Royalty imposed on Advertisement Hoardings by Municipal Corporations not Tax: Supreme Court

The Supreme Court has ruled that royalties imposed on advertisement hoardings by municipal corporations do not constitute a tax. The case involved a challenge to the imposition of royalties by municipal corporations on companies for displaying advertisements on hoardings. The petitioners argued that these royalties were effectively a form of taxation, which municipal corporations were not authorized to impose. The Supreme Court, however, held that the royalties were a fee for the use of public space and services provided by the municipal corporations, not a tax. This distinction is significant as it clarifies the legal basis for municipal corporations to charge fees for the use of public property for commercial purposes. The ruling supports the municipal corporations’ authority to regulate and monetize the use of public spaces for advertisements, ensuring that such charges are legally justified and not considered unauthorized taxation.