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IN THE HIGH COURT AT CALCUTTA
SABYASACHI BHATTACHARYYA, J.
Manoj Parmar & Others - Appellant
Versus
Union of India & Others - Respondent
W.P.A. No. 756 of 2007 & CAN 2 of 2010 & 3 of 2014 (Old CAN 4570 of 2010 & 4048 of 2014)
Decided On : 17-03-2023
RENTAL PREMISES - CPWD RATES - FAIR RENT - MUNICIPAL TAXES - MAINTENANCE AND REPAIR CHARGES - ADJUSTMENT - WRIT PETITION - [CPWD CODE PARA 134 - ASANSOL MUNICIPAL CORPORATION ACT, 1990 SECTION 151] - SUMMARY: The court held that the respondents were estopped from resiling from their position of fixing fair rent for the disputed premises as per the CPWD recommendation. The CPWD rates, as per the Manual on Infrastructure of CBDT, were merely advisory, but the Chief Commissioner of Income Tax, while fixing the fair rent for the premises lastly, had himself relied on the CPWD rates. The respondents had all along acted on the basis of the CPWD rates for assessing the rent for the premises-in-question. The court directed the respondents to disburse to the petitioners the arrears of rent to the tune of Rs. 2,82,39,242/- in terms of the respective CPWD revisions of rent for the period from January 31, 1994 to June 30, 2021.
Fact of the Case:
The petitioners, owners of a building let out to the Union of India for Income Tax Department, challenged the reduction of rent by the Board of Finance (Income Tax). The petitioners sought fair rent fixation and payment of arrears as per CPWD rates.
Finding of the Court:
The court held that the respondents were estopped from resiling from their position of fixing fair rent for the disputed premises as per the CPWD recommendation. The CPWD rates, as per the Manual on Infrastructure of CBDT, were merely advisory, but the Chief Commissioner of Income Tax, while fixing the fair rent for the premises lastly, had himself relied on the CPWD rates.
Issues: 1. Whether the respondents were estopped from resiling from their position of fixing fair rent for the disputed premises as per the CPWD recommendation? 2. Whether the CPWD rates, as per the Manual on Infrastructure of CBDT, were merely advisory? 3. Whether the respondents had all along acted on the basis of the CPWD rates for assessing the rent for the premises-in-question?
Ratio Decidendi: 1. The court held that the respondents were estopped from resiling from their position of fixing fair rent for the disputed premises as per the CPWD recommendation, as they had themselves relied on the CPWD rates while fixing the fair rent. 2. The court held that the CPWD rates, as per the Manual on Infrastructure of CBDT, were merely advisory, but the Chief Commissioner of Income Tax, while fixing the fair rent for the premises lastly, had himself relied on the CPWD rates. 3. The court held that the respondents had all along acted on the basis of the CPWD rates for assessing the rent for the premises-in-question.
Final Decision: The court directed the respondents to disburse to the petitioners the arrears of rent to the tune of Rs. 2,82,39,242/- in terms of the respective CPWD revisions of rent for the period from January 31, 1994 to June 30, 2021.
JUDGMENT
1. The writ petitioners are the owners of one Parmar Building situated at 2, Apcar Garden, Asansol. The entire building has been let out to the Union of India for use by the Income Tax Department.
2. The Executive Engineer, Central Public Works Department (CPWD) was designated as the authority to issue certificate of revised rent. Upon holding an inspection, the Assistant Engineer, Asansol submitted a report to the Deputy Commissioner of Income Tax recommending fair rent with effect from January 30, 1989 exclusive of Municipal Taxes. The total rent for the three floors was Rs.34,032/- per month, the fair rent of each floor having been determined at Rs.11,344/- per month.
3. Subsequently, the Board of Finance (Income Tax) reduced the rent for the building to Rs.21,458/- inclusive of Municipal Tax. The said order was challenged in a writ petition, which gave rise to CR No.18829(W) of 1993. Ultimately, the rule initially granted in the said writ petition was made absolute, against which the respondents preferred an appeal, bearing MAT 3571 of 2001. Vide order date July 10, 2003, a Division Bench allowed the appeal and directed the Trial Court to rehear the writ petition.
4. Upon such rehearing, the learned Single Judge directed the respondent no.5 (the Chief Commissioner of Income Tax), to reconsider the matter.
5. The said respondent held on April 8, 2004 that the rent of Rs. 34,032/- per month, as recommended by the CPWD with effect from January 30, 1989, was fair and reasonable.
6. The respondents did not fix fair rent for the subsequent periods, despite the rule being that such assessment had to be made every five years. Being thus aggrieved, a writ petition bearing WP No.4178(W) of 2005 was filed, which was disposed of by a co-ordinate bench on August 23, 2005 by directing the respondent no.2 (the Chief Commissioner of Income Tax, Burdwan) to consider the matter by giving hearing to the petitioners and to pass a reasoned order.
7. The petitioners, through their learned advocate, intimated the respondent-Authorities that they were agreeable to accept the fair rent fixed by respondent no.2, without prejudice to their right to claim further enhanced rate after considering the report of the CPWD.
8. The respondent-Authorities wrote to the petitioners asking for payment of Municipal Taxes for a particular period and asking the petitioners to enter into an agreement for accepting rents fixed by them. The petitioners conveyed their agreement thereto, subject to their claims and without prejudice to their rights.
9. Thereafter the petitioners wrote a letter dated December 27, 2006 indicating that instead of paying the fair rent fixed by the Chief Engineer, CPWD the respondents had stopped paying rent from September, 2006 and claimed rents as determined by the Chief Engineer, CPWD with arrears, etc.
10. On the subsequent inaction of the respondents-Authorities to do so, the present writ petition has been preferred.
11. Learned counsel for the petitioners submits that vide Office Memo dated January 30, 1987, the rent was revised in terms of paragraph 134 of the CPWD Code. The Chief Commissioner, Income Tax, vide Order dated April 8, 2004, fixed the fair rent in terms of the CPWD recommendation.
12. However, the respondents did not fix fair rents from time to time as per the revised CPWD recommendations.
13. It is submitted that since the CPWD rates were being followed all along and even the fair rent was ascertained on the basis of such rates, there was no reason for the respondent-Authorities to withhold the rent to the petitioners in terms of the CPWD rates, as they came out from time to time.
14. By placing reliance on the Office Memo dated January 30, 1987, learned counsel appearing for the respondents contends that even as per the fair rent decided by the Authorities, the Municipal Tax and maintenance and repair charges in respect of the dilapidated old building were payable by the landlords/petitioners. However, such charges have not
The CPWD rates, as per the Manual on Infrastructure of CBDT, are merely advisory, but the Chief Commissioner of Income Tax, while fixing the fair rent for the premises lastly, had himself relied on t....
Writ jurisdiction can address contractual disputes involving the State if no serious factual disputes exist, ensuring the State honors its obligations.
The court reaffirmed that fair rent determined by Rent Control Courts must reflect current market conditions, considering economic factors and evidence of comparable properties.
Point of Law : Every State action must be informed by reason and it follows that an act uniformed by reason is per se arbitrary.
The court upheld the rent fixed by the Committee as fair, emphasizing the petitioner's failure to prove valid ownership of the land.
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