In my opinion, the Small Causes Court has erred in allowing the appeal. The observation of the learned Judge that there can be no distinction in the rateable value payable in respect of commercial premises and residential premises is without any basis. As rightly submitted by Mr.Ketkar, the provisions of Section 129 of the Bombay Provincial Municipal Corporations Act indicate that there can be a distinction drawn between the rates of taxes paid for commercial and residential premises. The rateable value is to be fixed dependent upon the standard rent. It is obvious that the standard rent payable by a tenant in respect of commercial premises and residential premises would be different. The standard rent for commercial premises would obviously be higher and consequently the rateable value for those premises. The learned Judge has erred in accepting Rs.107 as the standard rent for the shop only because that was the standard rent payable in respect of a residential flat in the same building.
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Bombay High Court
Pune Municipal Corporation ... vs Dnyaneshwar Nivrutti Narhare on 25 March, 2008
Equivalent citations: 2008 (3) MhLj 853:2008(4) ALLMR375
1. The petition challenges the order passed by the Small Causes Court, Pune on 20.10.1993 allowing the appeal filed by the respondent for fixation of rateable value. The respondent, aggrieved by the order dated 30.3.1990 fixing the rateable value for Shop No. 3 on the ground floor of the building at CTS No. 1373, Sadashiv Peth, Pune, had preferred the appeal. The Small Causes Court has allowed the appeal by concluding that there cannot be a distinction between the taxes levied for residential premises and commercial premises. The Court came to the conclusion that since the occupant of shop No. 8 which was used for residential purposes was paying the rateable value @ Re.1/- per sq.ft, the respondent was also liable to pay rateable value at the same rate. The rateable value was thus fixed for the shop at Rs.1370/- w.e.f. 1.1.1990.
2. Mr.Ketkar, appearing for the petitioner, takes exception to the judgment of the trial Court by raising two issues namely that the learned judge has erred in holding that there cannot be any distinction between the rateable value fixed for residential premises and commercial premises. He also relies on Rule 7 of Taxation rules framed under the Bombay Provincial Municipal Corporations Act under which the rateable value is to be fixed in respect of a building or part thereof. According to the learned Counsel, Rule 7 does not put an embargo on the municipal corporation from assessing rateable value at a higher rate in respect of commercial premises.
3. In my opinion, the Small Causes Court has erred in allowing the appeal. The observation of the learned Judge that there can be no distinction in the rateable value payable in respect of commercial premises and residential premises is without any basis. As rightly submitted by Mr.Ketkar, the provisions of Section 129 of the Bombay Provincial Municipal Corporations Act indicate that there can be a distinction drawn between the rates of taxes paid for commercial and residential premises. The rateable value is to be fixed dependent upon the standard rent. It is obvious that the standard rent payable by a tenant in respect of commercial premises and residential premises would be different. The standard rent for commercial premises would obviously be higher and consequently the rateable value for those premises. The learned Judge has erred in accepting Rs.107 as the standard rent for the shop only because that was the standard rent payable in respect of a residential flat in the same building.
4. The impugned decision is therefore, set aside. The appeal is remanded to the Small Causes Court for a decision, afresh. The Small Causes Court will decide the appeal within six months from today. Parties are at liberty to file additional pleadings and lead evidence if they so desire. Rule made absolute accordingly. No order as to costs.
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