Shri Shyam Kishore vs Municipal Corporation Of Delhi … on 1 January, 1991

ORDER

P. N. NAG, J.

1. These writ petitions raise important and interesting questions of law, which can be formulated as follows:

1. Whether the- deposit -of tax amount under Section 170(b) of the Delhi Municipal Corporation Act, 1957 (hereinafter referred to as ‘the Act) is a condition precedent for nearing or determination of the appeal but also for filing of memorandum of appeal?

2. Whether the District Judge has a discretion to grant stay of the disputed amount or dispense with the condition of pre-deposit of the amount in appeal, with or without conditions, in the office of Corporation? Further, what is the amount in deposit in appeal?

3. In case it is held that the deposit of tax amount under Section 170(b) of the Act is a condition precedent for hearing or determination of the appeal and the District Judge has no discretion to grant stay of the deposit of tax amount and dispense with the condition of pre-deposit of amount with or without conditions, whether such provision is 20,42 ultra vires?

2. In Civil Writ Petition No. 148/89 the matter was referred by the Division Bench of this Court on 17th January, 1989 to the Full Bench for the reason that certain other writ petitions on such questions have been admitted, although the judgment of the Division Bench comprising of V. S. Deshpande and Yogeshwar Dayal, JJ. in Civil Writ Petition No. 963/ 75 – Panchsheela House Building Cooperative Society v. Municipal Corporation of Delhi (hereinafter referred to as ‘the Panchsheela case) already covers some issues involved. Therefore, Panchsheela case requires re-consideration.

3. In Panchsheela case the Division bench of this Court has taken a view that an appeal is filed to be heard. On constructions of Sections 169 to 171 of the Act, the deposit of the amount is a condition precedent to the hearing of the appeal and an appeal cannot be entertained or filed unless the condition is complied with. The appellant cannot insist on the appellate court receiving the memo of appeal but disabling itself from hearing the appeal by the mere refusal of the appellant to deposit the amount.

4. Similar question arose in Civil Writ Petition No. 2799/ 87 R. K. Goyal v. MCD which was dismissed by a Division Bench of this Court comprising of N. N. Goswamy and Arun B. Saharya, JJ. on 25-9-1987 by relying Upon Panchsheela case In S K Verma v. Municipal Corporation, Delhi reported in 1988 RLR 487 D.P. Wadhwa. J. also expressed the same view by following Panchsheela case and dismissed the matter. However Wad, J. in Punj Sons (p) Ltd. v. Municipal Corporation reported in 1982 RLR 247 has taken a conflicting view. He has held that an appeal under Section 169 could not be heard or determined unless the amount, as directed by the district judge, was deposited by the appellant. However, the district judge had a discretion to direct deposit of an admitted amount or disputed amount or a part of the total tax amount, with or without conditions. According to him the literal interpretation of Section 170(b) of the Act could perhaps lead to the result not intended by the scheme of taxation under the Act. In such a situation Section 457 read with Order 41 Rule 5 of the Code of Civil Procedure can be pressed in service to resolve the conflicting interest of the assesseds and the Corporation. The District Court can in exercise of the discretion of Appellate Authority direct the appropriate sum to be deposited by the assessed before the appeal is heard. In a given case it may be proper to direct the deposit of an admitted amount. In another case, the interest of justice would be served by directing deposit of the disputed amount. The exercise of the discretion is necessary both in the. interest of the assessed and the Corporation and to make Section 170 workable.

5. It appears the Panchsheela case was not brought to the notice of learned single Judge. Although the questions formulated are involved in both the writ petitions, CWs. 148/89 and 179/89, however, for the purpose of this judgment, I am referring to the facts of CW 179/ 89 in brief that the petitioner is the owner of the property in dispute, viz., B-13, Lawrence Road Industrial Area, Delhi. This plot was allotted to him under a policy of shifting of industries from conjusted business areas in old Delhi. Though the construction was started by him in 197 1, it had to be given up in 1972 or so on account of paucity of funds and material. After re-validation of the plans in 1979 by the D. D.A., the construction was re-commenced and completed some time in 1983. ‘The Deputy Assessor & Collector vide his order dated 23rd December, 1986 assessed the rateable value of the property as Rs. 2,28,650/ -with effect from 27-6-1983, the date when the party applied for completion certificate. According to the petitioner, the rateable value with effect from 1st March, 1984 should be only Rs. 94,920/- as opposed to Rs. 2,28,650/- with effect from 27-6-1983. The petitioner being aggrieved against this order of assessment of rateable value of the Deputy Assessor & Collector filed an appeal before the District Judge under Section 169 of the Act which was dismissed by him vide order dated 13-10-1988 on the preliminary point that the petitioner has not deposited the amount as required under Section 170(b) of the Act which is a condition precedent for the purpose of maintainability of the appeal. The judgment of Panchsheela case was also relied upon. Being aggrieved against this order of the District Judge dated 13-10-1988, the petitioner has filed the present writ petition on various grounds, inter alia, that the rateable value has not been fixed by the Deputy Assessor & Collector in accordance with law. Apart from that the impugned judgment is illegal as the District Judge should not have thrown out the case merely because of nondeposit of the amount under Section 170(b) of the Act as under Order 41 Rule 5 of the Code of Civil Procedure, which has been made applicable under Section 457 of the Act, the District Judge has discretion to grant stay of the deposit of the disputed amount or dispense with the requirement of pre-deposit with or without conditions in appeal. Furthermore if it is held that pre-deposit of the amount under Section 170(b) is mandatory for the maintainability of the appeal, in such a situation Section 170(b) is unconstitutional, ultra vires, Illegal and deserves to be struck down. Even otherwise the appeal before the District Judge should have been considered against the rateable value assessed by the Deputy Assessor & Collector for one year only, i.e. 1983 and for subsequent years the decision of the District Judge would have been automatically applicable as the rateable value as fixed in 1983 would govern the field for the subsequent years as well. The petitioner had already deposited Rs. 1 lakh in two Installments of Rs. 50,000/- each, almost double the amount what is required to be deposited for one year as according to the petitioner, the amount of tax would be Rs. 54,877 / – per year only and herefore, even the requirement of pre-deposit under Section 170(b) also stands complied with. Consequently the petitioner has prayed for a writ of certiorari quashing the judgment dated 13th October, 1988 of the District Judge and to issue a writ of mandamus declaring Section 170(b) of the Act as unconstitutional and for hearing the appeal under Section 169 of the Act on merits.

6. Mr. Rohatgi, learned counsel for the petitioners, submitted that for the purpose of filing an appeal under Section 169 of the Act against the levy or assessment of any tax before the court of the district judge of Delhi, it is not necessary that the amount in dispute in the appeal should be deposited by the appellant in the office of the Corporation under Section 170(b) of the Delhi Municipal Corporation Act as the condition of predeposit of the amount is only for the purpose of hering or determination of the appeal and not for the purpose of filing such an appeal. The judgment in Panchsheela case does not lay down the correct law wherein this court has held that the deposit of amount is condition precedent to the hearing of the appeal and an appeal cannot be entertained or filed unless the condition is complied with. On the other hand, the judgment in Punj Sons case (supra) correctly decides the issue where it has been held that unless the amount is deposited, no appeal shall be heard or determined. Normally, no appeal shall be determined unless it is heard. This would suggest that the appeal can be filed by the assessed without deposit of any amount. The District Judge at the time of hearing shall have the discretion to direct the deposit of an admitted amount or disputed amount or a part of the total tax amount, with or without conditions. In view of Section 457 of the Act, Order 41 Rule 5 of the Code of Civil Procedure can be pressed in service to resolve the conflicting interest of the assessed and the Corporation. In order to appreciate this contention the relevant portion of Rule 170(b) is reproduced below:

“170. Conditions of right to appeal.

No Appeal shall be heard or determined under Section 169 unless

(a) ……………

(b) the amount, if any, in dispute in the appeal has been deposited by the appellant in the office of the Corporation.”

7. A bare perusal of Section 170 of the Act reveals that there is no bar for filing a memorandum of appeal. The only restriction imposed under Section 170(b) of the Act is that the pre-deposit of the amount is necessary only for hearing or determination of the appeal I do not find anything contrary to such an interpretation in Section 169 and 171 of the Act, which also deal with or relate to the different stages of the appeal. In this connection, reference may be made to M/s. Lakshmiratan Engineering Works Ltd. v. Asstt. Commissioner (Judicial) 1, Sales Tax, Kanpur Range, Kanpur . In that case one of the questions that arose for consideration was whether an appeal under Section 9 of the U.P. Sales Tax Act, 15 of 1948 before the prescribed authority could be entertained unless it is accompanied by a satisfactory proof of the payment of tax and in the absence of which the appeal itself would become incompetent. The proviso to Section 9 of the Act provided that no appeal against an assessment shall be entertained unless it is accompanied by satisfactory proof of the payment of the amount of tax admitted by the appellant to be due. In this context the Supreme Court also examined certain decisions of Allahabad High Court wherein that court has interpreted Order 21 Rule 90 of the Code of Civil Procedure which had been amended by that court. The relevant proviso to changed rule is to the following effect:

“Provided that no application to set aside the sale shall be entertained :

(a) …………

(b) unless the applicant deposits such amount not exceeding 121/2 of the sum realised by the sale or furnishes such security as the court may in its discretion fix, except when for reasons to be recorded it dispenses with the requirements of this clause ……. ”

This decision of Allahabad High Court in Kundan Lal v. Jagan Nath Sharma and other decisions referred to hereinafter on the interpretation of the aforementioned Order 21 Rule 90 of the Code of Civil Procedure has been approved by the Supreme Court. In this connection relevant extract in paragraphs 9 & 10 of the judgment may be reproduced below at pages 548, 549; AIR 1962 All:

“9. The word ‘entertain’ is explained by a Division Bench of the Allahabad High Court as denoting the point of time at which an application to set aside the sale is heard by the court. The expression ‘entertain’, it is stated, does not mean the same thing as the filing of the application or admission of the application by the court. A similar view was again taken in Dhoom Chand Jain v. Chamanlal Gupta, in which the learned Chief Justice Desai and Mr. Justice Dwivedi gave the same meaning to the expression ‘entertain’. It is observed by Dwivedi, J. that the word ‘entertain’ in its application bears the meaning ‘admitting to, considered on’, and therefore when the court cannot refuse to take an application which is backed by deposit or security, it cannot refuse judicially to consider it. In a single bench decision of the same court reported in Bawan Ram v. Kunj Beharilal, one of us (Bhargava J.) had to consider the same rule. There the deposit had not been made within the period of limitation and the question had arisen whether the court could entertain the application or not. It was decided that the application could not be entertained because proviso (b) debarred the court from entertaining an objection unless the requirement of depositing the amount or furnishing security was complied with within the time prescribed. In that case the word ‘entertain’ is not interpreted but it is held that the court cannot proceed to consider the application in the absence of deposit made within the time allowed by law. This case turned on the fact that the deposit was made out of time. In yet another case of the Allahabad High Court reported in Haji Rahim Bux and Sons v. Firm Samiullah and Sons, a Division Bench consisting of Chief Justice Desai and Mr. Justice S.D. Singh interpreted the words of 0. 21, R. 90 by saying that the word ‘entertain’ meant not ‘receive’ or ‘accept’ but’ proceed to consider on merits’ or ‘adjudicate upon’.

(10) In our opinion these cases have taken a correct view of the word ‘entertain’ which according to dictionary also means ‘admit to consideration’. It would therefore appears that the direction to the court in the proviso to S. 9 is that the court shall not proceed to admit to consideration an appeal which is not accompanied by satisfactory proof of the payment of the admitted tax. This will be when the case is taken up by the court for the first time. In the decision on which the Assistant Commissioner relied, the learned Chief Justice (Desai, C. J.) holds that the words “accompanied by” showed that something tangible had to accompany the memorandum of appeal. If the memorandum of appeal had to accompanied by satisfactory proof, it had to be in the shape of something tangible, because no intangible thing can accompany a document like the memorandum of appeal. In our opinion, making ‘an appeal’ the equivalent of the memorandum of appeal is not sound. Even under 0. 41 of the Code of Civil Procedure, the expressions “appeal” and “memorandum of appeal” are used to denote two distinct things. In Wharton’s Law Lexicon, the word “appeal” is defined as the judicial examination of the decision by a higher Court of the decision of an inferior court. The appeal is the judicial examination; the memorandum of appeal contains the grounds on which the judicial examination is invited. For purposes of limitation and for purposes of the rules of the Court it is required that a written memorandum of appeal shall be filed. When the proviso speaks of the entertainment of the appeal, it means that the appeal such as was filed will not be admitted to consideration unless there is satisfactory proof available of the making of the deposit of admitted tax.”

This decision of the Supreme Court in M/s. Lakshmiratan Engineering Works Ltd. case (supra) was followed in Hindusthan Commercial Bank Ltd. v. Punna Sahu (dead) through legal representatives . In that case the amended clause (b) to proviso of Order 21 Rule 90, by Allahabad High Court with effect from 1-6-1957, was again considered and the contention that this proviso would not apply to the proceedings to set aside the sale initiated earlier under the amended proviso was rejected and the interpretation of word “entertain” was followed as given in M/s. Lakshmiratan Engineering Works Ltd. case (supra) which would mean adjudicate upon or proceed on merits and does not refer to initiation of proceedings. M / s. Lakshmiratan Engineering Works Ltd. case (supra) was again followed in M/s. Lalta Prasad Khinni Lal v. Asstt. Commissioner (Judicial) Sales Tax, Kanpur Range 1, Kanpur . The question that arose in that case was that the memorandum of appeal was filed under Section 9(6) of the U.P. Sales Tax Act (15 of 1948) within time but the amount of tax admitted to be due was not deposited within time although it was deposited later. It was held that it is true that an appeal filed under Section 9 of the Act cannot be entertained by appellate authority unless satisfactory proof is adduced of the payment of tax admitted by the appellant to be due but in a case where the amount of admitted tax is deposited after the period of limitation has expired all that will happen that the appeal will become entertainable only on the day on which satisfactory proof of payment of that amount is produced.

8. In the light of the decisions of the Supreme Court discussed above, the consequences that follow which we accordingly hold are that:

(1) There is no restriction for filing of an appeal without deposit of the amount of dispute in appeal under Section 170(b) of the Act. The law makes a distinction between receiving or filing of the appeal and hearing or adjudication of such an appeal. The making of an appeal, the equivalent of memorandum of appeal is not sound as both the expressions appeal and memorandum of appeal denote two distinct things. The appeal is a judicial examination, the memorandum of appeal contains the grounds on which the judicial examination is invited. For purpose of limitation it is required that memorandum of a appeal is filed. However, the requirement under Section 170(b) of the Act for deposit o the amount in dispute in the appeal is only for hearing or adjudication of the appeal which was filed.

(2) The hearing or adjudication of appeal does not indicate the same thing as filing of the appeal which is equivalent to memorandum of appeal. The words ‘hearing’ or ‘adjudication’ denote the point of time at which the appeal is heard or disposed of on merits by the Court. The Supreme Court has interpreted the word ‘entertain’ as to mean, not ‘to receive’ or ‘accept’ but ‘proceed to consider’ on merits, or ‘adjudicate upon’. It goes without saying that the case cannot be adjudicated, considered on merits and entertained unless it is heard. The word ‘hear’ is meant the first occasion on which the court takes up the matter for consideration. It may be at the admission stage, or if the appeal is admitted automatically, it will be the time of the hearing of the appeal. In case of failure of deposit of the amount as required under Section 170(b) of the Act, the court can dismiss the appeal as not maintainable but this would not amount to hearing or consideration on merits.

9. As such the reasoning and view taken by this Court in Panchsheela case that the memorandum of appeal cannot be filed under Section 169 of the Act and entertained unless the condition precedent of deposit of the amount is complied with is not quite correct.

10. Mr. Rohatgi, relying upon the judgment of Wad, J. in Punj Sons case (supra) next submitted that after the appeal is filed by the assessed under Section 169 of the Act, the application under Order XLI Rule 5 of the Code of Civil Procedure can be filed by him with the prayer for grant of stay of the disputed amount of the property tax with or without conditions and the court has discretion to grant stay having regard to facts and circumstances of each case in the interest of justice. It is possible that the appellant may not have money to deposit the amount along with the memorandum of appeal and may arrange and deposit afterwards. The arguments proceed on the basis that under Section 457 of the Act the procedure provided in the Code of Civil Procedure with regard to suits should be followed as far as it can be made applicable, in the disposal of applications, appeals or references that may be made to the court of District Judge of Delhi under this Act or any bye-law made there under. I am afraid this contention of the learned counsel cannot prevail. Firstly it is doubtful whether the procedure as provided for suits can be applied in a case of an appeal before the District Judge. But assuming such procedure is made applicable, I am of opinion Order 41 Rule 5 cannot be pressed in service as the provisions in the Code of Civil Procedure would be in direct conflict with Section 170(b) of the Act which provides that no appeal shall-be heard or determined unless the amount, if any, in dispute in the appeal has been deposited by the appellant in the office of the Corporation. There would be apparent conflict –between general and specific provisions in the statute. It is settled principle of law that where there are two provisions in an Act, one of which is specific or of a special character and the other of a general character, the specific or special provision qualifies the general one and ought to be applied in preference to and unaffected by the general one. Thus, when there is a specific provision in an Act which covers a particular case, it is not proper to apply another general provision, the application of which is not free from doubt. Therefore, invoking of the provision of Order 41 Rule 5 of the Code of Civil Procedure cannot arise. Viewed from another angle if Order 41 Rule 5 is made applicable under Section 457 of the Act, Section 170(b) can only carve out an exception and in case of appeal filed under Section 169 of the Act, therefore, the District Judge has no power and jurisdiction to hear and adjudicate the appeal unless the condition of pre-deposit under Section 170(b) is complied with. Even otherwise, when the appeal cannot be heard or adjudicated upon unless the amount is deposited, the application of stay obviously cannot be heard. Therefore with respect I am unable to find myself in agreement with the views expressed in Punj Sons case.

11. It was next submitted that the appellate court/tribunal has inherent powers to grant stay as incidental or ancillary to its appellate jurisdiction although specific power in the statute for the grant of stay might not have been conferred. In this connection the case of Income Tax Officer, Cannanore v. M. K. Mohammed Kunhi (AIR 1969 SC 430) was referred to. I have given careful consideration to the submission of the learned counsel and am of opinion that such a contention cannot be accepted. The case cited is distinguishable. In this case there was no provision under the Act for granting stay for the recovery of penalty or tax etc. although the provision of appeal was provided for in the statute. Therefore, in such circumstances it was held that the court has inherent powers to grant stay as incidental and ancillary to its appellate jurisdiction. In the present case, however- there is a specific provision to the contrary under Section 170(b) of the Act that unless the amount in dispute in the appeal is deposited by the appellant in the office of the Corporation, no appeal shall be heard or determined. This contention is, therefore, also rejected.

12. It was next contended that even if 0.41, R.5 of the Code of Civil Procedure is not to be made applicable then the petitioner should be allowed to deposit the disputed amount in appeal filed before the District Judge under S. 169 of the Act and not the whole amount of the tax. The interpretation being given by, the District Judge is wholly erroneous and it cannot be sustained in the eyes of law.

13. In this context let me examine the relevant provisions of the Municipal Corporation Act. The method of determining the, rateable value of the lands and buildings assessable to property tax is provided in S. 116 of the Act. Section 124 deals with the preparation of the assessment list. It provides that the Corporation shall cause an assessment list of all lands and buildings in Delhi to be prepared in such form and manner and containing such particulars with respect to each land and building as may be prescribed by bye-laws and invite objections and finally such a list will be prepared subject to alterations under S. 126 and subject to appeal and such assessment shall be conclusive evidence. Under S. 126 the Commissioner has, however, been given a power to amend the assessment list after providing an opportunity to the person affected by such amendment. However, there is a stipulation in the section that no person shall by reason of any such amendment become liable to pay any tax or increase of tax in respect of any period prior to the commencement of the year in which the notice under sub-s. (2) is given. It is possible and in fact has been brought to our notice that in many cases assessment is concluded after several years the notice of amendment was given. In such a situation the assessed might have to pay the property tax for several years with the result that at certain times with best of intentions he may not be able to pay such tax and that his property might be sold in this process. Under S. 123 of the Act, the property tax is the first charge on the premises which is subject to assessment. There is a prescribed procedure for recovery of tax under S. 152 onwards, particularly under Ss. 155 and 156 of the Act. Even warrant of distress can be issued for the recovery of tax. Under S. 155 if the person liable for payment of any tax does not, within 30 days from the service of demand under S. 154, pay the sum due and if no appeal is preferred against such tax, he shall be deemed to be in default. Section 156 provides that the Commissioner shall not recover any sum the liability for which has been remitted on appeal under the provisions of this Act. However, the Commissioner has been given a power under S. 156 to recover the arrears of tax by warrant of distress and sale of immoveable property or the attachment of sale of the property of the defaulter. If both these Ss. (155 and 156) are read harmoniously it would only mean that in case an appeal is preferred against the demand of tax, it has necessarily to be for the purpose of final determination/ adjudication as otherwise no remission of appeal is possible under the provisions of the Act. The District Judge before whom the appeal has to be preferred under S. 169 can remit the amount in appeal only in case the appeal is heard and adjudicated upon, for which the amount in dispute in the appeal has to be deposited under S. 170(b) of the Act. Merely filing of a memorandum of appeal without deposit of amount in dispute in the appeal shall not amount to preferring of an appeal as disearlier. Therefore, unless the amount is deposited under S. 170(b) of the Act, there is no preferring of an appeal in the eyes of law and, therefore, the assessed shall be deemed to be in default and consequently there will be no legal impediment for the recovery of tax under warrant of distress or otherwise as provided under the law.

14. In this background the question that arises for consideration is as to what is the amount in dispute in the appeal in the present writ petition and how it should be interpreted. If the literal interpretation to the words, amount in dispute in the appeal’ is given, it would mean ‘the difference of the admitted rateable value, i.e., Rs. 94,920/- and the, rateable value fixed by the Deputy Assessor and Collector, i.e., Rs. 2,28,650/-, i.e., Rs. 1,23,730/- and consequential increase of the tax amount thereon. What would be the amount in dispute in the appeal on the rateable value assessed under S. 126 of the Act in which the amendment of the list is sought for by the prescribed authorities? In this connection reference may be made to Punj Sons case (supra) where after the payment of tax on the rateable value of Rs. 88,500/- the notice was issued to landlord for increase of rateable value to Rs. 1,29,650/- under S. 126 of the Act with effect from 1-4-1969. However, after hearing objections of the landlord the rateable value was finally fixed at Rs. 1,16,520/- on 10-8- against which the landlord preferred an appeal. Therefore, in that case it meant that if the assessed deposited the tax amount on the basis of the difference or the disputed amount of the rateable value, i.e., Rs. 28,500/- then the court would hear and determine the appeal. In addition to this it may be pointed out that there may be many cases of original assessment of the rateable value or of amended assessment in which the increase in the amount of rateable value and consequently the increase in the tax amount -the amount in dispute in the appeal which has to be deposited under S. 170(b) of the Act may be a small amount in comparison to the original assessment of the rateable value under S. 24 or the amended assessment under S. 126 of the Act. The assessed by depositing the disputed amount, which sometimes can involve a very small amount can defeat the very object of S. 170(b) of the Act of adequately securing the recovery of taxes and preventing the assesseds from filing frivolous appeals. As already discussed, under Ss. 155 and 156 of the Act if an appeal is preferred against such tax the assessed shall not be deemed to be in default and the Commissioner shall not recover the sum the liability of which has been remitted in appeal under the provisions of the Act and no warrant of distress or sale of immoveable property or attachment of the sale of immoveable property can be effected. In other words, the decision of appeal will have to be awaited. This literal interpretation will obviously lead to manifest absurdity and also to the result not intended by the scheme of taxation. The object of enacting provision of S. 170(b) appears to us is that the assessed should be prevented from filing frivolous appeal against the rateable value and levy of the property taxes against the corporation and that the tax due to the Corporation is more than adequately secured before the appeal is heard and determined. In case if the disputed amount is literally interpreted to mean the disputed amount in the appeal as discussed above, this will defeat the very purpose and object of the provisions of S. 170(b) of the Act which the Legislature never intended. Therefore, the amount in dispute in the appeal would have to be interpreted as the tax amount based on whole amount of the rateable value – which tax has to be paid by the assessed. Such an interpretation shall be in conformity with the well settled principle of interpretation of statutes. In this connection reference may be made to Maxwell on ‘Interpretation of Statutes’:

“The so-called “golden rule” is really a modification of the literal rule. It was stated in this way by Parke B. “It is a very useful rule, in the construction of a statute, to adhere to the ordinary meaning of the words used, and to the grammatical construction, unless that is at variance with the intention of the legislature, to be collected from the statute itself, or leads to any manifest absurdity or repugnance, in which case the language may be varied or modified, so as to avoid such inconvenience, but on further.”

15. Mr. Jain, petitioner in C.W. 148/89, submitted that S. 170(b) of the Act is not applicable to the appeals against the rateable value in respect of property taxes inasmuch as the Legislature has secured the property taxes by making it as a first charge on the property under Sec. 123 and had laid down in Section 155(l) that if an assessed has preferred any appeal then he shall not be “deemed in default” and he shall not be visited the penalty under Sec. 155(2). This contention is inherently -erroneous and has been advanced merely to be rejected. By virtue of S. 156(l), the Commissioner has been authorised to recover the taxes by distress but will not recover the sum which has been remitted in appeal. In case Sections 155 and 156 of the Act are interpreted harmoniously, this will reference to preferring of an appeal Linder Section 155 of the Act is ‘to the competent appeal when the amount in dispute in the appeal under Section 170(b) of the Act has been deposited, as otherwise, such an appeal cannot be heard or determined, as already discussed earlier and the stage of not recovering of the sum, which has been remitted in the appeal would not arise. Preferment of appeal denotes not merely the memorandum of appeal but otherwise a competent appeal in which the amount under Section 170(b) of the Act also has been deposited. In such a situation, when no competent appeal has been preferred before the District Judge, the provision of Section 155(l) that the assessed shall not be ‘deemed in default’ will not apply. In order to avoid the recovery of property tax by warrant of distress, or other coercive methods available to Commissioner or other authorities, the assessed will have to prefer a competent appeal in case he is aggrieved against the assessment before the District Judge and the amount in dispute in the appeal will have to be deposited under Section 170(b) of the Act. Therefore, to say that Section 170(b) is not applicable to property tax is not correct.

16. Lastly it was contended that the provision of Section 170(b) of the Act requiring the assessed to deposit the amount in dispute in the appeal in the office of the Corporation before the appeal is heard and determined is arbitrary and violative of Article 14 of the Constitution. The argument proceeds on the basis that the condition imposed under Section 170(b) is so onerous that it would amount to unreasonable restrictions rendering the right almost illusory as no discretion is left with the appellate authority to grant stay or dispense with the requirement of pre-deposit of the amount in dispute in the appeal. On the other hand, Mr. Datar, learned counsel for the respondents, vehemently submitted that the right to appeal is a creature of statute and there is no reason why the legislature while granting the right cannot impose the conditions for the exercise of such rights. Therefore, before the appeal is heard or determined Section 170(b) of the Act must necessarily be compiled with.

17. In support of his submissions Mr. Datar, learned counsel appearing for the respondents, referred to various cases. At the very outset the case of Shri Vijay Prakash D. Mehta/ Sh. Jawahar D. Mehta v. Collector of Customs (Preventive) Bombay may be noticed. In that case the appellant’s appeal under Section 129A of the Customs Act, 1962 was dismissed by the Tribunal for non-deposit of the penalty of Rs. 1 lakh ordered to be reduced under Section 129E of the Customs Act pending hearing the appeal, which resulted into non-compliance of the provisions of Section 129E of the Customs Act. In this context the Supreme Court observed that right to appeal is neither an absolute right nor an ingredient of natural justice the principles of which must be followed in all judicial and quasi-judicial adjudications. The right to appeal is a statutory right and it can be circumscribed by the conditions in the grant. If the statute gives a right to appeal upon certain conditions, it is upon fulfillment of those conditions that the right becomes vested and exercisable to the appellant. Further, it was observed that the right given under Section 129A is controlled by Section 129E of the Act, and that right is with a condition and thus a conditional right. The petitioner in this case has no absolute right of stay. He could obtain stay of realisation of tax levied or penalty imposed in an appeal subject to the limitations of Section 129E. The proviso gives a discretion to the authority to dispense with the obligation to deposit in case of “under hardships”. No doubt, the Supreme Court has laid down the aforementioned principle but, it must be borne in mind that constitutional validity of the provision of pre-deposit of amount under Section 129E was not challenged in the case and that case, as such, cannot be of much assistance to us in deciding the constitutional validity of Section 170(b) of the Act.

18. In Soorajmull Nagarmull v. State of West Bengal the same principle has been laid down that the appeal is the creation of statute. However, there was no provision under examination under that Act which is pari materia to the provision under the present Act. Therefore this authority is not of much relevance to the present Act.

19. In The Anant Mills Co. Ltd. etc. v. The Municipal Corporation of the City of Ahmedabad the Supreme Court was concerned with the constitutional validity of various provisions of the Bombay Municipal Corporation Act, 1949. One of the provisions challenged was the amended Section 406 of that Act where under it was provided that no appeal against rateable value should be “entertained” unless the amount claimed from the appellant by a bill for property taxes was deposited in Court. The amended section gave to the Judge a discretion to dispense with the deposit or a part thereof if he was of opinion that the deposit would cause undue hardship to the appellant. It appears the unamended provision did not give to a Judge the discretion to dispense with the deposit or a part thereof in case of undue hardship. This unamended provision was struck down by the Gujarat High Court on the basis that the unamended Section 406(2)(e) classified the appellants filing appeals against tax and rateable value into two classes : (1) those who deposited the amount of tax assessed by the Commissioner; and (2) those who did not. It was held that the above classification had no rational nexus with the object of the provision for appeal and that there was no reasonable justification for giving a right of appeal to one class and denying it to the other. Section 406 (2)(e) was further amended by Act 5 of 1970 wherein the Judge was given a discretion to dispense with the deposit or a part thereof if he was of opinion that the deposit would cause undue hardship to, the appellant. This clause was also struck down by the Gujarat High Court on the ground that it did not make any material difference so far as the constitutional validity of the above provision was concerned. The proviso merely carves out an exception from the main provision in Section 406(2)(e) and limits the applicability of the main provision to appellants who can deposit the amount of tax without undue hardship. The result, in the opinion of that High Court, was that the discrimination between the appellants who deposited the amount of tax and the appellants who did not, which is the necessary consequence of the condition requiring deposit of the amount of tax still persisted, though it was now limited to the class of appellants who could deposit the amount of tax without undue hardship. The Supreme Court considered the question whether or not the amended provision in Section 406 (2)(e) which provides for a discretion to a Judge to dispense with the requirement of deposit with or without conditions is constitutionally valid. In that context the Supreme Court observed (at page 1249 of AIR 1975 SQ:

“The requirement about the deposit of the amount claimed as a condition precedent to the entertainment of an appeal which seeks to challenge the imposition or the quantum of that tax, in our opinion, has not the effect of nullifying the right of appeal, especially when we keep in view the fact that discretion is vested in the appellate Judge to dispense with the compliance of the above requirement. All that the statutory provision seeks to do is to regulate the exercise of the right of appeal. The object of the above provision is to keep in balance the right of appeal which is conferred upon a person who is aggrieved with the demand of tax made from him, and the right of the Corporation to speedy recovery of the tax. The impugned provision accordingly confers a right of appeal and at the same time prevents the delay in the payment of the tax. We find ourselves unable to accede to the argument that the impugned provision has the effect of creating a discrimination as is offensive to the principle of equality enshrined in Article 14 of the Constitution. It is significant that the right of appeal is conferred upon all persons who are aggrieved against the determination of tax on rateable value. The bar created by Section 406(2)(e) to the entertainment of the appeal by a person who has not deposited the amount of tax due from him and who is not able to show to the appellate Judge that the deposit of the amount would cause him undue hardship arises out of the constitutional validity of provision has his own omission and default. The above not been taken note by the single Judge of provision, in our opinion, has not the effect of Bombay High Court although the above case

classes with the object of meeting out differential treatment to them; it only spells out the consequences flowing from the omission and default of a person who despite the fact that the deposit of the amount found due from him would cause him no hardship, declines of his own volition to deposit that amount. The right of appeal is the creature of a statute. Without a statutory provision creating such a right the person aggrieved is not entitled to file an appeal. We fail to understand as to why the legislature while granting the right of appeal cannot impose conditions for the exercise of such right. In the absence of any special reasons there appears to be no legal or constitutional impediment to the imposition of such conditions.”

It necessarily follows from that decision of the Supreme Court that in case the condition of requirement of pre-deposit of the amount for hearing or determination of the appeal has the effect of nullifying the right of appeal constitutional validity of such a provision can be challenged. Further it has been held that the right of appeal is the creation of statute and the conditions can be imposed for hearing and determining of such an appeal in the absence of any special reasons to the contrary. In that case, however, the constitutional validity of the amended provision was upheld because there was a discretion vested in the appellate Judge to dispense with the compliance of the above requirement of pre-deposit in the case of undue hardship. It may be pointed out that the condition imposed on pre-deposit in the unamended provision of the Bombay Municipal Corporation Act, which was struck down by Gujarat High Court, was almost pari materia to the present provision in S. 170(b) of the Act. The case of M/s. Elora Construction Company v. The Municipal Corporation of Gr. Bombay was very heavily relied upon by Mr. Datar. I am afraid that this decision cannot be of much help to the respondents as the principle laid down in Anant Mills case (supra) for judging

20. Another decision in Chatter Singh Baid v. Corporation of Calcutta decided by a learned single Judge, no doubt has taken into account the decisions of the -Supreme Court in Anant Mills case (supra) and Nand Lal v. State of Haryana . However, the learned single Judge in so many words has not gone into the question whether the condition of payment of consolidated rate to be determined according to new valuation is onerous as to render the right of appeal nugatory or illusory. He has upheld the constitutional validity of the provision on the basis of the ratio laid down in the aforementioned cases that the right of appeal is a creature of statute and while granting the right of appeal the legislature can impose conditions for exercise of such right and there is no constitutional or legal impediment to imposition of such a condition for deposit of tax, and that further the power to determine consolidated rate on the valuation of the property would be reasonably exercised and in case such power is arbitrarily exercised, the aggrieved person can seek redress in another appropriate forum.

21. In the light of what has already been discussed in Anant Mill’s case (supra) and in the case of Nand Lal to be discussed hereinafter, it is apparent that though no doubt right of appeal is the creation of statute but in case the conditions imposed on the right of appeal are so onerous as to amount unreasonable restrictions rendering the right almost illusory and nugatory, such conditions can always be struck down by the court being ultra vires. In fact, in the aforementioned cases, the Supreme Court did go into the question whether the conditions imposed on the right of appeal are onerous as to render the right of appeal illusory and nugatory. Furthermore, for the correction in the assessment of the rateable value, the appropriate forum is neither the writ jurisdiction nor a civil suit as has also been explained hereinafter. Therefore, the decision of Chatter Singh’s case cannot also advance-the case of the respondents any further.

22. In Nand Lal v. State of Haryana the case of Anant Mills (supra) was followed. In that case challenge was made to the provision contained in Section 18(7) of Haryana Ceiling and Land Holdings Act imposing a condition of making a deposit of a sum equal to 30 times the land holdings tax payable in respect of the disputed area before any appeal or revision is entertained by the appellate or revisional authority – a provision inserted in the Act by Amending Act 40 of 1976. Section 18(l) and (2) provide for an appeal, review and revision of the orders of the prescribed authority and position was that prior to 1976 there was no fetter placed on the appellate/ revisional remedy by the State. However, by the amendments made by Haryana Act No. 40 of 1976, sub-sections (7) and (8) were added and the newly inserted sub-section (7) for the first time imposed a condition that all appeals under sub-section (1) or sub-section (2) and revisions under sub-section (4) would be entertained only on the appellant or the petitioner depositing with the appellate or revisional authority a sum equal to 30 times the land holdings tax payable in respect of the disputed surplus area. Under sub-section (8) it was provided that if the appellant or the petitioner coming against the order declaring the land surplus failed in his appeal or revision, he shall be liable to pay for the period he has at any time been in possession of the land declared surplus to which he was not entitled under the law, a license fee equal to 30 times the land holdings tax recoverable in respect of this area. On 6th June, 1978, the Act was further amended by Amending Act 18 of 1978 whereby the rigour of the condition imposed under sub-section (7) was reduced by permitting the appellant or the petitioner to furnish a bank guarantee for the requisite amount as an alternative to making cash deposit and while retaining sub-section (8) in its original form, a new sub-section (9) was inserted under which it has been provided that if the appeal or revision succeeds, the amount deposited on the bank guarantee furnished shall be refunded or released, as the case may be but if the appeal or revision fails the deposit or the guarantee shall be adjusted against the license fee recoverable under subsection (8). In this context the Supreme Court followed and further elaborated the principle laid down in Anant Mills case and observed in para 19 as :

“It is well settled by several decisions of this Court that the right of appeal is a creature of a statute and there is no reason why the legislature while granting the right cannot impose conditions for the exercise of such right so long as the conditions are not so onerous as to amount to unreasonable restrictions rendering

the right almost illusory In the first place, the object of imposing the condition is obviously to prevent frivolous appeals and revision that impede the implementation of the ceiling policy; secondly, having regard to sub-sections (8) and (9) it is clear that the cash deposit or bank guarantee is not by way of any exaction but in the nature of securing mesne profits from the person who is ultimately found to be in unlawful possession of the land; thirdly, the deposit or the guarantee is correlated to the land holdings tax (30 times the tax) which, we are informed, varies in the State of Haryana around a paltry amount of Rs. 8 per acre annually; fourthly, the deposit to be made or bank guarantee to be furnished is confined to the land holdings tax payable in respect of the disputed area i.e. the area or part thereof which is declared surplus after leaving the permissible area to the appellant or petitioner. Having regard to those aspects particularly the meagre rate of the annual land tax payable, the fetter imposed on the right of appeal/ revision, even in the absence of a provision conferring discretion on the appellate/ revisional authority to relax or waive the condition, cannot be regarded as onerous or unreasonable. The challenge to S. 18 (7) must, therefore, fail”

No doubt the validity of Section 18(7) of the Haryana Ceiling Act was upheld but that was on the ground that the conditions imposed are not onerous as to amount to unreasonable restrictions rendering the right almost illusory as the appellant was required to deposit only a paltry amount of Rs. 8 per acre annually.

23. At this stage, it would be very much relevant to point out that in this case, the rateable value of the property has been assessed for number of years, which is not a small amount. There may be cases, where the amendment of assessment under Section 126 of the Act is made also for number of years, after the service of notice contemplated there under and may again involve huge amount. The assessment may sometimes suffer from arithmetical mistake and result in exorbitant amount. The assessment can be perverse as well and not in accordance with law. There can be so many other similar contingencies and situations. In many cases although the assessed may not be able to deposit the amount in dispute in the appeal under Section 170(b) of the Act because of financial hardship and the huge amount involved and in this process at certain times his property may be sold, yet the District Judges have no discretion to grant stay of deposit of or dispense with the requirement of the disputed amount in appeal and consequently the appeal will have to be dismissed. It goes without saying that for the purpose of determination of rateable value of the property in accordance with the method laid down in Dr. Balbir Singh v. M/s. M.C.D. , certain complicated questions of facts will have to he determined for which the appropriate remedy is the only appeal provided for, and writ jurisdiction ordinarily cannot be resorted to or entertained for correction of error in assessment. Further, as would be discussed hereafter, the jurisdiction of the civil court would be barred in the matter. This provision of Section 170(b) of the Act, therefore, arbitrarily compels the citizen to deposit the amount under Section 170(b) of the Act without any exception or guideline. Such provision, therefore, in my opinion, imposes conditions which are on the face of it so onerous as to amount unread sonable restriction rendering the right of appeal almost illusory and nugatory and, therefore, suffers from vice of unconstitutionality and of being ultra vires of Article 14 of the Constitution.

24. No doubt provisions of Haryana Ceiling Act in Nand Lal’s case and Bombay Municipal Corporation Act in Anant Mills’ case have been upheld but that is on the basis of a finding that the conditions are not onerous or unreasonable whereas in the present case the condition is onerous and unreasonable which makes the right to appeal illusory. As we have seen various other Acts, e.g., Customs Act, 1962, Haryana Ceiling Act, Bombay Municipal Corporation Act, 1949 wherein an order to relieve the person from the rigour of the provision of predeposit of the amount in dispute in appeal for hearing and determination, the provision has been made for granting the Tribunal /Judge a discretion to stay the deposit of the amount or dispense with or waive the requirement of pre-deposit of the amount in case of hardship As already discussed, Section 406 (2)(e) of & Bombay Municipal Corporation Act, 1949 which imposed a condition for deposit of the amount of tax before the appeal is heard or determined was struck down by the Gujarat High Court and the Act was suitably amended to provide for grant of discretionary relief in case of undue hardship.

25. Section 170(b) of the Act, viewed from different angle as well, cannot stand the test of constitutional validity. Sections 123/126 of the Act provide for assessment and amended assessment of the rateable value of the property. This assessment is subject to appeal before the District Judge and provisions governing such appeal are in Sections 169 to 171 of the Act. Under Section 171 the order of the District Judge has been made final. Under Section 457 of the Act, the provisions of the Code of Civil Procedure in regard to suits shall be followed, as far as it can be made applicable, in the disposal of applications, appeals on preferences that may be made to the court of the District Judge of Delhi under this Act or any bye-law made there under. I do not find anything which the District Judge while hearing the appeal cannot decide, what civil court would normally do in a civil suit. In this background, it can easily be assumed that jurisdiction of civil court in regard to assessment of rateable value of property and levy of tax is excluded and barred. In this connection, reference may be made to Dhulabhai etc. v. State of Madhya Pradesh wherein it has been clearly held that where the statute gives a finality to the order of the special Tribunal, the jurisdiction of civil court must be held to be excluded, if there is adequate remedy to do what the civil court would normally do in a civil suit.

26. As already discussed earlier, in certain situations and circumstances it is neither practicable nor possible to deposit the amount in dispute in the appeal with the result, the assessed is left with no remedy of appeal. Consequently the assessment made under Sections 123-126 becomes conclusive and final. Jurisdiction of civil court is also barred. It goes without saying that assessment of rateable value of property and property tax affects the rights in property of the citizens and they cannot be left without a judicial remedy. No doubt under Section 169(l) reference can be sought to the superior court or High Court on the question of law or on construction of document but such a remedy cannot be considered to be as sufficient safeguard for a judicial review of all questions including questions of facts. In addition, the availability of right to invoke Articles 226 & 227 of the Constitution is also not a sufficient safeguard as all questions relating to appeal including highly disputed and complicated questions of facts cannot be gone into in the writ and supervisory jurisdiction. In M/s. Wire Netting Stores, Delhi v. The Regional Provident Funds Commissioner, New Delhi this Court struck down Section 7A of the Employee’s Provident Funds and Miscellaneous Provisions Act being violative of Article 14 of the Constitution since no appeal was provided for against the order under Section 7A of the Act and Jurisdiction of civil court was also barred. In that case the question that arose for consideration was whether Section 7A of the Employees Provident Funds and Miscellaneous Provisions Act which gives adjudicative power to the Commissioner to determine the amount due from the employer is ultra vires of Article 14 of the Constitution as such this provision gave a finality to such an order and was not to be questioned in any court of law, and no remedy of appeal etc. was provided for against such adjudication. It was held that admittedly there is no appeal provided for against the order under Section 7A. The order passed by the Commissioner is made final and nonjusticiable in civil court. The constitutional remedy under Article 226 of the Constitution cannot supply the lacuna . Therefore, sub-section (4) of Section 7A must be held to be violative of Article 14 of the Constitution of India. Following that judgment in the absence of alternative remedy of appeal being rendered illusory and ineffective and the jurisdiction of civil court being barred in the matter, Section 170(b) of the Act in the present case must be held to be violative of Article 14 of the Constitution of India.

27. In the light of the above discussion, I am left with no option except to hold that sub-section (b) of Section 170 of the Act which imposes a condition that no appeal shall be heard or determined unless the amount in dispute in the appeal is deposited is arbitrary and renders the right to appeal under Section 169 almost illusory and nugatory. It is without any judicial review. However, I am of opinion that in case this provision is suitably amended by the legislature by permitting the District Judge to exercise the jurisdiction to grant stay or waive or dispense with the condition of pre-deposit of the amount in dispute in the appeal before the appeal is heard or determined in cases of financial hardship on the lines of amended Section 406(2)(c) of the Bombay Municipal Corporation Act, 1949, the provision can be saved from the vice and attack of constitutional validity and can also provide a relief against the rigour of the provision by granting

discretion to the Judge/ Tribunal to grant stay or -waive or dispense with the condition of amount in case of undue hardship. At any rate this is the exclusive function of the legislature which they themselves will have to decide.

28. In the result, I allow the writ petitions and strike down sub-section (b) of Section 170 of the Act being violative of Article 14 of the Constitution of India. The District Judge consequently is directed to entertain the appeal of the appellant without deposit of the amount and decide on merits,

29. No costs.

V. B. BANSAL, J. – (for himself and Leila Seth, J.)

30. We have perused the judgment of our learned brother Nag, J. in which he has indicated three questions as arising from the writ petition requiring decision. They are as follows:

1. Whether the deposit of tax amount under See. 170(b) of the Delhi Municipal Corporation Act, 1957 (hereinafter referred to as the Act) is a condition precedent for hearing or determination of the appeal but also for filing of memorandum of appeal?

2. Whether the District Judge has a discretion to grant stay of the disputed amount or dispense with the condition pre-deposit of the amount in appeal, with or without conditions, in the office of the Corporations Further what is the amount in deposit in appeal?

3. In case it is held that the deposit of tax amount under Sec. 170(b) of the Act is a condition precedent for hearing or determination of the appeal and the District Judge has no discretion to grant stay of the deposit of tax amount and dispense with the condition of pre-deposit of amount with or without conditions, whether such provision is ultra vires?

31. We agree with the conclusion arrived at by our learned brother Nag J. as regards the first two questions, but are unable to do so the regard to the third question.

32. Sub-section (1) of S. 169 of the Delhi Municipal Corporation Act, M7 provides that an appeal against the levy of assessment of any tax under this Act shall lie to the court of District Judge of Delhi. Sec. 170 of the Act provides for conditions of right of appeal. It would be appropriate to quote the section which runs as under:

Section 170

“No appeal shall be heard or determined under section 169 unless –

(a) the appeal is, in the case of a property tax, brought within thirty days next after the date of authentication of the assessment list under section 124 (exclusive of the time required for obtaining a copy of the relevant entries therein) or, as the case may be, within thirty days of the date on which an amendment is finally made under section 126 and, in the case of any other tax, within thirty days next after the date of the receipt of the notice of assessment or of alteration of assessment or, if no notice has been given, within thirty days after the date of the presentation of the first bill or, as the case may be, the first notice of demand in respect thereof-, Provided that an appeal may be admitted after the expiration of the period prescribed thereof by this section if the appellant satisfies the court that he had sufficient cause for not preferring the appeal within that period

(b) the amount, if any, in dispute in the appeal has been deposited by the appellant in the office of the Corporation.”

33. The first question for consideration is, whether there is an inherent right in every person to file an appeal from a decision of any court or tribunal which is not to his liking. In fact, there is an inherent right available to an individual to file a suit. A suit for its maintainability requires no authority of law and it is enough that no statute bars the suit. However, the position with regard to appeal is entirely different. The right of appeal inheres in no one, and, therefore, an appeal for its maintainability must have the clear authority of law. It is on this account that the right of appeal is described as a creature of statute. Reference in this regard can be made to the case Smt. Gaga Bai v. Vijay Kumar, . In the matter of an arbitration between Sandback Charity Trustees and the North Staffordshire Railway Company, 1877 (3) Queen’s Bench Division 1, Bramwell, L.J. held that “an appeal does not exist in the nature of things; a right to appeal from any decision of any tribunal must be given by express enactment”. In case M/s. Elora Construction Company v. The Municipal Corporation of Gr. Bombay, , it was observed that the right of appeal is the creation of statute and it can be taken away only by a statute; and by express words or necessary intendment. It was further observed that the right of appeal is not inherent or fundamental but created by law. Courts which are subordinate to the High Court are not constituted under the Constitution and, therefore, access to such subordinate courts may be lawfully abridged or made subject to the fulfillment of conditions imposed by law.

34. It is, thus, clear that the right of appeal is neither absolute, inherent or unfettered and limitations can be prescribed to the right of appeal by the statute itself.

35. Submission of learned counsel for the petitioner has been that there is a total bar in the hearing of an appeal of a person who is unable to deposit the amount of tax which as such is violative of the provisions of Article 14 of the Constitution of India. He has, thus, submitted that unless and until the amount in dispute in the appeal is deposited by a person his appeal shall not be heard by the District Judge on account of which the said individual would be deprived of his right of adjudication by the appellate court. He has also submitted that there may be instances where two different individuals have appeals on identical facts but a person who is unable to deposit the amount would face the consequence of his appeal being dismissed whereas the other appeal entertained and disposed of on merits after the deposit of the amount In dispute gives relief to the individual. He has, thus, submitted that in the instant case there being no discretion left with the District Judge the provisions contained in Sec. 170(b) is ultra vires and prayed that the same may be declared as void. Reliance in support of this submission has been placed on the case The Anant Mills Co. Ltd. etc. etc. v. State of Gujarat, 1975 SC 1234 : 1975 Tax LR 1540 and Nand Lal v. State of Haryana, .

36. We have given our thoughtful consideration to these submissions but have not been able to persuade ourselves to agree with the same. In Anant Mill’s case (supra) Supreme Count was required to examine a number of provisions and one of them being Section 406 of the Bombay Provincial Municipal Corporation Act which is similar to Section 170 of Municipal Corporation Act. While interpreting this provision High Court of Bombay held that Sec. 406 classified the appeals against tax and rateable value into two classes, (1) those who deposit the amount of tax assessed by the Commissioner, and (2) those who do not whatever be the reason for non-deposit.

37. There being no discretion left with the court the provision was struck down by the Gujarat High Court. Subsequently, a proviso was added to this provision to the effect that where in any particular case the judge is of the opinion that the deposit of the amount by the appellant will cause undue hardship to him, the Judge may, in his discretion, dispense with such deposit or part thereof either unconditional or subject to such conditions as he may deem fit. Even after the addition of this proviso the section was struck down by the Gujarat High Court. While disposing of the appeal the following observation was made in para 40 by the Supreme Court at page SC 1249, AIR 1975:–

“The right of appeal is the creature of a statute. Without a statutory provision creating such a right the person aggrieved is not entitled to file an appeal. We fail to understand as to why the legislature while granting the right of appeal cannot impose conditions for the exercise of such right. In the absence of any special reasons there appears to be no legal or constitutional impediment to the imposition of such conditions. It is impossible, for example, to prescribe a condition in criminal cases that unless a convicted person is released on bail, he must surrender to custody before his appeal against the sentence of imprisonment would be entertained. Likewise, it is permissible to enact a law that no appeal shall lie against an order relating to an assessment of tax unless the tax had been paid. Such a provision was on the statute book in Section 30 of the Indian Income-tax Act, 1922. The proviso to that section provided no appeal shall lie against an order under sub-section (1) of Section 46 unless the tax had been paid”. Such conditions merely regulate the exercise of the right of appeal so that the same is not abused by a recalcitrant party and there is no difficulty in the enforcement of the order appealed against in case the appeal is ultimately dismissed. It is open to the legislature to impose an accompanying liability upon a party upon whom a legal right is conferred or to prescribe conditions for the exercise of the right. Any requirement for the discharge of that liability or the fulfillment of that condition in case the party concerned seeks to avail of the said right is a valid piece of legislation, and we can discern -no contravention of Art. 14 in it.”

38. It has further been observed that “a disability or disadvantage arising out of a party’s own default or omission cannot be taken to be tantamount to the creation of two classes of offensive of Art. 14 of the Constitution, especially when that disability or disadvantage operates upon all persons who make the default or omission.”

39. A perusal of the aforesaid observations made by the Supreme Court makes it amply clear that the legislature is competent to make a law that no appeal shall lie against any order relating to an assessment of tax unless the tax has been paid and that such a provision was on a statute book in S. 30 of the Income-tax Act, 1922.

40. Much reliance has been placed by learned counsel for the petitioner on the case Nand Lal (supra) which has referred with approval to the case of Anant Mills’Co. Ltd. (supra). The following observations have been made in paragraph 19 of the said judgment:

“It is well settled by several decisions of this Court that the right of appeal is a creature of a statute and there is no reason why the legislature while granting the right cannot impose conditions for the exercise of such right so long as the conditions are not so onerous as to amount to unreasonable restrictions rendering the right almost illusory (vide the latest decision in Anant Mills Ltd. v. State of Gujarat, ).”

41. In the said case different provisions of the Haryana Ceiling on Land Holdings Act were under consideration. S. 18(7) imposed a condition of making a deposit of sum equal to 30 times the land holding tax payable in respect of the disputed area before any appeal or revision is entertained by the appellate or revisional authority. This provision was introduced in the year 1976 and earlier there was no such restriction on filing of an appeal or revision. Under sub-sec. (8) of S. 18 it was provided that if the appellant or the petitioner coming against the order declaring the land surplus fails in his appeal or revision he shall be liable to pay for the period he has at any time been in possession of the land declared surplus to which he was not entitled under the law. A license fee equal to thirty times the land holding tax was recovered in respect of land. There was a further amendment in this section in June 1978 thereby permitting the appellant or the petitioner to furnish a bank guarantee for the requisite amount as an alternative to making cash deposit. This provision was upheld by the Supreme Court for more than one reasons which have been enumerated. One of the grounds mentioned therein was that the amount required to be deposited was not a heavy amount. The fact, however, remains that in the said provision also there was no discretion with the appellate or the revisional authority to grant exemption from the payment of the amount and the provision was still held to be valid. It is, thus, clear that the consistent view has been that the appeal is a statutory right and it is open to the legislature to provide for conditions under which the right of appeal can be exercised.

42. We may also refer to the case Chatter Singh Baid v. Corporation of Calcutta, . It was a case relating to the payment of house-tax and the right of the aggrieved party who filed an appeal. Petitioners in the said case were the owners of Premises No. 11, Indra Kumar Karnani Street. and with effect from 4th quarter, 1978 the Corporation of Calcutta had determined the annual value of the said premises at Rs. 4,30,606/ -. Objections filed by the owners were disposed of by Special Officer of the Corporation and the value was fixed at Rs. 3,61,135/-.

43. owners were not satisfied by the assessment and so an appeal was filed in the Court of Small Causes, Calcutta.

44. Sub-section (3-A) added to S. 183 reads as under:-

“No appeal under this section shall be entertained unless the consolidated rate payable up to the date of presentation of the appeal on the valuation determined

(a) by an order under S. 182, in the case of an appeal to the Court of Small Causes,

(b) by the decision of the Court of Small Causes, in the case of an appeal to the High Court,

has been deposited in the municipal office and -such consolidated rate is continued to be deposited until the appeal is finally decided.”

45. This provision is similar to the provision contained in S. 170 of Delhi Municipal Corporation Act.

46. An argument was advanced by learned counsel for the petitioners that unless the appellate authority is given discretionary powers to relax or modify such condition for deposit of the disputed amount, the condition precedent ought to be pronounced as unreasonable. This argument was not accepted by observing that the observations made in para 40 of the Supreme Court decision in Anant Mills’case (supra) are directly against the. Anve. submission of the petitioners. Reliance was also placed on the case of Nand Lal v. State of Haryana (supra) holding that condition of prepayment before appeal could be heard is not onerous on account of there being no discretion left to the appellate and revisional authority to relax or waive the said condition. This case fully supports the view we are taking.

47. The proviso to S. 170 of the Delhi Municipal Corporation Act does not make the right of appeal nugatory or illusory because it is only on account of his own default to comply with the condition for deposit the appellant himself may fail to avail of the remedy by way of appeal. We are clearly of the view that the ratio of the decision in Anant Mills’ case (supra) and Nand Lal’s case (supra) is that the right of appeal is creature of statute and while ?ranting the right of appeal the legislature can impose conditions for exercise of such right and there is no constitutional or legal impediment to imposition of such a condition for deposit of tax.

48. Absence of a discretion in the appellate Court to exempt the deposit, of the amount of tax cause hardship in some cases but the Court cannot test the validity of the statutory provision on the touchstone of hardship or stringency. If a provision made in a statute is not invalid, any person desirous of availing the right of appeal has no option but to comply with the condition under which this right of appeal can be exercised. A restriction is, undoubtedly, bound to be irksome and painful to the citizens even though it may be for public good. However, important the right of a citizen or an individual may be, it has to yield to the larger interest of the country or the community.,

49. Learned counsel for the petitioner submits that there may be cases where the assessing authority goes palpably wrong in the determination of the rateable value of the property and may even assess a person not even being the owner of the premises. He has also suggested that on account of clerical mistake the assessment is made ten times or hundred times more and in such like cases the aggrieved person to may not be in a position to deposit the amount of tax and, thus, would be deprived of his property even when no such tax was due from him. We do not agree with this submission. The law presumes that all authorities function properly and bona fide with due regard to the public interest, however, in case there is any such contingency a party can resort to the writ jurisdiction of the High Court under Art. 226 of the Constitution of India. The mere fact that an assessed might have to deposit the amount of the tax when filing an appeal could not in every case justify his by-passing the remedies provided by the Act. There must be some thing more in a case to warrant the entertainment of the petition under Article 226 something going to the root of the jurisdiction of the officer or something to show that it would be a case of palpable injustice to the assessed to force him to take the remedy provided under the Act. Reference in this regard can be made to the case Sales Tax Officer, Jodhpur v. M/ s. Shiv Ratan G. Mohatta, . In case 1. T. C. Limited v. Union of-India, 1983 ELT I (Delhi) it has been held that as a matter of practice and procedure the Courts do not normally permit the aggrieved party to abandon the normal remedies of appeal etc. under the Act in favor of a petition under Art. 226 of the Constitution of India but if any action is taken without jurisdiction or if the Court comes to the conclusion that the alternative remedy provided under the Act is not adequate cannot inspire confidence inasmuch as it would amount to an appeal from ‘Ceaser to Ceaser’ then the existence of an alternative remedy is no bar to the exercise of writ jurisdiction under Art. 226 of the Constitution. These two judgments provide a complete answer to the argument of the assessing authority committing an illegality apparent on the face of the record or going beyond the jurisdiction. Except such like cases an individual has to comply with the provisions of deposit of the amount before he can be permitted to avail the right of appeal.

50. We may also note that the Municipal Corporation of Delhi has to maintain essential civil services, like water supply, street lighting etc. apart from running public institutions. It has also to pay the salaries of the ,staff. Liquid cash is, thus, required for the running of its administration by the Municipal Corporation. We are of the opinion that this may be one of the reasons for the legislature to make a provision for the deposit of the disputed amount before an appeal is entertained by the District Judge. An assessed getting relief in appeal would have a right of adjustment of the excess amount paid as tax and, thus, he is not deprived of any excess amount.

51. At this stage it would be useful to refer to a recent judgment of the Supreme Court in case Shri Vijay Prakash D. Mehta/Sh. Jawahar D. Mehta v. Collector of Customs (Preventive) Bombay, Judgment Today . In the said case at the material time in 1983 Vijay Prakash D. Mehta and Shri Jawahar D.Mehta were based in Hong Kong and Singapore respectively. They came to India in February, 1983 and were charged of alleged offences under Ss. 112 and 114 of the Customs Act and simultaneously they were alleged to have committed offences under the Foreign Exchange Regulation Act (FERA). Petitioners’ statements were recorded by the Enforcement Authorities under Sec. 40 of FERA which according to them were obtained by using third degree methods. Their statements, however, were not recorded under S. 108 of the Customs Act. In the FERA proceedings they were, however, discharged on a request by the FERA authorities. The Enforcement Directorate, however, instituted adjudication proceedings and vide order dated 19th January, 1984 the Additional Collector of Customs (Preventive), Bombay imposed a penalty of Rs. 3 lacs on each of the appellants, against which they preferred an appeal to the appellate tribunal. The order of the Additional Collector of Customs (Preventive) was modified and both the appellants were asked to deposit a sum of Rs. I lac each pending hearing of their appeals – They failed to deposit this amount on account of which their appeals were dismissed. The plea taken up by them in the Supreme Court was that they had no money, hence the right of appeal would be illusory unless they were permitted to deposit only Rs. 60,000/ – each which they had procured with the assistance of their father. Under S. 129-E of the Act there was a proviso authorising the appellate tribunal to dispense with such deposits subject to such conditions as it may deem fit to impose so as to safeguard the interest of revenue. Not accepting the plea of the petitioner it was held that the right to appeal is neither absolutely right nor an ingredient of natural justice and the principles of which must be followed in all judicial and quais-judicial adjudications. The right to appeal is a statutory right and it can be circumscribed by the conditions in the grant. This judgment, thus, amply supports our conclusion that there is no absolute right of appeal and it being not a right under the Constitution there is nothing wrong in the statute making a provision of conditional appeal and a person desirous of availing the provision of appeal has to comply with the conditions.

52. Learned counsel for the petitioner has placed reliance upon the case M/s. Wire Netting Stores, Delhi v. The Regional Provident Funds Commissioner, New Delhi, . In this case no right of appeal was available to an employer and the provisions of Sec. 7A of the Employees’ Provident Funds and Miscellaneous Provisions Act were held to be unreasonable, violative of Article 14 of the Constitution. Submission of learned counsel for the petitioner has been that even in the instant case there is practically no right of appeal on account of an onerous condition of predeposit and so proviso to Sec. 170 of Delhi Municipal Corporation Act is violative of Article 14 of the Constitution of India. We have carefully gone through, the aforesaid judgment and have, no doubt, in our mind that this-judgment cannot be of any help to the petitioners. The admitted facts in the said case were that no appeal was provided from the decision of the Commissioner of Provident Funds nor could it be justified in a Civil Court. It was held that a provision should have been made for an appeal to tribunal, judicial or quasijudicial. It is also pertinent to note that in the said case powers were conferred on the Commissioner to enforce attendance of persons to examine them on oath and require discovery and production of documents. However, no such right was made available to the employer. In this way, the procedure provided was not just as it did not provide similar opportunities to the employer as were made available to the Commissioner. There was a complete absence of the right to challenge the order of the Commissioner though with a proviso to the effect that the amount of tax has to be deposited before the appeal is heard or determined. This judgment, thus, is distinguishable and cannot be of any help to the petitioners.

53. As a result, the writ petitions are dismissed. In the circumstances, the parties are left to bear their own costs.

PER COURT

54. In view of the majority decision our findings on the questions formulated are as follows:

(1) The deposit of the tax amount under S. 170(b) of the Delhi Municipal Corporation Act, 1957 is a condition precedent for hearing or determination of the appeal but there is no restriction on filing the memorandum of appeal. However, mere filing of a memorandum of appeal shall not be construed as a valid and competent appeal for the purpose of S. 155(l) of the Delhi Municipal Corporation Act, 1957.

(2) The District Judge has no discretion to grant stay of the disputed amount or dispense with the condition of pre-deposit of the amount in appeal, with or without conditions. Further the amount in dispute in appeal referred to in S. 170(b) of the Delhi Municipal Corporation Act, 1957 would mean the tax amount based on the whole amount of the rateable value.

(3) The provisions of Section 170(b) of the Delhi Municipal Corporation Act, 1957 are intra vires the Constitution of India.

55. In the light of the above findings, the writ petitions are dismissed. However, in the circumstances of this case we make no order as to costs.

Petitions dismissed.