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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ARUN R. PEDNEKER, J.
Nagari Niwara Parishad, Goregaon – Appellant
Versus
Municipal Corporation of Greater Mumbai and Anr. – Respondents
First Appeal No.1231 Of 2003 WITH FIRST APPEAL NO.1250 OF 2003 WITH FIRST APPEAL NO.1248 OF 2003 with FIRST APPEAL NO.1234 OF 2003 WITH FIRST APPEAL NO.1233 OF 2003 WITH FIRST APPEAL NO.1239 OF 2003 WITH FIRST APPEAL NO.1236 OF 2003 WITH FIRST APPEAL NO.1240 OF 2003 WITH FIRST APPEAL NO.1242 OF 2003 WITH FIRST APPEAL NO.1237 OF 2003 WITH FIRST APPEAL NO.1241 OF 2003 WITH FIRST APPEAL NO.1243 OF 2003 WITH FIRST APPEAL NO.1245 OF 2003 WITH FIRST APPEAL NO.1246 OF 2003 WITH FIRST APPEAL NO.1232 OF 2003 WITH FIRST APPEAL NO.1235 OF 2003 WITH FIRST APPEAL NO.1247 OF 2003 WITH FIRST APPEAL NO.1238 OF 2003 WITH FIRST APPEAL NO.1244 OF 2003 WITH FIRST APPEAL NO.1249 OF 2003
Decided On : 12-11-2024
JUDGMENT :
(Arun R. Pedneker, J.)
1. Appellants are challenging the Judgment and Order dated 29.10.2002 passed by the Additional Chief Judge of Small Causes Court in the Municipal Appeals Nos.59 of 1998 to 73 of 1998, 131 and 132 of 1998, 441, 443 and 444 of 1999 in the First Appeal Nos.1231 to 1250 of 2003.
2. As the appeals involve identical issues, all the first appeals are taken up together for consideration and the facts are taken from First Appeal No.1231 of 2003.
3. Questions involved in these appeals are:
If the answer to the above question is NO, then,
{2} Whether the rateable value of the assessed property, as determined by the Small Causes Court at the rate of Rs.300/- per sq.mtr. is excessive ?
{3} In view of the second proviso to Section 217(5) of the Mumbai Municipal Corporation Act, 1888 (for brevity “MMC Act”), whether direction can be issued by the Small Causes Court or by this court in exercise of the appellate jurisdiction under Section 218-D of the MMC Act for refund of the excess amount of property taxes deposited by the appellant or has to necessarily direct adjustment of the excess property tax deposited with the corporation towards the future property taxes of the assessed property ?
FACTS:
4. The appellant is a public charitable trust registered under the Bombay Public Trusts Act, 1950. The intent and object of the Trust is to secure shelter for the poor and weaker sections of the society and also to extend legal aid to the needy persons. Trust has constructed 6213 tenements in a housing project executed on 62 acres of land.
5. On 13.10.1983, Appellants applied to the Government of Maharashtra for making available land for housing its members belonging to weaker sections of the society.
On 16.02.1991, State Government passed Resolution to allot 62 acres of land out of 130 acres under Survey No.239 part of Village Malad to Appellant as per policy of 12.05.1983 on terms and conditions stipulated in the sanction.
On 26.03.1992, State Government gave possession of 62 acres of residential area for housing 6200 members of the appellants at the rate of Rs.25/- Square Meters which was paid by the appellant.
On 19.12.1994, Layout Plan was approved by the respondent subject to appellant constructing roads, lighting, drainage, sewerage, recreation spaces, amenity etc. Respondents took registered undertaking from the appellant. The appellant was required to even out the land and construct the roads internal and DP. Appellant obtained IOD for 67 buildings and 17 CC. Construction of 15 buildings started on Plot No.53 to 62 and 64 to 68.
On 27.03.1997, Special Notice under Section 162(2), 167 was issued by the respondent proposing to assess Plot No.53 Ward No.P/N/142668 as land under construction (LUC) at Rs.1,22,010/- w.e.f. 01.04.1996. The rateable value of plot was determined at Rs.750/- per mtr.
On 10.04.1997, appellants lodge their complaint against the Rateable Value of Rs.750/- per sq.mtr.
On 12.01.1998, IO passes order fixing Rateable Value of Rs.600/- per sq.mtr.
On 23.01.1998, appellant filed Municipal Appeal under Section 217 of the Mumbai Municipal Corporation Act before the Small Causes Court challenging the rateable value as determined by the IO.
On various dates the appellant deposited 100% of property taxes calculated on the Rateable Value fixed by the IO.
On 29.10.2002, impugned Judgments and orders passed by the Additional Cheif Judge Small Causes Court which are challenged before this court in the present first appeals. The Small Causes Court by the impugned Judgment and Order reduced the rateable value from Rs.600/- to Rs.300/- per sq.mtr. and directed adjustment of excess tax deposited in the future property tax of the assessed
The liability for property tax remains with the original owner despite property transfer, and the rateable value should reflect reasonable market conditions, adjusted to Rs.200/sq.mtr.
The assessment of property rateable value must be based on objective criteria including the actual construction costs, without presuming uniformity solely based on geographical proximity.
Assessment must be completed before close of the relevant official year and that once the official period is over, it is not open to the Commissioner to assess and levy the property tax for that year....
Tax assessment must adhere to established legal procedures; failure to follow the Tamil Nadu District Municipalities Act renders such challenges non-maintainable.
Municipal authority must act within jurisdiction and statutory mandates during property valuation revisions; arbitrary actions are subject to judicial scrutiny.
The Court upheld the authority of the KMC to reassess the property's annual valuation and affirmed the lessees' liability to pay property tax as possessors on ownership basis.
Assessments for property tax must be based on reasonable rent expectation, not merely actual rent received, to avoid jurisdictional errors.
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