Hafiz Wazid Ali v. Municipal Board — 1960 DIGILAW 28 (ALL)

JUDGMENT D.S. Mathur, J. - This is a petition under Art. 226 of the Constitution of India by Hafiz Wajid Ali for the issue of a writ of mandamus to restrain the Municipal Board, Sitapur, Respondent No. 1, from imposing and realising water tax from the Petitioner from 1-10-1956. The imposition of water tax is challenged on two grounds: firstly, it is in contravention of the provisions of Clause (a) of Section 129 of the UP Municipalities Act, 1916, as there is no stand pipe or other water work within the prescribed distance of 600 ft. and secondly, no assessment list was published u/s 142 of the Act, and no opportunity was furnished to the Petitioner to prove that his house was not liable to water tax. 2. In para. 8 of the counter affidavit it was mentioned that a list of Assessees liable to pay water tax was duly prepared and when the bills of demand were issued a number of them including the Petitioner filed objections which were considered by a sub-committee and its report is now under consideration of the Board. But it was not mentioned that the assessment list had been published for making objections, as required u/s 142 and 143 of the Act. It was, however, urged before me that compliance of Ss. 141 to 144 was not necessary when water tax on the annual value of building or land or both was being imposed and that these provisions are applicable only to a tax on such building or land, that is, to house tax. Reliance has been placed upon the phraseology of the word 'tax' as used in Cl. (i) and (x) of Sub-section (l)of Section 128 of the Act. 3. Cl. (i) of the above Sub-section relates to a tax on the annual value of building or land or of both, while Cl. (x) to water tax on the annual value of building or land or of both. Taxes imposed under both the clauses are assessed on the annual value of building or land or of both: the first is invariably called house tax and the other water-tax. It has been urged on behalf of the Municipal Board that where the Legislature used the word 'tax' it should be presumed that the provision relates to 'house-tax' and not to 'water tax'. It has been urged on behalf of the Municipal Board that where the Legislature used the word 'tax' it should be presumed that the provision relates to 'house-tax' and not to 'water tax'. This contention could be accepted if a separate procedure had been laid down for the imposition and assessment of water tax, or under the rule making powers such a procedure was laid down by the State Government. The Court may also have taken a lenient view if for the imposition of water tax it was not necessary to make any further investigation, and, water tax was proportionate to house tax assessed on the building. It will be found that in most of the provisions the word 'tax' has been used in a general sense. It is, therefore, highly probable that the word 'tax' used in Ss. 141 to 144 also covers water tax. 4. For the finalisation of an assessment list with regard to house tax a procedure has been laid down in Ss. 141 to 144. First of all an assessment list is prepared u/s 141 which is published for making objections u/s 142 and hearing thereof u/s 143, The Municipal Board has, at the same time, to give public notice of a date not less than one month thereafter when it will proceed to consider the valuation and assessment entered therein. Any person interested can make an objection within this period, and the objections are heard by the Board or by a committee empowered by delegation in this behalf, or by an officer of the Government or the Board to whom such powers have been duly delegated. After the objections have been decided, the list is suitably amended and becomes the authenticated assessment list. An entry contained in the assessment list is final, though, of course, subject to the result of an appeal preferred, if any, and any amendment or alterations made u/s 147. These sections thus lay down the procedure for the finalisation of the assessment list after the Assessees are given an opportunity to make an objection on the valuation and assessment. 5. If these sections are held not to be applicable to the assessment of water-tax, there would be no provision in the UP Municipalities Act, 1916, for the imposition or assessment of water tax. 5. If these sections are held not to be applicable to the assessment of water-tax, there would be no provision in the UP Municipalities Act, 1916, for the imposition or assessment of water tax. No rules have yet been framed for the preparation and finalisation of the assessment list with regard to water tax. It is difficult to accept that the legislature would have laid down rules for the finalisation of assessment list with regard to house tax only but not with regard to water tax. 6. Water tax is not necessarily proportionate to house tax imposed on building or land or both. Buildings may be exempt from house tax but not from water tax. For example, in many Municipalities building or land owned by the State Government is exempt from house tax but not from water tax. As no house tax is imposed on State owned buildings, no assessment list shall be prepared with regard to such buildings, and there would be no material before the Board for assessing water tax on such buildings. If the State Government is not given an opportunity to make an objection to the valuation and assessment of water tax being made on the building great injustice can be done to the Assessee, as it will be open for the Board to assess the valuation for purposes of water tax at any figure it may desire. The Board may fix the valuation at a high figure or a low figure depending upon the aptitude it adopts towards the State Government. 7. The rate of water tax imposed within the Municipal limits of Sitapur is detailed in notification No. 1293/23-9(l)(5)/56-57 dated July 27, 1957. Under this notification water tax on the annual value of buildings and land was levied at the rate of 10 per cent per annum with a rebate of -/1/- per rupee on the amount of the bill, if paid within the prescribed period. But certain buildings and land were exempted from payment of water tax. All buildings and land of which annual valuation is Rs. 36/ - or below are exempt from water tax. Similarly, buildings or part of buildings devoted exclusively for public worship are so exempt unless water connection is taken in which case water charges have to be paid on the actual consumption of water. All buildings and land of which annual valuation is Rs. 36/ - or below are exempt from water tax. Similarly, buildings or part of buildings devoted exclusively for public worship are so exempt unless water connection is taken in which case water charges have to be paid on the actual consumption of water. Portions of Dharamshala for the occupation of which rent is charged, may be, for the up-keep of Dharmshala, are not so exempt. Another restriction placed on the imposition of water tax is contained in Clause (a) of Section 129, namely, that there should be a stand pipe or other water works within the prescribed distance of the building being assessed to water tax. Consequently, if the Assessees are not given an opportunity to make an objection, the Board may impose water tax when it is not so possible under the rules. The Board may impose water tax even though there is no stand pipe or water works within 600 ft. of the building so assessed. When the Assessee has an opportunity to make an objection he can show to the satisfaction of the authority concerned that his building was exempt from payment of water tax. Similarly, the Assessee may be able to prove that the building was being devoted exclusively for public purpose as contemplated by Clause (b) of para. 2 of the afore-mentioned notification. He can also prove that no rent was charged for stay in the Dharamshala. 8. To sum up, if Sections 141 to 144 are held to apply to only the assessment of house tax and not water tax, great injustice will be done to Assessees. Further, when the legislature has provided a procedure for other taxes it can be presumed that it had also laid down a procedure for water tax. When Sections 141 to 144 are considered in this light, it shall have to be held that the word 'tax' used in these Sections must be given a wider meaning, to include water tax also which could be imposed under Clause (x) of S. 128(1) of the Act. To put it differently, before the recovery of water tax, an assessment list should be prepared u/s 14, which should be published for objection under Sections 142 and 143 and, after the objections have been heard, should be finalised u/s 144 of the Act. To put it differently, before the recovery of water tax, an assessment list should be prepared u/s 14, which should be published for objection under Sections 142 and 143 and, after the objections have been heard, should be finalised u/s 144 of the Act. In the present case, no(sic) compliance of these Sections had been made. When the assessment list has not been finalised, nor was it published for objection, water tax cannot be recovered from Assessees on its basis. The Petitioner had been served with a notice of demand before the water tax had been properly assessed, and such tax could not be recovered from him ill action in accordance with the law had been taken. 9. The petition is hereby allowed and Respondent No. 1, namely, the Municipal Board, Sitapur, is retrained from recovering water tax from the Petitioner till the assessment in accordance with the law has been made.