Maheshwari and Company vs State of Chhattisgarh and Another

Satish K. Agnihotri, J.—Challenge in this petition is to a notice dated 30-11-2005 (Annexure P/l) and the memo dated 16-3-2007 (Annexure P/2) issued by the Chief Executive Officer, Municipal Council, Birgaon, Raipur. whereby the. Petitioner was directed to deposit the property tax.

Case of the Petitioner is that the Petitioner is engaged in production of aluminum utensils at Birgaon, Raipur since 1972. The Municipal Council, Birgaon came into existence in the year 2004. Thereafter, notices wore issued to the Petitioner to pay the property tax. Accordingly, the Petitioner deposited Rs. 21,152/-. On 17-1-2006 a notice was issued to the Petitioner for payment of property tax of Rs. 74,431/- for the financial year 2005-2006. The copy of self assessment chart was not provided to the Petitioner. However, the Petitioner paid Rs. 21,152/- vide cheque No. 312254 as paid in financial year 2004-05. The Respondent council by letter dated 3-5-2006 (Annexure P/l2) intimated the Petitioner that according to the provisions of Chhattisgarh Municipalities Act, 1961 (for short "the Act, 1961") notification was published in different news papers. The Petitioner was directed to pay the remaining amount of property tax. Thereafter, the Petitioner made several correspondences, but he has not received any response from the Respondent council. The Petitioner sent a notice dated 24-6-2006 (Annexure P/14) to the Respondent council. Alter receipt of the said notice, the Respondent council directed the Petitioner to pay property tax of Rs. 47,832/-. According to the Petitioner, the assessment has been made by the Respondents at their whims and fancies. Again by letter dated 16-3-2007 (Annexure P/2) the Petitioner was directed to pay Rs. 55,027/- in an illegal and arbitrary manner. Thus, this petition.

Shri Otwani, learned Counsel appearing for the Petitioner, would submit that the Respondent council has no uniform policy for making the assessment of property tax. The Respondent authorities are charging the property tax in an illegal and arbitrary manner and contrary to the provisions of the Act, 1961. Shri Otwani would further submit that the procedure before levying and imposition of property tax has been prescribed in Sections 136, 137 and 138 of the Act, 1961. Noncompliance of the above-stated statutory provisions nullifies the assessment and the order passed thereon. Thus, the impugned notices may be quashed.

On the other hand, Shri Sharma, learned Counsel appearing for the Respondent No. 2 would submit that when the Petitioner did not deposit the property tax for the financial year 2005-06 in accordance with the new rates, the notice was issued for payment of Rs. 47.832/- whereas the Petitioner paid only Rs. 21.152/-. After affording full opportunity of hearing to the Petitioner, the impugned notice was issued. Even, the Petitioner has not challenged the notice for enhancement of the annual letting value. The Petitioner is defaulter in paying the property tax. Thus, the Petitioner is not entitled to any relief from this Court and the petition may be dismissed.

Shri Thakur, learned Panel Lawyer appearing for the State, adopts the submission made by learned Counsel appearing for the Respondent No. 2/Municipal Council.

I have heard learned Counsel appearing for the parties, perused the pleadings and the documents appended thereto.

The notice dated 30-11-2005 (Annexure-P/1) specifies the rate of property tax, as resolved by the Municipal Council, Birgaon, in its resolution dated 18-10-2005. Reliance of the learned Counsel appearing for the Respondent Municipal Council on notice dated 2-12-2005 published in ''Nav Bharat'' newspaper (Annexure-R 2/1) does not indicate anywhere that objections were invited from the public. It specifies only the rate determined by resolution and thereafter direction to make payment before 28-2-2006 and thereafter with 5% surcharge upto 31-3-2006. Nowhere in the notice it was stated that public is invited to lodge objection, if any, as required under the provisions of Sections 137 & 138 of the Act, 1961. Second impugned memo dated 16-3-2007 (Annexure-P/2) directs the Petitioner to deposit the amount without inviting objections, as required under the provisions of Section 138 of the Act, 1961.

Provisions of Sections 136, 137 and 138 of the Act, 1961 read as under:

Publication of notice of assessment list. When the assessment list has been completed, the Chief Municipal Officer shall give public notice thereof; and of the place where the list or a copy thereof may be inspected; and every person claiming to be either owner or occupier of property included in the list, and any agent of such person duly authorized by him in writing may inspect that list and take extracts therefrom free of any charge.

Public notice of time fixed for lodging objections.- (1) The Chief Municipal Officer shall, at time of publication of the assessment list u/s 136, give public notice of a date not earlier than thirty days from the publication of such notice by which objections to the valuation or assessment in such list may be delivered at his office.

(2) The Chief Municipal Officer shall in all cases in which the property is for the first time assessed or the assessment is increased as a result of increase in the valuation of the property, give special notice thereof to the owner or occupier of the property, if known, and if the owner or occupier of property is not known, shall cause such notice to be affixed in a conspicuous place on the property.

(3) Any person dissatisfied with a valuation or assessment made under this Chapter may file an objection at the Municipal office stating the grounds to such valuation or assessment on or before the first day fixed in this behalf in public notice referred to in Sub-section (1) or (2).

Investigation of objections by Chief Municipal Officer.- (1) All such objections shall be entered in a register to be maintained for the purpose and, on receipt of any objection the Chief Municipal Officer shall give a notice in writing to the objector of the time and place at which his objection will be investigated.

(2) At the time and place so fixed, the Chief Municipal Officer shall hear the objection, in the presence of the objector or his authorized agent if he appears, or may for reasonable cause, adjourn the investigation.

(3) When the objection has been determined, the order passed on such objection shall be recorded in the said register and, if necessary, an amendment made in the assessment list in accordance with the result of the objection.

(4) If the Chief Municipal Officer fails to determine the objection within a period of one year from the date of its filing, it shall be deemed that the objection so filed has been disallowed and the objector may prefer an appeal u/s 139 of the Act.

On perusal of the scheme, the Act, 1961 and the intention of the legislature, I find that the provisions of Sections 137 & 138 of the Act, 1961 are mandatory. In the case on hand, the Respondents have failed to produce any document to establish that before issuing the memo dated 16-3-2007 (Annexure-P/2) determining the property tax, the Petitioner has been noticed and called upon to file an objection, as required under the provisions of Section 138 of the Act, 1961. The procedural provisions, as contained in Sections 137 and 138 of the Act, 1961 are mandatory and the same impinge heavily on the determination and imposition of property tax. Non-compliance of the same nullifies the subsequent order.

It is well settled that an express condition relating to the exercise of statutory procedural aspect may imply a prohibition, if the subsequent order has been passed in breach of express or implied procedural conditions and the order will be illegal.

Prof. Wade points out as under:

Procedural safeguards, which are so often imposed for the benefit of persons affected by the exercise of administrative powers, are normally regarded as mandatory, so that it is fatal to disregard them. Where there is a statutory duty to consult persons affected, this must genuinely be done, and reasonable opportunity for comment must be given.

In the case on hand, it is indisputable that the Respondent Municipal Council came into existence in the year 2004 and the Council ought to have complied with the mandatory statutory provisions before determining the rate of taxation or imposition of property tax.

For the reasons stated hereinabove, the impugned memo dated 16-3-2007 (Annexure-P/2) is quashed. It is not necessary to quash the notice dated 30-11-2005 (Annexure-P/1), as it has already been published.

In the result, the writ petition is allowed to the above extent. However, liberty is reserved to the Respondent Municipal Council to initiate a fresh process for determination, assessment, imposition and levy of property tax, if so advised, from the date it became due, in accordance with law.

There shall be no order as to costs.