Assessments for property tax must be based on reasonable rent expectation, not merely actual rent received, to avoid jurisdictional errors.

JUDGMENT :

ARIJIT BANERJEE, J.

1. This appeal is directed against a judgment and order dated December 14, 2022, whereby the appellants’ writ petition being WPO 557 of 2019 was disposed of by a learned Judge of this Court. The appellants/writ petitioners had approached the learned Judge seeking cancellation of assessment orders of the Hearing Officer-XIII KMC, dated April 25, 2019, pertaining to premises no. 144A Rashbehari Avenue, Kolkata- 700 029 (hereinafter referred to as the ‘said premises’) for the periods starting from 3rd Qtr. 2001-02, 2nd Qtr. 2007-08, 4th Qtr. 2008-09, and 2nd Qtr. 2013-14. The learned Judge noted that there was an alternative remedy available to the writ petitioners by way of statutory appeal under Section 189 of the Kolkata Municipal Corporation Act, 1980 (in short ‘the KMC’ Act). The operative portion of the order of the learned Judge reads as follows:

“25. For all the reasons as aforesaid, this Court is not inclined to interfere in this writ petition and the petitioners are left free to approach the appropriate forum strictly in accordance with law. It is, however, made clear that the observations made hereinbefore are only for the purpose of disposal of this writ petition. The appropriate forum shall be free to decide all points raised by the parties in accordance with law if such forum is approached.”

2. The appellants/writ petitioners claim to be the owners of the said premises, which is a three storeyed building. It was their case before the learned Single Judge that part of the said premises is tenanted while the other portion is occupied by them for residential purpose. They received notices containing proposals for enhancement of annual valuation of the said premises in respect of the 4 assessment periods indicated above. Subsequently they received notices of hearing. They filed a written objection against the proposed annual valuations. They attended the hearing through a learned Advocate. The Hearing Officer passed the orders dated April 25, 2019, confirming the proposed annual valuations for the aforesaid 4 periods.

3. The arguments made by learned Advocate for the appellants/writ petitioners before the learned Single Judge were essentially the same as were advanced before us.

4. The first point argued by Mr. Arindam Banerjee, learned Advocate appearing for the appellants is that the assessments under challenge are void ab initio since both the proposals of KMC and the orders of the Hearing Officer are based on actual rent and not reasonable rent. Mr. Banerjee referred to Section 174 of the KMC Act as it stood before its amendment which would be the provision applicable in the facts of this case. The relevant portion of the unamended provision reads as follows:

“174. Determination of annual valuation:

(1) Notwithstanding anything contained in the West Bengal Premises Tenancy Act, 1956 (West Ben. Act XII of 1956) or in any other law for the time being in force, for the purpose of assessment to the property tax, the annual value of any land or building shall be deemed to be the gross annual rent including service charges, if any, at which such land or building might at the time of assessment be reasonably expected to let from year to yea