Abdul Kadar Khan vs Chairman, Puri Municipality

Harries, C.J.—This is a plaintiff''s second appeal from the concurrent decrees of the Courts below dismissing his suit for a declaration that a certain municipal assessment was ultra vires and for an injunction and the recovery of Rs. 284-13-9, which had been paid by him under protest. The case originally came before my learned brother who referred it to a Division Bench as it raises a question I of some importance in municipal law.

The plaintiff was the owner of a certain plot of land and it is clear that when the assessment list was last revised in the Municipality of Puri, his name did not appear as a person liable to pay house and latrine taxes. It is alleged that after the revision of the assessment list a house was constructed on the plot and thereupon he became liable to pay these taxes. The municipality assessed the holding at Rs. 156 and demanded tax accordingly. The plaintiff appealed to an appellate tribunal but obtained no relief there. In spite of his protests the plaintiff found himself compelled to pay, and the amounts paid by him now amount to rupees 284-13-9. It is clear that throughout he always paid under protest contending that the assessment upon him was ultra vires. Both the Courts below came to the conclusion that the assessment was valid and dis. missed the plaintiff''s claim. Before us two points have been taken. In the first place, it was alleged that the appellate tribunal, which has been constituted by the Puri Municipality is an illegal one, and therefore the proceedings by way of appeal in this case were wholly null and void. Section 117, Bihar and Orissa Municipal Act, is in these terms:

(1) Every application presented under the last preceding Section shall be heard and determined by a committee consisting of not less than three Commissioners, provided that no Commissioner shall be a member of the committee appointed to hear applications from the ward for which he was elected.

(2) Such committee after taking such evidence and making such inquiry as it may deem necessary, may pass such order as it thinks flit in respect of such application.

(3) The decision of the committee, or of a majority of the members thereof, in such cases shall be final.

In the present case it has been contended that the Puri Municipality by a resolution, has appointed seven members to act as an appellate committee, and amongst those seven are persons who were elected for the ward in which the plaintiff''s house is situate. That being so, it is said that the appellate tribunal in this case was illegally constituted. The true facts, however, are that out of the seven persons named in the municipal resolution four only sat on this particular appellate tribunal and not one of the members was in any way connected with the ward in question. There can be no doubt that the constitution of this tribunal was clearly within the spirit of Section 117; but it is said that it is not within the strict letter of Section 117. Mr. Sen Gupta has urged that the appellate tribunal consisted of seven members and that he was entitled to be heard by all the seven members. He concedes that if he was, the proceedings would be illegal, but he says that it is the inevitable result of the resolution of the municipality. In my view, the resolution of the municipality is nothing more than the appointment of seven persons to form a rota from which three or more should be selected for any particular appeal. The resolution does not, in substance, mean that for each appeal all seven must sit. They merely named seven persons from whom a Court of three or more should be selected as and when required. That being so, it cannot be said that the assessment in this case is illegal and ultra vires, because the appellate tribunal has been illegally constituted. The appellate tribunal in this particular case was a perfectly legal and properly constituted body.

Secondly, it was argued that this assessment was illegal by reason of non-compliance with Section 107, Sub-section (2), Bihar and Orissa Municipal Act. This point was taken before the Courts below; but the learned District Judge held that the present assessment did not fall within Section 107, Bihar and Orissa Municipal Act, but within Section 115 of that Act. Section 115 requires that notice should be given to the person assessed after assessment has been made, whereas Section 107(2), of the Act requires at least one month''s notice to a person interested of any proposed alteration in the list. All that the plaintiff was given in this case was a notice that he had been assessed, not that the municipality proposed to assess him. Section 115 of the Act is in these terms:

(1) When the assessment list mentioned in Section 89 or Section 105 has been prepared or revised, the Chairman shall sign the same, and shall give public notice, by beat of drum and by placards posted up in conspicuous places throughout the municipality, of the place where the list may be inspected.

(2) The Chairman shall also, in all cases in which any property is for the first time assessed or the assessment is increased, give notice thereof to the owner or occupier of the property if known.

The meaning of this Section is clear, and the Section applies only to cases where a new list or a revised list is issued. Such must be signed by the Chairman and notice given of it by beat of drum and by display of placards in prominent places. Further, if property appears in a revised list for the first time or if in a revised list an assessment is enhanced, then notice must also be given to the person affected. In other words, in such cases beat of drum and display of placards is not considered sufficient notice, and that is understandable; but this notice referred to in Sub-section (2) of Section 115 is notice of an increased assessment or a new assessment appearing for the first time in an assessment list or revised list. Section 115 cannot by its terms apply to a case where a list has been prepared, or revised and subsequently it is found that property has been omitted from the list which should have been included or property has become assessable which was not assessable when the list was prepared or revised. These two latter cases are expressly dealt with in Section 107 of the Act. That Section is as follows:

(1) The Commissioners may from time to time alter or amend the assessment list in any of the following ways: (a) by entering therein the name of any person or any property which ought to have been entered, or any property which has become liable to taxation after the publication of the assessment list u/s 115;....

(2) The Commissioners shall give at least one month''s notice to any person interested, of any alteration which they propose to make under Clauses (a), (b), (c) or (d) of Sub-section (1), and of the date on which, the alteration will be made....

This Section presupposes an existing list which has been published u/s 115, and that since such publication it has been found that property has been omitted from the list which should have been included or property has subsequently become assessable. That is the case contemplated in Sub-section (1)(a) of Section 107, and if it is proposed to assess such property a month''s notice must be given to the person interested of any alteration the Commissioners propose to make and of the date on which the alteration will be made. No such notice was ever served in the present case. In my view, the present case was clearly governed by the provisions of this section, and a month''s notice should have been given. The question arises as to what is the effect of an omission to give this statutory notice. It appears to me that giving of notice of the proposed assessment and the date upon which the alteration will be made is a condition precedent to the right of the municipality to make the alteration or addition. Unless such notice is given, the alteration or addition cannot, in my view, be made. Such was the view of the late Chief Justice of this Court in Lachminarayan Das v. Chairman, Cuttack Municipality AIR 1936 Pat. 322 and of Varma J. in Commissioners of Patna City Municipality Vs. Bishambhardeo Narain, . It appears to me that those cases were correctly decided and should be followed. That being so, the assessment in this case was ultra vires and not in accordance with law, and the Municipality had no right to demand tax from the plaintiff. As the plaintiff paid the tax under protest, he is entitled to a refund of the amounts paid. The plaintiff is clearly entitled to a finding of this Court that the tax cannot be levied upon him and for a declaration to that effect and an injunction restraining the municipality from further levying such tax. He is also entitled to a decree for Rs. 284-18-9. In the result, therefore, I would allow this appeal, set aside the decrees of the Courts below and decree the plaintiff''s claim as prayed. The plaintiff is entitled to his costs in this Court and in both the Courts below.

Manohar Lall, J.

I agree.