Abdul Malek Ahmad FCJ:

The respondent is the owner of unit B-7-25, 7th Floor, Flat Cempaka, Persiaran Bukit Raja, Bandar Baru Klang. She received her notice of assessment dated 1 December 2000 from the appellant which stated that the annual value of the holding is RM2,400, that the rate of assessment is 9 per cent and that the assessment is RM216 per annum.

Being dissatisfied with the notice of assessment, the owners of Rumah Pangsa Cempaka and Mawar through their association Persatuan Penduduk Rumah Pangsa Cempaka and Mawar filed an objection against the rate of assessment of 9 per cent pursuant to s. 142 of the Local Government Act 1976, hereinafter "the Act".

The objection was heard on 17 January 2001 where the respondent was represented by her husband who, also on behalf of seven other owners who were present, raised objections only with regard to the rate of assessment.

As a result, the appellant decided on 22 May 2001 to reduce the annual value from RM2,400 to RM1,920, maintain the rate of assessment at 9 per cent and reduce the assessment payable from RM216 to RM172.80.

The respondent appealed to the High Court pursuant to s. 145 of the Act by way of originating motion where she prayed for the following reliefs:

(a) that the rate of assessment of 9 per cent per annum and the annual value imposed on the holding is excessive and ought to be reduced;

(b) that the court fix the annual value for the year 2001 until such period determined by this court and the rate of assessment be determined as it deems fit and proper.

The learned High Court Judge decided to maintain the annual value reduced from RM2,400 to RM1,920 as it was reasonable and not excessive but allowed the appeal in relation to the rate of assessment by reducing it from 9 per cent to 6 per cent on the grounds that it was very high compared to the rates imposed by other local authorities for similar properties as in Shah Alam it was 4.5 per cent for houses and 5 per cent for flats and in Kuala Lumpur it was 6 per cent.

In his judgment, he relied on s. 142(1)(a) and (e) of the Local Government Act 1976 (hereinafter "the Act"). For ease of reference, the whole subsection is reproduced below:

142(1) Any person aggrieved on any of the following grounds:

(a) that any holding for which he is rateable is valued beyorid its rateable value;

(b) that any holding valued is not rateable;

(c) that any person who, or any holding which, ought to be included in the Valuation List is omitted therefrom;

(d) that any holding is valued below its rateable value; or

(e) that any holding or holdings which have been jointly or separately valued ought to be valued otherwise,

may make objection in writing to the local authority at any time not less than fourteen days before the time fixed for the revision of the Valuation List.

He also made reference to Shell Malaysia Trading Sdn Bhd v. Majlis Perbandaran Klang ; [1988] 3 MLJ 418 where the court had allowed a reduction on the rate of assessment from 8.25 per cent to 7 per cent per annum on two properties in the same area although there was a difference in their size, business profits and year of construction.

He said that although the rate of assessment had been approved by the State Authority through the 2001 Budget Estimates, they were purely estimates and not final. A case in point was the Shah Alam City Council which was subject to the same Budget Estimates but did not raise their rates. This shows that the Budget Estimates were not binding. The difference becomes more pronounced, he added, considering that the areas managed by the Shah Alam City Council were more developed than those under the appellant.

In these circumstances, although the rate of assessment has been fixed at 9 per cent per annum since 1993, the learned High Court Judge questioned the reasonableness for the appellant to continue fixing the same rate for property described as low cost housing for those with low income and subjected to restricted sale by the