JUDGMENT Satyanarayana Rao, J.
1. The Masulipatam Municipal Council by its Commissioner and Executive Authority, who was the defendant in the action, is the appellant in this second appeal. The suit was filed by the respondent for a declaration that the defendant was not entitled to levy any taxes on the schedule property and that the defendant should be restrained by a permanent injunction from recovering from her the sum of Rs. 78-2-2 and from levying further taxes on the schedule property. The tax that has been levied by the Municipality is property tax and the property is situated in what was previously known as Frenchpet or French Loge in Masulipatam town. In the plaint it was admitted that the sovereignty of British India was transferred to the Dominion of India under the Indian Independence Act, 1947, and that the Dominion had acquired by transfer the said Loge which was subsequently included in Bandar Town in the Province of Madras, but it was claimed that the said Loge was never included in the municipality of Masulipatam and that the procedure laid down for inclusion under Section 4, District Municipalities Act, was not complied with. It was also alleged that there were no proper, legal and valid notifications and resolutions under Sections 78(3) and 80, District Municipalities Act, and that therefore the defendant was not entitled to levy the tax. The defendant stated in the written statement that the French Loge was part and parcel of the Masulipatam town and it was so declared very early by Sir Samuel Hoare, the then Secretary of State for India, and that it was always within the Municipal limits of Masulipatam and constituted part of the Municipality under the District Municipalities Act, that there was no necessity for any notice under Section 4, District Municipalities Act, particularly in view of the order, -- The Madras (Enlargement of Area and Alteration of Boundaries) Order, 1948 published in G. O. No. 899, Public (Political) Department, dated 14-4-1948 -- by which the doubts, if any, which existed by that date were removed and it was declared that the French Loge at Masulipatam was included in the territories of the Dominion of India and shall be deemed always to have been included in the said territory. That notification further declared that the Loge at Masulipatam should form part of Bandar town in Kistna district and that the area should be administered accordingly. It was also further declared that all the enactments for the time being in force in the said town and all notifications, orders, schemes, rules, forms and by-laws issued thereunder, shall extend to or be in force in the said territory and shall always be deemed to have extended to and to have been in force in the area included in the town. It was also averred that there was no necessity to issue a fresh resolution or notification under Section 78 (3) or 80, District Municipalities Act) and the levy of the property tax by the Municipality was therefore valid and justified. The contention of the Municipality was upheld by the District Munsif and the suit was dismissed by him. On Appeal this decision was reversed by the learned Subordinate Judge and hence this second appeal.
2. It is no doubt true that for a long time French Loge or Frenchpet was under the French Government and the Municipality of Bandar or Masulipatam never exercised any rights over that area. In 1935, for the first time doubts arose whether the British Indian Court at Masulipatam had jurisdiction to try an offence which occurred in Frenchpet Under Section 438, Criminal P. C., the Sessions Judge of Kistna referred the matter to the High Court. During the hearing of the reference the Advocate-General on behalf of the Crown obtained an adjournment of the case to obtain a declaration from the Secretary of State for India regarding the status of the territory in question. Under Section 57(10), Evidence Act, the Court could take judicial notice whether a place is part of British territory or not and a declaration by the Political Department of the Government of India was treated as final. The Advocate-General obtained from the Foreign and Political Department of the Government of India, G. D. F. 24 x/35 dated 5-3-1935 and it was communicated to the High Court. It ran as follows:
"The Advocate-General is informed that the Secretary of State for India has since intimated that His Majesty's Government regard the Loge at Masulipatam as part of the territories in the dominion of the British Crown. He is requested to inform the High Court accordingly. Should the High Court require a copy of the official letter from the India office to be produced. Government will have no objection to furnish it. The Advocate-General is requested to ask for it at once if he finds it necessary."
When this was brought to the notice of this Court, the learned Judges accepted the communication as final and treated the area known as the Loge at Masulipatam as part of the territories under the Dominion of the British Crown. Vide -- 'Emperor v. Appayya', 1935 Mad Cr. C 424 (A).
3. One would have thought therefore that the question whether this Loge was or was not part of British territory became final by the communication of the Political Department which was accepted by this High Court in 1935, but for the fact that the learned Subordinate Judge in the present case thought that this is of no consequence as it may be a mere paper declaration without effect being given to it. After the declaration of independence in 1947) the provisions of the Government of India Act were amended so as to make them applicable to the altered circumstance that India became a dominion. Under Section 290, Government of India Act, as amended, to clear all doubts the Government of India issued a notification which is styled the Madras (Enlargement of Area and Alteration of Boundaries) Order, 1948. It reads:
"Whereas by Section 290, Government of India Act, 1935, as adapted by the Indian (Provisional Constitution) Order, 1947, it is provided that the Governor General may by order increase the area, and alter the boundaries) of any province and may make such provisions as the Governor-General may deem necessary or proper for any supplementary, incidental or consequential matters;
And whereas in accordance with the provisions of the said section, the Governor-General has ascertained the views of the Government of the Province of Madras, both with respect to the proposal to make the order and with respect to the provisions to be inserted therein;
Now, therefore, in exercise of the powers conferred on him by the said section and of all other powers enabling him in that behalf, the Governor-General is pleased to make that following order:
1. This order may be cited as the Madras (Enlargement of Area and Alteration of Boundaries) Order, 1948.
2. The areas specified in the schedule to this order, which were known as the French Loges at Masulipatam and Calicut, are hereby declared to be included in the territories of the Dominion of India and shall be deemed always to have been included in the said territories.
3. The said areas shall form part of the Province of Madras and shall be deemed always to have formed part of the said Province and the boundaries of the said Province shall be deemed always to have been so altered as to comprise within them the said areas.
4. (i) The area comprised in the loge at Masulipatam shall form part of Bandar town in Kistna district and the area comprised in the loge at Calicut shall form part of Calicut town in Malabar district and the said areas shall be administered accordingly.
(ii) All enactments for the time being in force in any of the said towns and all notifications, orders, schemes, rules, forms and by-laws issued, made or prescribed under such enactments and for the time being in force in any of the said towns shall extend to and be in force in and shall always be deemed to have extended to and to have been in force in the area included in that town by the preceding paragraph."
To this order is appended a schedule giving the boundaries of the loge at Masulipatam and also of the loge at Calicut. It is clear therefore that whatever doubt there might have been was resolved by this order of the Government of India which declared that the French Loge at Masulipatam was included in the territories of the Dominion of India and should be deemed always to have been included in the said territories. It was treated as forming part of the Province of Madras and also deemed to have always formed part of the said Province. It further provided that this loge at Masulipatam should form part of the Bandar town and it should be administered accordingly and Sub-section (2) of Section 4 declared that the enactments, notifications, orders, etc. which were in force at that time in Bandar town should extend to & be in force and shall always be deemed to have been extended to and been in force in the area included in the town by the preceding paragraph, so that for all practical purposes the area of 66.48 acres formed part and parcel of what is known as Bandar town which is only an 'alias' for Masulipatam, and so subject to the laws which were applicable to that town and it was directed that it should be administered in accordance with those laws.
4. The question now raised is that this notification could not have the effect of making this area part of the Municipality of Masulipatam even if it formed part of the town of Bandar for other purposes and that in any event, without a further notification under Section 4, District Municipalities Act, the tax could not be levied by the Municipality. My attention was drawn by the learned Advocate-General to the notifications constituting the town of Masulipatam a municipality under the District Municipalities Act, 1884. The Act of 1884 was the earliest of the District Municipalities Acts which was enacted for introducing municipal administration in this province. Section 4 of that Act empowered the Governor-in-Council by notification to declare any town, village, hamlet, suburb, bazar, station or other local area or any part of the same to be a municipality. Vide Sub-section (10) of Section 4. He could also cancel by a declaration a municipality and dissolve it, vide Sub-section (2) of Section 4. A "Municipality" is defined by that Act as meaning "any town, village, hamlet, suburb, bazar, station or other local area or any part of the same which may be declared to be a municipality in the manner hereinafter provided" so that it was open under that Act to constitute any local area into a municipality, and no other requirement is laid down by that section except a notification under Section 4 (1) by the Governor-in-Council. On 19-3-1885, Notification No. 597 was issued by the Governor-in-Council by virtue of the power vested in him under Sub-section (1) of Section 4, Madras District Municipalities Act, 1884, and it states: "The Governor-in-Council is pleased to declare all the marginally noted local areas, which have hitherto been towns for the purposes of the Madras Towns Improvement Act, 1871, to be municipalities for the purposes of the said Madras District Municipalities Act, 1884 and to direct that the said Act shall come into force in the said Municipalities on 1-4-1885." Among the marginally noted towns Masulipatam is one. Under the Towns Improvement Act, 1871, referred to in that notification, a notification was issued on 25-4-1871 by the Governor-in-Council extending the provisions of that Act to the town of Masulipatam. Under an earlier Town Improvement Act of 1865 (Act 10 of 1865) Masulipatam, commonly called and known as the town of Bandar, in the District of Kistna and the areas specified in the notification under the Act were united for the purposes of the Act under the name of the town of Masulipatam.
5. The question is whether this area is part of the Municipality of Bandar town or Masulipatam and whether a further notification under Section 4, District Municipalities Act, 1920 is necessary before the property tax is levied under the provisions of the District Municipalities Act, 1920 as contended on behalf of the respondent. On a plain reading of the provisions of the Order of 1948, there can be no doubt that this area was deemed to have always formed part of the town of Masulipatam, also known as Bandar. That is what in terms Sub-section (1) of Section 4 stales. If Masulipatam on that date was already a municipality governed by the provisions of the District Municipalities Act and if an area is added to it, it naturally follows that it forms part of the Municipality. Section 4(1) directs also that it should be administered as part of the Bandar town and what is more, Sub-section (2) of Section 4 not only provides that enactments, notifications, orders, schemes, rules, forms and by-laws issued, made or prescribed under such enactments for the time being in force in the town of Masulipatam should extend to and be in force in the added area, but should be deemed always, to have extended to and to have been in force in the area included in the town by the preceding paragraph. This implies that the enactment, namely, the District Municipalities Act, must be deemed to have been in force all along, in other words, it retrospectively makes the Act applicable. Not only the Act but also notifications issued under the enactments which were applicable to Bandar town would also apply and also must be deemed to have always applied and extended to the new area. By the force of this order the District Municipalities Act applies to the area added to the Bandar town and all the notifications issue i.e., notifications constituting the Bandar town a municipality would also apply to this area and the municipality would be entitled to levy property tax under the provisions of the District Municipalities Act.
6. It is however argued on behalf of the respondent that it is not known when exactly this territory was made over to the British Government and unless that is known it is not possible to assume that it formed part of the Municipality. The exact date when this area became part of British territory in my opinion is irrelevant for on either hypothesis the area formed part of the Municipality. If before the District Municipalities Act, 1920, came into force, the area was part of the Bandar town, as British territory the procedure laid down by Section 4, District Municipalities Act, cannot obviously be applied because the provisions of that section are prospective in their operation and not retrospective. If, however, the taking over possession by the British Government of this area from the French Government was subsequent to the Act of 1920, then the provisions of Section 4 would not apply to an area which was not till then British territory. It applies only to areas which are subject to the jurisdiction of Provincial Legislature, and in respect of which the Provincial Legislature could have enacted a law. When the possession was taken over, the British Government could make provision for its administration also and extend the operation of the laws which till then applied to what was then Bandar town to the newly added area. It was however urged that after India became a dominion after the Independence Act of 1947, the dominion had no power to acquire or add any fresh territory to it. This argument, in my opinion, overlooks the provisions of Section 5(d), Government of India Act, 1935. Section 5 reads:
"The Dominion of India established by the Indian Independence Act, 1947, shall, as from the 15th August 1947, be a Union comprising (a) the provinces, hereinafter called the Governor's provinces;
(b) the Provinces hereinafter called Chief Commissioners' provinces;
(c) the Indian States acceding to the Dominion in the manner hereinafter provided; and
(d) any other areas that may with the consent of the Dominion be included in the Dominion."
The inclusion in the dominion of an area implies that it was originally not part of the dominion. There could be no question of inclusion of an area if it was already part of the dominion. This clause therefore empowers the dominion to add other areas whatever may be the mode by which the areas were acquired, i.e., whether it was acquired under international law, by cession, accretion, conquest or subjugation. Whatever may be the mode, if the area was acquired, the dominion with its consent could add that area to the already existing area constituting the Dominion of India. Learned counsel for the respondent when he advanced this extraordinary proposition overlooked the provisions of Section 5, Government of India Act, 1935. In my opinion the argument which is in the teeth of the clear provisions of the Constitution cannot be accepted. Under the Act when India became a dominion, the power and duty to alter the boundaries of a province, to create a new province, to increase the area of a province and to diminish its area is conferred upon the Governor-General by Section 290 of the Act. Before independence this power vested in His Majesty. That power was conferred on the Governor-General when India was a dominion. The Governor-General under this provision was authorised to make alterations in the area of a province subject to the proviso that in making the order the Governor-General should ascertain the view of the Government of such province which will be affected by the Order, both with respect to the proposal to make the order and with respect to the provisions to be inserted therein. When once the area is taken over and added to a province, it naturally follows that an arrangement should be made for its proper administration. An area so acquired cannot be left in the air without providing the law applicable and the machinery which should administer the law to that area which was included in a province and for this purpose Sub-section (2) authorised 'inter alia' by Clause (e) that the Governor-General should make provisions for other supplemental, incidental and consequential matters. In other words, all the necessary machinery for the administration of the area by the province & the law that should be applied to it should be provided by the Governor-General while adding an area to a province. It is that that has been provided by the order of 1948. It was not a legislative power which was exercised by the Governor-General under Section 290 as was wrongly assumed by the learned Subordinate Judge. The law is already there; it had to be applied to a particular area which has been added to a province. This right of providing for the law applicable by a notification is not unknown to constitutional law of civilised countries. There are a number of decisions in which this power has been recognised and it is considered merely as a power to extend the existing laws by an executive order to the areas which have been newly added to a province. The Governor-General, therefore, was competent to issue the order under Section 290 of the Act, so as to bring into force the enactments, notifications, orders, rules and by-laws which have been in force till then in what was known as Bandar town alias Masulipatam. The requirement therefore that has been insisted on behalf of the respondent that there should be a fresh notification under Section 4 is, in my opinion, wholly unnecessary in view of the clear language of the order of 1948 which it was within the competence of the Governor-General to issue under Section 290, Government of India Act.
7. There remains the objection to the tax itself on the ground that there were no fresh resolutions and fresh notifications under Section 78 (3) and Section 80, District Municipalities Act. This argument again, in my opinion, proceeds on a wrong assumption. It is not disputed that the property tax was properly levied in what was known as Masulipatam municipality before the inclusion of the area. Resolutions and notifications wore regularly made and nobody ever disputed that the levy of property tax in the municipality was not warranted because the requirements of the two sections were not complied with. If the property tax was therefore properly levied by the Municipality and if this area was included within the municipal limits, it automatically follows that all the laws which were applicable under the District Municipalities Act to Masulipatam will equally apply to the area which has been added to the municipality. No fresh notifications or fresh resolutions are required and the tax in my opinion was properly levied by the Municipality.
8. From the foregoing it follows that the decision of the learned Subordinate Judge which proceeds on an erroneous view cannot be sup ported and must be set aside and that of the District Munsif restored with costs here and in the Courts below. No leave.