REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 5242 OF 2008
[Arising out of SLP (C) No. 4351 of 2007]
M. K. Palia & Sons Pvt. Ltd. .. Appellant
Versus
Mumbai Municipal Corporation
& Another ..
Respondents
JUDGMENT
Dalveer Bhandari, J.
1. Leave granted.
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2. This appeal is directed against the judgment of the
Bombay High Court dated 25.9.2006 passed in Writ Petition
No.1989 of 2006.
3. Brief facts giving rise to the present appeal are
recapitulated as under:
The appellant is one of the 600 lessees of the Mumbai
Port Trust, who after a lapse of 23 years has challenged the
rateable value fixed by the Mumbai Municipal Corporation in
the year 1982.
4. There are 600 lessees and the appellant is one of them.
According to the learned counsel appearing for the respondent
Mumbai Municipal Corporation, 599 lessees have already paid
the rateable value fixed by the Mumbai Municipal
Corporation. The appellant has challenged the rateable value
fixed in the year 1982 by filing a complaint in November,
2005. The appellant is the lessee of commercial premises
admeasuring 845.70 sq. meter area i.e. 9048 sq. ft.
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5. Under Section 162 of the Mumbai Municipal Corporation
Act, 1888 (for short `the Act’), the Commissioner has to give
fifteen days notice from the date of publication of such notice
according to the scheme of the Act. The notice has to be
advertised in the local newspapers and published in the
Official Gazette and complaints against the amount of any
rateable value shall be entertained by the office.
6. In order to properly comprehend the controversy in this
case, it is imperative to understand the scheme of the Act by
carefully perusing the provisions of the Act.
7. Section 156 of the Act deals with rateable value of each
such building and land determined in accordance with the
provisions of the Act. Section 156 of the Act reads as under:
“156. Assessment book what to contain- The
Commissioner shall keep a book, to be called “the
assessment book” which shall be entered every
official year-
(a) a list of all buildings and lands in Brihan
Mumbai distinguishing each either by
name or number, as he shall think fit;
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(b) the rateable value of each such building
and land determined in accordance with
the foregoing provisions of this Act;
(c) the name of the person primarily liable
for the payment of the property taxes, if
any, leviable on each such building or
land;
(d) if any such building or land is not liable
to be assessed to the general tax, the
reason of such non-liability;
(e) when the rates of the property-taxes to be
levied for the year have been duly fixed
by the corporation and the period fixed
by public notice, as hereinafter provided,
for the receipt of complaints against the
amount of rateable value entered in any
portion of the assessment-book, has
expired, and in the case of any such
entry which is complained against, when
such complaint has been disposed of in
accordance with the provisions
hereinafter contained, the amount at
which each building or land entered in
such portion of the assessment-book is
assessed to each of the property-taxes, if
any, leviable thereon;
(f) if under section 169, a charge is made for
water supplied to any building or land by
measurement or the water taxes or
charges for water by measurement are
compounded for, or if, under section 170,
the sewerage taxes or sewerage charges
for any building or land are fixed at a
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special rate, the particulars and amount
of such charges, composition or rates;
(g) such other details, if any, as the
Commissioner from time to time thinks
fit to direct.”
8. Sections 160 and 162 of the Act read as under:
“160. Public notice to be given when valuation
of property in any ward has been completed. (1)
When the entries required by clauses (a), (b), (c) and
(d) of section 156 have been completed, as far as
practicable, in any ward assessment book, the
Commissioner shall give public notice thereof and of
the place where the ward assessment-book, or a
copy of it, may be inspected.
(2) Such public notice shall be given by
advertisement in the Official Gazette and in the
local newspapers, and also by posting placards in
conspicuous places throughout the ward.
162. Time for filing complaints against
valuations to be publicly announced. (1) The
Commissioner, shall at the time and in the manner
prescribed in section 160, give public notice of a
day, not being less than fifteen days from the
publication of such notice, on or before which
complaints against the amount of any rateable
value entered in the ward assessment-book will be
received in his office.
(2) Special notice to be issued in certain cases.-
In every case in which any premises have for the
first time been entered in the assessment-book as
liable to the payment of property rates or in which
the rateable value of any premises liable to such
6payment has been increased, the Commissioner
shall, as soon as conveniently may be after the
issue of the public notice under sub-section (1), give
a special written notice to the owner or occupier of
the said premises specifying the nature of such
entry and informing him that any complaint against
the same will be received in his office at any time
within fifteen days from the service of the special
notice.”
9. Under section 164 of the Act, all complaints received by
the Commissioner are properly investigated and under Section
165 of the Act, those complaints are disposed of in the
presence of the complainants. Sections 164 and 165 of the
Act read as under:
“164. Notice to complaints of day fixed for
investigating their complaints.- The
Commissioner shall cause all complaints so
received to be registered in a book to be kept for
this purpose and shall give notice in writing to each
complainant, of the day, time and place when and
whereat his complaint will be investigated.
165. Hearing of complaint.- (1) At the time and
place so fixed the Commissioner shall investigate
and dispose of the complaint in the presence of the
Complainant, if he shall appear, and, if not, in his
absence.
(2) For reasonable cause, the Commissioner
may from time to time adjourn the investigation.
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(3) When the complaint is disposed of, the
result thereof shall be noted in the book of the
complaints kept under section 164, and any
necessary amendment shall be made in accordance
with such result, in the assessment-book.”
10. Section 167 is also relevant and the same reads as
under:
“167. Assessment-book may be amended by the
Commissioner during the official year.- (1) The
Commissioner may, upon the representation of any
person concerned, or upon any other information,
at any time during the official year to which an
assessment-book relates amend the same by
inserting therein the name of any person whose
name ought to be so inserted or any premises
previously omitted or by striking out the name of
any person not liable for the payment of any
property tax, or by increasing or reducing the
amount of any rateable value and of the assessment
based thereupon, or by making of cancelling an
entry exempting any premises from liability to any
property-tax.
(2) Every such amendment shall be deemed
to have been made, for the purpose of determining
the liability or exemption of the person concerned in
accordance with the altered entry, from the earliest
day in the current official year when the
circumstances justifying the amendment existed.”
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11. According to the scheme of the Act, any person aggrieved
by disposal of the complaint regarding fixation of rateable
value can challenge the same by filing an appeal under section
217 of the Act.
12. Section 217 of the Act reads as under:
217. Appeals when and to whom to lie. (1
Subject to the provisions hereinafter contained,
appeals against any rateable value or tax fixed or
charged under this Act shall be heard and
determined by the Chief Justice of the Small Cause
Court.
(2) But no such appeal by the Chief Judge of
the Small Cause Court shall be entertained by the
said Chief Judge, unless–
(a) it is brought within fifteen days after
the accrual of the cause of complaint;
(b) in the case of an appeal against a
rateable value a complaint has previously been
made to the Commissioner under section 163
as such complaint has been disposed of;
(c) in the case of an appeal against any
amendment made in the assessment book
under section 167 during the official year, a
complaint has been made by the person
aggrieved within fifteen days after the first
received notice of such amendment, and his
complaint has been disposed of;
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(d) in the case of an appeal against a
tax, or in the case of an appeal made against
rateable value the amount of the disputed tax
claimed from the appellant, or the amount of
the tax chargeable on the basis of the disputed
rateable value, up to the date of filing of the
appeal, has been deposited by the appellant
with the Commissioner.
(3) In the case of any appeal entertained by
the Chief Judge, but not heard by him before the
date of commencement of the Maharashtra
Municipal Corporation (Amendment) Act, 1975, the
Chief Judge shall not hear and decide such appeal
unless the amount of the dispute tax claimed from
the appellant, or the amount of the tax chargeable
on the basis of the disputed rateable value, as the
case may be, up to the date of filing the appeal, has
been deposited by the appellant with the
Commissioner within thirty days from the date of
publication of a general notice by the Commissioner
in this behalf in the local newspapers. The
Commissioner shall simultaneously serve on each
such appellant a notice under section 484 and 485
and other relevant provisions of this Act, for
intimating the amount to be deposited by the
appellant with him.
(4) As far as possible, within fifteen days
from the expiry of the period of thirty days
prescribed under sub-section (3) the Commissioner
shall intimate to the Chief Judge the names and
other particulars of the appellants who have
deposited with him the required amount within the
prescribed period and the names and other
particulars of the appellants who have not
deposited with him such amount within such
period. On receipt of such intimation, the Chief
Judge shall summarily dismiss the appeal of any
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appellant who has not deposited the required
amount with the Commissioner within the
prescribed period.
(5) In the case of any appeal against any
rateable value or property tax fixed or charged
under this Act, which may have been entertained by
Chief Judge before the commencement of the Act
aforesaid, or which may be entertained by him after
the said date, the Chief Judge shall not hear and
decide such appeal unless the property tax, if any,
payable on the basis of the original rateable value
plus eighty per centum of the property tax claimed
from the appellant on the increased portion of the
rateable value of the property out of the property
tax claimed under each of the bills, which may have
been issued, from time to time, since the Filing of
appeal, is also deposited with the Commissioner
within the period prescribed under the Act. In case
of default of the appellant, on getting an intimation
to that effect from the Commissioner, at any time
before the appeal is decided, the Chief Judge shall
summarily dismiss the appeal:
Provided that in case the appeal is decided in
favour of the Corporation, interest at 6.25 per
centum per annum shall be payable by the applicant
on the balance amount of the property tax from the
date on which the amount of property tax was
payable:
Provided further that, in case the appeal is
decided in favour of the appellant and the amount
of property tax deposited with the Corporation is
more than the property tax payable by him, the
Commissioner shall adjust the excess amount of
the property tax with interest at 6.25 per centum per
annum from the date on which the amount is
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deposited with the Corporation towards the
property taxes payable thereafter.”
13. The entire scheme of challenging the rateable value has
been fixed by the Corporation. There is also a statutory
provision of filing an appeal after the complaint has been
decided by the concerned authority.
14. In the instant case, the appellant has approached the
court regarding fixation of rateable value by filing a writ
petition after a lapse of 23 years. The other 599 lessees of the
building have already paid the rateable value fixed by the
respondent Corporation. Even the appellant has also
regularly paid rateable value fixed by the Corporation till
1999.
15. In the impugned judgment of the Division Bench of the
High Court dated 25.9.2006, it has been rightly observed that
there seems to be no justification of approaching the court
after a lapse of 23 years.
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16. Faced with this situation, the learned counsel for the
appellant tried to take shelter of the judgment of this Court in
Jamshed Hormusji Wadia v. Board of Trustees, Port of
Mumbai & Another (2004) 3 SCC 214. We have carefully
perused this judgment. It does not help the appellant at all.
The submission of the appellant that they are entitled to seek
review of the rateable value on the basis of Wadia’s judgment
(supra) is totally devoid of any merit.
17. Nine-Judge Bench of this court in Mafatlal Industries
Ltd. & Others v. Union of India & Others (1997) 5 SCC 536
held that “once assessment or levy became final in case of a
manufacturer-assessee, he cannot later file suit or writ
petition claiming refund on the ground that decision of the
court or tribunal in another person’s case led him to discover
the mistake of law under which he paid the duty”.
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18. The High Court correctly observed that it was not a case
of unjust enrichment made under the mistake of law by the
respondent.
19. In pursuance to the notice issued by this court, the
Assistant Assessor and Collector of Mumbai Municipal
Corporation has filed a detailed counter affidavit. It was
submitted that the appellant has not only failed to file any
complaint in the year 1984 or in the subsequent years
challenging the increase in the rateable value but also paid
the taxes on the basis of increase in rateable value without
any demur or protest. Regarding increase in the rateable
value, by no stretch of imagination, it can be said to be
excessive, disproportionate or contrary to the provisions of the
Act. The appellant is carrying on commercial activities in the
prominent area of Mumbai and cannot be permitted not to pay
a reasonable rateable value of the premises.
20. In the counter affidavit, it is also incorporated that the
rateable value of the property was increased in accordance
1
with law in the year 1984-85 on account of the increase in the
lease rent by the Mumbai Port Trust. The appellant has paid
the taxes as per rateable value fixed by the Corporation upto
the year 1999 and the same has attained finality under
section 219 of the Act and cannot be re-opened with
retrospective effect.
21. Section 219 deals with unappealed value and taxes and
decisions on appeal to be final and the same reads as under:
“219. Unappealed values and taxes and decisions
to appeal to be final.- (1) Every rateable value fixed
under this Act against which no complaint is made
as hereinbefore provided, andthe amount of every sum claimed from any
person under this Act on account of any tax, if no
appeal therefrom is made as hereinbefore provided,
andthe decision of the Chief Judge aforesaid upon
any appeal against any such value or tax, if no
appeal is made therefrom under section 218D, shall
be final.
(2) Effect shall be given by the Commissioner
to every decision of the said Chief Judge on any
appeal against any such value or tax.”
122. It was submitted by the respondent that in view of the
aforesaid provisions it is not within the powers of the
Commissioner or the respondent to reopen the assessment or
make any alternation in the assessment done with
retrospective effect.
23. Though it was not necessary to examine the detailed
averments of the complaint, however, in order to satisfy
ourselves that there is no injustice done to the appellant, we
have also looked into the facts of this case. The appellant’s
property No. 2797(1) being used for commercial purpose was
assessed on 31st March, 1961 at the rateable value of
Rs.20,100/- per annum. The premises was assessed as land
with C.I. Shed having an area of 2860 sq. ft. assessed at the
rate of Rs.8/- per brass and remaining land for storage was
assessed at the estimated rent of Rs.1,766/-. The property
was, therefore, assessed at a rateable value of Rs.20,100/- per
annum with effect from 31.3.1961. The rateable value of the
property was revised to Rs.25,645/- in the year 1984-85 on
account of increase in rent by the owner. There has been
1increase of Rs.5,545/- in the rateable value after about 23
years, which cannot be said to be exorbitant by any stretch of
imagination. It may be pertinent to mention that rateable
value for 2006-07 is still Rs.25,645/-. The appellant
continued to pay increased rateable value without any demur
till 1999. The complaint for the first time was filed on
12.11.2005.
24. It is incorporated that the appellant has, however, not
paid property tax from the year 2000 till December, 2007.
The total amount of Rs.5,86,185/- is outstanding by way of
taxes an amount of Rs.64,216/- by way of penalty and
Rs.750/- towards fees for notice of demand. Admittedly,
these amounts have not been paid by the appellant.
25. We do not want the appellant to get undue advantage
over all other 599 lessees, who have been regularly paying the
taxes within the prescribed time. The appellant by filing a
frivolous petition should not get unjust advantage over other
lessees, therefore, we direct the appellant to pay the entire
1outstanding amount with 10% interest per annum from the
date when the amount became due and payable along with
penalty and the fees towards notice of demand being charged
by the respondent. In case the amount is not paid by the
appellant within two months time, then respondent no. 1
would be entitled to get 15% interest on the outstanding taxes
from the date when it becomes due and payable and would
also be at liberty to take appropriate steps in accordance with
law.
26. This appeal, being devoid of any merit, is accordingly
dismissed with costs.
………………………………J.
(Dalveer Bhandari)………………………………J.
(Harjit Singh Bedi)
New Delhi;August 26, 2008.