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IN THE HIGH COURT OF DELHI AT NEW DELHI
S. RAVINDRA BHAT, A.K. CHAWLA, JJ.
DCM Ltd - Appellant
Versus
Municipal Corporation of Delhi and Ors - Respondent
Writ Petition (Civil) No. 1174 of 2010
Decided on : 24-04-2019
The court held that the impugned assessment order was erroneous and void on account of delay. The court also held that the petitioner had the option of choosing the mode of finalization of the assessment under Section 116G of the DMC Act, 2003. The court further held that the impugned order was erroneous and void on account of the assessing officer's failure to consider the petitioner's submissions with respect to the applicability of the principles laid down in Shashank Steel (supra). The court also held that the impugned order was erroneous and void on account of the assessing officer's failure to consider the petitioner's submissions with respect to the vacant land tax.
Fact of the Case:
The petitioner, DCM Ltd., challenged the impugned assessment order dated 27.12.2009 and demand notice dated 27.12.2009 (hereafter "impugned demand") as without jurisdiction and ultra vires of the provisions of the Delhi Municipal Corporation Act (hereafter referred to as "the Act"); the amendment of 2003 (hereafter referred to as "the Amendment Act") as well as the Delhi Municipal Corporation (Property Taxes) Bye-laws, 2004 ("bye laws"). DCM also challenged other consequential directions including quashing of an assessment order dated 18.12.2009 ("impugned order") and direction not to enforce the demand and further with reference to the assessment of property nos.8654-8979; 8989-9033 and 9035-9055 situated at Kishan Ganj, Delhi in accordance with the Unit Area Method ("UAM") as applicable for 2004-05 and consequential adjustments for the amounts paid/deposited by the assessee were sought.
Finding of the Court:
The court held that the impugned assessment order was erroneous and void on account of delay. The court also held that the petitioner had the option of choosing the mode of finalization of the assessment under Section 116G of the DMC Act, 2003. The court further held that the impugned order was erroneous and void on account of the assessing officer's failure to consider the petitioner's submissions with respect to the applicability of the principles laid down in Shashank Steel (supra). The court also held that the impugned order was erroneous and void on account of the assessing officer's failure to consider the petitioner's submissions with respect to the vacant land tax.
Issues: Whether the impugned assessment order was erroneous and void on account of delay. Whether the petitioner had the option of choosing the mode of finalization of the assessment under Section 116G of the DMC Act, 2003. Whether the impugned order was erroneous and void on account of the assessing officer's failure to consider the petitioner's submissions with respect to the applicability of the principles laid down in Shashank Steel (supra). Whether the impugned order was erroneous and void on account of the assessing officer's failure to consider the petitioner's submissions with respect to the vacant land tax.
Ratio Decidendi: The court held that the impugned assessment order was erroneous and void on account of delay. The court also held that the petitioner had the option of choosing the mode of finalization of the assessment under Section 116G of the DMC Act, 2003. The court further held that the impugned order was erroneous and void on account of the assessing officer's failure to consider the petitioner's submissions with respect to the applicability of the principles laid down in Shashank Steel (supra). The court also held that the impugned order was erroneous and void on account of the assessing officer's failure to consider the petitioner's submissions with respect to the vacant land tax.
Final Decision: The court set aside the impugned assessment order and directed the Assessing Officer to consider all contentions of the petitioner and also especially grant the option of assessment under the new Unit Area Method, in terms of Section 116G of the MCD Act. The process shall be completed in six months.
S. RAVINDRA BHAT, J.
1. Originally the writ petitioner (hereafter referred to as "DCM") had claimed various reliefs such as challenging amended Sections 61A, 116, 116A, 116B, 116K, 123(B)(8), 133, 152-155, 169, 170(b) of the Delhi Municipal Corporation Act (hereafter referred to as "the Act"); the amendment of 2003 (hereafter referred to as "the Amendment Act") as well as the Delhi Municipal Corporation (Property Taxes) Bye-laws, 2004 ("bye laws"). DCM also challenged other consequential directions including quashing of an assessment order dated 18.12.2009 ("impugned order") and direction not to enforce the demand and further with reference to the assessment of property nos.8654-8979; 8989-9033 and 9035-9055 situated at Kishan Ganj, Delhi in accordance with the Unit Area Method ("UAM") as applicable for 2004-05 and consequential adjustments for the amounts paid/deposited by the assessee were sought. After notice was issued and counter affidavits were filed, amendments to the claim were sought and made- whereby further reliefs by way of direction to MCD to re-constitute the Hardship and Anomaly Committee and decide its application of 15.10.2004 forthwith and also the plea that the impugned assessment order was made after the period of limitation prescribed under the Act. The other amendments sought for were with respect to the quashing of the assessment order on the ground that the land rate taken was excessive and that the rebate for size of the plot was not given and furthermore that the land was incapable of being constructed upon.
2. Briefly, DCM challenges the impugned order and demand notice dated 27.12.2009 (hereafter "impugned demand") as without jurisdiction and ultra vires of the provisions of the Act as based upon conjectures and surmises. The petitioner's challenge to Sections 61A, 116, 116A, 116B, 116K, 123(B)(8) and Section 169 of the Act pertain to penalty deposit, pre-deposit of the entire demanded amount at the time of filing of the appeal, removal of the concept of base year, limitation on raising demands on an assessee and lack of appeal under the UAM qua the fixing of the unit values, as violative of Article 14 of the Constitution. It is alleged that the respondent has acted in an arbitrary and in a mala-fide manner.
3. The first grievance which DCM articulated is that the impugned order makes a collective reassessment order. Mr. B.B. Jain, learned counsel highlighted that the Show Cause Notice (SCN), however, pertained to only six properties and referred to the SCN dated 08.03.2003. The SCN in question (for the period 2002-03) was issued on 08.03.2003; it pertained to property Nos.8654, 8979, 8989, 9033, 9035, 9355 Kishan Ganj, XIV Bara Hindu Rao. It proposed rateable value, subject to objections and hearing, stating that the "proposed rateable value shall be confirmed as per provisions of Bye Law 9 of the Delhi Municipal Corporation Assessment List Bye-laws 1959". According to the SCN, the existing rateable value (Rs. 80,420/-) was proposed to be increased to Rs. 55,92,23,200/- with effect from 01.04.2002. The column dealing with the rationale for increase of rateable value stated:
"Reasons in brief for amendment in the assessment list: Increase in land value."
4. The petitioner appears to have objected to the SCN and submitted that the layout plan for 26.9 acres was approved for development subject to certain conditions by the Resolution of the Standing Committee (of the MCD, the predecessor to the North Delhi Municipal Corporation or "NDMC" hereafter) dated 28.08.1995. It was submitted that one of the conditions for redevelopment was that the existing structure ought to be demolished before any construction activity was to be undertaken. Furthermore, DCM highlighted that more than 25% of the permitted and old structure were still on site and not demolished and further under occupation. Also, per
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