The inclusion of the occupier's share of tax in the service charges for determining the annual valuation under section 174(1) of the Kolkata Municipal Corporation Act, 1980, does not amount to tax on tax.

( 1 ) RESPONDENTS were the owners of 8th floor of premises No. 11, Dr. U. N. Brambhachary Street, Calcutta measuring about 14100 sq. ft. The appellant, Corporation proposed the annual valuation at Rs. 35,31,600/- and informed the respondents accordingly. The respondents filed objection. The Hearing Officer of the Municipal corporation after hearing the parties fixed the annual valuation at rs. 35. 31 lacs. The order of the Hearing Officer is appearing at page 57 of the Paper Book.

( 2 ) RESPONDENTS preferred an appeal before the Municipal Building tribunal. The Municipal Building Tribunal re-fixed the annual valuation at Rs. 29,03,100/ -.

( 3 ) BEING aggrieved by the order of the Municipal Building Tribunal respondents filed the above writ petition. The learned single Judge allowed the writ petition by Judgment and order dated April 29, 2002 appearing at pages 10-53 of the supplementary paper book.

( 4 ) BEFORE the Municipal Building Tribunal the respondents contended that there could not be any tax and as such service charges paid by the tenants which were inclusive of occupier share of the tax, commercial surcharge and user of the common lift should not be taken into 'account while determining the gross rent for the purpose of fixing annual valuation under section 174 of the Kolkata Municipal Corportion act, 1980 (hereinafter referred to as the "said Act of 1980" ). The municipal Building Tribunal gave the benefit to the respondents to the extent of lift and commercial surcharge, however, refused to give benefit for the occupier share which promted the respondents to prefer the writ petition. The learned Judge, however, allowed the writ petition by observing that although the challenge to the vires of the provisions of section 174 could not be sustained benefit should be given to the respondents to the extent that the appellant would be bound to deduct the occupier share paid by the tenants from the service charges before including the same within the gross rent while determining annual value.

( 5 ) BEING aggrieved by and dissatisfied with the Judgment and order of the learned single Judge the appellant filed the present appeal.

( 6 ) MR. Ashok Kumar Das Adhikari, learned counsel appearing for the appellant, contended before us that section 174 empowered the corporation to take into account the gross rent received from the premises before determining the annual valuation. According to Mr. Das Adhikari the gross rent included service charge. The learned judge accepted his submission and rejected the submission made on behalf of the respondents that such attempt would amount to tax on tax. After rejecting ouch contention of the respondents and after upholding the vires of the statute the learned Judge could not have allowed the writ petition by granting them relief to the extent as prayed for. In support of his contention Mr. Das Adhikari cited the following decisions:

(i) 2000 (1), Calcutta High Court Notes, page 494 (Calcutta metropolitan Development Authority v. Ajit Kumar Mqjumdar and Ors.) (ii) 2003 (3), Supreme Court Cases, page 533 (Calcutta Gujarat education Society and Anr. v. Calcutta Municipal Corporation and Ors.)

( 7 ) CITING the aforesaid decisions Mr. Das Adhikari contended that once the respondents/writ petitioners were unsuccessful on the issue of challenge to the vires of the relevant provision being section 174 (1)of the said Act of 1980 the learned Judge erred in granting them relief to the extent as prayed for by them.

( 8 ) MR. Anindya Kumar Mitra, learned counsel appearing for the respondents, contended as follows:

(i) The definition of "gross rent" as stipulated in section 174 (1) of the said Act of 1980 could not and did not include service charge to the extent of the property tax paid by the tenants in respect of the premises in question for the purpose of determining the annual valuation as it would amount to tax on tax.

(ii) Under the said Act of 1980 the landlord was permit