Chidambaram Municipality vs P. Venugopal Pillai

Beasley, C.J.—The question here is not free from difficulty. The suit was by the Chidambaram Municipality to recover house tax and water

tax for the year ending 31st March 1934 in respect of houses belonging to defendant. The point to be decided here is whether the suit was

maintainable by the Municipality in the absence of a proper and legal notice of demand previously served upon the defendant by the Municipality.

There were other points raised but it is this question which has given rise to this petition. The learned District Munsif has held that the plaintiff-

Municipality did not sufficiently prove that it had served what it was alleged was the required notice upon the defendant and that in the absence of

such proof, the Municipality was not entitled to file the suit. The question of whether the notice was really served is one of fact and therefore if it

had been the only question, the lower Court''s judgment could not be interfered with, although I am bound to say that there appears to me to have

been certainly prima facie proof that the defendant was served with a. notice of his liability to pay the tax and'' the defendant did not go into the

witness-box and deny the receipt of the notice merely contenting himself with a denial in his written statement. But the question here is whether,

even if such a notice of demand has not been given, the Municipality is entitled to sue. The statute imposes a clear liability to pay tax in respect of

property and therefore there is that statutory liability. The question is whether there are any rules which provide that as a condition precedent for

the enforcement of that liability upon the owner of property there must first have been a demand in compliance with the rules. The only rules

relating to the collection of taxes are rules 29 onwards ins Schedule 4, District Municipalities Act. Rule 29 provides for a notice or a bill to be

served upon a person containing

(a) a statement of the period and a description of'' the occupation, property or thing for which the tax is charged; and (b) a notice of the liability

incurred in default of payment.

When is a notice in that form required? Rule 29 says that this notice or bill is to be served before the provisions of Rule 30 are to be enforced.

Rule 29(1) reads:

The (executive authority) shall serve upon such person a bill for the sum due before he proceeds to enforce the provisions of Rule 30.

What is provided for in Rule 30? First"" of all, there is the very summary and salutary provision that, if the amount due on account of any tax is

not paid within 15 days from the service of the notice, the tax may be recovered by distraint under warrant and sale of moveable property of the

defaulter. That is Rule 30(1). Sub-rule (2) of the same rule provides that:

If for any reason the distraint, or a sufficient distraint, of the defaulter''s property is impracticable the executive authority may prosecute the

defaulter before a Magistrate.

Sub-rule (3) says:

Nothing herein contained shall preclude the council from suing in a civil Court for any tax due to it under this Act.

There is another sub-rule to which reference must be made, viz., Sub-rule (3), Rule 29; and it is as follows:

Where a notice, bill or direction referred to in Sub-rule (1) has not been served or given either in the half year in which the tax became due or in

the succeeding half year the tax for the half year first mentioned in this Sub-rule shall not be demanded.

Having set out the material rules, two points of view present themselves, namely (1) does this provision with regard to the serving of a notice or

sending of a bill form a condition precedent to the enforcing of the very salutary provisions of Rule 30, or (2) is it a condition precedent also to any

claims made in a civil suit? Rule 30 provides a very special procedure for the collection of the tax, i. e., by distraint of moveable property and

prosecution in the Magistrate''s Court; and it is to be enforced where there has been a failure to comply with the demand or bill after 15 days. In

my view, Sub-rule (3), Rule 30 means merely that this very special procedure is not to take away the right of the Municipality to sue in a civil Court

in the ordinary way--a right that it has like any other individual. My conclusion is that the requirements as to notice are only confined to the

enforcement of payment by distraint or prosecution in the criminal Court; and certainly Sub-rule 2 (b), Rule 29 which requires that the bill must

contain ""a notice of the liability incurred in default of payment"" is a reasonable and necessary provision if it relates to these two liabilities, but I see

no necessity for persons liable to pay tax being told. that they may be sued for it in the civil Court if they do not pay that which they are liable to

pay u/s 81 of the Act. I do not think that Sub-rule (3), Rule 29 really presents difficulty or gives support to the respondent''s contention. In my

view, what is there meant is that no distraint or criminal prosecution can be made in respect of the tax which is due for any half year as regards

which the bill or notice has not been served. I am of opinion therefore that no notice such as is specified in Rule 29 need be given by the

Municipality as a condition precedent to the filing of a suit in the civil Court to recover the tax. Of course a demand ought to be made upon the

person liable before a suit is filed, that is to say, a suit ought not to be filed without some notice being given to the defendant or the person liable to

pay of the intention to do so and a request for payment. In the present case, the special officer of the Municipality wrote-to the defendant a letter

dated 28th July 1934 as follows:

Sir,

A sum of Rs. 145-13-2 is due from you as house tax for the items and periods mentioned below. Please remit it at once as it is already long

overdue.

And on 13th August 1934, the defendant replied as follows:

Sir,

With reference to your letter which was duly received by me on 1st August 1934 I shall remit the amount of my house tax before the end of

September 1931. Please excuse for the delay.

In my opinion, this point was wrongly decided in the lower Court. The Civil Revision Petition is allowed with costs and the order of the lower

Court set aside and a decree passed in favour of the plaintiff Municipality for the amount claimed with costs.