Research › Search › Judgment

Rajasthan High Court · body

2001 DIGILAW 547 (RAJ)

Rajendra Beri v. Municipal Council, Ajmer

2001-04-03

R.R.YADAV

body2001
Honble YADAV, J.–The present two writ petitions have been preferred against a composite order dated 30.7.98, passed by District Collector, Ajmer, in Municipal Appeals Nos.51/98 and 52/98, respectively, in exercise of his power, under Section 139 of the Rajasthan Municipalities Act, 1959 (Act No. 38 of 1959), with common prayers to quash the aforesaid order in both the appeals and the notices dated 26.2.98, issued by the Municipal Council, Ajmer, demanding arrears of house tax from 01.1.86 to 1996-97 and refund of Rs.19,956.20 in Writ Petition No.5487/98 and Rs.20,221.25, in Writ Petition No. 5488/98, with interest thereon at the rate of 18 per cent per annum, from the date of deposit, till date of payment. (2). In both these writ petitions, common questions of law and facts are involved, therefore, these two petitions can be disposed of by a composite order, treating Writ Petition No.5488/98 as a leading case. (3). In both these cases, the points for determination gravitate and center round legal issues, which can be adjudicated, without delineating the factual matrix, yet, for better and deeper understanding of the controversy between the parties, a short resume of facts would be necessary. The details of the facts, averred in the writ petitions, counter and rejoinder affidavits, exchanged between the parties, are not relevant, and hence, skipped. (4). It is to be noticed that the Municipal Council, Ajmer, by its notice dated 26.2.98, raised the amount of house tax, for the assessment year 1997-98, to Rs.2,227/- and further made a claim for arrears, from the petitioners, for the period commencing from 01.1.86 to 1996-97. Aggrieved against the aforesaid demand, both the petitioners filed appeals before District Collector, Ajmer, in respect of premises, bearing Municipal No.225A/21, and in respect of premises, bearing Municipal No.225/21, which were registered as Municipal Appeals Nos. 51/98 and 52/98. (5). It is revealed from perusal of the materials available on record that in both the appeals, the case of the petitioners, was that in each year, in between 1st April to 31.03.authentication of the assessment list was continuously made by the Municipal Council, in respect of the premises in question for official years, namely, 1986 to 1997 and tax had already been paid by the petitioners in pursuant to demand notices, yet, now, recovery of arrears of house tax from them, with retrospective effect, is being made, which is per se illegal. It was put forth by the petitioners before District Collector, Ajmer, that before levying increased house tax, proposal must be sent to the owner of the house; his objections should be heard and after investigation, the assessment list of each official year should be altered and authenticated, which would create the increased liability of tax against the tax payer. (6). The averments made in the writ petitions, were denied and it was averred in the return that the Municipal Council, Ajmer, came to learn that apart from the premises, which were under the occupation of Survey of India, as tenant, the petitioner had let out a cabin, of size 10x10 and an open hall, of size 10x12, with effect from 01.4.96. The relevant rents, which were being received by the petitioners, from the Survey of India and from the second tenant, namely, Tower Hexacom India Ltd., had never been intimated by the petitioners, on the rental value of which, tax was leviable. (7). The facts, averred in the return, filed by the Municipal Council, Ajmer, were denied in the rejoinder, filed by the petitioners, and it was highlighted that the petitioners were not under legal obligation, to inform the Municipal Corporation, with regard to increase in rental value of the houses. It is further averred in the rejoinders, filed by both the petitioners that the Municipal Council, Ajmer, was not justified in reopening assessment of the previous official years. The existence of office of Hexacom India Ltd., in the house of the petitioners, as narrated by the respondents, was denied in the rejoinder. (8). A close scrutiny of the order impugned, passed by District Collector, Ajmer, reveals that he has approached the controversy between the parties, on administrative mind-set, ignoring the mandatory provisions, envisaged under Sections 115 to 120 of Act No.38 of 1959; Sections 6 and 8 of the Rajasthan Premises (Control of Rent & Eviction) Act, 1950 (hereinafter referred as ``the Act of 1950) and has also ignored the mandatory provisions of Articles 141 and 144 of the Constitution, which read thus:- ``141. Law declared by Supreme Court to be binding on all courts.- The law declared by the Supreme Court shall be binding on all courts within the territory of India. 142. ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... Law declared by Supreme Court to be binding on all courts.- The law declared by the Supreme Court shall be binding on all courts within the territory of India. 142. ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 143. ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 144. Civil and judicial authorities to act in aid of the Supreme Court - All authorities, civil and judicial, in the territory of India shall act in aid of the Supreme Court. (9). I have heard the learned counsel for the parties. (10). Perused the materials available on record. (11). It is urged by the learned counsel for the petitioners, with emphasis that laibility for payment of increased tax,could not have been levied against the petitioners, in absence of altered authenticated list. It is submitted by the learned counsel for the petitioners that it is settled law that in case, assessment list is not authenticated before the expiry of the official year, the assessment list would be void and inoperative and assessment would not give rise to liability for payment of house tax. In the instant cases, right from 1986, the respondent Municipal Council, Ajmer, was claiming and the petitioners had been depositing the house tax for the aforesaid premises, at the rate, as per the notices of demand. It was for first time that vide notice dated 26.2.98, the respondent Municipal Council, Ajmer, raised the amount for the year 1997-98, and it further raised the claim for arrears from 1.1.86 to 1996-97. It is urged that under Section 119(2) of Act No.38 of 1959, for enhancement of tax, the increased levy should be notified to the tax payer; his objections should have been heard and decided; and the altered assessment list should have been authenticated, giving rise to the liability of the tax payer. (12). It is next contended by the learned counsel for the petitioners that upto 1996-97, tax was being demanded at the old rate, which proves that no opportunity of being heard, was given to the petitioners. The respondent Municipal Council, Ajmer, gave no notices to them. (12). It is next contended by the learned counsel for the petitioners that upto 1996-97, tax was being demanded at the old rate, which proves that no opportunity of being heard, was given to the petitioners. The respondent Municipal Council, Ajmer, gave no notices to them. The petitioners were not heard, and still, the liability of tax was raised, with retrospective effect, and as such, the recovery of tax with retrospective effect, is per se illegal and not sustainable, in eye of law, by any stretch of imagination. District Collector, Ajmer, has not appreciated the provisions of Section 119(2), in correct perspective. In support of his aforesaid contention, the learned counsel, appearing on behalf of the petitioners, placed reliance on a decision, rendered by Supreme Court, in case of Municipal Corporation of City of Hubli Vs. Subha Rao Hanumatharao Prayag & Ors. (1) and a decision, rendered by Apex Court, in case of Kalyan Municipal Council and others vs. Usha Paper Products (P) Ltd. & Anr. (2). (13). In reply to the aforesaid arguments, the learned counsel, appearing on behalf of the respondents, Shri G.K. Garg, supported the order impugned dated 30.7.98, passed by District Collector, Ajmer, in exercise of his power under Section 139 of Act No. 38 of 1959. It is urged by the learned counsel for the respondents that the petitioners were under legal obligation to have given notice to the Municipal Council, Ajmer, within one month from the date of letting out the premises, to Survey of India and Hexacom India Ltd., as envisaged under Section 120 of Act No. 38 of 1959. (14). I have given my thoughtful consideration to the rival contentions, raised at the Bar. (15). A conjoint reading of Sections 115 to 120 of Act No. 38 of 1959, reveals the scheme for levying of house tax. Section 115 of the said Act, provides that ordinarily, it may be that the assessor may feel necessity of issuing requisition to each and every owner or occupier of property, but this is not obligatory in law. The assessment, contemplated under Section 115, is only a provisional assessment as under Section 117, a final assessment is to be made after publication of the assessment list and after giving public notice. Assessor is not required to give notices to all the owners or occupiers before making the preliminary assessment. The assessment, contemplated under Section 115, is only a provisional assessment as under Section 117, a final assessment is to be made after publication of the assessment list and after giving public notice. Assessor is not required to give notices to all the owners or occupiers before making the preliminary assessment. Sub-section (2) of Section 115, further provides that if such owner or occupier fails or refuses to comply with the requisition within the period specified therein, then, without prejudice to any other action that may be taken against him under any other provision of Act No. 38 of 1959, the assessor shall, after making such inquiry, as he considers necessary, determine the annual letting value of such building or land, or both, to the best of his judgment and assess the tax payable thereon. As regards obligation to supply information for purposes of amended assessment list in each official year, Section 120 of the aforesaid Act, provides that when a building is built or enlarged, the owner shall give notice thereof, to the Board, within one month, from the date of completion of such building, re-building or enlargement, or from the date of the occupation of such building, whichever date happens first. Sub-section (2) of Section 120 further provides that if any person fails to give the notice, required by sub-section (1), the Board may impose upon him such penalty, not exceeding fifty rupees or ten times the amount of the tax payable on the said building or enlargement, for period of three months, whichever is greater, as the Board may think fit. (16). From conjoint reading of Section 115 and of Section 120 of Act No. 38 of 1959, it is revealed that on the requisition of assessor or otherwise, the owner or occupier of any building or land, or both, is required to furnish requisite information, and failure to do so is not fatal.-Section 115 of Act No. 38 of 1959 provides for first assessment of house tax, and it has nothing to do with supply of information, for purposes of amendment to assessment list, as envisaged under Sections 117 and 118 of Act No. 38 of 1959. As regards obligation to supply information for purposes of amendment of assessment list, sub-sections (1) and (2) of Section 120 of the said Act, is applicable, which is silent with regard to furnishing information for purposes of amendment, when a premises is let out to someone, by the owner. Reason is not far to seek. All the houses, situated in Municipal limits, are to be governed by the Act of 1950, where, 11 ``standard rent is prescribed, and a landlord is not entitled to charge more than the standard rent, from a tenant. The method of standard rent is defined under Section 6 of the Act of 1950, whereas, Section 8 of the aforesaid Act of 1950 prohibits a landlord, to charge from a tenant, more than the standard rent, and if any agreement is made between the landlord and tenant, for more than the standard rent, then, such contract, relating to payment of such excess rent, as contemplated in the said section, is held to be void ab initio. I have reason to believe that for the aforesaid reason, State Legislature did not think it proper, either under Section 115, or under Section 120 of the aforesaid Act, casting an obligation upon the owner of a house, to furnish information, to the assessor, relating to letting out of the premises, which is subject to assessment, at first instance, or at the stage of amendment of the assessment list, envisaged under Sections 117, 118 and 119 of Act No. 38 of 1959. In the present cases, District Collector, Ajmer, has fallen into an error in arriving at a conclusion that a duty under Act No. 38 of 1959, was cast upon the petitioners, to give information, about letting out the premises in dispute, to the assessor, and if they failed to do so, then, enhanced house tax can be recovered from them, with retrospective effect from 1986, irrespective of the fact that the altered assessment lists from 1.1.1986 to 1996-97 had not been authenticated in these official years, in accordance with law. (17). It is to be noticed that Sec. 119 of Act No, 38 of 1959, provides for levying of increased house tax; the procedure for publication of the assessment list; and its authentication is provided u/Secs. 116, 117 and 118 of the said Act. (17). It is to be noticed that Sec. 119 of Act No, 38 of 1959, provides for levying of increased house tax; the procedure for publication of the assessment list; and its authentication is provided u/Secs. 116, 117 and 118 of the said Act. Sub- section (2) of Sec. 119 provides that the provisions of Sections 116, 117 and 118, shall be applicable every year, if a new assessment list has been completed at the commencement of the official year, and the expression ``official year has been defined in Sec. 3(20) of the said Act, to mean the year, commencing on the first day of April of each year. (18). The core question, for determination in the present two writ petitions, is as to whether the provision of s--bsection (2) of Section 119 of Act No. 38 of 1959, has not been complied with, inasmuch as every year, altered assessment list was not published and authenticated, without which, levying of house tax could not have been made. An identical question came up for consideration in case of Ami Chand and others vs. The State of Rajasthan and others (3). It is held in case of Ami Chand (supra) that authentication of assessment list, in order to be valid and effective, must be made within the official year, although, tax can be collected even after the expiry of the official year. The aforesaid view, taken by a co-ordinate Bench of this Court, in case of Ami Chand (supra), is based in the proposition of law, laid down in case of Municipal Corporation of City of Hubli (supra). (19). The provisions of Sections 81, 82 and 84 of the Bombay Municipal Boroughs Act, 1925 are pari materia to Sections 117, 118 and 119 of Act No. 38 of 1959. I, respectfully, concur with the view taken by the learned Single Judge, in case of Ami Chand (supra). On the aforesaid premises, I have no hesitation to hold that the Municipal Council, Ajmer, in the present cases, is not entitled to recover increased house tax, from the petitioners, for official years 1986 to 1997, inasmuch as in these years, between 01st April to 31.03.authentication of the amended assessment lists were not made by it at the enhanced rate, in accordance with law. Since for official years 1986 to 1997, the Municipal Council, Ajmer, failed to establish authentication of the altered assessment list at enhanced rate, before the expiry of each official year, therefore, it is not entitled to recover enhanced house tax from the petitioners. From the phraseology, used under Sections 115, 116, 117, 118 and 119 of Act No.38 of 1959, it is not possible to hold that State Legislature did not intend that there should be time-limit in regard to the levy of tax for each official year. (20). I am of the view that enhanced house tax under Sections 116, 117, 118 and 119 of Act No. 38 of 1959, is not leviable at any time, after the close of the official year. To my mind, from the discussion made hereinabove, there are sufficient indications in the provisions of Act No. 38 of 1959, to show that authentication of assessment list in order to be valid and effective, must be made within each official year, though, tax, so levied, may be recovered and collected even after the expiry of the official year. My aforesaid view is buttressed from the decisions, rendered by Supreme Court, in cases of Municipal Corporation of City of Hubli (supra) and Kalyan Municipal Council and Others (supra). (21). Before concluding the discussion on the subject, I would like to observe that District Collector, Ajmer, has fallen into an error, on empty formality that the decision, rendered by Supreme Court, in case of Municipal Corporation of City of Hubli (supra), and the decision rendered by a co-ordinate Bench of this Court, in case of Ami Chand (supra), are not applicable to the facts and circumstances of the present cases. I am of the view that whenever and wherever a decision of Supreme Court, is cited before a court of law, or tribunal, within the territory of India, decisions, rendered by Supreme Court, has binding effect, as a precedent under Article 141 of the Constitution, unless distinguished after relevant consideration, keeping in view the ratio of decision. It is to be noticed that every civil or judicial authority, within the territory of India, has no other option, except to act in conformity with the pronouncement of the Supreme Court decision, as envisaged under Article 144 of the Constitution. (22). It is to be noticed that every civil or judicial authority, within the territory of India, has no other option, except to act in conformity with the pronouncement of the Supreme Court decision, as envisaged under Article 144 of the Constitution. (22). It is well to remember that it is the Supreme Court and High Courts, which are to declare, what is the law of the land and every civil or judicial authority is bound to act according to the pronouncements made by Supreme Court or High Courts. An administrative authority, while exercising judicial or quasi- judicial power, as in the present cases, has no option, except to follow the pronouncements made by Supreme Court or High Courts and the attempt, made in the present cases, to make a departure from the proposition of law laid down by Supreme Court and Rajasthan High Court, cited before District Collector, Ajmer, on empty formality, is to be viewed seriously. In a democratic polity like ours, supremacy of rule of law, is to be followed sincerely and faithfully, with mutual respect, by all civil and judicial authorities, making the governance of welfare State, monolithic. (23). I am of the view that by necessary implication, the provisions of Article 141 and 144 of the Constitution, are extendable to the law, declared by every High Court, throughout the territories, to which, it exercises jurisdiction. All authorities, civil and judicial, in the territory of State, in relation to which every High Court exercises its jurisdiction, has no option, except to act in accordance with the law, declared by every High Court, to maintain the supremacy of rule of law. (24). It is well to remember that in a welfare State like ours, taxes can be levied and can be recovered from people of State, strictly, in accordance with the statutory provisions, not otherwise, due to negligence or due to over-zealousness of tax collecting authorities, in utter disregard of statutory provisions. In a welfare State, tax collecting authorities cannot be allowed to collect taxes from rate payers, which is not due upon them in accordance with law. The State Government is to keep strict control over its employees, causing loss to revenue collection, through negligence and collecting more than the just dues, due to over-zealousness, against the statutory provisions, leading to public dissatisfaction. The State Government is to keep strict control over its employees, causing loss to revenue collection, through negligence and collecting more than the just dues, due to over-zealousness, against the statutory provisions, leading to public dissatisfaction. The facts and circumstances of the present two cases, are glaring illustrations, wherein, the tax collecting authority is arrogating upon itself, by issuing demand notices for recovery of enhanced house taxes, with retrospective effect, from the petitioners, in utter disregard of the mandatory provisions, envisaged under Sections 116, 117, 118 and 119 of Act No. 38 of 1959 and also against the law, propounded in two decisions, by Supreme Court, in cases of Municipal Corporation of City of Hubli (supra) and Kalyan Municipal Council and others (supra); and one decision of a co-ordinate Bench of this Court, in case of Ami Chand (supra). (25). From the discussion made hereinabove, I am of the view that the order impugned, dated 30.7.98, passed by the District Collector, Ajmer, deserves to be quashed and both these petitions are liable to be allowed, with costs. (26). Upshot of the aforesaid discussion, is that the instant writ petitions are allowed, with costs, assessed to Rs.2300/- each, and the order impugned dated 30.7.98, is hereby quashed, with a direction to the respondent No.1, to refund Rs.20,221.25, with interest thereon at the rate of 9 per cent per annum, from the date of deposit till the date of payment, to the petitioner, in Writ Petition No. 5488/98; and Rs.19,956.20, with interest thereon, at the same rate, from the date of deposit, till the date of payment, to the petitioner, in Writ Petition No. 5487/98.