MULLINGAR RURAL DISTRICT COUNCIL v ROWLES (Surveyor of Taxes)

• Jurisdiction: Ireland
• Judgment Date: 20 June 1912
• Date: 20 June 1912
• Court: King's Bench Division (Ireland)

NO. 329.-HIGH COURT OF JUSTICE, IRELAND (KING'S BENCH DIVISION).-

MULLINGAR RURAL DISTRICT COUNCIL

and

ROWLES (Surveyor of Taxes)

Income Tax (Schedule D). - Profits. A Rural District Council is bound by Act of Parliament to supply water to any Ratepayers within its Rural District who may make application therefor, and is empowered to collect a special rate from consumers of water so supplied.

Held, following Glasgow Corporation Water Commissioners v. Miller and Corporation of Dublin v. McAdam, that the relation between the District Council representing the general body of rate-payers and the consumers of water respectively, is that of vendor and purchaser, and that the profit made by the District Council is a profit within the meaning of the Income Tax Acts, and as such is liable to tax.

(1) At a meeting of the Commissioners for the special purposes of the Income Tax Acts held at Mullingar on the 3rd November, 1910, the Mullingar Rural District Council appealed against an assessment made upon them under Schedule D. of the Income Tax Acts for the year ending 5th April, 1911, in the sum of £247, in respect of the profits of certain waterworks belonging to and carried on by them.

(2) The waterworks in question were constructed under a Provisional Order made in the year 1896 by the Local Government Board for Ireland under the Public Health (Ireland) Act, 1878, relating to the Rural Sanitary District of Mullingar.

(3) 1

(4) To meet the general expenses incurred by the Mullingar Rural District Council in the execution of the Public Health (Ireland) Act, 1878, a "General Rate" is struck by the County Council on all rate-payers within the waterworks area-whether such rate-payers take the water or not. Such rate is levied as part of the Poor Rate under the provisions of Section 233 of the Act.

(5) A "Special Rate" is collected by the Mullingar District Council (under Section 66 of the Act) on all persons who take in the water. If the pipe for supplying the water does not exceed half an inch the consumer is charged a 9d. rate on his valuation, but if the pipe exceeds half an inch, then the consumer has to pay by meter. The Mullingar Rural District Council do not supply water to any person except to those rate-payers who make

application to be so supplied, and the said Council have no power to supply water to persons outside their rural district.

(6) The duties for income tax for the year 1910-11 were granted by the Finance Act, 1910, Section 3(1), and by Section 3(2) of such Act all previous enactments relating to income tax were continued in force.

(7) The rules for assessing and charging the several duties are contained chiefly in the Act 5 and 6 Vict. Cap. 35. By Section 40 of that Act it is enacted that all corporations, companies, or societies, whether corporate or not corporate, shall be charged with duties, and the Chamberlain or other officer acting as Treasurer shall be answerable for doing all such things as are required by the Act to be done in order to assessment.

(8) The waterworks of the Appellant were charged and assessed to the duties in the manner directed in Schedule A. No. III. of the Act 5 and 6 Vict. Cap. 35, and under the 8th Section of 29 and 30 Vict. Cap. 36 according to the rules described by Schedule D. of the first Act so far as such rules are consistent with the said No. 3.

(9-12) 2

(13) The Appellants contended that under Section 233 of the Public Health (Ireland) Act, 1878, the Rural Sanitary Authority, as the District Council was then called, was authorised to levy the general expenses as part of the Poor Rate, and under Section 66 of the Act, when the Sanitary Authority supply water to premises, it can charge a rate to be assessed on the annual value, or it can enter into agreements with the persons receiving the supply and may recover the Water Rate or money payable under such agreements in a summary manner.

The Appellants further contended that the effect of the Local Government Act, 1898, was to transfer to the County Council the collection of the rate under Section 233, but, as was decided in the case of theRathdrum Council v. Saul, 39 Ir. L.T. Reports, page 270, the powers under Section 66 remain vested in the...