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Colonial Cases

Grands Moulins v. Haifa Municipality, 1932

[taxation]

Grands Moulins v. Haifa Municipality de Palestine

High Court, Palestine
1932
Source: The Palestine Bulletin, 5 April 1932

 

DYNAMOS ARE NOT STEAM MOTORS

HIGH COURT DECISION ON OTTOMAN LEVY

Grands Moulins v. Haifa Municipality

   That the dynamos of the Grands Moulins Company of Haifa used for generating electric power to their machinery cannot be considered as coming under the levy imposed by the Ottoman Law of Municipal taxes on "all motors which create steam," was the considered judgment of the Supreme Court sitting as a High Court of Justice  on March 25, in a case where the Municipality of Haifa and the Chief Executive Officer, Haifa, claimed the sum of L.P. 26, as an alleged licence tax payable in respect of the motor used by the Grands Moulins. 

   The case was heard before Mr. Justice Baker and Mr. Justice Khalil, the Petitioner, the Grands Moulins de Palestine, being represented by Mr. A. Levin and Mr. J. Solomon, while the two Respondents, the Chief Executive Officer, Haifa, and the Municipality of Haifa, were represented by Dr. Weinshall.

The Judgment

   The Judgment is given below in full.

   This is a return to a Rule Nisi issued by the High Court on the 14th day of December, 1931, calling upon Respondents to show cause why they should not be restrained from executing against Petitioners the claim of the Municipality of Haifa for L.P. 26, being an alleged licence tax payable in respect of the motors used by Petitioners for the purpose of transmission of electric power to their m chinery.

   The Municipality of Haifa base their claim for the payment of the tax upon Section 10 of the Ottoman Law of Municipal taxes of 24th Rabbi 1333 which translated into English from the Turkish text, reads as follows:-

There shall be levied on all motors which create steam which are not exempted by special law or used for agricultural purposes a licence tax payable once only as follows: ... L.P. 2 when the H.P. is up to 5.   L.P. 5 when the H.P. is from 5 up to 10 and L.P. 10 when the H.P. exceeds 10."

   Upon notice emanating from the Execution Office, Haifa, being served upon Petitioners to pay the tax, Petitioners opposed on the grounds that none of their motors in respect of which the tax was claimed were in any way of the nature of steam engines, and required the Chief Execution Officer to refrain from execution.

   The Municipality replied to the opposition submitting that they were entitled under the Municipal Tax Law to collect licence tax not only in respect of a steam engine but also in respect of motors (prime movers) which is defined in the Fencing of Machinery Ordinance 1928 as "every engine motor or other apparatus which provides mechanical energy derived from steam, water, wind, electricity, combustion, or other source."  The Municipality at the same time requested that the question should be taken to the High Court.

   The learned Chief Executive Officer upon the opposition and reply thereto expressed an opinion that upon the interpretation of Section 10 of the said Municipal tax Law it appeared that the section did not apply to the dynamos of the Grands Moulins de Palestine and stayed execution for fifteen days to enable the present petitioner to apply to the High Court.

   The only question for this Court is whether the motors of Petitioners in respect of which the claim of the Haifa Municipality is made are steam engines or motors which create steam within the meaning of Section 10 of the Municipal Tax Law.

   There is a wide distinction between a steam engine and motor which creates steam and the motors or dynamos of Petitioners which distinction I am of opinion cannot be bridged by the definition of a prime mover contained in the Fencing of Machinery Ordinance 1928, which definition Respondents request us to accept.

   I am accordingly bound to hold that the motors or dynamos of Petitioners are not liable to be taxed under the before-mentioned Section 10 of the Municipal Tax Law, and make the Order Nisi absolute with costs to include L.P. 4 advocate's fees.

DELIVERED this 19th day of March, 1932.

Published by Centre for Comparative Law, History and Governance at Macquarie Law School