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2024 DIGILAW 425 (CAL)

MPMC Pvt. Ltd. v. Canara Bank

2024-02-27

APURBA SINHA RAY

body2024
JUDGMENT : Apurba Sinha Ray, J. 1. By filing the instant application being GA 3 of 2023 the decree-holder has prayed for direction upon the judgment debtor to make payment of a sum of Rs.1,06,01,516/- towards reimbursement of the municipal taxes and surcharges for the period from September 2006 to August, 2011 after adjusting a sum of Rs.19,81,723/- in accordance with the prayers in the tabular statement. The learned counsel for the petitioner/decree-holder has submitted that initially the plaintiff/decree-holder filed a suit against the judgment debtor – bank praying for a decree of eviction along with other reliefs and the said suit was decreed on or about 31.07.2008 and on an appeal filed by the bank, the parties thereat amicably settled their disputes and a consent decree was passed on certain terms and conditions on 04.08.2010. 2. According to the learned counsel of the decree-holder, pursuant to such consent decree the judgment-debtor – bank had vacated certain portion of the suit premises in favour of the decree-holder and started occupying the rest of the suit premises. The judgment-debtor was under a duty to reimburse the shares of municipal taxes and surcharges and also the service tax. However, the decree-holder has further claimed that the shares of municipal taxes and surcharges which the decree-holder is entitled to receive from the judgment debtor-bank, have been paid to the account of KMC in utter violation of the consent decree. According to the learned counsel, the amount of municipal taxes and surcharges etc. are its entitlement and the bank cannot pay the said amount in favour of the KMC. It is also argued that judgment debtor has agreed to pay the municipal taxes and surcharges but that does not mean that the judgment debtor will pay the petitioner’s entitlement to the KMC. It is the decision of the bank and it has done so at its own peril and such action of the judgment debtor cannot affect the petitioner’s rights. It is further pointed out that the bank had paid the enhanced valuation assessed by the KMC which was under challenge from the side of the decree-holder and such action on the part of the bank is beyond the scope of the consent decree. It is further pointed out that the bank had paid the enhanced valuation assessed by the KMC which was under challenge from the side of the decree-holder and such action on the part of the bank is beyond the scope of the consent decree. It was not correct to say that by paying the amount of taxes and surcharges the judgment debtor was absolved from its duty to reimburse the amount which decree-holder paid to the accounts of KMC. The decree-holder is claiming its entitlement only as it is entitled to Rs.1,26,00,000/- on account of municipal taxes and surcharges and after adjusting the payment of Rs.19,81,723/- the due amount has come to Rs.1,06,01,516/- which is to be paid by the judgment debtor – bank in favour of the decree-holder. 3. The learned counsel appearing on behalf of the judgment debtor-bank has vehemently objected to the submissions of the learned counsel of the decree-holder. According to the learned counsel of the bank the service tax issues have already been resolved as the bank has already paid Rs.32,00,000/- approximately on account of the service tax and there was no allegation till date that service tax was not paid from the side of the bank. As the decree-holder could not provide any receipt showing that they have paid the amount of municipal taxes and surcharges, it was very much difficult for the bank to know the exact amount of municipal taxes and surcharges which are required to be paid from the side of the bank. Moreover, the consent decree does not specify to whom such amount of municipal taxes, surcharges are to be paid and further the consent decree has disclosed only the percentage of municipal taxes and surcharges to be paid by the judgment-debtor bank. The decree-holder itself quantified the amount of municipal taxes and surcharges and it appears that the decree-holder claimed more than 2/3rd shares of municipal taxes and surcharges which they were not actually entitled as per consent decree. As the KMC was directed by the Hon’ble Court to prepare a report for the amount of municipal taxes and surcharges including service taxes and after submission of such report before the court, the judgment debtor found that the relevant amount is its statutory dues and the bank paid the relevant amount in its wisdom to protect its rights and interest. There is no condition of reimbursement mentioned in the consent decree nor there was any condition including to whom such municipal taxes and surcharges are to be paid. As the amount was not crystallized even after the calculation of the decree-holder the judgment-debtor has paid the amount to get rid of legal complications. 4. The learned counsel for the decree-holder has relied upon the judicial decision reported at (2021) 6 SCC 418 (Rahul S. Shah Vs. Jitendra Kumar Gandhi & Ors.) (relevant paragraphs 23 onwards). Court’s View:- 5. The bank authority has taken several pleas to resist this execution process by contending that the decree was silent about the condition of reimbursement and also the person to whom such municipal taxes and surcharges are to be paid. But such plea cannot be accepted since the order dated 20th September, 2016, order dated 8th January, 2022 of the Hon’ble Division Bench have made it clear that there is no ambiguity in terms of settlement, and the proposed payment of municipal taxes and surcharges on behalf of the judgment-debtor bank is in the nature of reimbursement of the payment already made by the decree-holder on behalf of the bank. Such observations of the Hon’ble Division Bench have reached finality and therefore the position, thus, is that the decree-holder can claim the relevant amount from the concerned bank on showing that payment of municipal taxes and surcharges have been made by the decree-holder on behalf of the judgment-debtor bank in respect of the property for the relevant period that is from September, 2006 to August, 2011. 6. Now if we look into the other side of this case we shall find that there is no material on record to show how much amount have been paid by the decree-holder to the corporation on behalf of the judgment-debtor bank. The quantification made by the decree-holder was contested by the judgment-debtor by contending that instead of 50% share of municipal taxes and surcharges, the decree-holder was claiming 2/3rd of the shares of the municipal taxes and surcharges which the decree-holder could not claim. The record shows that special referee was appointed to get the relevant quantification but ultimately the same was not accepted and by order dated 8th January, 2020 the Hon’ble Division Bench asked the KMC to make an assessment of the respective shares of the parties regarding municipal taxes and surcharges. The record shows that special referee was appointed to get the relevant quantification but ultimately the same was not accepted and by order dated 8th January, 2020 the Hon’ble Division Bench asked the KMC to make an assessment of the respective shares of the parties regarding municipal taxes and surcharges. The KMC filed a report as per order dated 8th January, 2020 before the Hon’ble Division Bench but the decree-holder alleged that in the garb of assessment they have made revised valuation of the property which the KMC was not entitled to as per order dated 8th January, 2020. However, the Hon’ble Division Bench by order dated 30th September, 2021 disposed of the appeal with certain directions which may be quoted herein below:- “We admit the appeal dispensing with all other formalities and dispose of the same with the direction that the respondent will be at liberty to take out a fresh application before the executing court to execute the decree dated 31st July, 2008 which was subsequently modified by the decree passed by the division bench on 4th August, 2010 in accordance with the terms of settlement executed by and between the parties on 3rd August, 2010. While considering the execution application, the executing court will take into account the order of the division bench dated 8th January, 2020 together with the said reports of the Kolkata Municipal Corporation and any exception to them that may be taken. All points are kept open before the executing court. The appeal and the connected application are disposed of.” 7. Challenging such report of KMC, one separate writ petition was filed by the decree-holder and by order dated 30th June, 2022 the learned Single Judge has kept all the issues open and further given liberty to the bank to pay the property tax and surcharges which has been raised by the KMC and the corporation is directed to accept the same without prejudice to the rights and contention of either of the parties. It is also observed therein that if the revised annual valuation of the property taxes is ultimately set aside by the court, then the amount that is lying with the KMC shall be adjusted with the future bills to be raised by the corporation in respect of the said property. It is also observed therein that if the revised annual valuation of the property taxes is ultimately set aside by the court, then the amount that is lying with the KMC shall be adjusted with the future bills to be raised by the corporation in respect of the said property. It is also observed in the aforesaid order dated 30th June, 2022 that the claim of the petitioner landlord as regards reimbursement of the amount from the lessee bank on account of the property tax dues already paid by the petitioners landlord on behalf of the lessee bank to the KMC for the disputed period shall also be taken up for consideration on the next date. The issue of maintainability of the said writ petition is kept open to be decided at the time of final hearing of the writ petition. 8. Keeping aside such observation, I would like to say that the allegation that bank was unable to pay the municipal taxes etc. for non-quantification comes to an end as soon as the KMC as per direction of the Hon’ble Court vide order dated 8th January, 2020 submitted its report quantifying the amount of taxes etc. Therefore, the quantification or the amount of municipal taxes and surcharges has been crystallized at the instance of the KMC. Now the bank cannot take the plea that it is in the state of confusion as the quantification or the amount has not been crystallized. However, it appears that the bank has deposited its alleged share of municipal taxes and surcharges with the KMC without obtaining leave of the executing court or the Hon’ble Division Bench who asked the KMC to file the quantification or assessment as the case may be. The decree-holder has challenged the quantification in a separate writ proceedings on the ground that KMC in the garb of preparing assessment of the municipal taxes and surcharges in respect of the properties, has actually revised the annual valuation of the property which they cannot do so. In that proceeding the bank has persuaded the Hon’ble Court on the point whether they can pay the amount as indicated in the report of the KMC and the concerned court gave some liberty to the bank to pay such amount subject to certain conditions. In that proceeding the bank has persuaded the Hon’ble Court on the point whether they can pay the amount as indicated in the report of the KMC and the concerned court gave some liberty to the bank to pay such amount subject to certain conditions. The steps taken by the bank has further complicated the execution process when it pays the amount to the accounts of KMC in connection with a proceeding which is totally unconnected with the instant execution process. Especially, when the Division Bench by its order dated 30th September, 2021 has directed this execution court to proceed with the execution proceeding after considering the order of the Division Bench dated 8th January, 2020 along with report of the KMC and any exception to them, the steps taken by the bank is absolutely unnecessary and an attempt to divert the execution process. Therefore I find merits in the submission of the learned counsel of the decree-holder. However, for the purpose of asking the judgment-debtor bank to pay the exact amount of money for reimbursement to the petitioner/decree-holder, the decree-holder is directed to submit the particulars of the relevant amount which the decree-holder actually paid to the KMC in connection with the municipal taxes and surcharges on behalf of the judgment-debtor by the date fixed positively. 9. However, it would be apposite to quote the relevant observation of the Hon’ble Division Bench in the order dated 8th January, 2020 as hereunder:- (The respondent be treated as the ‘decree-holder’) “It is evident from the records that the amount claimed to be due in the tabular statement filed by the respondent herein was not supported by requisite calculations in the affidavit accompanying the tabular statement. A supplementary affidavit came to be filed by the respondent in January, 2017 which indicated a different basis. A further supplementary affidavit was filed by the respondent in March, 2017 and such further supplementary affidavit gave another figure as the amount due and owing from the appellant herein to the respondent on account of municipal taxes and surcharge.” 10. From the above and other materials on record, it is pertinent to know how much amount the decree-holder actually paid on account of municipal taxes and surcharges on behalf of the judgment-debtor for the relevant period and this would certainly assist the court to take the instant proceeding to a logical end. 11. From the above and other materials on record, it is pertinent to know how much amount the decree-holder actually paid on account of municipal taxes and surcharges on behalf of the judgment-debtor for the relevant period and this would certainly assist the court to take the instant proceeding to a logical end. 11. List the matter after two weeks i.e. on 12.03.2024. 12. Urgent certified website copies of this judgment, if applied for, be supplied to the parties subject to compliance with all the requisite formalities.