Law: LICENCES AND PERMITS FEE ORDER, 1979

Section: 3

FEE AND TAX........A tax is imposed for public purposes and is not supported by any consideration of service rendered in return. Whereas a fee is levied in View of services rendered. Consequently, there is an element of quid pro quo between the payer of the fee and the Authority which imposes it. A fee is distinguishable from a tax inasmuch as it is meant to defray the cost of particular services rendered to particular individuals. The distinction between a tax and fee lies primarily in the fact that tax is levied as a part of common burden or general revenue, while a fee is a payment for special benefit or privilege. In the matter of fee, the Government has always to offer an explanation vis-a-vis the reasonableness and as long as there is reasonableness the requirement of quid pro quo gets satisfied. LICENCES AND PERMITS FEE ORDER, 1979........Paragraph 3.......Import licence fee at the time of obtaining of the Import Licence for Industrial undertaking in Hattar area was 6% subsequently, but before the Import of machinery the area was included in the definition of rural area, the import licence fee was reduced to 2% the petitioner is liable to pay 2% import licence fee applicable at the time of actual import.--The industrial concern of the petitioner was situated in an area declared to be a rural area and 2% ad Valorem licence fee was charged when the petitioner applied for an import licence for the machinery requested for the industry. The area was excluded from the definition of rural area and 6% ad Valorem licence fee was demanded. Fee was, however paid under protest after issue of licence but before the import of machinery the area was again declared as rural area and the 2% ad valorem rate was again made applicable. Petitioner demanded the refund of excess fee paid on the plea that the machinery was not yet imported. The case of the petitioners had not been rendered as past and closed transaction at the time of the issuance of the 1992 circular. Because as was stated by them in their letter to the Secretary Commerce, the Import licences were obtained by them in September, 1991. But the machinery in question had not yet been imported. Meaning thereby that…

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