Meghna Petroleum Marketing Co. Ltd. and others Vs. MF Limited and others, 53 DLR (2001) 368

Case No: FA No. 203 of 1993

Judge: NK Chakravartty,

Court: High Court Division,,

Advocate: Mr. M.A. Samad,Mr. Ozair Farooq,,

Citation: 53 DLR (2001) 368

Case Year: 2001

Appellant: Meghna Petroleum Marketing Co. Ltd.

Respondent: MF Limited

Subject: Fiscal Law,

Delivery Date: 2001-5-7

 
Supreme Court
High Court Division
(Civil Appellate Jurisdiction)
 
Present:
Md. Fazlul Haque, J.
NK Chakravartty, J.
 
Meghna Petroleum Marketing Co. Ltd. and others
…..……………Appellants
Vs.
MF Limited and others
…….................Respondents
 
Judgment
May 7, 2001.
 
Municipal Committee Assessment and Collection of Octroi Rules, 1961
Rule 2(1)(7)
Company was not liable to octroi in respect of goods which it brought into the local area and which were re-exported.
 
Lawyers Involved:
Md. Abdus Samad, Bar-at-law with Mustafa Adil, Advocates—For the Appellants.
Md. Ozair Farooq with Sadikun Naher, Advocates- For the Respondents.
Appeal From Original Decree (FA) No. 203 of 1993.
 
JUDGMENT
 
NK Chakravartty J.
 
This appeal at instance of the defendants-appellants is directed against the judgment and decree dated 8-10-1992 and 5-11-1992 respectively passed by the learned Subordinate Judge, Third Court, Dhaka in Title Suit No.274 of 1980
 
2. The plaintiffs-respondents parties No.1-3 M/S MF Limited a private company, having its registered office at 38, Dhanmondi Residential Area, Road No.2, Police Station Dhanmondi, Dhaka and also having a branch office at Khan Lodge, Daulatpur, Khulna. The company is represented by its Managing Director Mr. ATM Mustafa and others filed the Title Suit No.274 of 1980 in the Third Court of Subordinate Judge, Dhaka against the defendant appellants the Meghna Petroleum Marketing Company Limited having its Head office at Ispahani Building, 14-15 Motijheel, Dhaka and others for a decree of accounting how much petroleum were imported by them within Khulna Pourashava during the period from 1-10-1977 to 30-6-1980 and how much octroi plaintiffs are entitled to.
 
3. The learned Subordinate Judge, Third Court, Dhaka after taking evidences of both the parties decreed the suit on 8-10-1992 against the principal defendants and in favour of the plaintiff.
 
4. That by the said judgment and decree learned Trial Court passed order upon the principal, defendant Nos.1 to 3 to give the plaintiffs statement of petroleum imported within Khulna Pourashava and sold within and out side Pourashava within the period from 1-10-1977 to 30-6-1980 and to pay octroi upon it within 50 days from the date of the judgment. If the principal defendants fail to do so, the plaintiffs are entitled to appoint through court a survey knowing Advocate Commissioner to prepare the said statement.
 
5. Being aggrieved by and dissatisfied with the judgment and decree dated 8-10-1992 and 5-11-1992 respectively passed by the learned Subordinate Judge, Third Court, Dhaka in Title Suit No.274 of 1980, the defendant-appellants have preferred this appeal.
 
6. The subject matter of challenge in this appeal in short, is that the plaintiffs-respondents opposite parties Nos.1-3 were lessees of octroi check posts through which the defendant’s appellants imported and sold petroleum within Khulna Municipal Corporation. The plaintiff’s respondent’s No.1 was lessee of the Check posts for the year 1977-78, the plaintiffs-Respondents No.2 was lessee for the year 1978-79 and the plaintiffs- Respondent No.3 was lessee for the year 1979-80. According to Notification No.223-L/76/S-VI/78-2/76/17 dated 6-7-1976 all the parties who imported goods within Pourashava were required to give declaration of the goods brought at the entry point of Pourashava.
 
7. During this period of lease the defendant- appellants imported petroleum products within Khulna Pourashava and sold the same within the Pourashava area, but did not give declaration of import of petroleum at the entry point as well as did not pay octroi dues as per the Rules. So the plaintiffs had been deprived of huge amount of octroi.
 
8. The principal defendants contested the suit by filing a written statement denying all allegations of the plaintiffs and contended, inter alia, that they have paid octroi for the petroleum consumed within Khulna Paurashava but they were not required to pay octroi for petroleum supplied out side Khulna Pourashava. The learned Third Court of Sub Judge. Dhaka decreed the suit. Hence, this appeal.
 
9. The material question that was for considering before the Subordinate Judge, whether the plaintiffs were entitled to money decree for realisation of the amount of octroi dues payable by the defendants No.1-2 and 3 to the plaintiffs including the provisional amount of Taka 5(five) lac according to the accounting, calculation and assessment to be made in term of the preliminary decree.
 
10. Before the learned lower Court to prove the case of the plaintiffs they adduced evidence of only one PW namely Khan Nuruzzaman, father-in-law of AM Mustafa, Managing Director of plaintiff No.1 company and proprietor of plaintiffs Nos.2-3 farms and the constituted attorney of ATM Mushaffar and filed series of documents such as (letter’s legal notices and statements of accounts with original records) marked (Exhibit 1 to 33) (a).
 
11. So on defendant adduced only one DW Abul Fateh Md. Zakaria Depo super in-charge of defendant’s No.1 and 2. He is an Aeronautical Engineer, but did not produce papers. The learned Subordinate Judge, after considering facts, circumstance as well as evidence on record decreed the suit, in full.
 
12. Now the only issue to be decided in this appeal is whether the impugned judgment and decree passed by the learned Subordinate Judge Maintainable?
 
13. Mr. Abdus Samad, Barrister-at-law, with Mr. Mustafa Adil, learned Advocates appeared for defendants-appellants and plaintiffs Respondents are represented by Mr. Md. Ozair Farooq, with Mrs. Sadikun Naher, learned Advocate.
 
14. The pith and substance of the contentions advanced from the side of the appellants is that the learned Subordinate Judge, misappreciated and misconstrued the facts and substances of the case and came to a wrong findings and did not take into consideration that 3(three) different plaintiffs took lease of the octroi posts for three different periods and their causes of action are different. According to him DW1 who categorically stated in his deposition that since 1955 their petroleum depot is functioning and before paying octroi to the plaintiffs they used to pay octroi to the Khulna Municipality and this DW1 has submitted a statement containing of (eight) pages in respect of payment of octroi to the plaintiffs from July, 1978 to June, 1981 and this statement has been marked as Exhibit ‘ka’ series. DW1 in-cross has stated that “I have not demanded octroi for any supply made by Meghna Petroleum Company but on all sales made by them within Pourashava. I do not demand octroi for supply of oil to Mubarakganj Sugar Mills, Darsona Sugar Mills and he did not claim octroi charge for supply of oil to Naval base”.
 
15. Learned Advocate further submits that the Subordinate Judge, has failed to consider that submission of statement of goods imported in the depot was waived since the date of establishment of the depot at Khulna and that for convenience of transaction in the matter of payment of octroi by the Principal defendants they were given the privilege of monthly payment facility presumably under Rule 17(4) from the time when the Check posts, were under the direct control and management of Khulna Pourashava but the learned Trial Court did not consider this aspect of the case.
 
16. Learned trial Court also did not approach the case from the correct stand point and failed to take into account that after the lease of octroi Check posts to the plaintiffs the collection of octroi on the import of the goods of principal defendants at the entry point was not enforced by the plaintiffs and the previous system of monthly payment of octroi was continued to be followed as before and that the plaintiffs did not enforce the collection of octroi and submission of aforesaid declaration at the very entry point of import as that could have been done under the Rule.
 
17. He also pointed out that in view of section 68 of the Khulna Municipal Corporation Ordinance, 1984 the plaintiffs, respondents have no authority to call for account of petroleum import made by the appellants within Khulna Municipal Corporation and as such the suit for accounts filed against the defendants appellants is not maintainable and he has also pointed out before us section 68(1) and 69(2) of the Khulna Municipal Ordinance, 1984. And as such the suit for accounts filed against the defendants-appellants is not maintainable and the judgment and decree passed against them is liable to be set aside.
 
18. On the contrary, learned Advocate Mr. Ozair Farooq submits, that he took lease of the octroi Check posts for 1977-80 from Khulna Pourashava for collection of octroi from the importers of goods within the Pourashava area for the purpose of either consumption, use or sale during this period of lease the defendants-appellants imported petroleum product within Khulna Pourashava and sold the same within Pourashava area, but did not pay octroi dues as per the Rules nor did they submit declaration as per the Rules and thus deprived the plaintiffs from their legal dues and as such they were compelled to file the suit for accounting and also for recovery of their legal dues.
 
19. In view of aforesaid facts, argument and law involved we are now to consider and decide whether the plaintiffs are entitled to get a decree of counting and also for recovery of their legal dues as was decreed Section 68(1) of the Khulna Municipal ordinance 1984 reads as follows—
 
“The corporation may by notice call upon any persons to furnish such information, produce such record or accounts or to present such goods or animal liable to any tax, rate, case, toll or fee as may be necessary for the purpose of determining the liability of such persons, goods or animal to a tax, rate cess, toll or fee or the assessment thereof and 69(2) of the Khulna Municipal Corporation ordinance states as follows.”
“All arrears of taxes, rates cesses, tolls and fees and other money claimable by the corporation under this Ordinance shall be recoverable as Public demand.”
 
20. We have very carefully gone through the findings and decisions of the learned lower court and we find that the learned lower court took final decision on octroi Rules basing 2(i) (f) as well as Exhibit 9 a letter of LGRD Ministry of the Peoples Republic of Bangladesh and also relied upon a letter dated 9-3-1979 of the Divisional Commissioner, Khulna (Exhibit 12)
 
21. Let us now see what says the octroi Rule 2(r) (f)—
 
Octroi means a tax on the import of goods or animal for consumption, use or sale within Pourashava”.
 
22. Upon plain reading of the above Ordinance of Khulna Pourashava octroi Rules it can be said that the plaintiffs-Respondents took lease of the Octroi Check for 1977-80 from Khulna Pourashava for, collection of octroi from the importers of goods within the Pourashava area for the purpose of either consumption, use or sale and that during the period of lessee of lease the defendants appellants imported petroleum Khulna Pourashava products within Khulna Pourashava and sold the same from within the Pourashava area and are liable to pay Octroi dues. This view also find support from the Exhibit 9 and 12 Let us see what where the contents of these two letters written by LGRD Ministry and Commissioner of Khulna Division.
 
Exhibit 9 reads as follows:
Govt. of the People’s of Republic of Bangladesh Ministry of local Govt. Rural Dev and Co-Opt.
(Section XVI)
 
Memo No.8-XVI/21-14/78/334 dated 8-11-1978.
 
To
The Chairman
Khulna Pourashava.
Sub: Imposition of octroi on the petroleum products.
Ref: Mis No. Shu-2616, dated 18-10-1978.
The under signed is directed to refer his memo under reference on the above subject and to inform him that Govt has never issued any order to exempt the imported petroleum products from the payment of octroi which is sold by the importer in the Pourashava limit.
M/S Jamuna Oil Co Ltd. Meghna Petroleum Marketing Co Ltd and Burmah Eastern Ltd have to pay octroi at the entry point on their imported petroleum within Khulna Pourashava limit for sale to the parties situated within and out side Pourashava and collection of Octroi Rules, 1961.
Sd. Mujibur Rahman
Section Officer.
 
Exhibit 20 reads as follows:

Government of Bangladesh Office of the Commissioner, Khulna, Division.
Memo No.Br IV/XXVI-4/78 dated 9-3-1979.

To
The Chairman
Khulna Pourashava.

Subject: Payment of Octroi on Petroleum Products.

Reference: Memo No.MB 8/78-79.47, dated 3-3-1979 of M/S Mustafa Brothers, Octroi lessee of Khulna Pourashava.

Govt. Instructions laid down in Memo No.8 XVI/21-14/78/334 dated 8-11-1978 regarding payment of octroi on petroleum Products require that the companies concerned shall have to pay octroi at the entry on their imported Petroleum Products within Khulna Pourashava limit for sale to parties situated within and outside Pourashava limit.

Sd. MA Qasim
Commissioner-in-Charge.
 
23. Learned Barrister Mr. Abdus Samad in support of his contention has taken us to some Rulings Reported in AIR 1976 SC 1447 AIR 1992 SC 645, AIR 1985 Bomb 219, and AIR 1963 SC 907 wherefrom we find that the Supreme Court of India. Bombay and Haryana in a similar matter held that, on facts that company was liable to pay of Octroi tax on goods brought into local Area (a) to be consumed itself or sold by it to consumers direct and (b) for sale to dealers who in their terms sold the goods to consumer within the Municipal Area irrespective of whether such consumer brought them for use in the or outside it. The company was, however, not liable to octroi in respect of goods which it brought into the local area and which were re-exported.
 
24. In the instant case the plaintiffs which is a partnership firm and were lessee of octroi Check posts through which the defendants-appellants imported and sold petroleum within Khulna Municipal corporation seeks the relief claiming Octroi on goods which are in transit from one octroi limit to another and which are either consumed or used within the Municipal Area.
 
25. In order to understand the rival contention of the parties it may be convenient at this stage to look into the relevant previsions in Rule 4, after sub-Rule (2) a new sub-Rule (2A) has been inserted by notification No.SRO 66-L79/S-VI/3R-2/79/37, dated 20-3-1979.
 
Sub Rule (2A) reads as follows:
 
“No octroi shall be levied on goods imported and stored in a godown or ware house within the Octroi limits if such goods are not intended for consumption, use or sale within such Octroi limit and a certificate to that effect issued by a competent person is produced at the barrier.”
 
26. In the instant case, we find that the defendants-appellants which is a partnership firm and deals in import of petroleum and stores in a depot within the Octroi limits and according to rule if such goods (Petroleum) are not intended for consumption, use or sale within such octroi limits no Octroi shall be levied on goods Octroi imported (Schedule III) appended to these Rules and goods specified in column 2 of schedule II. It is, therefore, needless to say admittedly, Defendants Company imports petroleum and stores in depot within the Octroi limits for ultimate use or consumption there in but specifically for export, sale of such petroleum even within the Octroi limits not for use or consumption therein but for export would not make the importer or the exporter (defendants) liable to pay the octroi and they would be entitled to refund of the amount already deposited after such export.
 
27. Considering entire matters on record we also find that the Certificate to that effect was required to be issued by a competent person is produced at the barrier has been waived by the Khulna municipality and they are now estopped for raising this issue.
 
28. We, therefore, find that the learned Subordinate Judge practically did not apply his judicial mind in deciding the case and arrived at a wrong findings and decision which is liable to be set aside. The issue is, therefore, decided in the negative. Consequently, we find merit in the argument advanced by the learned Advocate Mr. Abdus Samad.
 
29. Before going to consider the main issue we must say that the plaintiffs took pleas which do not come under the purview of law.
 
30. Having regard to the nature and incidence of Octroi unless the octroiable goods which are consumed or used are meant to reach an ultimate user or consumer in the octroi area, no octroi is livable. The words ‘sale therein.’ In the words consumption, use or “sale therein” In the definition of Octroi sale are octroi goods to a person for purpose of consumption or use by such person in the Octroi area if sale was intended for consumption or use in the Octroi area whether the purchaser actually consumed inside or out side octroi area is irrelevant. We, therefore, hold the view that the defendants are not liable to pay of Octroi only with respect to the petroleum imported and stored within the Octroi limit of Khulna Municipality and ultimately exported.
 
31. In the circumstances, the appeal succeeds end is allowed. The judgment and decree appealed against are set aside, Consequently, Title Suit No.274 of 1980 stands dismissed.
 
The parties are directed to bear their respective costs although.
 
Send down the LC Record immediately.
 
Ed.