Kiripi T. Sangtam, Advocate
[dropcap]T[/dropcap]he State Legislative Assembly enacted the Nagaland Municipal Act, 2001 (herein after referred to as the Act) to provide for the constitution and management of Municipalities and Town Councils in the State of Nagaland. The collection of tolls and fees in Dimapur Municipality has led to the present impasse between the Urban Development Department (UDD) and the Dimapur Municipal Council Employees. As a keen observer, it is noticed that though different opinions and views on the issue has been publicly expressed by the parties involved and the concerned citizens, the provisions of Law relating to collection of toll tax, fees etc. as envisaged under the Act has not been discussed.
Through this article a humble endeavor is being made to look into the provisions under the Act concerning the issue. Section 120 (1) of the Act provides that with the previous sanction of the Government, a Municipality can levy within its jurisdiction taxes, fees and tolls in order to raise revenue for performing its duties and functions. Section 120 (4) further provides that the Government, by general or special order, direct a Municipality to levy tax referred under Section 120(1) at the prescribed rate and thereupon the Municipality is to act accordingly. Section 121 of the Act prescribes the procedure for imposing tax. In sum and substance, Section 121 of the Act stipulates that firstly, the Municipality should pass a resolution for imposition of any tax under section 120.
Thereafter, the Municipality is required to give a public notice of the property/items/goods which are proposed to be taxed and also the rate to be imposed on each items/property/goods. Any inhabitant who has any objection against the proposed tax may, within 30 days from the date of the publication of the aforesaid notice submit written objection to the Municipality. The Municipality is to take such objection into consideration in a special meeting. When the proposal for tax is finally settled, the Municipality shall forward a copy of the proposal to the Government. On receiving the proposal from the Municipality, the Government may give sanction or refuse to give sanction to the proposal for taxation.
The Government can also return the proposal to the Municipality for further consideration. Section 121 (8) envisages that when the proposal for levy of tax is sanctioned by the Government, it shall notify the imposition of tax in accordance with such proposal. Section 121 (10) further stipulates that a notification under the Act shall be conclusive evidence that tax is being imposed in accordance with the provisions of the Act.
It is learnt that the DMC invited claims and objections to the proposal for tax through notices published in the local dailies in the month of August and September, 2012. Since no objection was made within the stipulated period of 30 days, the proposal was forwarded to the Government for approval. The Government gave the sanction for collection of taxes, tolls and fees to the Dimapur Municipal Council within its Municipal area and the same was notified by Notification No. UDD/MAC-13/2009 dated 26.10.12. Hence, as per the provisions of the Act the DMC was empowered by the Notification dated 26.10.12 to collect the tolls, taxes and fees on the goods/items and at the rate mentioned in the said Notification.
The cause for the present tussle between the UDD and the Employees of the DMC is the decision to give the collection of tolls, tax and fees on lease to private (third) parties. In so far as the Act is concerned, there is no provision which says that the task of collections should be leased to private parties. The Act only provides that a Municipality “may” also lease the collection of octroi or toll. The relevant Section is 199. The said Section stipulates that the “collection of any octroi or toll may, with the previous sanction of the Government, be leased by the Municipality for any period not exceeding one year….”. As such, as per the provisions of the Act, the decision as to whether the collection of tolls or octroi is to be leased to private parties or not is a decision which is to be made by the concerned Municipality and not by the Government. If the Municipality decides to give the work of collection on lease to private parties, then the Law requires that the Municipality must first get the approval from the Government for doing the same.
The words “may be leased by the Municipality” appearing under Section 199 of the Act make it clear that it is the Municipality which will be giving the collection of tolls on lease. Corollary to the aforesaid provisions would also mean that it is the Municipality which is to select the lessees. It is also learnt that the High Court in W.P (C) No. 171 (K)/13 has held that in case a Municipality decides to collect tax on its own, it can do so without any permission from the Government. However, if it chooses to lease out the work of collection of tolls to third person then the previous sanction of the Government is necessary.
It is learnt that the work orders for collection of tolls and fees issued to the DMC selected lessees were cancelled because it was not in conformity with the provisions of Section 199, in as much as, prior permission from the Government for giving the collection of tolls and fees on lease was not taken by the DMC. Now the UDD has given the work for collection of tolls and fees to 37 persons selected by it. Even the aforesaid lease for collection of tolls and fees to the 37 UDD selected lessees is in contravention with the provisions of Section 199. In as much as, the decision as to whether the collection of tolls is to be given on lease cannot be taken by UDD but is required to be taken by DMC.
It is only after the DMC takes a decision that it wants the collection of tolls and fees to be leased that the approval of the Government becomes necessary. After obtaining the approval of the Government it is again the DMC which will make the lease to the persons selected by it. It appears that the lease to the 37 UDD selected lessees has been made without following the prescribed procedure of Law.
It is my humble opinion that once a law has been put into place to regulate certain matters the same must be followed and applied strictly. If the authorities had followed the provisions of law governing the issue involved, one feels that the present impasse would have been avoided. Even now it is not too late to resolve the matter by undertaking the entire exercise afresh strictly in accordance with the provisions of the Nagaland Municipal Act, 2001.
