JUDGMENT - THAKKER C.K., C.J.:—This petition is filed by the petitioners for quashing and setting aside a demand notice dated 23rd December, 2003 for an amount of Rs. 2,09,64,344/- (Exh. K). A prayer is also sought directing respondent No. 1 to accept building completion certificate dated 11th April, 1989 issued by the Area Manager of respondent No. 1 Corporation.

2.The case of the petitioners is that petitioner No. 1 is a Public Limited Company having its registered office at Plot No. F-4, Maharashtra Industrial Development Corporation, Badlapur, Dist. Thane. Petitioner No. 2 is the Executive Director of petitioner No. 1. Respondent No. 1 is Maharashtra Industrial Development Corporation ("MIDC" for short), a Government of Maharashtra undertaking constituted under the Maharashtra Industrial Development Act, 1961 (hereinafter referred to as "the Act"). Respondent No. 2 is the State of Maharashtra.

3.The grievance of the petitioners is that the Deputy Engineer of the first respondent illegally refused to accept the Building Completion Certificate ("BCC" for short) issued by the Area Manager of respondent No. 1. Consequently a demand was made for payment of more than rupees two crores as difference between normal rate and penal rate of water charges. According to the petitioners, they had regularly paid water charges at normal rates. The action of the first respondent in demanding water charges at penal rate of 1.5 times is illegal, contrary to law and unlawful. Since the first respondent Corporation is insisting for penal rate of water charges, the petitioner is constrained to approach this Court.

4.The first respondent-Corporation formulated a scheme under which every industrial unit was required to submit BCC for its factory building and construction. If BCC is not submitted, the first respondent used to levy water charges at the penal rate of 1.5 times of normal water charges. According to the petitioners, first respondent is neither authorised nor entitled to levy water charges at penal rate. Several representations were, therefore, made to respondent No. 1 to waive or relax condition as to payment of water charges at penal rate. Respondent No. 1 accordingly issued a circular dated 31st July, 1998 confirming that those plot holders who had not obtained BCC would not be required to pay water charges at penal rate of 1.5 times of normal water charges provided conditions laid down in the said circular would be satisfied. It is asserted by the petitioners that since they had complied with and fulfilled all the conditions of circular dated 31st July, 1998, they were not required to pay water charges at penal rate.

5.It is also the case of the petitioners that the construction of the factory of petitioner No. 1 was complete and the construction was in accordance with law. A prayer was, therefore, made to issue BCC. The Area Manager, D-VIII of the first respondent issued the certificate on 11th April, 1989. Thus, even that requirement was complied with. The petitioners have stated that the first respondent issued a circular on February 1, 2002, purportedly withdrawing the earlier circular dated 31st July, 1998. By the said circular i.e. circular of 1st February, 2002, the first respondent intimated the petitioners that the circular dated 31st July, 1998 was cancelled and as per MIDC Rules, penal rate of 1.5 times water charges are applicable to plot holders who have not obtained BCC. It is contended that the first respondent is wrongfully implementing the circular dated February 1, 2002 with retrospective effect by asking the petitioners to pay water charges from 1998. The said action is illegal and improper. It is also contended that in total disregard to the certificate dated 11th April, 1989, on 1st April, 2002, respondent No. 1 issued a revised bill of Rs. 86,89,006/- on account of rate difference of water charges from August, 1998 to January, 2002. The said action was taken on the ground that the petitioners had not obtained BCC.

Click Here to Read the rest of this document