Judgement

RAMASWAMI, J.: The question of law involved in this appeal is whether the primary liability is imposed on the appellant under the Bombay Municipal Corporation Act, 1888 (Act No. 3 of 1888) to pay property taxes to the respondent, i.e., the Municipal Corporation of Greater Bombay in respect of land owned by the appellant and let on a monthly basis to a third party who has constructed a building thereon.

2. The appellant is a banking company incorporated in the United Kingdom and has established places of business in India. The appellant is the sole trustee of the estate of the late Mr. F. E. Dinshaw and in that capacity is the owner of a plot of land at Manchubhai Road, Malad, Greater Bombay in the State of Maharashtra, bearing No. P. Ward No. 6418, Street No. 299B. The said plot of land had been leased by the former trustee of the estate to one Mr. R. R. Pande (hereinafter referred to as the lessee) since a number of years at a monthly rent of Rs. 12.50. The lessee had constructed at his own cost a tiled house on the said plot of land. The Malad area merged into Greater Bombay on lst February, 1957. Upto the date of the merger the Malad District Municipality was assessing and levying taxes on the land and the structure separately and recovering the same from the landlord and the tenant. After the merger, the Bombay Municipal Corporation issued a notice to the appellant under Section 167 of the Act informing him that the assessment book had been amended by inserting the name of the appellant and that the rateable value of the house had been fixed at Rs. 430/-. Being aggrieved by this order the appellant preferred an appeal to the Chief Judge, Small Causes Court Bombay under Section 217 of the Act. The appeal was dismissed by the Chief Judge, Small Causes Court by his order dated 3rd August, 1960. The appellant took the matter in further appeal to the Bombay High Court. The appeal was heard by Mr. Justice Patel and was dismissed on the 14th January, 1964. The learned Judge felt that he was bound by the decision of Chagla, C. J. and Shah, J., in Ramji Keshavji v. Municipal Corporation for Greater Bombay, (1954) 56 Bom LR l132. The appellant thereafter preferred a Letters Patent Appeal No. 28 of 1964 which was summarily dismissed by Chief Justice H. K. Chainani and Mr. Justice Gokhale on 25th March, 1964. The present appeal is brought by special leave from the judgment of the Bombay High Court dated 25th March, 1964.

3. Section 3 (r) of the Bombay Municipal Corporation Act, 1888 (Act No. 3 of 1888) (hereinafter called the Act) defines land as including land which is being built upon or is built upon or covered with water ...." Section 3 (s) defines building as including a house, out-house, stable, shed, hut and every other such structure, whether of masonry bricks, wood, mud, metal or any other material whatever. Section 3 (gg) defines premises as including messages, buildings and lands of any tenure, whether open or enclosed, whether built on or not and whether public or private. Section 140 states:

"140. The following taxes shall be levied on buildings and lands in Greater Bombay and shall be called "property taxes", namely:

(a) a water tax of so many per centum of their rateable value as the corporation shall deem reasonable for providing a water-supply for Greater Bombay.

(b) a halalkhor-tax of so many per centum, not exceeding five of their rateable value as will, in the opinion of the corporation, suffice to provide for the collection, removal and disposal, by municipal agency, of all excrementitious and polluted matter from privies, urinals and cesspools and for efficiently maintaining and repairing the municipal drains constructed or used for the receptions or conveyance of such matter, subject however, to the provisions that the minimum amount of such tax to be levied in respect of any one separate holding of land, or of any one building or of any one portion of a building which is let as a separate holding, shall