Shantinagar Nagrik Mandal vs State Of Maharashtra And Anr.
2004 Latest Caselaw 1156 Bom

JUDGMENT

Kamdar S.U., J.

1. The petitioner No. 1 is an association of purchasers of tenements from respondent No. 2 under the Economically Weaker section of Housing Scheme (hereinafter referred to as 'L.I.G. & E.W.S. Scheme'). These schemes are floated by the 2nd respondent Development Board. Under these schemes, the 2nd respondent which is the Housing and Area Development Board has constructed various tenements to be sold to the persons falling under the lower income as well as economically weaker section of societies on what is known as 'ownership basis'. The said scheme provided that the tenements will be sold on hire purchase and the purchaser will be entitled to make payment of the purchase price in instalments for 30 years. It is further provided that at the end of the said period when the entire purchase price is paid, the various tenement holders will become the owners in respect of their respective tenements. Under the said scheme, it is further provided that the said tenement holders till and until acquires the ownership right in the said tenements will continue to be allottees and/or tenants thereof and they will be entitled to occupy the same as tenants.

2. In pursuance of the said scheme, various persons applied for allotment of the tenement and the 2nd respondent Board has by their letter dated 5-8-1974 allotted the tenements. Under the letter dated 5-8-1974 it has provided that the allotment will be subject to the provisions of the M.P. Housing Board Act, 1950 and the regulations framed thereunder. The said letter further provided for filing of an undertaking under Clause 4 thereof to accept the said tenement on hire purchase basis. Clause 9 of the said letter reads as under :-

"9. This allotment order shall stand cancelled in case you fail to complete the formalities within the prescribed period and thereafter to take over possession of the allotted house within 15 days of the date of this letter and an amount of Rs. 200/- out of your deposit shall stand forfeited to the Board."

3. Thereafter on 28-10-1974 an allotment letter has been issued to the various tenement holders. One of such allotment letter as and by way of sample is annexed as Annexure "B" by the petitioner to this petition. Clause 8 of the said allotment letter inter alia reads as under :-

(8) During the period of tenancy the allottees shall be responsible at his/her cost to pay Municipal taxes, water and electricity charges to the authorities to whom such taxes and charges are due. He shall also bear pay and discharge all rates, taxes, assessments, duties, ceases, impositions and outgoings whatsoever assessed, imposed or charged on the tenement and the land appurtenant thereto."

4. Similar allotment letters have been issued from time to time to various purchasers of the tenements and it is not disputed before us that more or less the terms and conditions of the said allotments are identical. Under Clause 5 thereof it is provided that each of the purchaser of the tenement will execute what is known as lease-cum-sale tenancy agreement and the same will be in operation till the expiry of the period of 30 years and on expiry of the period of 30 years, the said tenement will become of an ownership of each of the allottees and they will thereafter be occupying the same as owners thereof.

5. After the allotment of the said tenements, the construction of the various tenements has been completed and each of the tenement holder has been placed in possession of their respective tenements. Each of the tenement holders are put in possession on various dates commencing from 1974 onwards.

6. The 1st respondent has levied what is known as non-agricultural assessment tax under the provisions of sections 113 and 114 of the Land Revenue Code read with Section 168 thereof. In respect of the land on which the said tenements has been constructed by the 2nd respondent. The claim of the non-agriculture assessment tax by the respondent No. 1 has been made on the 2nd respondent herein. The 2nd respondent has in turn by its notice dated 26-3-1992 has levied the said assessment tax on each of the allottees of the said tenement. Under the said notices claim has been made for payment of non-agriculture assessment tax by the tenement holders from the year 1969-70. The respondent No. 2 has claimed the said tax of non-agriculture assessment tax on said tenement holders as according to the 2nd respondent the ultimate liability to pay the non-agriculture assessment tax is that of the occupiers in respect of the respective tenements. It is these notices dated 4-3-1992 and 26-3-1992 which are the subject-matter of the present petition on behalf of various tenement holders through their association being petitioner No. 1 herein.

7. Before we deal with the submissions of the rival parties on merits, it is required to be noted that the respondent No. 2 has filed their affidavit dated 8-10-2004 and has stated therein that the claim of payment of the non-agricultural assessment tax though raised from 1969-70, the same will be restricted from the date on which the respective tenement holders are put in possession of their respective tenements. In paragraph 4 of the said affidavit it has been specifically stated that in view of the fact that admittedly the possession of the respective tenements are given after 1974 the claim of non-agriculture assessment tax will be restricted for the period after 1974. The said affidavit dated 8-10-2004 has been taken on record.

8. In so far as the issue of payment of the non-agriculture assessment tax for a period subsequent to that of tenement holders are put in possession is concerned, the learned Counsel appearing for the petitioner has inter alia contended that it is not the liability of each of the tenement holder as there is no complete transfer of the land and/or the building in favour of each of the allottee of tenement. It is the contention of the learned Counsel for the petitioner that the liability to pay non-agriculture assessment tax would arise only on the expiry of period of 30 years when on payment of purchase price there is ultimate transfer of the building along with the appurtenant land to the various allottees of tenement. It is her further case that till and until the said transfer has taken place, the tenement holders cannot be treated as occupier or lessee of the said land since no rights are vested in the tenement holders in respect of the said land.

9. On the other hand, the learned Counsel for the respondent has drawn our attention to the provisions of sections 13 and 114 and 168 of the Maharashtra Land Revenue Code, 1966 and has contended that the liability to pay the amount is on each and every occupier of the said tenements and since each of the tenement holders are admittedly in occupation in respect of their allotted tenements and under the terms of the allotment they are treated as lessee/tenant in respect of each of the said tenement they cannot escape the liability of making payment of non-agriculture assessment tax. The learned Counsel for the respondent has also dawn our attention to the judgment of the Apex Court in the case of Nagpur Improvement Trust v. Nagpur Timber Merchants Association and Anr., etc., and has pointed out that in light of the aforesaid judgment, the 2nd respondent as a development authority is entitled to pass on the levy of the non-agriculture assessment tax on to each of the tenement holders. He has further contended that Clause 8 of the said allotment dated 28-3-1974 empowers the said authority to pass on such liability to the said tenement holders.

10. Having considered the provisions of the Maharashtra Land Revenue Code, 1966 as well as the allotment order dated 28-10-1974, particularly Clause 8 thereof. We are of the opinion that Clause 8 of the said allotment letter entitles the 2nd respondent to claim all the liabilities of assessment tax, electricity charge, water charges, municipal charges and other such charges if paid by the 2nd respondents by passing over the same to the tenement holders and recover the same from such tenement holders. A similar point arose in the aforesaid judgment of the Nagpur Improvement Trust in which the Supreme Court while considering the identical position has held as under :-

"Shri Bobde has also placed reliance on Clause (b) of the Lease Deed and has submitted that the Improvement Trust is entitled to require the lessees to pay the non-agricultural assessment that is being recovered by the State Government from the Improvement Trust and that the High Court was in error in holding that in view of Rule 9, Clause 1(b) of the Lease Deed cannot be construed to impose such a liability on the lessees.

"The submissions of the learned Counsel is that Clause 1 (b) of the Lease Deed cannot be construed as entitling the Improvement Trust to require the lessees to pay the non-agricultural assessment and that, if Clause 1(b) is so construed, it would be inconsistent with the provisions contained in Rule 9 of the Rules.

"As a result, the State Government can recover the land revenue payable in respect of the lands so disposed of from the Improvement Trust and it need not take proceedings of recovery of such land revenue from the transferees of the lands that are disposed of under the Rules. But that does not mean that the Improvement Trust cannot pass on its liability to the lessees in respect of the land revenue payable by it to the State Government in respect of the lands that have been transferred to the lessees."

11. The issue before the Hon'ble Supreme Court was identical in as much as under Clause 1(b) of the said Lease Deed before the Supreme Court also owner was empowered to discharge all liabilities and pass on the same to the lessee from time to time and all times. The said Clause 1(b) in the aforesaid judgment is somewhat similar and almost identical to Clause (8) of the sample allotment letter dated 28-10-1974 with which we are dealing with in the present case. In view of the aforesaid position in law, it cannot be said that the petitioners are not liable to make payment of non-agriculture assessment tax till and until the entire property is vested in their favour after completion of the instalments as contemplated under the higher purchase scheme. We are of the view that vesting of the land and/or building in favour of each of the tenement holders is an independent issue and had nothing to do with the liability for payment of taxes, levies including non-agriculture assessment tax. Furthermore, in our view, Clause 8 of the allotment letter entitles the 2nd respondent to pass over the claim of non-agricultural assessment tax even during the pendency of completion of the transaction which is to be completed after payment of instalment for a period of 30 years. The liability to the taxes by the allottees of tenement subsists as an occupier and the petitioners will be liable to make payment of the aforesaid non-agriculture assessment tax. However, the said liability will have to be restricted from the date on which each of the tenement holder are put in possession by the 2nd respondent.

12. In the circumstances aforesaid, we allow the petition partly and set aside the notices dated 4-3-1992 and 26-3-1992 in so far it pertains to the period prior to the date on which the respective tenement holders are put in possession. We direct the 2nd respondent to recover non-agricultural assessment tax only from the date on which each of the tenement holders are put in possession of the respective tenements. The learned Counsel for the petitioner state that the 2nd respondent has already recovered a part of the agricultural assessment tax from the various allottees of the tenements and/or in some cases allottees have effected the payment of such non-agricultural assessment tax to the 2nd respondent and therefore the respondent No. 2 should be directed to give credit thereof. The aforesaid submission of the learned Counsel for the petitioner deserves to be accepted. We therefore direct that the payment of non-agricultural assessment tax if made earlier by allottees of tenements then the same will be adjusted while claiming the balance of non-agricultural assessment tax from them.

13. The petition is accordingly disposed of. However, there shall be no order as to costs.