Ram Saran Das Kishori Lal Charitable Trust Hospital vs Municipal Corporation

G.S. Singhvi, J.—The petitioner has challenged the demand of house tax made by the respondent-Municipal Corporation.

The case of the petitioner is that it is a charitable trust set up for advancement of education and affording of medical care by opening or helping hospitals and dispensaries and thereby providing Medical and other facilities to the patients. It is said that even though by an order dated 24.1.1979 issued by the Commissioner, Municipal Corporation, Amritsar the petitioner was exempted from payment of the house tax, the respondents have initiated steps for recovery of house tax from it for different years. Aggrieved by the proceedings taken by the respondents to recover the house tax for the year 1982 to 1990, the petitioner filed a civil suit in the court of the Senior Sub Judge, Amritsar and an order of injunction came to be passed in its favour. Notwithstanding the injunction order, notices Annexures P13 and P14 have been issued to the petitioner for recovery of the taxes for the years 1982 to 1993-94 and 1994-95.

The principal ground on which the impugned notices have been challenged is that in the face of exemption granted by the order Annexure P4 dated 24.1.1979, the respondents have no jurisdiction to impose house tax on the buildings owned by the petitioner. It has also been pleaded that the respondents cannot use coercive process to recover the taxes in respect of the period which is subject matter of the suit filed by the petitioner in the Court of the Senior Sub Judge, Amritsar.

The respondents have contested the writ petition by asserting that the petitioner-Trust is not running the hospital on a charitable basis but is charging exorbitant amount from the patients. They have also pleaded that the exemption granted vide Annexure P4 was limited upto the year 1981-82 and as no exemption has been granted for the subsequent years, the petitioner is bound to pay the taxes in accordance with the provisions of the Punjab Municipal Corporation Act, 1976. The respondents have relied on the assessment orders Annexures R1, 2/1 and R-l, 2/2 to show that the competent authority passed the assessment orders dated 21.10.1988 and 24.2.1992 after giving notice to the petitioner u/s 103 of the Act of 1976.

During the course of hearing the learned counsel for the respondents produced some documents to show that the petitioner was fully conscious of the fact that the exemption granted to it vide Annexure P4 was operative till the year 1981-82 and thereafter the petitioner had sought extension in the period of exemption and, therefore, its plea that the Municipal Corporation cannot levy house tax is untenable.

In our opinion, it is neither necessary nor proper for us to adjudicate upon the claim of the petitioner regarding exemption from payment of house tax in this petition because we are of the considered opinion that the writ petition deserves to be dismissed on the ground of availability of effective alternative remedy. Section 146 of the Act of 1976 provides for appeal against the levy or assessment of any tax under the Act of 1976. Though this remedy can be availed subject to the provisions of Section 147, the same cannot be termed as ineffective. The provisions contained in the Act of 1976 regarding levy and collection of taxes are self-contained and when the statute, namely, the Act of 1976 under which the tax has been levied on the petitioner provides for the remedy of appeal, there can be no justification for this Court to exercise its jurisdiction under Article 226 of the Constitution. Indeed, the petitioner had itself thought that other remedies are more effective and, therefore, it filed civil suit against the proceedings initiated by the respondents for levy and collection of house tax for the year 1982 to 1990.

In Titaghur Paper Mills Co. Ltd. and Another Vs. State of Orissa and Others, and Assistant Collector of Central Excise, Chandan Nagar, West Bengal Vs. Dunlop India Ltd. and Others, , the Supreme Court has cautioned the High Courts against entertaining the writ petitions in matters involving recovery of taxes even when alternative remedy is available to the aggrieved party. These cases have been noticed by a Division Bench of this Court in Sachdeva and Sons Rice Mills Ltd. Vs. State of Punjab and Others, and it has been held that the High Court would be loath to invoke its jurisdiction under Article 226 of the Constitution to stall the recovery of taxes even when the petitioner is entitled to avail statutory remedy of appeal etc.

In view of the above, we dismiss the writ petition but leave it open to the petitioner to avail the remedy of appeal. We also make it clear that if the petitioner files appeal(s) within 15 days from today, the same shall be heard on merits by the competent authority and the same shall not be dismissed on the ground of limitation. However, we make it clear that the competent authority shall be entitled to insist upon the fulfilment of other conditions imposed by the statute for entertaining the appeal(s).