Whether occupier of property is liable to pay property tax if he files Municipal appeal?

 It is not possible to accept this submission. Section 209 as already clarified above, deals with the case of liability for payment of property taxes as far as occupiers are concerned. The bill is raised on the person primarily liable for payment of property tax. If the person primarily liable is not the occupier of the premises, then, the bill may be raised on the occupier and after it is served on him the recovery can be effected in accordance with section 199 to 209 of the MMC Act. While recovering taxes, the arrears cannot be recovered from such occupiers under section 209, if the same have remained due for more than one year. Thus, the recovery in terms of section 209 cannot be effected if the property tax has remained in arrears for more than one year. It is not possible to extend the provision and particularly sub-section 3 of 209 and read it into section 217(5) of the Act. It will be defeating the Legislative Mandate if such a reading of the provision is permitted. The word "payable" is used in sub-section 5 only to point out that after the appeal is filed the payment of property taxes which are due on the basis of the original and the increased rateable can be secured during the pendency of the appeal provided it is claimed from the appellant by issuing bills from time to time, since filing of the appeal. Therefore, to secure further sum till such time as the appeal is decided that sub-section 5 has been introduced in the Statute Book. In other words to enable and facilitate the corporation to effect recovery of property taxes levied and assessed at the original rate and to secure the claim on the basis of the revised or increased rateable value that this provision is made. Taxes are public dues and their recovery should not be hampered in any manner because challenge to the levy and assessment is pending before a court of law, is the intent in inserting sub-section (5) in the Act. That intent will be defeated if it is held that operation of this provision is controlled and restricted by section 209(3) of the MMC Act. That section serves another purpose. Once, the Legislature does not provide for any restriction and enacts the law in absolute terms full effect must be given to the provision or else the object and purpose of its insertion is defeated and frustrated. Once its introduction is understood in proper perspective, then, it is not difficult to reject the submissions of Mr.Joglekar.{Para 22}

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

S.C. DHARMADHIKARI, J.

Dena Bank & Anr. Vs. Municipal Corporation Of Gr. Mumbai & Anr.

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Should the court summarily dismiss Municipal Appeal if the appellant fails to deposit property tax during the pendency of Municipal Appeal?

 As far as section 217 is concerned, it provides for an appeal against the valuation and taxes and the appeal lies to the Chief Judge of Small Causes Court and there is a precondition inasmuch as the appeal cannot be entertained unless the disputed tax which is mentioned in the appeal is deposited with the Commissioner. Sub-section 5 provides for a continuing liability inasmuch as it cannot be that the appellant assessee stops paying taxes which are due and payable in respect of the property, after the appeal under section 217(1). Therefore, after the appeal is filed and, during its pendency, the disputed amount has to be deposited or else the appeal can be summarily dismissed. This is a condition attached to the statutory right of appeal. It is well settled that appeal is a right created by Statute. The Statute can regulate and control exercise of that right. It is also well settled that imposition of condition of deposit of disputed tax for entertaining and hearing of the appeal cannot be held to be onerous, excessive or arbitrary (See Sham Charan Vs. Delhi Municipal Corporation - reported in A.I.R. 1992 S.C. 2279).{Para 17}

18. An amendment in section 217 was made inasmuch as sub-section 5 as was reading prior to the amendment came to be substituted by Maharashtra Act 10 of 1998, which is already reproduced above.

19. Therefore, payment of the amount of tax till the date of institution and filing of the appeal and the taxes which are due and payable during the pendency of the appeal have to be secured or else, the Corporation stands to lose by way of property tax, merely because legal proceedings are pending challenging the valuation and the assessment of the same. That would not be in public interest and that is how sub-section 5 of section 217 came to be inserted.

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

S.C. DHARMADHIKARI, J.

Dena Bank & Anr. Vs. Municipal Corporation Of Gr. Mumbai & Anr.

Writ Petition No.6816 of 2010

21st July, 2011

Citation: 2011(6) ALL MR 508

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Whether a party can challenge Validity and legality of property tax before Magistrate?

(A) Goa, Daman and Diu Municipalities Act (1968), Ss.164, 165, 115 - Scope of appeal - Validity and legality of tax - Could not be challenged before Judicial Magistrate - Scope of appeal is restricted to valuation and assessment alone.

S.115 of the Goa,Daman and Div Municipalities Act, 1968 provides for the objections which can be filed by the party aggrieved in relation to the assessment list. S.115(2) restricts the objections which can be raised by the aggrieved party to the calculation and amendment. It does not provide that levy of tax its validity or legality can be challenged thereunder. The aggrieved party is required to state the grounds on which the valuation or amendment is disputed. S.164 provides for appeals to Magistrates against any claim for taxes or other dues included in a bill presented to any persons u/s. 145 or any other provisions of the Act. The provisions of Ss. 164and 165 clearly restrict the scope of the appeal before the Judicial Magistrate and the scope is restricted to valuation and amendment alone. The filing of written objections, which are restricted to the valuation and assessment u/s. 115(2) is a condition precedent for entertaining an appeal u/s. 165 of the Act. In view of this, it is clear that in an appeal u/s. 164 of the Act, it is not open to the assessee to challenge the legality or validity of the tax itself.

(B) Goa, Daman and Diu Municipalities Act (1968), Ss.116, 115 - Procedure - Filing of objections to assessment list - Objections dealt with not by authorised Valuation officer but by Chief Officer - Held, challenge to procedure regarding levy & tax amounted to challenge to assessment itself and hence matter had to be remanded back to follow proper procedure u/s. 116. 

(C) Goa, Daman and Diu Municipalities Act (1968), S.101 - Recovery of tax - Retrospectivity - Tax cannot be recovered retrospectively and recovery would be in relation to financial year during which assessment list is duly authenticated. 

 

IN THE HIGH COURT OF JUDICATURE AT BOMBAY (PANAJI BENCH)

R.K. BATTA AND S.S. NIJJAR, JJ.

Shri Ketan Ranjit Maaganlal, Vs. Panaji Municipal Council & Ors.

Letters Patent Appeal No.2 of 1998

15th October, 1999

Citation: 2000(1) ALL MR 515

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Whether Municipal Corporation can recover property tax with retrospective effect?

 Section 2(44) of the Act of 1949 defines "official year" thus : "2(44) "official year or year" means the year commencing on the first day of April."

{Para 7}

8. The law laid down by the Full Bench of this Court in Solapur Municipal Corporation and approved by the Apex Court in Municipal Corporation of City of Hubli and further re-iterated in Kalyan Municipal Council is applicable on all fours in the light of the statutory provision contained in Rule 20(1)(e) and definition of the expression "official year" occurring in Section 2(44). Any amendment in the assessment book by inserting or altering an entry in respect of any building erected, re-erected, altered, added to or reconstructed in whole or in part of the assessment book shall be and can only be effective during the currency of official year. The expression "official year" defined under Section 2(44) of the Act of 1949 read with Rule 20(1)(e) indicates without doubt the legal position that the property tax being tax for the official year must be levied only during the official year. In view thereof, it was not open for the Commissioner to amend or alter assessment entry of petitioner's property with retrospective effect. In other words, the demand of property tax raised for the period from 1-4-1985 to 31-3-1990 vide demand notices dated 8-1-1991 cannot be justified and to that extent the notices as well as the demand bills have to be modified.

9. We, accordingly, partly allow the writ petition and partially quash the special notices dated 8-1-1991 (Annexures "D" and "E") and bills dated 12-12-1991 (Annexures "G" and "H") to the extent demand of property tax has been raised with retrospective effect for the period from 20-5-1985 till 31-3-1990. The respondents may, accordingly, issue fresh demand of property taxes as per the aforesaid observations.

Bombay High Court

Satish Dattatray Shivalkar vs Pimpri-Chinchwad Municipal ... on 6 February, 2002

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