Court was not justified in
     holding that such imposition of· fee by framing regulations was wholly
     unauthorised and as such illegal and void.

          Dismissing the appeal of the Urban Development Authority, this              D
     Court,

            HELD: 1.01. In a fiscal matter it Win not be proper to hold that even
     in the absence of express provision, a delegated authority can impose tax
     or fee. Such power of imposition of tax and/or fee by delegated authority
     must be very specific and there is no scope of implied authority for             E
     imposition of such tax or fee. [336 E}

            1.02. The delegated authority must act strictly within the parameters
     of the authority delegated to it under the Act and it will not be proper to
     l &ing the theory of implied intend or the concept of incidental and ancil-      F
     lary power in th~ matter of exercise of fiscal power. (336 F]

           1.03. Whenever there is compulsory exaction of any money, there
     should be specific provision for the same and there is no room for
     intendment. Nothing is to be read and nothing is to be implied and one
     should look fairly to the langttage used. (337 8]                                G

           The Hingir Rampur Coal Compnay Limited v. State of Orissa, AIR
     1961 SC 459; Sri Jagannath Ramanuj Das v. State of Orissa, AIR 1954 SC
     400i Delhi Municipal Corporation v. Mohd. Yasin, AIR 1983 SC 617 and
     Lilawati v. Stute of Bombay, AIR 1957 SC 521, referred to.                       H
    330                    SUPREME COURT REPORTS                  [1992] 3 S.C.R.

A         District Council of the Jowai Autonomous District, Jowai and others v.
    Dwet Singh Rymbai etc., AIR 1986 SC 193; Khargam Panchayat Samiti and
    Anr. v. State of West Bengal and Ors., (1987] 3 SCC 82, distinguished.

            CIVIL APPELLATE JURISDICTION: Civil Appeal No. 10111 of
    1983.
B
         From the Judgment and Order dated 22.8.1983 of the Gujarat High
    Court in ·Special Civil Application No. 3494 of 1980.

            P.K. Goswami and P.H. Parekh for the Appellants.

C
                                                                                           --
            P.C. Kapur (NP) and M.N. Shroff (NP) for the Respondents.

            The Judgment of the Court was delivered by

          G.N. RAY, J. This appeal is directed against the judgment of the
    High Court of Gujarat dated August 22, 1983 in Special Civil Application
D   No.3494 of 1980. The said Special Civil Application No.3494 of 1980 arose
    out of a Writ Petition moved in the High Court of Gujarat by the respon-
    dents Nos.1,2,3 inter alia for declaration that the provisions of Sections
    119(1) and 119(2)(c) of the Gujarat Town Planning and Urban Develop-
    ment Act, 1976 (hereinafter referred to as the Town Planning Act) are ultra
E   vires and the impugned regulations purported to have been made under
    the Town Planning Act are ultra vires Articles 14, 19 and 21 of the
                                                                                     _..., -
                                                                                       l

    Consti.tution and the said regulations are also ultra vires the Town Planning.
    Act itself. The Writ Petitioners also made a prayer before the High Court
    for appropriate writ, order or direction directing the Ahmedabad Urban
    Development Authority (hereinafter ·referred to as the Development
F   Authority) not to enforce or implement the said regulations and not to levy
    or recover any amount as development fee under the said regulations. A
    prayer was also made for appropriate writ, order or direction directing the
    Development Authority to refund the amount of development fees realised
    form the Writ Petitioners.
G
            It was contended by the Writ Petitioners that;

                  (a) levy of development fee is not authorised by the statute and
                  therefore the action of respondent No.1 in collecting various
                  amounts from the petitioners in the forms of development fee
H                 was not authorised.
       DEVELOPMENT AUTHORITY v. PASAWALLA [RAY, J.]                   331

           (b) No development fee could be charged even by the State         A
           Government because there is no provision in any Entry in the
           List II of Schedule 7 to the Constitution.

           (c) The levy of development fee is ultra vires as the same does
           not fall under Section 119 of the Town Planning Act and the       B
           impugned regulations made by the Development Authority are
           unauthorised, illegal and void.

           (d) Even if there is any power to levy such fee by the State
           Legislature in the absence of delegation of such power, the
           Development Authority could not impose any development fee.       C
       The High Court of Gujarat has held that Entry 66 of List II of Vllth •
Schedule to the Constitution deals with fees in respect of any of the matters
in the said List but not including any fee taken in any Court. Entry 5 of
List II of that Schedule refers to Constitution and powers of improvement
trust and other local authorities for the purpose of local self government D
or village administration. The High Court has held that under Entry 66,
the State Legislature has legislative competence to make provisions for fees
to be imposed by the Development Authority constituted under Section 31
of the said Act. The High Court has, however, held that simply because
 there is legislative competence for th_e State Government to charge fees for E
 the Urban Development Authority, it cannot be held that demands for the
 development fee and/or imposition of the same by the Development
 AuthoritY under the impugned regulations is legal and valid. The High
 Court has indicated that it is to be seen whether under Town Planning Act,
 a specific power has been given to the Development Authority to impose
 such development fee. After scrutinising the provisions of the Town Plan- F
 ning Act, the High Court has come to the finding that the Development
 Authority or as a matter of fact any other authority under the Act has not
 been vested with the power to charge betterment or the development fee.

      The High Court has referred to the decisions of this Court in The
Hingir Rampur Coal Company Limited v. State of Orissa, AIR 1%1 SC 459        G
and Sri Jagannath Ramanuj Das v. State of Orissa, AIR 1954 SC 400. This
Court has held that between a tax and a fee there is no generic difference
because in a sense both are compulsory exactions of money by public
authority but in a tax imposed for public purpose, no service need be
rendered in return of such tax. A fee is however levied essentially for      H
    332                   SUPREME COURT REPORTS                  [1992] 3 S.C.R.

A   services rendered and as such there is an element of quid pro quo between       y-~

    the person paying the fee and the public authority imposing the same. It
    has been further indicated that whenever there is any compulsory exaction
    of any money from a citizen, there must be a specific provision for imposi-
    tion of such tax and/or fee. There is no room for any intendment for
    imposition of compulsory payment. Whenever there is any compulsory
B   exaction of money froin a citizen, nothing is to be read and nothing is to
    be implied. One should look fairly at the language used. The High Court
    has also referred to another decision of the .Court in the case of Delhi        y
    Municipal Corporation v: Mohd. Yasin, AIR 1983 SC 617 wherein the
    compulsory nature of exaction by way of tax and fee partaking the charac-
c   ter of tax has been reiterated and it has been held that there is no generic
                                                                                         ...
    difference between tax and fee though broadly a tax is compulsory exaction
    as part of a common burden without promise of any special advantages to
    classes of tax payers whereas a fee is a payment for services rendered or
    benefit provided or privilege conferred. The High Court has held that since
    there is no express provision for imposition of fee and the State Govern-
D
    ment has not delegated any such power to the Development Authority to
    impose fees for development, the regulations framed for such imposition
    of fees and the demands made therefore are wholly unauthorised and
    illegal.

E         Mr. Goswami, learned Counsel for the appellant, has however, sub-         -(
    mitted that although in some cases, a fee is essentially a tax because of its
    compulsory nature of exaction, there is a defference between a tax and a
    fee if examined with reference to absence or presence of element of
    corresponding service rendered. He has however fairly conceded that when
F   pursuant to the development scheme an area is developed under the
    provisions of the Act, such development of the area does not depend on
    the volition of the person concerned. Hence, when development fees are
    imposed for the development effected in the area in question, the persons
    coming under the scheme will have to make such payment irrespective of
    the fact whether or not such person had intended for such development.
G   Even then, such fee is charged for the service rendered by the Develop-
    ment Authority. Mr. Goswami has further contended that the Development
    Authority, unlike other local authorities, like Municipalities or Panchayats    :>-,
    has no power or authority to collect any tax even though it is essentially
    necessary to augment its revenue for the desired purpose of development
H   of the area in question. Precisely for implementing various schemes of
       DEVELOPMENT AUTIIORITY v. PASAWALLA [RAY, J.]                     333

development, the development or betterment fee is required to be imposed A
and collected. Such imposition of fee, therefore, must be held to be
incidental to the development activities. In such state of affairs even if then;
is no specific provision for imposition of betterment or development fee,
such power must be held to be implied under the Act. In this connection,
Mr. Goswami bas drawn our attention to Section 90 and Section 91 of the' B
Town Planning Act. Section 90 provides that:

            "An appropriate authority may for the purpose of a develop-
            ment plan or for the making of execution of a town pla'nning •
            scheme borrow money and if the approriate authority is a local
            authority the money shall be borrowed in accordance with the C
            provisions of the Act under which the local authority is co!l-
            stituted or if .such Act does not contain any provision for such
            borrowing, in accordance with the Local Authorities Loans
            Act, 1914 or as the case may be, the Saurashtra Local Autho-
            rities Loans Act, 1951, and any expenses incurred by an ap-
            propriate authority or the State Government under this Act in D
            connection with a development plan or a town planning scheme
            may be defreyed out of the funds of the appropriate authority".

.      Section 91 (1) and (2){ave been referred to by Mr. Goswami, which
 are to the following effect:                                                   E
            "91 (1) An appropriate authority shall have and maintain its
            own fund to which shall be credited-

            (a) all moneys received by the authority by way of grants, loans,
            advances or otherwise;                                              F
            (b) all moneys derived from its undertakings, projections and
            other sources;

            (c)sucil amounts of contributions from local authorities as the
            State Government may specify from time to time to be credited G
            to the fund

            (2) the fund of an appropriate authority shall be applied
            towards meeting-

            (a) expenditure incurred in the administration of this Act;         H
    334                  SUPREME COURT REPORTS                  [1992) 3 S.C.R.

A               (b) cost of acquisition of land for the purpose of this Act;

                (c) expenditure for any development of land in the development
                area;

                (d) expenditure for such other purposes as the State Govern-
B
                ment may direct .

                • • • • • • • • * • * *"

           Mr. Goswami has submitted that clause (a) of sub-section (1) of
C   Section 91 indica!es that moneys received by the authorites may come by
    way of grants, loans, advances "or otherwise". He has, therefore, contended
    that apart from grants, loans and advances, the appropriate authority which
    is Development Authority in the instant case, can have funds which are not
    by way of grants, loans and advances but from a source different from that.
D   He has contended that the legal implication of the expression 'or otherwise'
    has been noted by this Court in the case of Lilawati v. State of Bombay,
    AIR 1957 SC 521. This Court in the said decision has indicated when and
    under what circumstances the principle of ejusdem generis is to be applied
    and has indicated that the legislature, when it uses the word 'or otherwise',
E   apparently intends to cover other cases which may not come within the
    meaning of provided clauses. Relying on the said decision, Mr. Goswami
    has contended that apart from the money received by the Development
    Authority by way of grants, loans and advances, the Development Authority
    can also create funds "otherwise" and the development fee is creation of
    such fund otherwise than by loans, grants, etc. Mr. Goswami has contended
F   that the funds so received by the development authority are required to
    applied under sub-section (2) of Section 91 for purposes mentioned therein
    including the expenditure for any development of the land in development
    area. He has, therefore, contended that the legislature has really intended
    that for the purpose of development, fund is required to be generated and
G   such fund may be generated not only by way of grants, loans or advances
    but also otherwise. The only limitation of generation of such funds is to
    apply such fund for the specific purposes referred to in sub-section (2) of
    Section 91. Mr. Goswami has contended that it is nobody's case that such
    development fee has not been utilised for the purpose of sub-section (2)
H   of Section 91. He has, therefore, contended that the development authority
             DEVELOPMENT AUTIIORITY v. PASAWALLA [RAY, J.]                    335,

      can impose such fee and such power to impose fees is ancillary to the A
      development activities and is implied in the Act. He has contended that if
      the State Legislature is competent to impose fees, the Development
      Authroity by virtue of the delegated legislation can also impose betterment
      fee or the development fee and simply because imposition of such fee by
      the Development Authority is not specifically mentioned, it cannot be held B
      that the Development Authority cannot impose any betterment fee or
      developm~nt fee even though such fee was essential for the development
      activities and has been imposed with reference to devr lopment effected.
      Mr. Goswami has very strongly relied on the decision of this Court in the
      case of the District Council of the Jowai Autonomous District Jowai and C
---   others v. Dwet Singh Rymbai etc., AIR 1986 SC 193. In considering the
      validity of the Notification issued by the District Council of District, Jowai
      under United Khasi and Jaintia Hills Autonomous District (Management
      and Control of Forests) Act. 1959, it has been held by this Court that in
       the real sense what in sought to be required under the Act is not royalty
       since the forest does .not belong to the District Council. The amount D
       claimed by way of royalty under the Notification is in reality compulsory
       exaction of money by public authority for public purpose enforeceab!e by
       law and in not a payment for service rendered. The Court has held that
       there is no specific 1 eference to the power to levy and fee in respect of any
       matter mentioned in paragraph 3 in the 6th Schedule to the Constitution E
       similar to the corresponding provision in Entries of List II of 7th Schedule.
       Considering the facts of the case, it has been held that the power to levy
       fees in respect of any of the matters mentioned in paragraph 3 should be
        necessarily implied but such fee should not be disproportionately very high,
        that is a tax in disguise. The Court has indicated that the said United Khasi F
        and Jaintia Hills Autonomous District (Management and Control of
        Forests) Act 1959; was enacted for the purpose of making provisions
        regarding the management and the control of forests which are not
        reserved forests in the area within the jurisdiction of District Council in
        the exercise of the powers conferred by Entry 3(1)(d) of the 6th Schedule G
        to the Constitution. It has been held that even if there is no express
        provision to levy fees, the District Council under paragraph 3 can levy fees.
        Mr. Goswami has contended that it will not be correct to conted that in
        no case imposition of fee can be made unless there is sp!!cific provision fot
        such imposition. Such power of imposition may be implied if the provision .
                                                                                     H
    336                  SUPREME COURT REPORTS                   [1992] 3 S.C.R.

A · of the Act are considered in the proper perspective and if such imposition
    becomes essential for the activities for which the statutory bodies are
    created. In this connection, Mr. Goswami has referred to another decision
    of this Court made in the case of Khargram Panchyat Samiti and Anr. v.
    State of West Bengal and Ors., [1987] ~ SCC 82. It has been held by this
B   Court that in a statute conferment of general statutory power also carries
    with it incidental and consequential powers. Relying on the said de~ision,
    Mr. Goswami has contended that as the development has been effected by
    the Development Authority and there was necessity for augmenting the
    revenue for such development work and as Section 91 has recognised a

c   fund to be created otherwise than by way of grants, loans or advances and
    as imposition of such fee is incidental and/or ancillary to carrying on the
    purposes for which the Development Authority has been constituted.under
    the Town Planning Act, it should be held that such power of imposition of
                                                                                          -
    fee is implied. He has, therefore, contended that the High Court of Gujarat
    was not justified in holding that such imposition of fee by framing im-
D   pugned regulations was wholly unauthorised and as such illegal and void.

          After giving our anxious consideration to the contentions raised by
    Mr. Goswami, it appears to us that in a fiscal matter it will not be proper
    to hold that even in the absence of express provision, a delegated authority
    can impose tax or fee. In our view, such power of imposition of tax and/or
E   fee by delegated authority must be very specific and there is no scope of
                                                                                     -(
    implied· authority fur imposition of such tax or fee. It appears to us that
    the delegated authority must act strictly within the parameters of the
    authority delegated to it under Act and it will riot be· proper to bring the
    theory of implied intent or the concept of incidental and ancillary power
F   in the matter of exercise of fiscal power. The facts and circumstances in
    the case of District Council of Jowai are entirely different. The exercise of
    powers by the Autonomous Jantia Hills Districts are controlled by the
    constitutional provisions and in the special facts of the case, this Court has
    indicated that the realisation of just fee for the a specific purpose by the
G   autonomous Dislrjct was justified and such power was implied. The said
    decision cannot be made applicable in the facts of this case or the same
    should not be held to have laid down any legal proposition that in matters
    of imposition of tax or fees, the question of necessary intendment may be
    looked into when there is no express provision for imposition of fee or tax.
    The other decision in Khargram Panchayat Samiti's case also deal with the
H
         DEVELOPMENT AUTHORITY v. PASAWALLA [RAY, J.)                  337

exercise of incidental and ~onsequential power in the field of administrative A
law and the same does not deal with the power of imposing tax and fee.

      The High Court has referred to the decisions of this Court in Hingir's .
case, and Jagannath Ramanuj's case and Delhi Municipal Corporation's
case (supra). It has been consistently held by this Court that whenever
there is compulsory exaction of any money, there should be specific B
provision for the same and there is no room for intendment. Nothing is to '
be read and nothing is to be implied and one should look fairly to the ·
language used. We are, therefore, unable to accept the contention of Mr.
Goswami. Accordingly, there is no occasion to interfere with the impugned
decision of the High Court. The appeal, therefore, fails and is qismissed · C
with no order as to costs.

V.P.R.                                                  Appeal dismissed.