$~60
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 186/2014 & CM No.333/2014
M/S. ASIAN INSTITUTE OF TRANSPORT
DEVELOPMENT ..... Petitioner
Through Mr. B. B. Jain, Advocate.
versus
SOUTH DELHI MUNICIPAL CORPORATION..... Respondent
Through Mr. Gaurang Kanth, Advocate.
CORAM:
HON'BLE MR. JUSTICE SUDERSHAN KUMAR MISRA
% SUDERSHAN KUMAR MISRA, J. (ORAL)
1. The petitioner is aggrieved of an Assessment Order dated 23rd December, 2013, whereby vacant land tax to the tune of Rs.31,45,440/- has been raised against the petitioner, who has been directed to deposit the same within 15 days, failing which the petitioner will be obliged to pay interest @ 1% per month till the same is realized, besides the likelihood of coercive action being taken against the petitioner for realisation of the said demand.
2. Issue notice to the respondent to show cause as to why Rule nisi be not issued.
3. Mr. Gaurang Kanth, Advocate, accepts notice and submits that it is also open to the petitioner to approach the Tribunal under Section 169 of the Delhi Municipal Corporation Act, 1957, and that, therefore, this Court ought not to exercise writ jurisdiction under Article 226 of the Constitution of India in the matter. For this purpose, he relies on a decision of this Court in MCD & Anr. v. Tata WP (C) No.186/2014 Page 1 of 7 Engineering & Locomotive Company Ltd., 128 (2006) DLT 300, which, according to him, inter alia, posits that writ court should normally desist from interfering in revenue matters. At the same time, in response to a query put by this Court, counsel fairly concedes that the scope of the aforesaid decision cannot be taken to be a pronouncement to the effect that writ courts exercising jurisdiction under Article 226 of the Constitution do not, in fact, have any jurisdiction in such matters. It is only a caution keeping in view the fact that these are matters concerning government revenues, the collection whereof must not be lightly interdicted, and therefore, as far as possible, the courts should merely desist from interfering.
4. On the other hand, counsel for the petitioner submits that actually in a case where there is no ground whatsoever in raising the demand; and where there can be no conceivable basis for the said demand; to compel the petitioner to approach the Tribunal under Section 169 of the Delhi Municipal Corporation Act, 1957 which, in effect, also compels an aggrieved party to the deposit of the demand raised in advance as a pre- condition; could be utterly ruinous to the petitioner, and therefore, iniquitous. He submits that it can never be taken to be the intention of the Legislature to put its citizen to a situation where they would be obliged to comply first with even the most unreasonable monetary demands before any grievance with regard to such demands can even be heard; and it cannot be said that the writ courts are powerless to come to the aid of the petitioner in such a situation. He submits that the material facts of the matter would show that this is one such case.
5. Counsel for the petitioner relies on a decision of the Full Bench of this Court in Municipal Corporation of Delhi v. Shashank WP (C) No.186/2014 Page 2 of 7 Steel Industries (P) Ltd. 100 (2002) DLT 66 (FB), which has held as follows:
"....27. Thus, so long as the liability of the lessee does not come within the purview of Sub-section (2) of Section 120 of the DMC Act, he is not liable to pay any property tax to the Corporation."
He submits that the case of Shashank Steel Industries (P) Ltd. (supra) arose on the case of a sub lease which stated as follows:
"31. The lease money for the first five years was Re.1 per year having regard to the retrospective effect given to the said lease and @ 2.5% of the premium paid. The said deed of lease contains the following terms and conditions:
"5. The sub-lessee shall, within a period of 2 years from the 20th day of February one thousand nine hundred and eightyone (and the time so specified shall be the essence of the contract) after obtaining sanction of building plan with necessary designs, plans and specification from the proper Municipal or other authority at his own expense, erect upon the industrial plot and complete in a substantial and workman like manner, and industrial building for carrying on approved manufacturing process or industry with the requisite and proper walls, sewers, drains and other conveniences in accordance with the sanction building plan and to the satisfaction of such Municipal or other authority.
6(a) The sub-lessee shall not sell, transfer, assign or otherwise part with the possession of the whole or any part of the industrial plot in any form or WP (C) No.186/2014 Page 3 of 7 manner, benami or otherwise to a person who is not a member of the lessee.
6(b) The sub-lessee shall not transfer, assign or otherwise part with the possession of the whole or any part of the industrial plot to any other member of the lessee except with the previous consent in writing of the lessor which it shall be entitled to refuse in his absolute discretion.
10. The sub-lessee shall from time-to-time and at all time pay and discharge all rates, taxes, charges and assessment of every description which are now or may at any time hereafter during the continuance of the sub-lease be assessed, charged or imposed upon the industrial plot hereby sub-leased or on any building to be erected hereupon or on the landlord or tenant in respect thereof."
6. He submits that in the instant case also, although the document in question is a Lease Deed, however, the relevant provisions are identical. They are as follows:
"The Lessee shall from time to time and at all times pay and discharge all rates, taxes, charges and assessments of every description which are now or may at any time hereafter during the continuance of this lease be assessed, charged imposed upon the said land hereby demised or on any building to be erected thereupon or on the landlord or tenant in respect thereof."
A copy of the Lease Deed in question containing the aforesaid provisions has also been annexed with the writ petition. He submits that under the circumstance, the conclusion reached by the Full WP (C) No.186/2014 Page 4 of 7 Bench of this Court in Shashank Steel Industries (P) Ltd., including, inter alia, to the effect that the Lease Deed in question contains various restrictions on the Lessee preventing him from full enjoyment of the property would be equally applicable to this case, and it therefore follows that the petitioner is not liable to pay the tax in question. The conclusions arrived at by the Full Bench in this regard, are as follows:
"40. By reason of a covenant, the person, who is not liable to pay tax, under a legislative enactment cannot be made liable therefore, particularly when the Corporation in relation to the sub-lesee is a third party and cannot in law be permitted to derive any benefit therefrom. The said finding also must be held to be contrary to the scope and purport of Section 120(1) of the DMC Act. We, therefore, are of the opinion that in a case where no building has been constructed, the sub lessee would be liable to pay the property tax."
7. Admittedly, in the case of the petitioner, the construction of the building has not been completed. Admittedly also, once the construction in question is completed, the petitioner would be liable to pay property tax as per law.
8. A perusal of the impugned order and the Lease in question shows that, inexplicably, the Joint Assessor and Collector has relied on a virtually identical clause in the Petitioner's Lease Deed, to the one which was also under examination by the Full Bench, to hold that it binds the Lessee to pay a similar demand, despite the fact that the Full Bench had concluded to the contrary. Obviously, this aspect of the matter has clearly escaped the attention of the Joint Assessor and Collector. Looking to the decision of this Court in Shashank Steel Industries (P) WP (C) No.186/2014 Page 5 of 7 Ltd. (supra), it is obvious that the impugned demand could not have been raised.
9. It is also stated that the decision of this Court in Shashank Steel Industries (P) Ltd. has also been upheld by the Supreme Court of India.
10. Counsel for the petitioner also drawn the attention of this Court to another Writ Petition (C) No.3897/2006, titled as Sanchar Vihar Cooperative Group Housing Society Ltd. v. Municipal Corporation of Delhi, where also, following the aforesaid decision of the Full Bench in the Shashank Steel Industries (P) Ltd. (supra), this Court has decided to exercise jurisdiction in these circumstances by issuing notice and also staying the impugned orders on 14th March, 2006. Counsel for the petitioner also places reliance on the decision of this Court in Ms. Shefali Bhushan v. Municipal Corporation of Delhi & Anr., Writ Petition (C) Nos.7396/2001 & 7394/2001, both decided on 17th January, 2003; K. K. Enterprises v. Municipal Corporation of Delhi, 127 (2006) DLT 679 and; Municipal Corporation of Delhi v. Sh. Santosh Kumar & Anr., LPA No.560/2006, dated 13th April, 2009; in support of the relief claimed by him.
11. Under the circumstances, the impugned order of the Joint Assessor and Collector dated 23rd December, 2013 is set aside.
12. The petition stands disposed off.
13. A copy of this order be given dasti under the signature of Court Master to counsel for the parties.
WP (C) No.186/2014 Page 6 of 7CM No.333/2014
14. Since the main petition has been disposed off, this application does not survive and the same is also disposed off as such.
SUDERSHAN KUMAR MISRA (Judge) JANUARY 15, 2014 dr WP (C) No.186/2014 Page 7 of 7