HIGH COURT OF JUDICATURE AT ALLAHABAD ?Court No. - 32 Case :- WRIT TAX No. - 1637 of 2011 Petitioner :- Indian Institute Of Technology Respondent :- State Of U.P. And Others Petitioner Counsel :- Yashwant Varma Respondent Counsel :- C.S.C.,Vivek Varma Hon'ble Sunil Ambwani,J.
Hon'ble Manoj Misra,J.
The office of the Chief Standing Counsel has accepted notice on behalf of respondent no. 1. Shri M.C. Tripathi has accepted notice on behalf of Nagar Nigam, Kanpur Nagar-respondent no.2. He also represents the Deputy Municipal Commissioner and Chief Tax Assessment Officer, Nagar Nigam, Kanpur Nagar-respondent nos. 3 and 4.
The Indian Institute of Technology, Kanpur Nagar (the Institute), declared as an institute of national importance by the Parliament under Institutes of Technology Act, 1961, has challenged in this writ petition the order dated 24.9.2011passed by the Municipal Commissioner, Nagar Nigam, Kanpur Nagar, rejecting the objections of the Institute that it is a charitable institution and an institution imparting technical education, and as such it is exempt from payment of property taxes. The Institute has also challenged the demand of property tax vide notice dated 2.11.2011 issued by the Deputy Municipal Commissioner, Nagar Nigam, Kanpur Nagar, on the ground that the demand does not precede assessment.
The Institute had earlier filed a Writ Tax No. 1791 of 2006, in which this Court had framed three questions, and in which the main question was, 'as to whether the Municipal Commissioner has powers to levy service charge in pursuance to Office Memorandum of the Central Government dated 26.4.1994. The Court had also framed a question (question no.iii, in paragraph-14, 'as to whether the petitioners, who are imparting education are charitable institutions and cannot be assessed to tax in view of Section 177 (b) of the U.P. Municipal Corporation Act. The Court held that the statutory corporations as well as the society, such as the Institute are not Union, even if they are established by the Union Government. In paragraph-20 the Court observed that since the writ petition was allowed on the first ground, it was not necessary to express any opinion on the second and the third ground.
After the decision of the writ petition, the Nagar Nigam started assessments for which the Institute was asked to submit information about the details of the buildings constructed after the year 2000. The Institute filed a second Writ Tax No. 598 of 2011 which was disposed of on 26.4.2011 with observations that the petitioner will file details of the constructions on the premises in question; the authority concerned shall take an appropriate decision in accordance with the law, preferably within one month and until the decision is taken the recovery shall not be raised against the petitioner. The Court also directed that the attachment of the bank account shall be lifted.
The representative of the Institute appeared and raised objections, which have been decided by the Municipal Commissioner, Nagar Nigam, Kanpur Nagar on 24.9.2011. The Municipal Commissioner held that the institute is not entitled to exemption under Section 177 (b) and (c) of the Act, as it is neither a charitable institution nor a school or intermediate college. The Commissioner thereafter directed the notice to be issued under Section 213 of the Municipal Corporation Act requiring the institute to file the details of the land and buildings, already in existence and constructed after the year 2004 for making assessment.
It is prima facie apparent from the averments in the petition, and has been rightly accepted by Shri M.C. Tripathi that after getting the required information, the Nagar Nigam, Kanpur Nagar has without making any assessment of tax, issued the demand notice on 2.11.2011, giving rise to this writ petition.
We express our displeasure in the manner in which the Nagar Nigam has issued demand notice to the premier Institute of the country. The Nagar Nigam was required to make assessment, which could be objected or subjected to appeal by the Institute.
Shri M.C. Tripathi will file a counter affidavit within four weeks, to decide the question, 'as to whether the petitioner is a charitable institution or an educational institution, which is not liable to pay the property taxes under the Municipal Corporations Act'.
It will be open to the Nagar Nigam to complete the assessment.
The Chief Tax Assessment Officer, who has issued the notice on 2.11.2011, to the petitioner raising a demand of Rs. 22,02,08,338/- admittedly without making any assessment on the information furnished by the Institute, will file his personal affidavit to justify, 'as to how he had issued demand notice purportedly, on the ground that it was generated by the computer, and the demand notice has been issued mechanically without making any assessment on the information furnished by the Institute'.
List on 17.1.2012.
Until further orders of the Court, the effect and operation as well as the recovery in pursuance to the demand notice dated 2.11.2011 shall remain stayed.
Order Date :- 24.11.2011 RKP