Telangana High Court
N Srimanrayana vs Greater Hyderabad Municipal ... on 5 July, 2024
Author: G. Radha Rani
Bench: G. Radha Rani
THE HONOURABLE DR.JUSTICE G. RADHA RANI CIVIL MISCELLEAOUS SECOND APPEAL No.7 of 2018 JUDGMENT:
This Civil Miscellaneous Second Appeal is filed by the appellant aggrieved by the order dated 13.06.2017 in M.A.No.127 of 2015 on the file of the Chief Judge, City Small Causes Court, Hyderabad (Appellate Authority under the provisions of GHMC Act) to the extent of putting a condition to deposit 40% of amount demanded in the demand notice, while allowing the Appeal filed by the appellant herein.
2. Aggrieved by the property tax notice of demand No.TC10/ GHMC/2014-15/720 dated 09.01.2015 received and served on the appellant on 25.02.2015 issued by the respondent herein demanding a sum of Rs.1,19,231/- in respect of property bearing Municipal No.8-2- 293/82/A/555/A/A, Jubilee Hills, Hyderabad - 500033, the appellant preferred the appeal baring M.A.No.128 of 2015 under Section 282 of the Greater Hyderabad Municipal Corporation Act, 1955 (for short, 'GHMC Act') contending that the property tax notice of demand under appeal was in pursuance of deliberate harassment being meted out to the appellant. On the false complaint of the appellant's neighbor, the Dr.GRR,J cmsa_7_2018 2 respondent Corporation earlier issued an impugned notice under Section 461 of the GHMC Act, which was post dated as 28.06.2012 and was served on the appellant. As against the said notice, the appellant filed suit against the respondent herein and the neighbor bearing O.S.No.1302 of 2012 on the file of the IV Junior Civil Judge, City Civil Court and status-quo order was granted in the said suit, which was pending. The appellant submitted the information as sought for by the respondent herein under Section 213 of the GHMC Act under due acknowledgment dated 25.06.2012 in respect of premises bearing Municipal No.8-2- 293/82/A/555/A/B and premises bearing Municipal No.8-2- 293/82/A/555/A/A. The respondent Corporation issued Special Notice under Section 220(2)(3) of the GHMC Act fixing the half yearly property tax for the property covered under the Appeal to Rs.17,609/- and in respect of other property bearing M.No.8-2-293/82/A/555/A/A to Rs.58,438/-. The appellant submitted his objections dated 21.07.2012. Thereafter, there was neither any hearing, any notice nor any order served on the appellant. In fact, for similar portion the property tax was only Rs.786/- whereas the appellant was continuously paying a sum of Rs.6,692/- for the property covered in the appeal and Rs.5,196/- for the property bearing M.No.8-2-293/82/A/555/A/B, as was fixed in respect of new construction made by the appellant during the years 2006-2008.
Dr.GRR,J cmsa_7_2018 3 The tax paid by the appellant was already excessive, huge, unfair and unreasonable when compared with the above property for the similar area/square feet. The respondent was harassing the appellant, demanding a sum of Rs.1,19,231/-. The increase of the property tax was vague and did not disclose valid reasons for such increase. The respondent in its special notice dated 04.07.2012 (received on 11.07.2012) called for the complaint against the enhancement of property from Rs.6,692/- to Rs.35,212/- per annum, mentioning the reasons as "Under Assessed". In response to the said special notice, the appellant filed his complaint dated 21.07.2012 as required under Section 221 of GHMC Act. After filing the complaint, the appellant had not received any communication from the respondent, as such, the appellant continued to pay the existing tax for the periods mentioned below:
i. Property tax for the year 2012-2013 at the rate of Rs.6,692/- was paid through pay order dated 17.07.2012 bearing No.853757 drawn on Canara Bank, Jubilee Hills Branch, Hyderabad for the period from 01.04.2012 to 31.03.2012.
ii. Property tax for the year 2013-2014 at the rate of Rs.6,892/- was paid through pay order dated 20.06.2013 bearing No.854121 drawn on Canara Bank, Jubilee Hills Branch, Hyderabad for the period from 01.04.2013 to 31.03.2014.
Dr.GRR,J cmsa_7_2018 4 iii. Property tax for the year 2014-2015 at the rate of Rs.6,543/- was paid through pay order dated 25.04.2014 bearing No.369143 drawn on Canara Bank, Jubilee Hills Branch, Hyderabad for the period from 01.04.2014 to 31.03.2015.
Thus the appellant was not due any amount to the respondent Corporation either towards property tax or towards alleged arrears of property tax till 31.03.2015. The complaint filed by the appellant against the special notice dated 21.07.2012 had not been disposed off in the presence of the appellant as required under Section 223 of GHMC Act. The increase of property tax and notice of demand were utterly against the Principles of Natural Justice. No date of hearing was communicated to the appellant or served any notice on him in that regard, as per the provisions of Section 222 of GHMC Act and the complaint filed by appellant had not been disposed of as per the provisions of GHMC Act.
3. The respondent Corporation on the other hand, contended that the assessment of tax for the schedule property was reasonable in view of its location and there was no basis for filing the appeal by the appellant and the appeal was liable to be dismissed with costs.
Dr.GRR,J cmsa_7_2018 5
4. On considering the contentions of both the learned counsel, the learned Chief Judge, City Small Causes Court, Hyderabad observed that the respondent had not followed the procedure laid under Sections 220 to 223 of the GHMC Act before confirming the annual property tax. As per the provisions of Sections 220 to 223 of GHMC Act, when any tax demand was made, the party who was affected by the same had to be given an opportunity to make a representation by way of lodging objections to the said assessment and the Municipal Authorities have to fix a date of hearing on the said objections and then hear the owner of property on the objections raised by them, but no material was filed to show that the respondent followed the said procedure and only after following the procedure issued the demand notice on 09.01.2015, as such, concluded that there were irregularities on the part of the respondent in claiming the property tax amount as shown in the demand notice and remitted the matter back to the respondent Corporation to assess the tax afresh in accordance with the procedure laid down under Sections 221 to 223 of the GHMC Act, but imposed a condition that the appellant shall pay 40% of the amount demanded in the demand notice.
5. Aggrieved by such condition imposed upon him, the appellant preferred this appeal raising the following substantial questions of law:
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1. The Court below ought to have considered that, when admittedly there was no counter filed by the respondent Corporation or any documents, the Court below should not have put condition to deposit 40% of the amount demanded in the demand notice.
2. The appellant submits that though the demand notice was set aside, the lower court erred in imposing condition of depositing 40% amount for further proceedings by the Municipal Corporation authorities, instead the lower court ought to have directed the respondent to adjust the amount already paid in part in pursuance of its interim orders.
6. Heard Sri Manik Rao, the learned counsel for the appellant and Sri S. Vamsidhar, the learned Standing Counsel for GHMC representing the respondent.
7. Learned counsel for the appellant contended that the condition to pay 40% of the amount demanded in the demand notice at the time of final disposal of the appeal was illegal. Only before hearing the appeal, such conditions, could be imposed and relied upon the judgment of the erstwhile High Court of Andhra Pradesh in Alladi Venkateswarlu Vs. Warangal Municipal Corporation, Warangal 1.
1 2002 (1) ALD 861 Dr.GRR,J cmsa_7_2018 7
8. Learned Standing Counsel for the respondent Corporation on the other hand contended that the appellant had not made payment as per the orders of the Court in M.A.No.128 of 2015 and disobeyed the same. The appellant was paying property tax at the rate of Rs.6,792/- as part payment to the commercial usage property occupied with private offices admeasuring 1,000 Sq. feet situated in Jubilee Hills locality. As per Act 15 of 2013, Section 225(4)(ii) of GHMC Act, "such assessment or reassessment or correction of records shall not relate to a period earlier than the five half years immediately preceding the current half year."
9. In view of the Court's order, again the respondent approached the appellant for payment of property tax dues pending from the year 2012. The appellant furnished the building permission copy issued vide BPS.No.BPS/10338/CZ/12/08 dated 22.07.2009 and also participated in joint inspection for taking re-measurements of the property bearing door No.8-2-293/82/A/555/A/A. Accordingly, the respondent arrived the yearly property tax of Rs.33,244/-. The property tax in respect of above commercial usage property had been reduced and re-fixed from Rs.1,19,231/- to Rs.33,244/- with effect from 01.04.2020. Accordingly, a Speaking Order was served to the appellant with all details on property Dr.GRR,J cmsa_7_2018 8 tax measurements. The same was acknowledged by the appellant on 21.12.2022. But even after receiving the same, he was not paying the tax at the rate assessed and prayed to dismiss the appeal.
10. Learned counsel for the appellant on the other hand contended that re-assessment could not be put to retrospective effect. Though reassessment was conducted, but the same was also re-fixed to an amount of Rs.33,244/- with effect from 01.04.2020 retrospectively and relied upon the judgment of the erstwhile High Court of Andhra Pradesh in Valluri Basavaiah Chowdary and Brothers Vs. Vijayawada Municipal Corporation 2 on the aspect that Municipal tax cannot be levied with retrospective effect unless expressly authorized by the Act.
11. Learned counsel for the appellant also relied upon the judgment of the erstwhile High Court of Andhra Pradesh in The Himayatnagar Rate-payers Association, Hyderabad and Ors. Vs. The Government of Andhra Pradesh, Hyderabad and Ors. 3 wherein also it was held that:
"...There is no scope for collecting tax after determining rateable value after enquiry into complaints retrospectively. The only retrospectivity which is given by the Act is for the same financial year to which the book relates and which is 2 2002 (1) ALD 276 3 W.P.Nos.243 of 1967 and Batch.
Dr.GRR,J cmsa_7_2018 9 authenticated during the course of the financial year. Thus although the authentication, even if made on the last day of the financial year, the liability will be deemed to have commenced from the beginning of that financial year. No greater retrospectivity than what the Act has given can be given. There is no scope for such construction."
12. Learned Standing Counsel on the other hand contended that as there was no dispute on the re-assessment or on the rate of tax assessed on re-assessment and appellant also participated in the joint inspection for taking re-measurements of the property, sought to give a direction to the appellant to pay the tax atleast from 01.04.2022 from the date of re- assessment.
13. Considering the submissions of both the learned counsel and after going through the impugned order passed by the Chief Judge, City Small Causes Court, Hyderabad, as the respondent Corporation had not followed the procedure laid down under Sections 220 to 223 while issuing the demand notice dated 09.01.2015, setting aside the said notice by the learned Chief Judge, City Small Causes Court is considered as proper, but imposing a condition to deposit 40% of the amount demanded while passing the final decree is considered as illegal and not supported by any law or procedure, as such, the said condition is liable to be set aside. As the re-assessment was conducted in the presence of Dr.GRR,J cmsa_7_2018 10 the appellant and the respondent had arrived the yearly property tax of the appellant as Rs.33,244/-, the appellant is directed to pay the said tax prospectively from the date of assessment i.e., from 01.04.2022 onwards, but not retrospectively with effect from 01.04.2020, as per the judgments of the erstwhile High Court of Andhra Pradesh in Valluri Basavaiah Chowdary and Brothers Vs. Vijayawada Municipal Corporation (2 supra) and in The Himayatnagar Rate-payers Association, Hyderabad and Ors. Vs. The Government of Andhra Pradesh, Hyderabad and Ors. (3 supra).
14. In the result, the appeal is allowed in part modifying the judgment and decree passed by the learned Chief Judge, City Small Causes Court, Hyderabad in M.A.No.127 of 2015 dated 13.06.2017 to the effect of imposing condition of depositing 40% of the amount demanded in the demand notice.
Pending miscellaneous applications, if any, shall stand closed.
_____________________ Dr.G. RADHA RANI, J Date: 05.07.2024 ss