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IN THE HIGH COURT OF BOMBAY
R.M. Lodha D.B. Bhosale, JJ.
Naman Developers Pvt. Ltd. another.... Petitioners.
Versus
Municipal Corporation of Greater Mumbai others.... Respondents.
Writ Petition Nos. 2465, 2758, 1634, 1295, 444 of 2001 along with 319 646 of 2002, decided on 19-8-2002.
Advocates appeared :
Aspi Chinoy, Sr.Adv. with Ms. Preeti Shah in W.P. No. 2465/2001, for petitioners.
K.K. Singhvi, Sr.Adv. with N.A. Shaikh i/b. S.J. Billimoria in W.P. Nos. 2465, 2758, 1634 444/2001, 319 646/2002, for respondents.
Y.E. Moomen with Ms. M.B. Gawde in W.P. No. 2758/2001, for petitioners.
V.A. Thorat, Sr.Adv. with Ms. Seema Sarnaik in W.P. No. 1634/2001, for petitioners.
Aspi Chinoy, Sr.Adv. with Shyam Diwan, Paresh Shah, Ms. Payal Daftari and Ms. Shefali Desai i/b. S.J. Billimoria in W.P. No. 1295/2001, for respondents.
Bipin Joshi in W.P. No. 319/2002, for petitioner.
A.Y. Bookwala with Tushar Bhavsar i/b. V. Mistry Co. in W.P. No. 646/2002, for petitioners.
Mumbai Municipal Corporation Act, 1888 - Section 217 - Constitution of India, Article 226 - Rateable value of Land - Fixing of - Jurisdiction of Assessor and Collector - Value of land under construction fixed at much higher rate than that fixed for vacant land - Contention that land under construction is to be treated as vacant land - Value can be fixed for period as vacant land only - Held - Land which is being built upon for rating is to be valued as vacant land in relevant year - Not whole land at same rate - Order fixing rateable value of land under construction at much higher rate not without jurisdiction. - The question was whether it was open to the Assessor to assess land under construction as not vacant plot of land. The stand of Assessing Officer was that land under construction cannot be treated as vacant plot of land. The stand of Assessor being contrary to the judgment of the Apex Court in Polychem, the writ petition was entertained and allowed though appeal against the impugned assessment was pending. Once the Apex Court had ruled that land under construction has to be treated as vacant land, obviously, the Assessing Officer had no jurisdiction to hold otherwise and treat land under construction not as vacant plot of land. The action of Assessing Officer in real to was ex facie without jurisdiction and, therefore, this Court was satisfied to invoke extraordinary jurisdiction under Article 226 of the Constitution of India. In this group of petitions before us, the Assessing Officer has valued land under construction for the purposes of rating, as vacant land only which is in conformity with the law laid down by Apex Court in Polychem, though at a much higher rate which may or may not have been justified at that rate but the order of the Assessing Officer cannot be said to be without jurisdiction.
Mumbai Municipal Corporation Act, 1888 - Section 217 - Rateable value of Land - Rate of land fixed at much higher rate than fixed - Remedy against - Held - An aggrieved party can challenge it by way of statutory appeal under Section 217 of M.M.C. Act - Further appeal lies before High Court. - Legality, correctness or otherwise justification of the high rateable value fixed for land under construction as vacant land than the remaining land simpliciter has to be questioned by the aggrieved party in a statutory appeal provided under Section 217 of M.M.C. Act, 1988 which is in the nature of original proceedings. Since, according to us, the petitioners have adequate and efficient statutory remedy in challenging the fixation of rateable value of land under construction, we need not go into the matter further and the petitioners, if so advised, may challenge fixation of rateable value in the statutory appeal.
as it involved common issue. The common issue being: "Whether the Assessor and Collector in the office of Municipal Corporation of Greater Bombay has acted without jurisdiction by fixing rateable value of land under construction thereby not following the law laid down by the Apex Court in (The Municipal Corporation of Greater Bombay v. M/s. Polychem Ltd.)1, A.I.R. 1974 S.C. 1779, or the petitioners should be relegated to the statutory remedy of appeal under section 217 of the Mumbai Municipal Corporation Act, 1888 (for short, MMC Act, 1888') and question the legality, justification and/or correctness of fixation of rateable value of land under construction before appellate forum.
2. For the sake of convenience and brevity we refer to the facts obtaining in Writ Petition No. 2465/2001. Pursuant to the agreement for sale dated 29-10-1993, Naman Developers Private Limited (the petitioner No. 1) purchased property comprising of land together with bungalow, building and structures standing therein at Kandivali (West), Mumbai. The said property had the then bearing C.T.S. Nos. 403, 404, 405, 409 and 410. The conveyance in favour of the petitioner No. 1 for the aforesaid property was executed on 7-3-1996. After relocation, amalgamation and sub-division of the said property, new C.T.S. Nos. of the said property are 403-A, 403-B, 403-C, 403-D and 403-E. The first commencement certificate was obtained by the petitioner No. 1 from Mumbai Municipal Corporation of Greater Bombay on 7-7-1994 after the agreement of sale was executed in their favour on 29-10-1993 and old and dilapidated structures were demolished for the period between 1994 and 1997. The construction work commenced in the month of September 1995. Prior to 31-3-1995 the entire property had a rateable value fixed at Rs. 1335/-. For the period from 1-4-1995 to 31-3-1996 the assessor divided the plot notionally into two parts, one which was lying vacant and the other which was being built upon. The rateable value was fixed at Rs. 1335/- for land lying vacant and the rateable value of the land which was under construction was fixed at Rs. 2,53,140/-. The said rateable value was maintained for the year 1-4-1996 to 31-3-1997. Vide communication dated 29-3-1997 the Assessor and Collector, R/South Ward intimated that rateable value for land under construction shall be increased to Rs. 11,98,200/- from 15-3-1997. The petitioner No. 1 lodged complaint against fixation of the said rateable value on 31-3-1997 by writing to the concerned Assessor and Collector that rateable value fixed was on higher side and needed to be reduced to the minimum. Pursuant to the lodging of the complaint, the petitioner No. 1 was issued notice on 2-8-1997 for hearing on 28-8-1997. The concerned Assessor and Collector, after hearing the party reduced the rateable value for land under construction to Rs. 10,40,690/- with effect from 15-3-1997. While rateable value for land which was lying vacant was fixed at Rs. 885/-. The petitioners were called upon to make payment of the due property tax for the land under construction amounting to Rs. 10,40,690/- together with penalties but when such amount was not paid, warrant of attachment was ultimately issued. The petitioners, it may be noted, prayed to the authorities for payment of property taxes by way of instalments. By communication dated 14-3-2001 the petitioner No. 1 was allowed to pay the balance amount of property taxes in three monthly equal instalments though the prayer of the petitioners was to grant them quarterly instalments for payment of arrears of property taxes and the penalty. The petitioners did not pay the complete property taxes as demanded and instead by letter dated 27-9-2001 addressed to Joint Municipal Commissioner set up the case that the property is the land under construction which is not assessable to rateable value and no property tax can be levied or charg
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