JUDGMENT : ( 1. ) THIS petition has been filed by the petitioner against the respondents about levy of tax on immovable property under the Madhya Pradesh Nagaria Sthawar Sampatti Kar Adhiniyam, 1964. ( 2. ) ACCORDING to the petitioner, he owns a house bearing No. 3 in Ward no. 19, Street No. 2, Snehalataganj Indore. It is not in dispute that the said house is in possession of the petitioner and the members of his family. According to the petitioner notice was served on him on 30-1-1971 under the said adhiniyam in Form No. 11 as contemplated under the Rules framed under the said Adhiniyam, alleging that Property Tax to the tune of Rs. 378 is payable on the said property. The petitioner, thereafter, on 19-2-1971 submitted his objections which were heard and disposed of by orders dated 11 6-1971 and the annual letting value of the said house was assessed at Rs. 2430. Against this order the petitioner went up in appeal under section 15 (1) of the said Adhiniyam. Before the appellate authority the main contention raised was that the letting value of the property could not be assessed to any amount more than what could be charged as standard rent under section 7 of the Madhya Pradesh accommodation Control Act, 1961, and on that basis the annual letting value would fall below the limit prescribed by section 6 sub-clause (h) of the Adhiniyam and therefore no tax could be levied on this property. This contention was repelled by the learned appellate authority and therefore the petitioner preferred as second appeal under section 15 (2) of the Adhiniyam. This second appeal was also rejected and the petitioner has now submitted this petition under article 226 of the Constitution. Misc. Petn. No. 40 of 1973 decided on 14-2-1975. (Indore) ( 3. This contention was repelled by the learned appellate authority and therefore the petitioner preferred as second appeal under section 15 (2) of the Adhiniyam. This second appeal was also rejected and the petitioner has now submitted this petition under article 226 of the Constitution. Misc. Petn. No. 40 of 1973 decided on 14-2-1975. (Indore) ( 3. ) IT was contended on behalf of the petitioner: (a) That the authorities under this Adhiniyam were to determine under section 5 (ii) (c) thereof hypothetical rent at which the said house could be let and for this purpose an inquiry about the rent which could reasonably be earned by the said house was to be made as contemplated under Rule 7 of the Rules framed under the Adhiniyam, that this hypothetical rent could not be assessed at anything more than what could be recovered as standard rent under section 7 of the Madhya Pradesh Accommodation Control Act, 1961. (b) That the mandatory provisions of the Madhya Pradesh Accommodation Control Act making it incumbent on the landlord to recover only the standard rent and nothing more could not be kept out of consideration while assessing the annuaj rental value of the property for the purposes of the said adhiniyam. ( 4. ) SECTION 2 sub-clause (a) of the M. P. Nagariya Sthawar Sampatti Kar adhinijam defines "annual letting value". It reads.- "2 (a) "annual letting value" in a relation to any land or building means the annual letting value as determined under section 5. " Section 5, clause (ii) sub-clause (c) reads-"5 (ii) (c) where the land or the building not being a building covered by sub-clause (a), is not let out and is in the actual occupation of the owner or of any other person on his behalf, other than as a tenant, or is lying vacant, the annual rent or twelve times of the monthly rent at which it could have been let out having cegard to the prevailing rents in the neighbourhood and such other factors as may be prescribed. " This definition states that when the property is not let out and is in actual occupation of the owner or of any person on his behalf other than a tenant, the annual rent or twelve times the monthly rent at which it could have been let out having regard to the prevailing rents in the neighbourhood and such other factors that may be prescribed, will be the annual let. ing value of the property for purposes of this Adhiniyam. This sub-clause, therefore, contemplates a hypothetical evaluation of rent which could be lecovered of the property in question and so, for property which is not let out, the authorities under this adhiniyam are expected to assess the annual letting value keeping in view the provisions of this sub-section 5 quoted above. For this purposes under the rules framed under this Adhiniyam Rule 4 has been framed and sub-rule (7) of rule 4 provides- "4 (7) An enquiry shall be made about the gross annual rent earned or which could reasonably be earned in respect of the property during the financial year, immediately preceding the current financial year. " Apparently, under this rule the authorities are expected to conduct an inquiry and find out what could be the reasonable rent that could be earned in respect of the property if it is not actually let out. ( 5. ) THE scheme of the Adhiniyam and the Rules quoted above therefore goes to show that for properties not actually let out the annual letting value shall be determined by the authorities after conducting an inquiry hypothetically as to what reasonably could be the rent which could be recovered by the landlord for the property under assessment and on that basis tax under the Adhiniyam could be levied. ( 6. ) SECTION 7 of the Madhya Pradesh Accommodation Control Act, 1961, provides for "standard rent" and afso how it could be determined in different cases for the properties. Section 5 thereof provides- "5 (1) No tenant shall, notwithstanding any agreement to the contrary, be liable to pay to his landlord for the occupation of any accommodation any amount in excess of the standard rent of the accommodation. (2) Any agreement for the payment of rent in excess of the standard rent shall be construed as if it were an agreement for the payment of the standard rent only. (2) Any agreement for the payment of rent in excess of the standard rent shall be construed as if it were an agreement for the payment of the standard rent only. " Apparently, sub-clause (2) of this section makes it clear that if there is any agreement for payment of rent in excess of the standard rent, still, it shall be construed to be an agreement for payment of standard rent only, and sub-clause (1)of this section provides that in spite of any agreement a tenant shall not be liable to pay to his landlord any amount in excess of standard rent for the accommodation. Section 43 of this Act furtner provides- "43. Penalties.- (1) If any person receives any rent in excess,of the standard rent as specified in clause (1) of section 7 or as fixed by the Rent Controlling Authority under section 10, he shali be punishable with simple imprisonment for a term which may extend to three months, or with fine which may extend to a sum which exceeds the unlawful charge claimed or received in excess of the standard rent by one thousand rupees, or with both. . . . " This provision makes it penal for the landlord to charge any rent which is in excess of the standard rent. ( 7. ) IT is therefore clear that when the authority under the Adhiniyam determines the letting value under section 5 clause (ii) sub-clause (c) and assesses the monthly rent which the property could fetch, the authority has to keep in view the provisions of section 7 of the Accommodation Control Act because as discussed above a landlord cannot recover anything more than the standard rent from a tenant in view of section 5 and 43 of the said Act. Consequently, the hypothetical amount of rent to be calculated for the purpose of assessment of annual letting value under section 5 (ii) (c) of the Adhiniyam cannot exceed the standard rent defined in section 7 of the Act. Sub-rule (7) of rule 4 framed under the Adhiniyam also talks of the rent which could be reasonably earned and in view of the provisions of the Accommodation Control Act the rent which could reasonably be earned can only be the rent which a landlord could lawfully recover. Sub-rule (7) of rule 4 framed under the Adhiniyam also talks of the rent which could be reasonably earned and in view of the provisions of the Accommodation Control Act the rent which could reasonably be earned can only be the rent which a landlord could lawfully recover. Consequently, thev authorities under the Adhiniyam determining the annual letting value for an accommodation which is in possession of the landlord himself or someone on his behalf and to which the provisions contained in section 5 (ii) (c) of the Adhiniyam apply could not assess the annual letting value more than the standard rent under the Accommodation Control Act. ( 8. ) IN The Corporation of Calcutta v. Smt. Padma Debi and others, AIR 1962 SC 151 , their lordships of the Supreme Court, considering the provisions in section 127 (a)of the Calcutta Municipal Act, held that the gross annual rent at which the building might reasonably be expected to let cannot be fixed higher than the standard rent under the Rent Control Act. This decision was followed in corporation of Calcutta v. Life Insurance Corporation of India, AIR 1970 SC 1417 , where their lordships were considering the provisions of the Calcutta Municipal Corporation Act. In Guntur Municipal Council v. Guntur Town Rate Payers Association, AIR 1971 SC 353 , while considering the provisions of section 82 (2) of the Madras District Municipalities Act, their Lordships of the Supreme Court held- "new section 82 (2) of the Municipalities Act, as stated before, makes provision for the fixation of annual value according to the rent at which lands and buildings may reasonably be expected to be let from month to month or from year to year less the specified deduction. The test essentially is what rent the premises can lawfully fetch if let out to a hypothetical tenant. The municipality is thus not free to assess any arbitrary annual vslue and has to look to and is bound by the fair or the standard lent which would be payabb for a particular premises undei the Rent Act in force during the year of assessment. The municipality is thus not free to assess any arbitrary annual vslue and has to look to and is bound by the fair or the standard lent which would be payabb for a particular premises undei the Rent Act in force during the year of assessment. " Similarly, a Division Bench of this Court, while considering the provisions of the Madhya Pradesh Municipal Corporation Act placing reliance on The Corporation of Calcutta v. Smt. Padma Debt and others (supra), held- "in determining the hypothetical rent regard must be had to the provisions of the M. P. Accommodation Control Act, 1961, regarding standard rent. This does not mean that the commissioner of the Corporation or the Assessment Officer can proceed to determine the annual value of the building under section 138 of the Act only after the standard rent in respect of the building is fixed by the Rent Controlling Authority. The Assessment Officer or the Commissioner himself can form an estimate of the standard rent in respect of the building and then see whether the hypothetical rent, which the petitioners may reasonably be expected to get in the open matket for the building for running a hotel therein, exceeds the standard rent or it is below it. " ( 9. ) IT is, therefore, clear that in view of the pronouncements referred to earlier also it cannot be doubted that the authorities under the Adhiniyam, while determining the annual letting value, have to keep in view the standard rent which could be recovered by the landlord and in this view of the matter this petition deserves to succeed. ( 10. ) CONSEQUENTLY, the petition is allowed, the orders passed by the respondents are set aside and it is directed that the respondent No. 1, the Property Tax officer, Indore, shall proceed to determine the annual letting value of the premises in question afresh keeping in view the provisions of the Madhya Pradesh accommodation Control Act, 1961 providing for the standard rent. The petitioner shall also be entitled to costs of this petition. Counsel fee Rs. 100 (one hundred) if certified. The security amount be refunded to the petitioner after verification. Petition allowed.