Judgement

Consolidated Appeals (Nos. 7 and 8 of 1943) from a judgment and two decrees of the High Court (January 29, 1941), which had affirmed a judgment and two decrees of the Subordinate Judge of

Law. Rep. 71 Ind. App. 113 ( 1943- 1944) Madras and Southern Mahratta v. Bezwada Municipality

29

Bezwada (March 31, 1937).

These appeals arose out of two suits brought by the appellants, the Madras and Southern Mahratta Railway Co., Ld., for a refund of property tax levied by the respondents, the Municipal Council, Bezwada, under the Madras District Municipalities Act, 1920, as amended to 1933, for the quinquennium beginning 1931-32 on vacant lands belonging to the appellants in the respondent municipality. The question was whether the provisions of the Act had been complied with in substance and effect by the respondents in levying the tax in question.

On March 15, 1929, the local self-government department of the government of Madras issued a notification regarding instructions for the assessment of railway buildings and land with effect from 1929-30, and which provided, inter alia, that " with the concurrence of the government of India, the local “ government are pleased to issue the following instructions " for the assessment of railway buildings and lands to property " tax in municipalities .... (1.) The annual value of " buildings of a class not ordinarily let shall be deemed to be " six per cent, of their book value for a period of five years " after their first constructions. (2.) In the case of other “buildings and lands after a period of five years after construction in the case of buildings mentioned in sub-para. (1.) " above, the annual value shall be fixed once in every five " years in accordance with s. 82 of the Madras District " Municipalities Act, 1920 . . . ." On February 8, 1930, the respondents wrote to the appellants calling on them to pay Rs. 17,558-6-0 as the tax on the appellants vacant lands for the year 1929-30 only. The appellants objected to the assessment, and on March 12, 1932, the respondents wrote to the appellants convening a valuation committee, which included a representative of the appellants, for fixing the valuation of vacant sites belonging to the appellants at Bezwada for the quinquennium 1931-36. The valuation committee met on March 19, 1932, and arrived at the capital value of the vacant sites and calculated the annual value thereon at six per cent, of the capital value for the quinquennium beginning April 1, 1931, and ending on March 31, 1936. In accordance with that valuation the respondents levied Rs. 20,508-12-0 as the land tax due on the appellants vacant sites for the first year, 1931-32, calculated at 16J per cent, per annum of the annual value arrived at by the committee, and called on the appellants to pay that tax. Similar demand notices were issued for the successive years of the quinquennium 1931-36, based on the valuation adopted for the first year.

The appellants, aggrieved by the decision of the valuation committee, applied to the Collector of the Kistna District on January 26, 1933, for his ruling, and on February 12, 1933, the Collector decided that no appeal in the ordinary sense of the term had been filed against the decision of the valuation committee, and so the valuation of the valuation committee held good. Between March 16, 1933, and January 12, 1935, the appellants paid a total sum of Rs. 71,637-12-4 for the years 1932-33, 1933-34 and 1934-35. The payments were made under protest and without prejudice to any claim for refund. The appellants having failed in further representations to the government of Madras and to the railway board of the government of India thereupon instituted the suits out of which these appeals arose, the first on March 28, 1935, for the refund of the tax levied for the year 1931-32 ; the second on July 4, 1935, for the refund of the tax levied for the three years 1932-33, 1933-34 and 1934-35.

The Subordinate Judge tried both suits together, and