City of Tshwane Metropolitan Municipality v Cable City (Pty) Ltd

The City of Tshwane Metropolitan Municipality sought to recover alleged arrear regional services levies and regional establishment levies from Cable City (Pty) Ltd for the period May 1999 to March 2005. Cable City had failed to submit the required levy returns. Relying on paragraph 11(1) of Government Notice R340 issued under the Regional Services Councils Act 109 of 1985, the municipality estimated the levies allegedly payable and issued an assessment without instruction from the Commissioner for Inland Revenue (SARS). Cable City resisted the claim, contending that paragraph 11(1), which empowered councils to estimate levies, was ultra vires the Act and therefore invalid. The High Court upheld this defence and dismissed the municipality’s claim, prompting the appeal to the Supreme Court of Appeal.

The appeal was dismissed with costs, including the costs of two counsel.

The case affirms important principles of administrative and constitutional law in South Africa, particularly the doctrine of legality and the limits of delegated legislative power. It confirms that subordinate legislation must remain within the bounds of its enabling statute and that unlawful administrative acts cannot be enforced. The judgment also clarifies the availability of collateral challenges to administrative action and reinforces the separation of functions between municipalities and SARS in the assessment of levies.