2025(03)LCX0091

SELVEL MEDIA SERVICES PRIVATE LIMITED

Versus

STATE OF U.P

WRIT TAX No. - 354 of 2018 decided on 19-03-2025

Neutral Citation No. - 2025:AHC:39582-DB

Court No. - 45
Case :- WRIT TAX No. - 354 of 2018
Petitioner :- M/S Selvel Media Services Private Limited And 11 Others
Respondent :- State Of U.P. And 4 Others
Counsel for Petitioner :- Javed Husain Khan,Gulrez Khan,W.H. Khan
Counsel for Respondent :- C.S.C.,Alok Mishra,Abhinava Krishna Srivastava

Hon'ble Saumitra Dayal Singh,J.
Hon'ble Dr. Gautam Chowdhary,J.

In Re: Civil Misc. Clarification Application No.7 of 2023

1. Heard Sri M.C. Chaturvedi, learned Senior Counsel assisted by Sri Alok Mishra and Sri Abhinav Krishna Srivastava, learned counsel for the respondent nos.2 to 5 (applicant herein), Sri W.H. Khan, learned Senior Counsel assisted by Sri Gulrez Khan, learned counsel for the original petitioners (respondent herein).

2. Much submissions have been advanced on the Clarification Application. It would be appropriate to note the basic facts. Earlier, the original petitioners have filed a writ namely Writ TAX No.354 of 2018 for the following reliefs:

"Issue a writ, order or direction in the nature of certiorari quashing the impugned demand notices dated 09.02.2018, 13.02.2018, 15.02.2018 and 17.02.2018;

Issue a writ, order or direction in the nature of mandamus commanding the respondents not to interfere in petitioners carrying on business by displaying advertisements tax on hoardings installed by them."

3. Upon exchange of affidavits and after hearing learned counsel for the parties, the aforesaid writ petition was allowed by a co-ordinate bench of this Court by order dated 06.05.2019: That order reads thus:

"Heard Sri W.H. Khan, Senior counsel assisted by Sri Javed Husain Khan, learned counsel for the petitioners, learned Standing counsel for the State of U.P., and Sri Alok Mishra, learned counsel for Kanpur Nagar Nigam.

The petitioners are all advertising companies. They are aggrieved by the demand of advertisement tax imposed by the Nagar Nigam, Kanpur on displaying advertisement through hording within its jurisdiction. Basically, the challenge is to the realization of the advertisement tax w.e.f. 1.7.2017 on the ground that from the said date, as the provision to levy advertisement tax has been deleted and the U.P. Goods and Service Tax, 2017 has come into force, no advertisement tax can be levied.

There is no dispute to the fact that previously Nagar Nigam Kanpur framed U.P. Municipal Corporation (Assessment and Collection of Tax on Advertisement) Rules, 2009. These Rules were struck down by the Lucknow Bench of the Allahabad High Court in the case of Anurag Bansal Vs. State of U.P. & others 2011 (5) ADJ (LB) (FB). Thereafter, Kanpur Nagar Nigam made another set of rules for the purposes of levying advertisement tax known as Kanpur Nagar Nigam (Vigyapan Kar Ka Nirdharan Aur Wasuli Viniyam) Upvidhi, 2016 which were enforced w.e.f. 2.4.2016. The said bye laws were also struck down vide judgment and order dated 4.5.2017 in writ petition no. 9389 of 2017. Thereafter, no further rules or bye laws for levying advertisement tax have been made and enforced by the Nagar Nigam, Kanpur but even then demand for advertisement tax has been raised against the petitioners.

The power to levy advertisement tax was contained in Section 172 (2) (h) of the Municipal Corporation Act, 1916 which stood deleted w.e.f. 1.7.2017 by virtue of Section 173 of U.P. GST Act.

In addition to the above, even the power of the State Government to legislate regarding advertisement tax as provided under Entry 55 of List II of the VII Schedule of the Constitution of India also stood deleted w.e.f. 12.9.2016 by the Constitution (101 Amendment) Act, 2016.

Article 265 of the Constitution of India mandates that no tax shall be levied or collected except by the authority of law. Therefore, the authority to levy any tax much less the advertisement tax must be derived from the Statutes.

Since the provision of Section 2 (h) of Section 172 of the Municipal Corporation Act was omitted vide Section 173 of the U.P. GST Act w.e.f. 1.7.2017 and even the power of the State legislature to legislate with regard to advertisement tax stood deleted w.e.f. 12.9.2016, there is neither any power left with the State Government or the Municipal Corporation to legislate about the imposition of tax on advertisement.

In view of the above, after 12.9.2016 or from 1.7.2017 the Nagar Nigam, Kanpur ceased to have any jurisdiction to impose and realize tax on advertisement. Accordingly, the demand of tax on advertisement from the petitioners after 1.7.2017 is held to be illegal and without jurisdiction.

The notices of demand impugned in the petition to the above extent are quashed and the amount, if any of the advertisement tax deposited by the petitioners for the period 1.7.2017 onwards shall be refunded to the petitioners.

The writ petition is allowed and it is held that the Nagar Nigam, Kanpur shall not realize any tax on advertisement after 1.7.2017."

4. Submission being advanced is, earlier the Kanpur Nagar Nigam had framed byelaws for collection of advertisement tax. Those bye-laws had been framed under U.P. Municipal Corporation (Assessment and Collection of Tax on Advertisement) Rules, 2009. Those were quashed by a co-ordinate bench of this Court in Anurag Bansal Vs. State of U.P. & others 2011 (5) ADJ (LB) (FB).

5. Thereafter, another set of bye-laws were framed by Kanpur Nagar Nigam described as 'Kanpur Nagar Nigam (Vigyapan Kar Ka Nirdharan Aur Wasuli Viniyam) Upvidhi, 2016. Those were quashed by a co-ordinate bench of this Court in Writ-C No.9389 of 2017 (U.P. Advertisers Association through its President & 13 Ors. Vs. State of U.P. & 2 Ors.).

6. Thereafter, the Kanpur Nagar Nigam issued notices including the original petitioners to remove advertisement holdings. That action of the Kanpur Nagar Nigam was challenged by the U.P. Advertisers Association & 10 others Vs. State of U.P. & 3 others. In that writ petition, the below quoted order was passed by a coordinate bench of this Court on 14.11.2017:

"Heard Mr. W.H. Khan, learned Senior Counsel for the petitioners and Mr. Vivek Verma, learned counsel for respondent nos. 2 to 4.

By way of an interim arrangement, learned counsel for the parties have agreed for the following order:

(1) The respondent - Nagar Nigam shall determine, without prejudice to their rights and contentions, the rate for displaying advertisements/erecting hoardings by petitioners and their members, within a period of 10 days from today and shall raise demand within a period of 15 days therefrom w.e.f. 1 April 2017. Petitioners and their members, without prejudice to their rights and contentions, shall deposit the moneys demanded by the respondent Nagar Nigam within a period of 15 days from the date of demand, failing which it would be open to the Nagar Nigam to remove the hoardings of such petitioners/their members who fail to deposit the amount within the stipulated time.

(2) It is needless to mention that if the petitioners or their members are in arrears of the claims in pursuance of the agreements which expired on 31 March 2017, they shall pay the same within a period of 15 days from the date of demand without prejudice to their rights to challenge the same in appropriate proceedings, if they feel aggrieved, failing which such petitioners/their members shall not have any right to display any advertisements/erect hoardings and it would be open to the respondent Nagar Nigam to remove the same immediately thereafter.

Petition to come up for hearing on 2 January 2018."

7. According to the learned Senior Counsel appearing for the Kanpur Nagar Nigam, the money thus demanded and deposited by the original petitioners was not in the nature of Advertisement Tax, but only Advertisement Fees. In that regard, he would refer to the show-cause notices dated 09.02.2018, 13.02.2018, 15.02.2018 and 17.02.2018 challenged in the Writ Tax No.354 of 2018 to submit that no demand of Advertisement Tax was made, at that stage.

8. In view of the above facts, a clarification has been sought by means of the present application that the Court may clarify that the Kanpur Nagar Nigam is not required to refund any part of Advertisement Fees, collected by it after 01.07.2017.

9. Such prayer has been opposed by learned Senior Counsel appearing for the original petitioners. He would submit that the order itself is self speaking. The Clarification Application is misconceived. It may be dismissed. In any case, the submission being now advanced was never raised, at that stage.

10. We have heard learned counsel for the parties.

11. By means of the present Clarification Application following prayer has been made:

"It is therefore most respectfully prayed that this Hon'ble Court may kindly be pleased to allow this application and clarify the order dated 06.05.2019 passed by this Hon'ble Court."

12. In support of such prayer, reference has also been made to contents of paragraphs 8 and 9 of the affidavit filed in support of the clarification application. Those read as below:

"8. That it is pertinent to mention here that in Counter Affidavit dated 03.05.2018 which has been filed by the answering respondent/applicant in the aforesaid writ petition it has specifically stated that the petitioners have not deposited the dues pertaining to the year 2016-2017 and even as on date and amount of Rs.1,89,54,993/- is still pending against them it may be relevant to state here in that as per the terms of the consent order for interim arrangements dated 14.11.2017, the petitioners were liable to pay the entire demand for the period expired on 31.3.2017 within 15 days which they have failed to do. So far as the site rent/premium and administrative charges is concerned, the Nagar Nigam Kanpur has right to charge the advertisement fees. It is further submitted that the answering respondent/applicant is not realizing any advertisement tax. It is only realizing the site rent/advertisement fees for use and occupation of the land belonging to Kanpur Nagar Nigam which has been used by the petitioners for installation of hoardings.

9. That by order dated 06.05.2019 the Hon'ble Court has hold that "The notices of demand impugned in the petition to the above extent are quashed and the amount. If any of the advertisement tax deposited by the petitioners for the period 1.7.2017 onwards shall be refunded to the petitioners" but as per demand notices which has been annexed in the writ petition, the answering respondent/applicant has raised demand with regard to advertisement fees. The said demand notice is not for charging advertisement tax so the present application is being filed by the answering respondent/applicant to clarify whether the demand which was under challenge in the aforesaid writ petition is related to advertisement fees or advertisement tax."

13. In this context, we have perused the order dated 06.05.2019 passed by a coordinate bench of this Court, allowing the writ petition.

14. Insofar as in the penultimate paragraph of the order (of which clarification is sought), it has been clearly provided that the demand impugned in the writ petition to the extent such demands fall in the teeth of Section 173 of U.P. G.S.T. Act read with the 101st Constitutional Amendment is quashed and further to the extent it has been provided by that co-ordinate bench that any amount of "Advertisement Tax" deposited by the petitioners for the period beyond 01.04.2017 may be refunded to the petitioners and no further or other direction was issued, that order is crystal clear as to its reasoning and as to the effect it causes. It admits of no doubt as to what has been provided and what has not been decided.

15. In light of our above observation, further submissions being advanced by learned Senior Counsel for the Kanpur Nagar Nigam would involve a fresh consideration on the issues that may not have been raised or pressed at the stage of final hearing of Writ Tax No.354 of 2018. That consideration may never arise on an application seeking clarification of the order.

16. To the extent, the order is itself speaking and admits of no doubt, as noted above, the present application fails and is liable to be dismissed. It is dismissed, accordingly. No order as to costs.

Order Date :- 19.3.2025