Shylendra Kumar, J.:—

Petitioners in the above Writ Petitions are either hospitals or Nursing Homes wherein health services are provided. Petitioners are charging for such services. In the course of their activities petitioners produce waste which is required to be disposed of and having regard to the nature of the activity and the use of chemicals and drugs in such activities and the waste also containing residuary wage particles generated due to treatment on patients, the disposal of such wastes is sought to be regulated by Rules known as Bio Medical Waste, (Management and Handling) Rules, 1998 (for short ‘the Rules’). Such Rules are framed by the Central Government in exercise of the powers conferred on it under Sections 6, 8 and 25 of the Environment (Protection) Act, 1986 (hereinafter referred to as ‘the Act’).

2. Every occupier of an institution generating such bio medical waste and handling of such bio medical wastes are required to obtain an authorisation as indicated in Rule 8(3) of the Rules. Rule 8 reads as under:

“8. Authorisation

(1) Every occupier of an institution generating, collecting, receiving, storing, transporting, treating, disposing and/or handling biomedical waste in any other manner, except such occupier of clinics, dispensaries, pathological laboratories, blood banks providing treatments/service to less tfian 1000 (One Thousand) patients per month, shall make an application in Form I to the prescribed authority for grant of authorisation.

(2) Every operator of a bio-medical waste facility shall make an application in Form I to the prescribed authority for grant of authorisation.

(3) Every application in Form I for grant of authorisation shall be accompanied by a fee as may be prescribed by the Government of the State or Union Territory.

sub-rule 3 of Rule 8 also provides for payment of a fee as may be prescribed by the Government of the State or Union Territory by persons who apply for grant of authorisation to deal with the bio-medical waste and the application is to be in Form No. 1. Such fee is prescribed by the Government of Karnataka as per its proceedings in G.O No. FEE 126 ENV 98, Bangalore dated 17.7.1999 The fee so provided as per this Government Order is a sum of Rs. 25/- per any such application which should be accompanied by a further fee of Rs. 100/- per bed per annum for hospitals and health care establishments and a fee at flat rate of Rs. 1,000/- per annum in the case of Clinics, dispensaries, Veterinary institution, animal house, Pathological laboratories and blood banks. Clause 3 is illustrative of the case of the petitioner in W.P No. 451/2000 which is filed by Fr. Muller's Hospital, Mangalore. Petitioner had been apprised as per communication dated 26.7.1999 copy at Annexure A, on the framing of such rules, the requirement on the part of the petitioner institution to obtain authorisation as provided for under the Rules and by making proper application in this regard and payment of the fee as notified by the Government of Karnataka referred to supra. Petitioner was also apprised that violation of the provisions of these Rules would attract penal action under the provisions of Section 15 of the Act.

3. Petitioner obviously not having responded to this communications was issued with a show cause notice dated 17th December 1999 copy at Annexure B issued by the Prescribed Authority for Bio-Medical Waste who is impleaded as 1st respondent in these Writ Petitions proposing action as contemplated under Section 15 of the Act for non-compliance of the provisions of the Rules and particularly for not obtaining valid authorisation envisaged under the Rules.

4. It is in these developments of facts petitioners have approached this Court. While some of the petitioners in fact had applied and obtained such authorisation on payment of the prescribed fee, many others who have not obtained such authorisation, were issued with show cause notices. Challenging such show cause notices and also the legality of the levy of such fee, petitioners have approached this Court.

5. In this regard petitioners have called in question the very validity of sub-rule 3 of Rule 8 of the Rules which provides for levy of such fee. Though many other contentions are urged in support of the reliefs sought for in the Writ Petitions for quashing the show cause notices as well as sub-rule 3 of Rule 8 of the Rules, the primary attack is regarding the validity or the sanctity of the prescription of fee under these Rules.

6. It is the submission of Sri K.G Raghavan, learned Counsel for the petitioners in some of the Writ Petitions that the levy lacks legislative sanction, that levy of such fee under sub-rule 3 of Rule 8 is ultra-vires the Act, that the Act has not enabled or delegated the authority to levy such a fee under the Rules and in the absence of any enabling provision in the Act itself, no such fee can ever be levied or collected under the Rules framed by the delegated authority, the levy is bad in law, collection of fee is not sustainable and the petitioners are not under any legal duty to pay such fee for obtaining authorisation contemplated under the rules and as such has urged for not only quash the show cause notices but also to invalidate the very Rule made by the Central Government, under which prescription of fee by State Governments or Union Territories provided for.

7. Statement of objections has been filed on behalf of the 1st respondent. It is sought to be asserted that the Rule in question is legally and constitutionally valid, that the 1st respondent is justified in collecting the fee as prescribed in the proceedings of the Government of Karnataka in G.O No. FEE 126 ENV 98, Bangalore dated 17.7.1999 copy of which has been produced as Annexure-R1 along with the statement of objections that there is justification for levy of such a fee particularly having regard to the amount of expenditure incurred for the purpose of maintaining laboratories run by the prescribed authority wherein samples are required to be treated, that the said laboratories are very essential for monitoring the pollution levels at various places including places where biomedical waste is generated, that the officials of the authority are also required to conduct periodic inspection of places where bio medical waste is generated, collect samples for survey and analysis, obtain reports and take suitable follow up action and do all such incidental activities which are required to be carried out by the officials of the authority for achieving the objects of the Act and the Rules and as such the levy is perfectly justified and duly authorised under the provisions of the Act. It is inter alia asserted that sanction for such levy is found in the provisions of the Act and as such the levy of such fee and collection of the same is sustainable, that there is no occasion for quashing of either the show cause notices or the Rule as sought for and has prayed for dismissal of the Writ Petitions.

8. Elaborate submissions have been made on behalf of the petitioners by Sri K.G Raghavan, learned Counsel appearing for the petitioners in some of the Writ Petitions as indicated earlier. Though several contentions are urged it is not necessary to examine all of them and the discussion in this judgment is confined to the attack on the levy of the fee and collection of fee under the rules on the ground that it does not pass the test of legislative sanction as I do not find it necessary to consider the submission any further with regard to the other aspects which are urged in support of the justification of the levy or even the attack on the part of the petitioners to show that levy of such fee is not commensurate to the services rendered etc.

9. In this regard, learned Counsel for the petitioners has taken me through the provisions of the Act. It is submitted and pointed out that even after a detailed scrutiny of the provisions of Sections 6, 8, and 25 of the Act which are all the provisions which if at all can be said to enable the Central Government to make or provide for Rules for achieving the objects of the Act for implementing the same, for enforcing the provisions of the Act and which provisions generally enables the Central Government to make provisions for giving effect to the objects of the Act and submits that in none of these sections there is any mention made enabling the Central Government to levy the prescribed fee or collect any fee with reference to an application made in the context of permission or authorisation to be issued to persons dealing with bio medical waste. Though no doubt the expression used in the Act under Section 2 is ‘hazardous substance’ there is no doubt that the bio medical waste is one such hazardous substance. Mr. Raghavan, learned Counsel drawing the attention of the Court to the provisions of Clause (f) of sub-section 2 of Section 25 of the Act submits that this is the only provision in the entire Act where an enabling power is conferred on the Central Government for levying any fee under the Act. However, a fee that is referred to and that is permitted to be levied under the provisions of sub-section 2 of Section 25 is only in respect of a fee chargeable for furnishing a laboratory report on samples of air, water, soil and other substances brought for an analysis or tests conducted at such laboratory. It is also further pointed out that this is an environmental laboratory of the nature referred to in sub-section 2 of Section 12 and a conjoint reading of Section 25 and Section 12 makes it very obvious that the Rule making power extends only to the fee payable for a report to be furnished by such a laboratory in respect of samples tested in that laboratory and not on other activities. Learned Counsel submits that in the absence of a specific enabling provisions providing for levy of fee in the contest of granting authorisation or permission or even in the context of monitoring institutions generating hazardous substance in the act, no such fee could have been levied or prescribed even by the Central Government under the Rule making power and as such the provisions of sub-rule 3 of Rule 8 of the Rules which provides for levy of such a fee as prescribed by the State Government is illegal and un-authorised in law being ultra-vires the provisions of the Act.

10. Sri Jayakar, learned Counsel for the petitioner in W.P 22806/2000 while adopting the arguments of Sri Raghavan has relied upon the decision of the Supreme Court in the case of Bimal Chandra Banerjee v. State of Madhya Pradesh Etc. . 1970 2 SCC 467 and submits that no tax can be imposed by any bye-law or rule or regulation unless the state under which the subordinate legislation is made, specially authorises the imposition. Even if it is assumed that the power to tax can be delegated to the executive, on that basis of the statutory power conferred by the statute cannot be transgressed by the rule-making authority. A rule-making authority has no plenary power. It has to act within the limits of the power granted to it and submits that the ratio laid down by the Supreme Court in this case equally applies in respect of the levy of fee in the present situation also.

11. Sri Raghavan learned Counsel while supporting this proposition has also placed reliance on the decision of the Supreme Court in the case of Ahmedabad Urban Development Authority v. Sharadkumar Jayanti Kumar Pasawalla . 1992 3 SCC 285. The observations of the Court in para 3 reads thus:

“This Court has held that between a tax and a fee there is no. 1 generic difference because in a sense both are compulsory exactions of money by public authority but in a tax imposed for public purpose, no service need be rendered in return of such tax. A fee is however levied essentially for services rendered and as such there is an element of quid pro quo between the person paying the fee and the public authority imposing the same. It has been further indicated that whenever there is any compulsory exaction of any money from a citizen, there must be a specific provision for imposition of such tax and/or fee. There is no room for any intendment for imposition of compulsory payment. Whenever there is any compulsory exaction of money from citizen, nothing is to be read and nothing is to be implied. One should look fairly at the language used. The High Court has also referred to another decision of this Court in the case of Delhi Municipal Corpn. v. Mohd. Yasin, (1983) 3 SCC 229 : AIR 1983 SC 617, wherein the compulsory nature of exaction by way of tax and fee partaking the character of tax has been reiterated and it has been held that there is no generic difference between though broadly a tax is compulsory exaction as part of a common burden without promise of any special advantages to classes of tax payers whereas a fee is a payment for services rendered or benefit provided or privilege conferred. The High Court has held that since there is no express provision for imposition of fee and the State Government has not delegated any such power to the Development Authority to impose fee for development, the regulations framed for such imposition of fees and the demands made therefor are wholly un-authorised and illegal.”

12. In this decision the Supreme Court was concerned with the levy of development fee by the authority under the Regulations which was challenged as being without the authority of law particularly in the absence of an express provision to that effect in the Act Le., Gujarat Town Planning and Urban Development Act, 1976. The Supreme Court while dealing with such challenge accepted the contentions urged on behalf of the challenger and held that in a fiscal matter it will not be proper to hold that even in the absence of an express provision, a delegated authority can impose tax or fee. Such power of imposition of tax and/or fee by delegated authority must be very specific and there is no scope to imply the authority for imposition of such tax or fee. Delegated authority must act strictly within the parameters of the authority delegated to it under the Act and it will not be proper to bring the theory of implied intent or the concept of incidental and ancillary power in the matter of exercise of fiscal power. It was held that there is no express provision in the Town Planning Act, 1976 and as the State Government has not delegated any power in favour of the Development Authority, imposition of fee for development under the regulation framed by the authority was wholly unauthorised and illegal. Learned Counsel for the petitioners submit that the position is no different in the present case, that under the Act no specific authorisation for levy of fee as stipulated under subrule 3 of rule 8 of the Rules can be found. In the absence of the same the very provision is un-authorised and illegal.

13. Sri B.V Acharya, learned Senior Counsel appearing on behalf of Sri V.R Datar, learned Counsel for the 1st respondent countering the submission made on behalf of the petitioner submits that the fee that is levied under sub-rule 3 of Rule 8 is a fee in the nature of revenue sought to be collected in the context of maintaining the laboratories wherein relevant tests are conducted and the official of which laboratories are required to monitor the pollution levels, manner of disposal of the bio medical waste at the place where they are generated. It is submitted that for such monitoring the place should be identified and the persons handling also should be known that the bio medical waste generated at such places has to be tested for compliance with safety regulations at the laboratories established for such purpose, person handling such bio medical waste by obtaining authorisation from the prescribed authority and at the time of granting of such authorisation. If a fee is prescribed commensurate to the capacity of the person generating the bio medical waste and as the fee is prescribed with reference to the bed capacity in the hospitals in the case of big hospitals and fixed fee, in the places of smaller institutions and the fee sought to be collected being far below the amount of expenditure incurred for such purpose by the laboratories maintained by the prescribed authority; there is every justification for such levy.

14. For sustaining the validity of such levy learned Counsel has drawn the attention of the Court not only to the specific provisions of Clause (f) to sub-section 2 of Section 25 of the Act but also sub-section 1 of Section 25 as also Clause (j) of sub-section 2 of Section 25 of the Act. It is the submission of the learned Counsel that the fee referred to and payable is undpr Clause (f) of sub-section 2 of Section 25 of the Act can be not merely in respect of its report but even in the context of the function of the environmental laboratories and the procedure for submission to such laboratories of samples of air, water, soil etc., and if it is so understood the levy is well justified and sanctioned in law. These statutory provisions reads as under:

“25(1) The Central Government may, by notification in the Official Gazette, make rules of carrying out the purposes of this Act.

*****************

25(2)(f) the functions of the environmental laboratories, the procedure for the submission to such laboratories of samples of air, water, soil and other substances for analysis or test; the form of laboratory report; the fees payable for such report and other matters to enable such laboratories to carry out their functions under sub-section (2) of Section 12.

**************************

25(2)0) any other matter which is required to be, or may be, prescribed.”

15. Learned Counsel submits that by implication it should be understood that the levy of fee can encompass to maintain the functions of the environmental laboratories and related activities particularly as such other activities also mentioned in the very Clause (f) to sub-section 2 of Section 25. Learned Counsel submits that the authorisation for levy cannot be restricted to in respect of the test reports in the laboratories as that will amount to give a restricted interpretation more so having regard to the objects of the Act and the purpose of setting up such laboratories which in fact is maintained by the prescribe authority. In this regard learned Counsel appearing for the 1st respondent has relied upon the decision of the Supreme Court in the case of B.S.E Broker's Forum, Bombay v. Securities and Exchange Board of India . 2001 3 SCC 482. to contend that in this case the levy of registration fee by the securities and Exchange Board of India for the purpose of registration was challenged as illegal void-ab-initio being ultra-vires the Act and Rules. The attack was repelled by pointing that the levy was not only in the context of the provisions of Section 12 of the Act particularly sub-section 2 of Section 12 under which such registration fee was permitted, but also a fee so collected eventually for regulatory purposes in respect of which Board incurred expenses. The Supreme Court while dealing with such contentions pointed out that the scheme of the Act provided and enabled the Board to collect two types of fees, namely the fee under Section 11(2)(k) of the Act for carrying out the purposes of Section 11 and a fee for the purpose of registering the applicants under Section 12(2) of the Act. The quantum of fee to be paid is fixed under Schedule III of the Regulations as provided under the Act. In such circumstances it was held that though the fee was prescribed as a fee for registration fee, if any part of it was referable to the carrying out the purposes under Section 11 of the Act and when there was an express enabling provision under Section 11(2)(k) for such purposes, the question of invalidating levy of registration fee though not entirely referable to the services of granting registration did not arise as the excess portion of registration fee realised even under Section 12(2) of the Act can be attributed to the other aspects namely for carrying out the purposes under Section 11 for which there was an express enabling provision and as such the levy was sustained by the Supreme Court.

16. I have noticed that in the present case the only provision wherein enabling power is conferred on the delegated authority to levy any fee under the Act is under Clause (f) to sub-section 2 of Section 25 of the Act. Even the scope of such levy is in turn controlled and regulated by the provisions of Section 12. A conjoint reading of these two sections make it clear beyond doubt or ambiguity that the authorisation for levy of fee is only in respect of the laboratory test report for the analysis carried out on samples tested at such laboratory and not for any other purposes. When the authorisation is so express and limited that authorisation cannot be extended to any other activity which the 1st respondent may not doubt carry out for the purpose of the Act. The recognized principle in the matter of levy of fee or tax assessed by a delegated authority is not open to expand the scope of delegation by a process of interpretation in the light of the authoritative pronouncement by the Supreme Court on this aspect referred to earlier.

17. The traditional concept of quid pro quo in respect of levy of fee has no doubt undergone a transformation in recent times and Courts have recognised that a fee almost partakes the character of a tax except for the limitation there should be a proper co-relation between the total fee levied and collected to the cost for providing services to the users with close co-relation to levy. A fee person wise or a particular unit-wise co-relation has now given way to justifying the levy even if there is a broad co-relation between services rendered and the expenditure incurred in this regard and that of total collection.

18. Article 265 of the Constitution mandates that no tax should be levied or collected without the authority of law. Such mandate is equally or a fortiori applied to delegated legislation. The letter of the law should be strictly adhered to when such levy is by the delegated authority. It has been well recognised that taxing power can be exercised only by the Legislature. The levy of fee is part of taxing power though on a lesser scale. If the constitutional mandate even for levy of taxes is that it cannot be without the authority of law the scrutiny in respect of justification of fee by the prescribed authority can only be stricter and not to the contrary. There cannot be any levy either by implication or intent. The levy should be specific, permitted and authorised in law. If these principles are applied the provisions of sub-rule 3 of Rule 8 cannot withstand the scrutiny of any of the tests evolved in the context of levy of fee by a delegated authority. There is no express provision in the Act enabling the Central Government to frame Rules providing for levy of fee as is levied as per letter dated 26th July, 1999 issued by the State Government based on the notification dated 20th July, 1998, Annexure C issued by the Central Government. The provisions of sub-rule 3 of Rule 8 are clearly ultra-vires the Act and as such cannot be sustained.

19. In the result, the notification levying a fee as per notification dated 26.7.1999 and the other consequential show causes notices issued to the individual petitioners calling upon them to comply with this requirement as also the proposed action under Section 15 of the Act are also not sustainable and these notices are quashed by issue of Writ of certiorari.

20. The levy itself having been held to be illegal and ultra-vires the provisions of the Act and not being sanctioned in law it is inevitable that such illegal collection has to be refunded to the persons from whom it has been collected. A writ of mandamus is issued to the respondent in this regard directing them to refund the amount of fee that they have collected from some of the petitioners on account of “grant of authorisation” fee collected under sub-rule 3 of Rule 8 of the Rules.

21. Sri Raghavan, learned Counsel for the petitioners has made an application on behalf of the petitioners seeking permission to add additional prayer for quashing Government Order No. FEE 126 ENV 98, Bangalore dated 17.7.1999 under which the fee is notified by the State Government. The prayer is for quashing this notification also. The said Government Order does not stand on its own as the particular provision i.e Rules 8(3) made in the notification dated 27th July, 1998 under which the Government Order is issued for collection of a fee itself has been held ultra-vires and illegal and not enforceable. Consequently the notification details are also quashed. Writ Petitions allowed.