Fabworth Promoters Pvt. Ltd. vs Kolkata Municipal Corporation

Arijit Banerjee, J.—In this writ petition, the petitioner challenges the assessment order dated 13 January, 2015 passed by the Hearing Officer-XIV of the Kolkata Municipal Corporation in respect of municipal premises No. 4A, JBS Haldane Avenue, Kolkata fixing annual valuation at Rs. 13,27,71,870/- with effect from 3rd quarter of 2007-08.

Case of the Petitioners:-

The petitioner no. 2 is a director of the petitioner no. 1 company.

At all material times the Kolkata Metropolitan Development Authority (in short �KMDA�) being the respondent no. 4 was and still is the absolute owner of a plot of land situated at the junction of Dhapa Road and Eastern Metropolitan Bypass measuring about 5.61 acres within Ward No. 58 of the Kolkata Municipal Corporation (hereinafter referred to as the �said premises�). The said premises has presently been numbered as Premises No. 4A, JBS Haldane Avenue, Kolkata.

On 20 February, 2006, KMDA published a notice in the English daily �The Times of India�, inter alia, inviting notice for granting a lease of the said premises for the purpose of constructing a 5/7 Star Hotel thereon.

The petitioners offered a lease premium of Rs. 189,67,41,000/- which turned down to be the highest bid received by KMDA. Accordingly, KMDA accepted such bid.

A lease deed dated 28 September, 2007 was executed by and between the KMDA and the petitioner no. 1 (hereinafter referred as �Fabworth�) whereby KMDA demised unto Fabworth the said premises on lease for a period of 99 years, renewable for a further period of 99 years against payment of lease premium of Rs. 1,89,67,41,000/- and annual rent of Rs. 1 per cottah. The petitioners contend that the same is a standard long lease with several restrictions on the lessee and with the right of reversion lying with the lessor.

On 4 October, 2007, Fabworth applied for mutation of the said premises in its name qua lessee in Form No. A-42 which is the form issued by Kolkata Municipal Corporation (in short the �KMC�) for making an application for mutation.

By a letter dated 8 October, 2007 KMC informed Fabworth that the Annual Valuation in respect of the said premises with effect from the 3rd quarter of 2008 was determined at Rs. 13,27,71,870/-.

On 11 October, 2007, mutation of the said premises was granted in the name of Fabworth as a lessee.

Subsequently, building permit was granted by KMC in favour of the Fabworth which refers to KMDA as lessor and Fabworth as lessee.

Fabworth had objected to the Annual Valuation of the said premises arrived at by the KMC. By an order dated 30 December, 2008 such objection was overruled and the Annual Valuation was confirmed.

Fabworth challenged the said order in this court by filing WP No. 9372 (W) of 2012. By an order dated 25 July, 2013 this court disposed of the said writ application by directing the KMC to make an assessment in accordance with law by passing a reasoned order within a period of three months after giving an opportunity of hearing to all interested parties.

A detailed representation was made by Fabworth to the committee constituted by KMC for conducting the hearing and carrying out this court�s order dated 25 July, 2013.

On 13 August, 2014 an order was passed by the Joint Municipal Commissioner (Revenue, KMC) whereby the Annual Valuation of the said premises that had been communicated by KMC on 8 October, 2007 was upheld. It was held in the said order that Section 176 of the KMC Act was not applicable and the lease granted in favour of Fabworth is to be deemed to be a perpetual lease and, therefore, Fabworth would be fully liable to pay the property tax in respect of the said premises.

Being Aggrieved, Fabworth challenged the said order before this Court by filing WP No. 30732 (W) of 2014.

By its judgment and order dated 12 December, 2014, this court set aside KMC�s order dated 13 August, 2014 holding, inter alia as follows:-

"In view of the above, the respondent no. 11 was under obligation to pay the property tax of the premises under reference at the first instance. No material is available on record to show that the provisions of sub-Section (3A) of Section 193 and/or Section 230 could be invoked in this case. Therefore, the impugned order is liable to be set aside on that ground alone.

I do not find substance in the submissions made by Mr. Biswajit Mukherjee, Ld. Adv. of the Kolkata Municipal Corporation, that in view of the conditions prescribed in Deed of lease executed by and between the petitioners and the respondent no. 4, the above provisions of the said Act, 1980 need not be considered. If an agreement executed by and between the parties is pitted against statutory provisions, the statutory provision would prevail.

For the purpose of deciding the question of applicability of the provisions of Clause (a)(ii) of sub-Section (8) of Section 171 and those of Section 176 of the said Act, 1980 are quoted below:

�171(8). Notwithstanding anything contained in sub-Section (2), the property tax on the-

(a)Land owned by or belonging to-

(i) The Board of Trustees for the improvement of Calcutta, constituted under the Calcutta Improvement Act, 1911 (Ben. Act V of 1911), or

(ii) The Kolkata Metropolitan Development Authority, constituted under the Calcutta Metropolitan Development Authority Act, 1972 (West Ben. Act XI of 1972), or

(iii) The West Bengal Housing Board, constituted under the West Bengal Housing Board Act, 1972 (West Ben. Act XXXIII of 1972), or

(iv) The West Bengal Industrial Infrastructure Development Corporation, established under the West Bengal Industrial Infrastructure Development Corporation Act, 1974 (West Ben. Act XXV of 1974), or

(v) Such other statutory body as may be notified by the State Government in this behalf from time to time, for the purposes of development schemes in accordance with the published or approved plans but not put to such use, Shall be ten per cent of the annual value of such land as determined under this Chapter;

(b) Land or building acquired, constructed, purchased or owned by the Government or any of the statutory bodies mentioned in Clause (a) for any Government approved scheme for the purpose of subsidised housing for persons belonging to low income group or industrial workers and comprising of tenements let out to such persons on a monthly rent shall be ten per cent of the annual value of such land or building determined under this Chapter;

(c)Land or building acquired, constructed, purchased or owned by Government or any of the statutory bodies mentioned in Clause (a) for any other purpose shall be at the rate determined under sub-Section (2) of this Section.�

�176. Annual valuation of lands or buildings belonging to various statutory bodies.- The annual value of any land or building belonging to the State Government or any of the statutory bodies mentioned in Clause (a) of sub-Section (8) of Section 171 shall be deemed to be five per cent of the cost of acquisition thereof, subject to any revision made in this behalf by the State Government on an application by any such body or by the Corporation.

Explanation.- For the purpose of this section, the cost of acquisition shall mean.-

(i) In the case of any land or building acquired under the Land Acquisition Act, 1894 (1 of 1894), as amended by the Calcutta Improvement Act, 1911 (Ben. Act V of 1911), the value of such land or building as determined under the Land Acquisition Act, 1894, as so amended or by the Tribunal constituted under the Calcutta Improvement Act, 1911 or by any appellate authority under any of the enactments as aforesaid;

(ii) In the case of any land or building acquired by private treaty, the purchase price of such land or buildings;

(iii) In the case of any land or building taken for an improvement scheme under Section 54 or Section 55 of the Calcutta Improvement Act, 1911, such amount as may be determined under either of those sections;

(iv) In the case of any land or building belonging to the State Government or any of the statutory bodies mentioned in clause (a) of sub-Section (8) of Section 171, such amount as may be determined under the provisions of the Act governing such body or of any other law in force for the time being and applicable to such body.�

The liability of the respondent no. 11 is evident in Clause (a) (ii) of sub-Section (8) of Section 171 of the said Act, 1980. Both the aforesaid provisions contain �Non-obstante� clause. The objection had been raised by the petitioners in their written objection on the above ground and it was ignored.

In view of the discussion and observations made herein above, the impugned order is quashed and set aside.

I direct the Kolkata Municipal Corporation to pass an order afresh on the basis of the order dated July 25, 2013 passed in WP No. 9372 (W) of 2012 taking into consideration the discussions and observations made herein above within January 15, 2015 after giving opportunity of hearing to the persons concerned including the petitioners. The above competent authority is further directed to communicate the above decision to the parties concerned within a week thereafter.

Let it further be recorded that the payment of property taxes paid by the petitioners on the basis of the claim of the Kolkata Municipal Corporation made by a communication dated July 22, 2013 (Annexure P-7 at page 111 of this writ application) shall be adjusted against the amount which may be due and payable on the basis of the aforesaid decision of the competent authority of the Kolkata Municipal Corporation.

I make it clear that I have not entered into the merits of this case with regard to correctness of annual valuation or property taxes of the above premises while examining the propriety of the decision making process and all points are kept open. This writ application, is thus, disposed of."

On 2 January, 2015 KMC issued a notice to Fabworth fixing a hearing on 9 January, 2015. The hearing notice was not in accordance with the procedure followed by KMC for assessment of the Annual Valuation of properties. The notice usually sent in such cases, as per the provisions of the KMC Act, was not issued. The notice was not in proper format.

Hearing was conducted by the Hearing Officer but the same was contrary to the settled principles of natural justice, equity and fair play.

On 13 January, 2015, the Hearing Officer passed the order which is impugned in this writ petition. The operative portion of the impugned order is as follows:-

"It is clear that M/s. FPPL has come forward taking the liability to pay tax and not KMDA. So, the liability of tax if any regarding the property is to be borne by M/s. FPPL. The very argument that the Corporation should run after KMDA for realisation of property tax on & from 3/2007-08 belies their application for mutation. Now adverting to the proposed valuation of Rs. 13,27,71,870.00, it is the case of the petitioner that they have paid a fancy amount at Paragraph 4 of the WP No. 30362 does not hold any merit.

They have on their own, paid a lease premium of Rs. 189,67,41,000.00. The assessee being a seasoned businessman must have calculated its prospects before making the bid. The said premium has been accepted by the assessee as the market value in terms of Section 16B (2) of the Indian Stamp Act, 1999 and the assessee also paid the true and correct stamp duty based on such market value which has been accepted by the registering authority.

Therefore, I have no authority to dis-believe such market value of the property. Taking the same to be the estimated market value and applying Section 174 (2), the Annual Valuation of the said property w.e.f. 3/2007-08 for the purpose of payment of property tax comes to Rs. 13,27,71,870.00.

It would be worthwhile to mention that in one of the objections, the assessee referred to an opinion given by the Ld. Adv. General and also the Circulars as referred to earlier regarding the determination of annual value, I have to apply my mind independently without being influenced by any opinion.

Secondly, the Circular referred to hearing have no application in respect of determination of the annual value of the property in question.

Sub-section 3(a) of Section 193 has been kept in abeyance by virtue of the Kolkata Municipal Corporation (Amendment) Act, 2011. Hence, today while determining the Annual Valuation, the Section 3(a) of Section 193 cannot be of any relevance as the law prevalent on the date of adjudication is to be applied. Section 230 of the KMC Act deals with the apportionment of property tax by the person primarily liable to pay who may recover the same from the occupier. But in the instant case, the person primarily liable i.e. KMDA has denied its liability to pay the tax pursuant to the Lease Deed and acting in terms of Clause 2(C)(i), M/s. FPPL had applied for mutation of its name in the records of KMC to be considered as a person liable to pay the tax.

Hence, the argument of M/s. FPPL to apply section 193 as well as 230 appears to be fallacious and there is no merit. The assessee should agitate the same with KMDA. The KMC is only concerned with the property tax in respect of the property which the assessee is enjoying and has come forward to be considered as a person liable to pay the tax. So, the contention of the assessee insisting KMC to run after KMDA for recovery of tax appears to be not sustainable and contrary to the documents on record and their stand.

In view of the aforesaid, the annual value of the property in question is determined hereunder:-

Total lease premium of the property in question is Rs. 1,89,67,41,000/-. Therefore, the Annual Valuation is being fixed @ 7% of said lease premium w.e.f. 3rd quarter 2007-08 which is Rs. 13,27,71,870/- following relevant provisions of KMC Act, 1980."

Mr. Chidambaram, Ld. Sr. Adv. submitted that this court in its order dated 12 December, 2014 clearly came to a finding that the primary liability to pay tax is on KMDA. This court further found that the provisions of the lease deed executed by and between KMDA and Fabworth cannot override the statutory provisions. Thirdly, this court came to a finding that the applicable Sections are Section 176 read with Section 171 (8)(a)(ii) of the KMC Act, 1980. He submitted that the aforesaid three findings of this court in its order dated 12 December, 2014 are final and binding on the KMC authorities. This court�s order dated 12 December, 2014 was not challenged by way of appeal or otherwise and the same has attained finality. The order of the Hearing Officer impugned in this writ petition is in violation of this court�s order dated 12 December, 2014 and particularly in violation of the aforesaid three findings of this court.

Mr. Chidambaram submitted that KMDA is the owner as well as lessor of the said premises. The assessment book of the KMC as well as building permit issued by the KMC record KMDA as the lessor of the property. He referred to paragraph 4(a) and paragraph 5 of the KMC�s affidavit-in-opposition wherein it is admitted that KMDA is the owner of the property in question and the stand of KMC that a perpetual lease was granted by KMDA to Fabworth in respect of the property in question. A perpetual lease is also a species of lease and it does not transfer the ownership right from the lessor to the lessee. The primary liability to pay property tax is on KMDA.

The KMC Act contains special provisions for levy of property tax on properties owned by various statutory bodies. Section 171 (8)(a)(ii) read with Section 176 of the said Act provides for the methodology of determination of the Annual Valuation as well as the quantum of property tax in respect of properties owned by KMDA.

Section 193 of the KMC Act provides that the incidence of property tax leviable on land or building which are let out would be upon the lessor. Section 193 (3A) and Section 230 of the KMC Act enumerate the circumstances under which the property tax can be recovered from the occupier as well as the quantum thereof. Ld. Sr. Counsel submitted that this court, in its order dated 12 December, 2014, clearly held that KMDA was under the primary obligation to pay the property tax in respect of the said premises. There is no material on record to attract the provisions of Section 193(3A) and/or Section 230 of the KMC Act.

Mr. Chidambaram submitted that in defiance of this court�s order dated 12 December, 2014, the Hearing Officer held that Section 171 (8) of the KMC Act was not applicable in the present case and that KMDA does not have any interest in the property. The Hearing Officer has also erroneously held that Section 176 of the KMC Act is not applicable as the property is not being assessed in the hands of a statutory body, but is being assessed in the hands of a private body namely, Fabworth. By the impugned order the Hearing Officer has held that the Lease Deed fastens the liability on account of property tax upon Fabworth, and, therefore, Fabworth cannot contend that KMDA is the actual person to pay tax and/or that the incidence of tax would be on KMDA. All these findings of the Hearing Officer are contrary to and in violation of this court�s order dated 12 December, 2014 which has attained finality and is binding on the parties. Despite the earlier determination of the Annual Valuation of the said premises having been set aside by this court, KMC vide the impugned order has adopted the same method of computation for arriving at the same Annual Valuation of the property in question.

In support of his contention that a lessee is never the owner of a property, Mr. Chidambaram relied on a decision of a Division Bench of the Bombay High Court in the case of The Collector of Bombay v. Khatizabai Dharsi Somji Dossa reported in 1961 (64) BLR 311. In that case the Bombay High Court observed that the owner of a land only carves out or slices out of his larger interest a particular interest in the land in favour of the lessee by granting a lease for any number of years to another person. Nevertheless, he does not cease to have a right to possession of the property, though such right may be exercisable on the expiry of the term of the lease. Despite the lease for whatever term the lessor is the person having the highest title to the land demised. The Bombay High Court referred to a decision of this court in the case of Kally Dass Ahiri v. Monmohini Dassee reported in (1897) ILT 24 Cal, wherein Jenkins, J. observed that a man who being the owner of land grants a lease in perpetuity carves out a subordinate interest out of his own and does not annihilate his own interest. This result is to be inferred by the use of word �lease�, which implies an interest still remaining in the lessor. Before the lease the owner had the right to enjoy the possession of the land, and by the lease he excludes himself during its currency from that right, but the determination of the lease is a removal of that barrier, and there is nothing to prevent the enjoyment from which he had been excluded by the lease. The Bombay High Court observed that even in the case of a permanent lease of land which is longer in term than a lease for 99 or 999 years, the lessor has got a superior estate in the land that is superior to the estate of the lessee.

Mr. Chidambaram also relied on a decision of a Division Bench of the Delhi High Court in the case of Union of India v. Hotel Excelsior Ltd. reported in ILR (2013) 1 Delhi 157. At paragraphs 15 and 16 of the said judgment it was observed that a lease is different from ownership and a lease in which ownership rights are conferred would cease to be a lease. The Delhi High Court referred to a decision of the Privy Council in Subramanya Chettiar v. Subramanya Mudaliyar reported in AIR 1929 PC 156 wherein it was held that the length of the lease is not indicative of even permanency of the lease much less of transfer of ownership. In Kamal Kr. Dutta v. Nandalal Dubey reported in AIR 1929 Cal 37, this court held that a lease for 99 years does not qualify as a permanent lease. In Kiran Tandon v. Allahabad Development Authority reported in (2004) 10 SCC 745, the Hon�ble Apex Court held that even a perpetual lessee of NAZUL land is not entitled to get full compensation for acquisition thereof since only a full owner gets the entire amount of compensation.

Mr. Chidambaram then submitted that the price mentioned in any Deed may not reflect the market value of the property and it does not have a direct nexus with the determination of the Annual Valuation of the property. In this connection he relied on a decision of this Court in the case of Sree Mahamaya Mining & Industries (P) Ltd. v. The Calcutta Municipal Corporation reported in (1995) 2 CHN 125 wherein at paragraph 101 of the judgment it was observed that price mentioned in the transfer deed does not reflect the market value of the property conveyed and it has no direct nexus with the determination of the Annual Valuation consequent upon change of ownership. Price, in fact, is a fickle and unreliable indicator of the market value as it is related to various factors, some of which are of a nature personal to an individual and should be relied upon for arriving at the Annual Valuation only in cases where the gross annual rental cannot be easily estimated.

Mr. Chidambaram submitted that the contention of the learned Advocate General that the property in question is owned by KMDA but belongs to Fabworth is not supported by pleadings. Further, the impugned order of the Hearing Officer does not say that the property is being assessed in the hands of Fabworth because the property belongs to Fabworth. He submitted that the argument of the learned Advocate General is an afterthought, not supported by pleadings or the impugned order and, therefore, cannot be entertained by this Court. In support of such contention he relied on the celebrated case Mahendra Singh Gil v. Chief Election Commissioner, reported in (1978) 1 SCC 405 wherein the Hon�ble Supreme Court observed that the legality of an order, if challenged, must be judged by the reasons mentioned in the order and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise.

As regards the maintainability of the writ petition, Ld. Sr. Counsel submitted that it is settled position in law that in certain exceptional circumstances the High Court will depart from the rule of alternative remedy and exercise its wide powers under the writ jurisdiction. This exceptions are, firstly, when the authority violates the fundamental rights of a party; secondly, when the authority violates the principle of natural justice; and thirdly, when the authority passes an order without jurisdiction. According to him, the instant case falls under the third exception. He referred to two observations of the Hearing Officer in the order impugned which are as follows:-

"(a) The applicability of Section 171 (8) of the KMC Act, in the present case, cannot be pressed due to the fact as on the date of the assessment, KMDA did not have any interest in the land in question.

(b) Section 176 of the KMC Act will not be applicable as the property is not being assessed in the hands of a statutory body but in the hands of a private body namely, Fabworth, which came forward to be considered as �person liable to pay tax�."

29 (i). Ld. Counsel submitted that the aforesaid two observations made in the impugned order, apart from being contrary to the facts as well as law, are also contrary to the order dated 12 December, 2014 passed by this court. On the basis of such incorrect observations, KMC has clutched at and usurped a jurisdiction which it did not otherwise possess. In this connection, Mr. Chidambaram relied on a decision of the Hon�ble Supreme Court in the case of Whirlpool Corporation v. Registrar of Trademarks, Mumbai reported in (1998) 8 SCC 1. He relied on paragraphs 14, 15 and 20 of the judgment which are as follows:-

"14. The power to issue prerogative writs under Article 226 of the Constitution is plenary in nature and is not limited by any other provision of the Constitution. This power can be exercised by the High Court not only for issuing writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari for the enforcement of any of the Fundamental Rights contained in Part III of the Constitution of India but also for �any other purpose�.

Under Article 226 of the Constitution, the High Court, having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction. But the alternative remedy has been consistently held by this court not to operate as a bar in at lease three contingencies, namely, where the writ petition has been filed for the enforcement of any of the Fundamental Rights or where there has been a violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case-law on this point but to cut down this circle of forensic whirlpool, we would rely on some old decisions of the evolutionary era of the constitutional law as they still hold the field.

Much water has since flown under the bridge, but there has been no corrosive effect on these decisions which, though old, continue to hold the field with the result that law as to the jurisdiction of the High Court in entertaining a writ petition under Article 226 of the Constitution, in spite of the alternative statutory remedies, is not affected, specially in a case where the authority against whom the writ is filed is shown to have had no jurisdiction or had purported to usurp jurisdiction without any legal foundation."

Mr. Chidambaram then relied on a decision of the Hon�ble Apex Court in the case of Raza Textiles Ltd. v. Income Tax Officer, Rampur reported in (1973) 1 SCC 633 wherein it was held that no authority, much less a quasi-judicial authority, can confer jurisdiction on itself by deciding a jurisdictional fact wrongly. The question whether the jurisdictional fact has been rightly decided or not is a question that is open for examination by the High Court in an application for a writ of certiorari. If the High Court comes to a conclusion that the quasi-judicial authority had clutched at the jurisdiction by deciding a jurisdictional fact erroneously, then the aggrieved party would be entitled to a writ of certiorari. The Apex Court observed that it is incomprehensible to think that a quasi-judicial authority (in that case it was the Income Tax Officer) can erroneously decide a jurisdictional fact and, thereafter, proceed to impose a levy on a citizen.

The last case relied upon by Mr. Chidambaram is the decision of the Hon�ble Supreme Court in the case of Godrej Sara Lee Ltd. v. Assistant Commissioner (AA) reported in (2009) 14 SCC 338, at paragraph 13 whereof it was observed that the question whether the notification in question would have a retrospective effect or retroactive operation being a jurisdictional fact, should have been determined by the High Court in exercise of its writ jurisdiction under Article 226 of the Constitution of India as it is well-known that when an order of a statutory authority is questioned on the ground that the same suffers from lack of jurisdiction, alternative remedy may not be a bar.

On the basis of the aforesaid submission Mr. Chidambaram prayed that the writ petition be allowed.

KMC�s Contention:-

Mr. Jayanta Kr. Mitra, Ld. Adv. General appearing on behalf of the KMC submitted that as per the terms of the lease deed, the lessee that is Fabworth has taken over the lessor�s primary liability to pay tax. He referred to the application for mutation of the land in question and submitted that it is significant that mutation was asked for in the name of Fabworth. He also pointed out from the application for mutation that the land in question had been hitherto unassessed. He referred to the affidavit affirmed on behalf of Fabworth (page 49 of KMC�s A/O) whereby Fabworth undertook to pay the pro-rata share of taxes in respect of the said premises. He submitted that given the nature of the lease in question and the vast rights given to the lessee, in fact, the land no longer belongs to KMDA but belongs to Fabworth. Valuation of the land should be done on the basis that Fabworth is the owner thereof. Otherwise, it will be a travesty of justice because the land will be valued as a vacant land and Fabworth � a big business house � will get away by paying a pittance as property tax.

The Ld. Adv. General then referred to Sections 105 and 108 of the Transfer of Property Act, 1982. Section 105 deals with transfer of right to enjoy property. Section 108 enumerates the rights and liabilities of the lessor and the lessee. He submitted that parties by agreement can change the rights and liabilities. In the facts of the case, the lessee has agreed to discharge the lessor�s obligation to pay property tax and as such the property should be valued as if it belonged to the lessee.

The Ld. Adv. General then submitted that the hearing officer took lease premium of Rs. 189,67,41,000/- as the market value of the property in question and assessed the annual value thereof in terms of Section 174 (2) of the KMC Act. The Hearing Officer proceeded on the basis that the writ petitioner/lessee itself having assessed the worth of the property at the said figure and having paid stamp duty on the lease document on the basis of such valuation, there was no reason why he should accept any other value as the market value of the said property. In his order, the Hearing Officer recorded that in the instant case, the Registering Authority accepted the market value given in the instrument to be correct and has calculated the stamp duty based on such valuation, which the writ petitioner paid without any demur. Accordingly in terms of Section 174(2) of the KMC Act, the Hearing Officer fixed the Annual Value of the said property at Rs. 13,27,71,870/- being 7% of the lease premium.

The Ld. Adv. Gen then submitted that the principal ground for challenging the Annual Valuation that it is contrary to the judgment dated 12 December, 2014 passed by this court, is baseless. The contention of the writ petitioners that in view of this court�s interpretation of the provisions of the KMC Act in the order dated 12 December, 2014, the Hearing Officer had no other alternative but to follow the same and arrive at a valuation on the basis thereof is based upon a wholly erroneous reading of the judgment dated 12 December, 2014. Firstly, in the said judgment after setting out a few Sections of the KMC Act and relevant provisions of the indenture of lease in question the court directed the Hearing Officer to take into consideration the discussions and observations made in the said judgment. Secondly, the said judgment itself recorded that the Ld. Judge had not entered into the merits of the case with regard to the correctness of Annual Valuation or property tax of the said premises while examining the propriety of the decision-making process, and expressly kept all points open for decision of the Hearing Officer. In other words, after recording his own views on the provisions of the KMC Act and interpreting the terms of the said lease, the Ld. Judge himself left it to the Hearing Officer to decide all the issues pertaining to the determination of Annual Valuation of the said property taking into consideration the judge�s views on law and fact, but without being influenced by the same.

36 (i). Thirdly, the writ petition before Debasis Kar Gupta, J. challenged the decision dated 13 August, 2014 of a committee constituted by the KMC for considering the valuation of the property in question. It has been recorded in the said judgment that according to the writ petitioner, law did not prescribe formation of a committee to assess the tax on the property under reference. The court held that the determination of the Annual Valuation of the property could have been done only by an officer appointed in terms of the provisions of the KMC Act and there was no provision in the KMC Act empowering the KMC to form a committee to hear such objection; hence, the order passed by the committee was without jurisdiction. Once the court had held that the committee had no jurisdiction to pass the said order of assessment of Annual Valuation, such committee became coram non-judice and its order became null and void. In other words, the impugned order was liable to be set aside by the Ld. Judge on this ground alone, whereupon all other observations in the said judgment became obiter dicta. The Ld. Judge, upon holding that the committee had no jurisdiction to decide the matter of assessment of Annual Valuation of the property, had no need to go into a discussion of the various provisions of the KMC Act. In any event, the Ld. Judge had only directed the Hearing Officer, upon remand, to take into consideration the discussions and observations made in the judgment as regards the various Sections of the KMC Act. The Hearing Officer in due compliance of the decisions in the said judgment, in his order dated 13 January, 2015 took note of and considered each of the Sections referred to by the Ld. Judge along with the provisions of the lease of deed before he came to his finding.

The duties of the Hearing Officer are prescribed by Sections 186, 187 and 188 of the KMC Act. The Ld. Adv. General submitted that a statutory obligation has been imposed upon the Hearing Officer to hear objections against valuation. Such duty is quasi-judicial in nature. He has to hear the objections to determination of annual value of a land and building as entered in the assessment list both on facts and in law. Section 187 of the KMC Act empowers him to determine the objections to such Annual Valuation. Under Section 187 (3), he is entitled to make such queries and observations in relation to any entry in the assessment list and call for such records, returns and explanations as he thinks fit.

Under Section 188 (1) of the KMC Act, the Hearing Officer is entitled to entertain objections to annual valuation filed under Section 186 and to enter the same in a Registrar maintained for the purpose. Sub-section (2) of the Section obliges the Hearing Officer to give the person filing such objection an opportunity of being heard, either in person or through an authorised agent. Thus, the Hearing Officer is statutorily bound to observe the principles of natural justice. Only upon compliance of such requirements, he has to determine the objections. After the objection has been determined, the order of the Hearing Officer is required to be recorded in a Register maintained for such purpose. A copy of the order is required to be supplied to the person filing the objection.

38 (i). Section 189 of the Act makes provision for appeal against the order passed by the Hearing Officer. A Municipal Assessment Tribunal has been constituted for such purpose. It is evident that the legislature intended to give full flow to the entire quasi-adjudicatory process to the system of assessment of annual valuation, namely, entertaining and hearing of objection, passing of order thereon and taking such adjudication to its logical conclusion by way of appeal, if the objector or the KMC is aggrieved by the order of assessment. The statute provides a comprehensive alternative remedy to the party aggrieved by the order of assessment. The writ petitioner has adequate alternative remedy under the statute, and, therefore, the writ petition is not maintainable.

Mr. Mitra submitted that no exception could be taken against the order of the Hearing Officer on the ground that he has ignored this Court�s judgment dated 12 December, 2014 or that he has sat in appeal over the said judgment or has arrived at a different conclusion from the said learned Judge. In any event, considering the said sections the learned Judge did not at all consider, as His Lordship had no occasion to consider, the effect and consequences of the lessee/writ petitioner applying for the first time for mutation of the said property in its name and the fact that KMDA had never been on the records of the KMC as an assessee thereof.

Mr. Mitra submitted that the Hearing Officer is a person specialised in the matter of valuation. I.P Mukherjee, (J.) while disposing of W.P No. 9372 (W) of 2012 observed that "KMC is the best body to make the assessment in accordance with law" and, accordingly, directed KMC to make such determination. The Hearing Officer having been clothed with such authority with the specific statutory power to hear and determine such objection, the Court cannot arrogate to itself such power and denude the statutory authority of its jurisdiction to entertain and hear such objection. The power and jurisdiction exercised by the Hearing Officer is quasi-judicial in nature, and in exercise of such power he is entitled and competent to decide both questions of law and of facts. In a well-considered order, the Hearing Officer on 13 January, 2015, after considering the objections raised by the writ petitioner had given his findings. There is no lack of jurisdiction to pass such an order. There is no error of law apparent on the face of the order which could entitle the writ petitioner to assail the same. There has been no violation of the principles of natural justice. After considering the contentions and counter-contentions raised by the parties, the Hearing Officer construed the provisions of the Act, considered facts of the case and assessed the annual valuation of the property-in-question.

The Advocate General then submitted that the meaning and interpretation of land �owned by� or �belonging to� used in Section 171 (8) and Section 176 of the KMC Act will have to be understood in the context of the factual situation in each individual case. The legislature has used the terms �belonging to� in Section 176 in connection with the determination of annual valuation in contradistinction to �owned by� or �belonging to� in Section 171 (8). When the legislature uses two distinct terms in different sections it is to be understood that they do not convey the same meaning.

41 (i). He submitted that on granting of lease of the said land for 99 years with the option to renew the same for a further period of 99 years in favour of the writ petitioners under Section 105 of the Transfer of Property Act, 1882, there has been a rightful separation of ownership from possession. Before the lease, the owner had a right to enjoy possession of the land, but by the lease he excluded himself from that right during the currency of the lease. A lease is transfer of right to enjoy the property. By the lease-in-question, KMDA transferred such interest in the land and it created a right in rem. A lease creates an interest in the property in favour of the lessee by virtue of the contract of lease and such interest created in the property can also be put to an end too by terminating the contract of lease.

41 (ii). By parting with the right of possession and enjoyment of the property-in-question during the period of the said lease, the said property ceased to �belonged to� KMDA. The writ petitioner was fully aware of the implication of the creation of lease with reference to the provision of KMC Act. It applied for mutation of its name in the records of the KMC agreeing to be primarily liable for payment of tax on the basis that the property belonged to it. In the case reported in AIR 1965 SC 1923, the Hon�ble Supreme Court observed that though the term �belonging to� is capable of denoting an absolute title, it is nevertheless not confined to connoting that sense. Even possession of interest less than that of full ownership could be signified by that term. The Supreme Court referred to the Webster Dictionary which explained the term �belonging to� to mean, inter alia, "to be owned by, be in possession of". The precise sense which the word is meant to convey can be gathered only by reading the said sections together and adverting to the context and which it occurs. The Hearing Officer rightly took notice of the fact that it was the writ petitioner which invited mutation of its name in the records of the KMC thereby agreeing to become person liable to pay property tax on the said property.

In response to the writ petitioner�s contention that under Section 193 of the KMC Act, the property tax on lands and buildings is primarily leviable, if the land or building is let out, upon the lessor, the learned Advocate General submitted that the lease deed dated 28th September, 2007, which creates a right of possession and enjoyment of the said property in favour of the lessee, records the agreement and understanding by the lessee that during the term of the said lease it shall pay all present and future rates and taxes, charges and other imposition of every description in respect of the demised land and building erected or to be erected thereon, which are or may be assessed to be payable by the owner or the occupier presently or in future and all increases thereof in respect of the demised land and all structure thereon or to be made thereon from the date of commencement of the lease. By entering into the said lease agreement the lessee/writ petitioner took upon itself and undertook to pay the municipal rates and taxes in respect of the said property thereby agreeing to be primarily liable to pay the property tax, which liability under the KMC Act was foisted upon the lessor. Under the KMC Act the lessee has the right to contend that the incident of the property tax on the land or the building should primarily fall on the lessor. This is a statutory right which was available to the writ petitioner as the lessee of the said property. However, by executing the said indenture of lease, the writ petitioner, as the lessee, waived such right and undertook to be primarily liable for payment of the property tax in the place and stead of KMDA. It is well-accepted proposition of law that even a mandatory provision of law can be waived by the person for whose benefit such provision was framed, if such requirement is not in public interest. In this connection, the leaned Advocate General relied on a decision of the Hon�ble Supreme Court in the case of Grafite India Limited v. Durgapur Project Limited reported in (1999) 7 SCC 645 wherein the Hon�ble Supreme Court referred to of its earlier decision in the cases of State of Patiwala v. S.K. Sharma reported in (1996) 3 SCC 364 and Rajendra Singh v. State of M.P. reported in (1996) 5 SCC 460 and affirmed that even a mandatory provision which is in the interest of the party can be waived by the party itself but if it is in public interest, it cannot be waived. The learned Advocate General also referred to a judgment of the Hon�ble Supreme Court in the case of Commissioner of Customs (Mumbai) v. Vargo Steels (Bombay) reported in (2002) 4 SCC 316 wherein the Hon�ble Supreme Court after referring to several earlier decisions, observed that though a provision of law is mandatory in its operation, if such provision is one which deals with the individual rights of the person concerned and for his benefit, the said person can always waive off such right.

The learned Advocate General then submitted that the lease agreement is not in supersession of the statutory provision but it records, inter alia, that the obligation for which the primary liability is alleged to be on KMDA has been voluntarily and expressly undertaken to be discharged by the lessee/writ petitioner. There is no dichotomy between Clause (2) (b) and (c) (i) of the lease deed on the other hand and Sections 193 and 230 of the KMCA Act on the other. In this connection, he referred to a decision of a Division Bench of this Court in the case of Tea Corporation of India Limited v. The Saturday Club Limited reported in (2003) 2 CHN 369.

The learned Advocate General then submitted that under Section 183 (5) of the KMC Act, the application for mutation of the said property was made by the writ petitioner. It is significant that when it made the application for mutation, the said property was admittedly an unassessed property. In the affidavit accompanying the application for mutation the writ petitioner undertook to pay the pro rata share of taxes in respect of the said premises, which was unassessed, that may be determined after mutation of name. On the basis of the said application the name of the writ petitioner was mutated in the records of the KMC and also in the Municipal Assessment Book. Upon such mutation, the writ petitioner became liable to pay the tax. Mutation is nothing but recording as to who is liable to pay tax:

44 (i).The learned Judge in the judgment and order dated 12 December, 2014, had no occasion to consider this aspect of the legal implication of mutation of the property in the name of the lessee, being the person in possession. Mutation of a property in the Corporation Assessment Records does not create nor extinguishes title to the property. It only imposes an obligation on the person in whose favour mutation is granted to pay the property tax. The Municipal Corporation is concerned with collection of property tax from a person liable to pay the same. By taking mutation of the property-in-question in its own name, the writ petitioner has become the person liable to pay property tax. In the Municipal Assessment Book, KMDA has been shown to be a lessor but the writ petitioner has been shown as "person liable to pay tax" and its address at Hungerford Street has been recorded so that the municipal rate bills could be sent to it.

Court�s View:

The short question that falls for determination by this Court is whether the property in question should be valued on the basis that the owner of the property is KMDA or whether it should be valued on the basis that the owner of the property is Fabworth. The Hearing Officer has valued the property on the basis that Fabworth is the owner of the property and the property belongs to Fabworth. The petitioners have taken exception to the same. According to them the property belongs to and is owned by KMDA and the Hearing Officer valued the property on an erroneous basis.

Certain facts are undisputed. The property in question is owned by KMDA. KMDA has leased out the property to Fabworth for the purpose of constructing a 5/7 Star Hotel thereon under a lease deed dated 28 September, 2007. The lease is renewable for a further period of 99 years. Fabworth has paid a lease premium of Rs. 189,67,41,000/- to KMDA.

The contention of the writ petitioners is that irrespective of the length of the terms and conditions of the lease in favour of Fabworth, the ownership in the property continues to be with KMDA. A lease never transfers the ownership right to the lessee and the right of reversion always lies with the lessor. Accordingly, the annual value of the land in question should be determined in accordance with Section 176 read with 171 (8) (a) of the KMC Act, 1980.

Section 176 and Section 171 (8) (a) of the KMC Act, 1980 are set out hereunder:

"S. 176. Annual Valuation of lands or buildings belonging to various statutory bodies. - The annual value of any land or building belonging to the State Government or any of the statutory bodies mentioned in clause (a) of sub-section (8) of Section 171 shall be deemed to be five per cent of the cost of acquisition thereof, subject to any revision made in this behalf by the State Government on an application by any such body or by the Corporation. For the purpose of this section, the cost of acquisition shall mean,-

(i) in the case of any land or building acquired under the Land Acquisition Act, 1894 91 of 1894), as amended by the Kolkata Improvement Act, 1911 (Ben. Act V of 1911), the value of such land or building as determined under the Land Acquisition Act, 1894, as so amended or by the Tribunal constituted under the Kolkata Improvement Act, 1911 or by any appellate authority under any of the enactments as aforesaid;

(ii) in the case of any land or building acquired by private treaty, the purchase price of such land or buildings;

(iii) in the case of any land or building taken for an improvement scheme under section 54 or section 55 of the Kolkata Improvement Act, 1911, such amount as may be determined under either of those sections;

(iv) in the case of any land or building belonging to the State Government of any of the statutory bodies mentioned in clause (a) of sub-section (8) of section 171, such amount as may be determined under the provisions of the Act governing such body or of any other law in force for the time being and applicable to such body.

S. 171 (8) Notwithstanding anything contained in sub-section (2), the property tax on the �

(a) land owned by or belonging to �

(i) the Board of Trustees for the Improvement of Kolkata, constituted under the Kolkata Improvement Act, 1911 (Ben. Act V of 1911), or

(ii) the Kolkata Metropolitan Development Authority, constituted under the Kolkata Metropolitan Development Authority Act, 1972 (West Ben. Act XI of 1972), or

(iii) the West Bengal Housing Board, constituted under the West Bengal Housing Board Act, 1972 (West Ben. Act XXXIII of 1972), or

(iv) the West Bengal Industrial Infrastructure Development Corporation, established under the West Bengal Industrial Infra-structure Development Corporation Act, 1974 (West Ben. Act XXV of 1974), or

(v) such other statutory body as may be notified by the State Government in this behalf from time to time, for the purposes of development schemes in accordance with the published or approved plans but not pout to such use, shall be ten per cent of the annual value of such land as determined under this Chapter."

Debashis kargupta, J. in his judgment and order dated 12 December, 2014 passed on W.P No. 30732 (W) of 2014 held that KMDA was under obligation to pay the property tax of the premises in question at the first instance and that no material is available on record to show that the provisions of Section 193 (3A) or Section 230 of the KMC Act could be invoked. The said sections are set out hereunder:

"S. 193(3A):- In the case of any land or building or portion thereof which is not self-occupied and where the owner is refrained, by any law, Order of the Government or order of a Court, from recovering the property tax due from the occupier or occupiers, such tax shall be recovered from the occupier or occupiers, as the case may be: Provided that the owners shall continue to pay such amount of property tax as he was liable to pay before coming into force of the Kolkata Municipal Corporation (Amendment) Act, 2006 and only the balance amount of the property tax, when determined after coming into force of the Kolkata Municipal Corporation (Amendment) Act, 2006, if any, shall be recovered from the occupier.

S. 230:- Apportionment of property tax by the person primarily liable to pay. � Save as otherwise provided in this Act, the person primarily liable to pay the property tax in respect of nay land or building may recover �

(a) if there be but one occupier of the land or building, from such occupier half of the rate so paid, any may, if there be more than one occupier, recover from each occupier half of such sum as bears to the entire amount of rate so paid by the owner the same proportion as the value of the portion of the land or building in the occupation of such occupier bears to the entire value of such land or building:

Provided that if there be more than one occupier, such half of the amount may be apportioned and recovered from each occupier in such proportion as the annual value of the portion occupied by him bears to the total annual value of such land or building:

(b) the entire amount of the surcharge on the property tax on any land or building from the occupier of such land or building who uses it for commercial or nonresidential purposes:

Provided that if there is more than one such occupier, the amount of surcharge on the property tax may be apportioned and recovered from each such occupier in such proportion as the annual value of the portion occupied by him bears to the total annual value of such land or building."

The true purport of the aforesaid judgment and order of Debashis Kargupta, J. is that the primary liability to pay property tax is on KMDA and as such, the land in question should be valued on the basis that it belongs to KMDA. The learned Judge set aside the annual valuation and property tax arrived at by the committee constituted by KMC and remanded the matter to KMC to pass an order afresh after taking into consideration the discussions and observations made in the judgment and order dated 12 December, 2014.

When a challenge is thrown against an order of a statutory authority regarding the legality or validity thereof before a writ Court and the Court finds that the order is based on erroneous premises, normally the writ Court quashes the order and sends back the matter to the authority with appropriate guidelines for fresh consideration. The writ Court normally does not substitute its own decision for that of the statutory authority as that would amount to usurpation of the power and function of the authority. This is not to say that the writ court does not have such power. But except in exceptional circumstances, the writ court does not exercise such power. The writ Court lays down the correct principles of law which the authority should follow while considering the matter afresh. Such guidelines are binding on the authority.

In the instant case, Kargupta J. laid down the guidelines for the KMC to follow in arriving at a fresh assessment of property tax. The guidelines required the KMC to apply the provisions of Section 176 read with Section 171 (8) (a) of the KMC Act. However, the Hearing Officer ignored such guidelines and assessed the property tax on the basis that the property is owned by Fabworth, taking the lease premium as the market value of the land. The Hearing Officer clearly erred in not following the guidelines laid down by Kargupta, J., in his aforesaid judgment and order dated 12 December, 2014, which has attained finality as no appeal was preferred from the same. A situation cannot be countenanced where the writ Court lays down the guidelines as to how a statutory authority should decide the matter but the authority ignores the same and decides the matter in a completely different way. This would lead to legal anarchy. In my opinion, the Hearing Officer was bound to follow the guidelines by Kargupta, J. in His Lordship�s aforesaid judgment and order.

In fact, as per the principles stare decicis, the judgment and order of Kargupta J. is also binding on me. If I want to differ from the view taken by Kargupta J., judicial discipline would impel me to refer the matter to a Larger Bench. However, for the reasons stated hereinafter, I am in respectful agreement with the views of Kargupta J., and, hence, such reference is not necessary.

Before proceeding further I should deal with the submissions of the learned Advocate General to the effect that Kargupta J. having come to a finding that the provisions of the KMC Act did not empower KMC to form a committee for assessing the property tax and the assessment order of the committee was without jurisdiction and having quashed the assessment order of the committee on that ground alone, all other observations of the learned Judge in the judgment and order dated 12 December, 2014 are no more than obiter dicta, having no binding effect. He further submitted that the learned Judge himself recorded that he did not enter into the merits of the case with regard to correctness of annual valuation or property tax in respect of the premises in question and all points were kept open. Hence, the judgment and order of Kargupta J., has no binding effect either on the Hearing Officer or on this Court.

With great respect, I cannot agree with the submission of the learned Advocate General. On a proper reading of the judgment and order dated 12 December, 2014, the learned Judge not only held that the committee did not have jurisdiction to pass any assessment order but also held that the method of calculating the annual valuation and the property tax of the property in question was erroneous. It was not that the issue of correctness of the method of computation of the property tax was not before the learned Judge. That point was also a ground for challenging the assessment order of the committee constituted by the KMC. The learned Judge held that the formula applied by the committee was erroneous and the assessment should have been done in accordance with the provisions of Section 176 read with Section 171 (8) (a) of the KMC Act.

In the case of Ratanbansi Lal v. Kishori Lal Goyenka reported in AIR 1993, Calcutta 114, a Full Bench of five learned Judges of this Court observed that there are various tests to find out whether a particular observation of the Court is part of the ratio or is obiter. The first test is whether that part of the decision results from the determination of a live issue raised between the parties. A Judge may let fall various observations not precisely relevant to the issue before him. A hypothetical situation may be taken for illustration and he may hypothetically apply a law to such illustration but the same not being the issue, it would not be proper to give the observation equal weight with what is given to his actual decision. In the case of State of Haryana v. Ranbir reported in (2006) 5 SCC 167, Hon�ble Supreme Court held that a decision is an authority for what it decides and not what can logically be deduced therefrom. The distinction between a dicta and obiter is well-known. Obiter dicta is more or less presumably unnecessary to the decision. It may be an expression of a view point or sentiments which has no binding effect. The statements which are not part of the ratio decidendi constitute obiter dicta and are not authoritative. The Supreme Court referred to its earlier judgment in the case of Director of Statements, A.P v. M.R. Apparoy, reported in (2002) 4 SCC 638, wherein at Paragraph 7 of the judgment, the Supreme Court observed that a obiter dicta as distinguished from the ratio decidendi is an observation by the Court on a legal question suggested in a case before it but not arising in such a manner as to require a decision. Such an obiter may not have a binding precedent but it has considerable weight. The Supreme Court also referred to a decision of the English Court in the case of Behrens v. Bertram Mills Circus Limited, reported in (1957) 2 QB 1 wherein Devlin J. observed that if the Judge gives two reasons for his decisions, both are binding. It is not permissible to pick out one as being supposedly the better reason and ignore the other one; nor does it matter for this purpose which comes first and which comes second.

Going by the meaning of obiter dicta as discussed above, in my opinion, it cannot be said that the observation of Kargupta J., regarding applicability of Section 176 read with Section 171 (8) (a) of the KMC Act, to the facts of the instant case was obiter dicta. It was one of the grounds for setting aside the assessment order of the committee constituted by the KMC. It was very much a part of the ratio decidendi of the judgment and order dated 12 December, 2014 and, hence, binding on the Hearing Officer to whom the matter of assessment was remanded and also binding on me.

Even if I were to accept the submission of learned Advocate General that the observation of Kargupta J., in his aforesaid judgment regarding applicability of Section 176 read with Section 171 (8) (a) of the KMC Act was obiter dicta having no binding value, my decision would not be any different. Generally speaking, a lease is a contract entered into by and between the owner of a property or a person having a transferable interest in a property who is the lessor and the lessee where under the lessor parts with his right to enjoy the property in favour of the lessee on the terms and conditions agreed upon between the parties. It is never an outright transfer of ownership right. The lessor remains the owner of the property with the right of reversion. Once the lease comes to an end the right to enjoyment of the property reverts back to the owner/lessor. The length of the lease is immaterial. A perpetual lease is also a spices of lease. Admittedly, there was no outright sale of the property in question by KMDA to Fabworth. The ownership of a superior title to the land in question remains with KMDA. Section 171 (8) (a) (ii) of the KMC Act clearly states that notwithstanding anything contained in Sub-section (2), the property tax on the land owned by or belonging to the Kolkata Metropolitan Development Authority, constituted under the Kolkata Metropolitan Development Authority Act, 1972, shall be 10 per cent of the annual value of such land as determined under that chapter. Section 176 of the KMC Act provides, inter alia, that the annual value of any land or building belonging to any of the statutory bodies mentioned in Clause (a) of Sub-section (8) of Section 171 shall be deemed to be 5 per cent of the cost of acquisition thereof, subject to any revision made in this behalf by the State Government on an application by any such body or by the Corporation. In my opinion, it cannot be said that the land in question does not belong to KMDA. The distinction sought to be made by the learned Advocate General between the terms "owned by" and "belonging to", is with great respect, a distinction without a difference. Any property be it movable or immovable, cannot belong to somebody without being owned by him and vice versa. The land in question is owned by and belongs to KMDA and Fabworth has the right to enjoy the property for the duration of the lease on the terms and conditions stipulated in the deed of lease.

It is correct that Section 176 of the KMC Act uses the phrase "belonging to" whereas Section 171 (8) (a) uses the phrase "owned by or belonging to". However, in my opinion, the same makes no difference. In my opinion, and in any event, the phrase "belonging to" and "owned by" are synonymous in the context of the KMC Act. It may be noted that under Section 539 of the KMC Act, the KMC has the power to dispose of property belonging to the KMC. Obviously, the phrase "belonging to" has been used as a synonym of the phrase "owned by" as it is inconceivable that KMC can dispose of property without being the owner thereof. Further Section 615 of the KMC Act provides for penalty for causing damage to property belonging to the corporation. Here also the phrase "belonging to" must be interpreted as meaning "owned by" as otherwise KMC would have no jurisdiction to impose penalty for damage to such property.

The fact that Fabworth applied for and obtained mutation of the land in its own name, does not change the situation. Mutation does not confer ownership title to property. Even if Fabworth has represented itself as the party liable to pay property tax in respect of the land in question, that does not make Fabworth owner of the land. Ownership still continues with KMDA. As such, annual valuation of the land has to be determined in accordance with Section 176 of the KMC Act and property tax has to be determined in accordance with Section 171 (8) of the KMC Act. Thus, if the cost of acquisition of the property by KMDA was Rs.100/-, the annual valuation would be Rs.5/- and the property tax would be 10 per cent thereof i.e 50 paise.

A case directly on point is that of Calcutta Swimming Club and another v. Kolkata Municipal Corporation, (2010) 3 CLT 410. In that case, the Government of West Bengal had leased out a vacant plot of land to the Calcutta Swimming Club with permission to build structures thereon. The club got the land mutated in its name it also constructed swimming pools and buildings on the vacant plot of land. The KMC issued notice of hearing to the club for assessment of property tax. The club challenged the notice by way of writ petition in this Court inter alia contending, that the primary liability to pay property tax is on the lessor i.e the Government of West Bengal. It was contended on behalf of the club that the Government being exempted from payment of property tax on the lands belonging to it, question of failure of the Government to pay property tax could not arise and, hence, the club could not be proceeded with under Section 195 of the KMC Act. The learned Single Judge held that the club was liable to pay property tax for the land in question.

61 (i). In appeal, a Division Bench of this Court reversed the said finding of the learned Trial Judge. The Division Bench held that notwithstanding the agreement between the lessor and the lessee to the effect that the lessee shall bear the rates and taxes in respect of the land in question, the lessor continues to be the person responsible upon whom the property tax is primarily leviable, however, the club being the undisputed owner of the buildings and structures constructed on the land, the property tax in respect thereof was payable by the club/lessee.

61 (ii). In the case in hand, KMDA remains the owner of the land in question. Hence, the primary liability of paying property tax in respect of the land is that of the KMDA. The agreement between the KMDA and Fabworth to the effect that Fabworth will pay the rates and taxes in respect of the property in question is an inter-parties agreement, not binding on any third party including the KMC. KMC has the legal right to proceed against KMDA for recovery of the property tax in respect of the land. The property tax in respect of the buildings and structures constructed on the land would be leviable on Fabworth. Liability to pay property tax and discharge of such liability are two different issues. The primary liability to pay property tax is still on KMDA. If that be so the property tax in respect of the land must be assessed on the basis that the property is owned by KMDA. If the annual value of the land is assessed on the basis that Fabworth is the owner of the land, in my opinion, it will make a mockery of the statute.

I am also unable to agree with the submission of the learned Advocate General that if the property in question is valued and property tax thereon is assessed on the basis that the land is owned by KMDA, the property tax would be a pittance and this would be unfair as Fabworth is a big business house and will make huge commercial gains by running a 5/7 star hotel from the said property. One cannot lose sight of the fact that Fabworth has paid substantial lease premium of more than Rs. 189/- crores to KMDA which is also a statutory body. Fabworth will also be liable to pay property tax on the building that it is constructing on the land in question which will be assessed on the basis that the building belongs to Fabworth. In any event, the language of Section 176 and Section 171 (8) of the KMC Act is clear and unequivocal leaving no scope for confusion. It is not that the said sections are liable to two interpretations, one favouring KMC and the other favouring Fabworth.

Even if two interpretations of the said sections of the KMC Act were possible as the learned Advocate General would argue, it is settled law that a taxing statute is to be strictly construed. It is wellestablished that "the subject is not to be taxed without clear words for that purpose; and that every Act of Parliament must be read according to the natural construction of words" (Re: Mickle Thwait, (1885) 11 EX 452). In Partington A.G (1869) L.R 4 HL 100 Lord Carns said "if the person sought to be taxed comes within the letter of law he must be taxed, however, great hardship may appear to the judicial mind to be." On the other hand, if the Crown seeking to recover the tax, cannot bring the subject within the letter of the law, the subject is free, however, apparently within the spirit of law the case may otherwise appear to be. In other words, if there be admissible in any statute what is called an equitable construction, certainly such a construction is not admissible in a taxing statute where you can simply adhere to the words of the statute. In various judgments, our Supreme Court has made pronouncements to the similar effect. In A.V. Fernandez v. State of Kerala reported in AIR 1957 SC 657 (661) the Supreme Court observed that in construing a fiscal statute and in determining the liability of a subject to pay tax one must have regard to the strict letter of the law. If the revenue satisfies the Court that the case falls strictly within the provisions of the law, the subject can be taxed. However, on the other hand, if the case is not covered within the four corners of the provisions of the taxing statute no tax can be imposed by inference or by analogy or by trying to probe into the intentions of the legislature and by considering what was the substance of the matter. In Sales Tax Commissioner v. Modi Sugar Mills, reported in AIR (1961) SC 1047 (1051), the Supreme Court observed that in interpreting a taxing statute equitable considerations are entirely out of place. Nor can a taxing statute be interpreted on any presumptions or assumptions. The Court must look squarely at the words of the statute and interpret them. It must interpret a taxing statute in the light of what is clearly expressed; it cannot imply anything which is not expressed; it cannot import provisions in the statute so as to supply any assumed deficiency.

It is also trite law that if the words use in a taxing statute are ambiguous and reasonably open to two interpretations, benefit of interpretation is given to the subject. In this connection, reference may be had to the cases of Express Mill v. Municipal Committee, Wardha, reported in AIR 1958 SC 341; C.A. Arraham v. ITO Kottoyam, reported in AIR 1961 SC 609; J.K. Steel v. Union of India, reported in AIR 1970 SC 1173 Petron Engineering Construction Private Limited v. Central Board of Direct Taxes, reported in AIR 1989 SC 501; Hindustan Lever v. Municipal Corporation of Greater Bombay, 1995 (3) Scale 24. Thus, even if the interpretation of the relevant provisions of the KMC Act as given by the learned Advocate General is reasonably possible, the interpretation given to the said provisions by Mr. Chidambaram would have to be accepted being a reasonable interpretation and favouring the subject.

The learned Advocate General submitted that since an alternative remedy is available to the writ petitioners by way of an appeal, the writ application should not be entertained. I am unable to accept such submission of the learned Advocate General. There is no rule of law that the High Court can not entertain a writ petition where an alternative remedy is available to a party. It is always a matter of discretion with the Court and if the discretion has been exercised by the High Court not unreasonably or perversely, it is the settled practise of the Supreme Court not to interfere with the exercise of discretion by the High Court, State of U.P v. M/s. Indian Hume Pipe Company Limited, reported in AIR 1997 SC 1132, Para 4. In the case of Municipal Council, Khurai v. Kamal Kumar, reported in AIR 1965 SC 1321, the Hon�ble Supreme Court held that though the High Court would not ordinarily maintain a petition under Article 226 of the Constitution of India where an alternative remedy is open to the aggrieved party, it has jurisdiction to grant relief to such a party if it thinks proper to do so in the circumstances of the case. The High Court having chosen to exercise discretion in favour of the writ petitioners, it would not be right to interfere with the exercise of that discretion unless the Supreme Court is satisfied that the action of the High Court was arbitrary or unreasonable. In the case of A.V. Venkateswaran, Collector of Customs (Bombay) v. Ramchand Sobhraj Wadhwani, reported in 1961 SC 1506, a Constitutional Bench of the Supreme Court held that the rule that the party who applies for the issue of a high prerogative writ should, before he approaches the Court, have exhausted other remedies open to him under the law is not one which bars the jurisdiction of the High Court to entertain the petition or to deal with it, but, is rather a rule which Courts have laid down for the exercise of their discretion. The wide proposition that the existence of an alternative is a bar to the entertainment of a petition under Article 226 of the Constitution of India unless there was a complete lack of jurisdiction in the Officer or authority to take the action impugned, or where the order prejudicial to the writ petitioner has been passed in violation of the principles of natural justice and could, therefore, be treated as void or non-est and that in all other cases Courts should not entertain petitions under Article 226 or should not grant any relief to such petitioners, cannot be accepted. The two exceptions to the normal rule as to the effect of the existence of an adequate alternative remedy are by no means exhaustive and even beyond them a discretion vests in the High Court to entertain the petition and grant the petitioner relief notwithstanding the existence of an alternative remedy. The broad lines of the general principles on which the Court should act having been clearly laid down, their application to the facts of each particular case must necessarily be dependent on a variety of individual facts which must govern the proper exercise of the discretion of the Court, and in a matter which is, thus, pre-eminently one of discretion, it is not possible and in any event not desirable to lay down inflexible rules which should be applied with rigidity in every case which comes up before the Court. In the case of S.J.S Business Enterprises (P) Limited v. State of Bihar, (2004) 7 SCC 166, at Paragraph 14 of the judgment, the Hon�ble Supreme Court observed that the existence of an adequate or suitable alternative remedy available to a litigant is merely a factor which a Court entertaining an application under Article 226 will consider for exercising the discretion to issue a writ under Article 226. But the existence of such remedy does not impinge upon the jurisdiction of the High Court to deal with the matter itself if it is in a position to do so on the basis of the affidavits filed.

It is, thus, settled law that existence of an efficacious alternative remedy is not a bar to the High Court entertaining a writ petition. It is a rule of law developed by the Courts to encourage the litigants to exhaust the avenue of alternative remedy. Existence of an alternative remedy by no means goes to the jurisdiction of the writ Court.

In the present case, this Court has already found that the Hearing Officer ignored the guidelines laid down by Kargupta J., in His Lordship�s judgment and order dated 12 December, 2014. His Lordship interpreted the relevant provisions of the KMC Act and held that valuation of the property in question should be done in accordance with the provisions of Section 176 read with Section 171 (8) (a) of the KMC Act. This finding, not having been challenged by either of the parties before a superior forum, was binding on the parties and on the Hearing Officer who is an employee of the KMC. It is for the Courts of law to construe a statute and such construction is binding on the authorities. If it is found that the authority has issued an order ignoring the opinion of the High Court as to which particular section of a statute is applicable to the facts of a particular case, the same would amount to a grave dereliction of duty on the part of the authority concerned and an error apparent on the face of the order and if such order is brought before the writ Court by way of challenge, the writ Court would be failing in its duty if it does not interfere notwithstanding that an alternative remedy may be available to the aggrieved party. Further, I am also of the opinion that once a writ petition is admitted and affidavits are invited, a writ petition should not be dismissed at the stage of final hearing only on the ground that an efficacious alternative remedy exists.

For the reasons afore stated, this application succeeds. The impugned order dated 13 January, 2015 passed by the respondent No. 3 is quashed. The matter is remanded back to the respondent No. 3 for assessing the annual valuation and property tax in respect of Municipal Premises No. 4A, JBS Haldane Avenue, Kolkata, afresh on the basis that the property is "owned by" and "belongs to" the KMDA and hence, and the same should be assessed in accordance with the provisions of Section 176 read with Section 171 (8) of the KMC Act. The cost of acquisition of the property by KMDA has been disclosed by KMDA in these proceedings pursuant to a direction of this Court. Hence, there should be no difficulty on the part of the respondent No. 3 in assessing the annual value and the property tax in question following the aforesaid guideline. Such assessment must be completed within a period of four weeks from date after giving a personal hearing to the writ petitioners. The assessment order must be a reasoned one and must be communicated to the writ petitioners within one week from the date of the order.

W.P 4928 (W) of 2015 is accordingly disposed of.

There will be no order as to costs.