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Judgment
K.M. Natarajan, J.—This writ petition is filed for the issue of a writ of mandamus directing the first respondent to grant the petitioner-
Company at No. 84, General Patters Road, Mount Road. Madras-2 exemption from payment of water and sewerage tax till such time water and
sewerage connections are provided to its premises. The grievance of the petitioner, as seen from the affidavit filed in support of the petition, is that
the petitioner-company is engaged in the business of iron and steel fabrication. It is one of the factories in a cluster of several establishments inside
the same vast compound situated in a busy locality in the Mount Road area near Odeon Talkies. It has employed 50 workers. It has provided a
private toilet with septic tank facility as also a bore-well for the use of the workers. According to the petitioner, neither the petitioner company nor
any other companies in the aforementioned compound has water supply or sewerage connection, and that the petitioner had been requesting the
1st respondent to arrange for these facilities. It is further stated in the affidavit that there cannot be a justifiable demand for water and sewerage tax
without actually providing these facilities. It has been categorically stated to the first respondent that once the facilities were provided, the
petitioner-company would unhesitatingly pay the bills as and when received. The petitioner-Company also wrote letters on 6-4-1982 and 12-11-
1982 to the Consumer Service Engineer, Madras Metropolitan Water Supply and Sewerage Board Area-1, Division 93 requesting him to arrange
for these facilities. The petitioner-company further wrote to the Controller of Finance, Madras Metropolitan Water Supply and Sewerage Board,
Door No. 43-46, Greams Road. Madras-600006, on 8-6-1983 and 11-7-1983 stating that there is no water and sewerage connection to the
premises in question and, therefore, they are not justified in raising any demand without providing these facilities. The Controller of Finance replied
on 30-6-1983 stating that water and sewerage tax is payable by all that property owners irrespective of the fact whether water and sewerage
facilities are available or not, as it is only a component of the property tax paid earlier by the property owners to the Madras Corporation, and as
such, the demand raised by the Board will have to be paid by the petitioner. The petitioner has further stated in the affidavit that by letter dated 18-
6-1983, the Senior Accounts Officer No. 1, Madras Metropolitan Water Supply and Sewerage Board, Area 1, Madras-2, wrote to the petitioner
company that the petitioner''s request for cancellation of water and sewerage tax for the reason that its premises has no water supply or sewerage
connection is not tenable as there is no provision in the Madras Metropolitan Water Supply and Sewerage Board Act, 1978. According to the
petitioner, the first respondent is a statutory body constituted under Tamil Nadu Act 28 of 1978 for the purpose of exclusively attending to the
growing needs of and for planned development and appropriate regulation of water supply and sewerage services in the Madras Metropolitan
area. The scheme of the Act would indicate that the tax cannot but be for the purpose of defraying the expenses connected with water and
drainage system of the City and the first respondent under S. 34 (3) of the Tamil Nadu Act 28 of 1978 had the power to exempt any local area
from the whole or portion of the water tax and sewerage on the ground that such area is not deriving any or the full benefit from the water supply
or sewerage system or the first respondent may remit a portion of such taxes not exceeding one half on the ground that the premises concerned has
remained vacant. On the basis of this, the present writ petition has been filed.
In the counter affidavit filed by the first respondent, it is stated that the petitioner may approach Area Engineer-IV of the Board for getting water
supply and sewerage connection for his premises. According to S. 34(1) and (2) of the Madras Metropolitan Water Supply and Sewerage Board
Act, 1978, the Board shall levy a water and sewerage tax on premises situated in city area and collect tax at 7% of the assessed annual value of
the premises .The assessed annual value is fixed by the Corporation of Madras. According to that 1st respondent, the petitioner is liable to pay the
water and sewerage tax to the Board from 1-79-80 to 2-87-88 amounting to Rs 3,668-80 (except 1-84-85 & 2-85-86). It is further stated in the
counter affidavit that according to S. 34(3) of the Madras Metropolitan. Water Supply and Sewerage Act, 1978, the exemption can be given only
on the following conditions, namely, (a) with the consent of Government, and (2) if any local area is not deriving any or full benefit from water or
sewerage service. A single house will not constitute an area mentioned in the S.34(3). Hence the first respondent prayed for the dismissal of the
writ petition.
When the writ petition was taken up for final hearing, learned counsel for the petitioner Mr. Sundaravaradhan submitted that he is confining his
relief prayed for in the writ petition to only the exemption provided under S. 34(3) of the Act, and that he is not canvassing the question that
without supplying water, they are not liable to pay water tax. However, he invited the attention of this Court to S. 34 of the said Act and also the
decision in The Corporation of Madras Vs. R. Sundaram and Another, , and submitted that in view of S. 34(3) of the Act, when there is no facility
provided, the Board has got every power with the sanction of the Government to exempt a particular premise from paying the tax, and as such, the
petitioner-Company requested the Board to give such exemption in the light of S. 34(3) of the Act, in respect of premises No. 84, General Patters
Road, Mount Road, Madras-600 002. Per contra, learned counsel for the first respondent submitted that already a request has been made and the
same has been turned down. On going through the letter dated 8.3.1983, which has been produced, it is found that the Senior Accounts Officer
himself has rejected the application, and that too not under S. 34 under which the petitioner prayed for cancellation of the demand for tax, on the
ground that there is no provision for such cancellation. I do not find anything in that letter to show that the first respondent-Board has considered
the question of exemption under S. 34(3) of the Act so far as the premises in question is concerned.
In The Corporation of Madras Vs. R. Sundaram and Another, a Division Bench of this Court, while considering a similar question, had
observed as follows:
It is a well-settled principle that where a public body is vested with a power or discretion, it is for exercise and not for inaction and it is especially
so, when the power or discretion has been vested for the benefit of those who will be affected by its non-exercise. But whether on the merits, the
exemption should be extended to a particular area will be a matter of detail and will depend on several circumstances, if the Council thought that,
having regard to the expenses the Corporation has to incur for providing in general a waiter drainage and lighting system for the city as a whole, it
would not be possible, without affecting its financial position to grant exemption, it would be within its discretion to deny exemption. We do not
understand proviso (d) to S. 102 as implying that the fact of non-provision of any of the facilities comprehended by it will by itself necessarily
compel the Council to grant exemption and that the area affected will be entitled as a matter of right it such an exemption. If exemption should
follow, as a matter of right, the proviso should have been differently worded and not in the present form, which seems to leave the judgment to the
council.
X X X X
The duty of the Council is to consider with reference to all the relevant facts and circumstances whether exemption to a particular area to any
extent under proviso (a) to S. 102 is called for, and if so, whether the consent of the Government therefor should not be obtained. The Council has
failed to discharge that duty in regard to the area concerned...
It is to be noted that S. 100(2) Proviso (a) of the old Act 1978 is in pari materia with S. 34 of the present Act. Therefore, it is quite appropriate to
quote the said decision to the facts of this case. I do not think there can be any impediment for the first respondent-Board to consider the request
of the petitioner with reference to S. 34(3) of the Act, and as such, certainly a direction can be given to the respondent No. 1 in this regard.
Accordingly, the writ petition is allowed. The first respondent is directed to consider the question of granting the exemption under S. 34(3) of the
Act on the application by the petitioner within three weeks from this date, with a copy to the Area Engineer IV, for Premises No. 84, General
Patters Road, Mount Road. Madras 600 002. The first respondent Board is directed to dispose of the application, if so, filed as expeditiously as
possible. No order as to costs.