Bombay High Court: Pune's Sky-Sign Fee Hike Upheld Amidst Advertising Company Challenges

Summary: The Bombay High Court recently agreed with Pune Municipal Corporation's decision to increase sky-sign and hoarding license fees, rejecting claims that the increase was illegal or unfair.

The Case of the Fee Hike

In a recent decision, the Bombay High Court addressed the heated issue of sky-sign and hoarding license fees in Pune. The case involved several advertising companies challenging the Pune Municipal Corporation (PMC) over increased fees for advertising spaces.

Background: What's the Fuss About?

The controversy started when the PMC decided to raise the license fees for sky-signs and hoardings from Rs. 82.60 to Rs. 222 per square foot each year. This change was based on a bidding process where the highest offer was Rs. 222. The companies argued that this increase was random and was more like a tax than a fee.

Legal Grounds: Fee or Tax?

The companies claimed that the new fees were basically a tax, which the PMC wasn't allowed to charge. They said the fees were too high, didn't offer a fair exchange, and were therefore against the law. However, the court found these fees to be for regulation purposes and not for making money, dismissing the idea that they were a tax.

"The license fee is for regulation, not a tax," the court stated, stressing the difference between fees and taxes.

Constitutional and Legislative Context

The court looked into the rules, especially after a change in 2016 that no longer allowed states to charge advertisement taxes. The court ruled that this change did not stop the PMC from charging fees under the Maharashtra Municipal Corporations Act.

Retrospective Approval: A Point of Debate

The issue of making the fee hike apply to past actions was another argument. The PMC had started the fee hike from April 2013, but the companies argued that the approval in September 2018 couldn't apply to past years. The court, however, agreed with the PMC, interpreting the rules to allow such approval.

Scrutiny Fee and Administrative Costs

A fee of Rs. 5,000 for processing applications was also challenged. The court found this fee fair, as it covered administrative costs and wasn't a replacement for the license fee.

Conclusion: Court's Verdict

The court's decision highlighted that the PMC's actions were legal and fair. It stressed the need for city bodies to have financial independence to meet their responsibilities, especially in fast-growing areas like Pune.

In summary, the court confirmed the PMC's right to control and charge fees, ensuring that city growth and public needs are addressed.