Dayal Shankardas Harchandani And ... vs Municipal Corporation For City Of ...
2017 Latest Caselaw 4748 Bom

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               IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                       CIVIL APPELLATE JURISDICTION
                      WRIT PETITION NO.2981 OF 2005



 Dayal Shankardas Harchandani and Others.          .. Petitioners
       Vs
 Municipal Corporation for the City of 
 Ulhasnagar and Others.                            .. Respondents
       -

Shri Amol P. Mhatre for the Petitioners.

Shri Vijay D. Patil for the Respondent Nos.1 and 2. Shri Manish M. Pabale, AGP for the Respondent Nos.3 and 4.

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                                CORAM  :      A.S. OKA & 
                                              SMT. VIBHA KANKANWADI, JJ

                                DATED    :    19TH JULY 2017


 ORAL JUDGMENT ( PER A.S. OKA, J)

1. Submissions of the learned counsel appearing for the

parties were heard on the earlier date.

2. On 7th July 2003, the Commissioner of the first Respondent

Municipal Corporation for the City of Ulhasnagar passed an order in

relation to computation of rateable value in respect of new buildings

constructed within the limits of the first Respondent Municipal

Corporation. A chart was appended to the said order. The order

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records that the hypothetical rent as mentioned in the chart appended

to the order shall be taken into consideration for fixing hypothetical

rent of the property under assessment. The order further records that

while assessing the rateable value, if actual rent received is more than

the standard rent, the rateable value shall be fixed not on the basis of

the standard rent, but on the basis of the actual rent. The order

directed that the assessment of the rateable value from the year 2003-

2004 shall be made as per the said order.

3. The General Body of the first Respondent Municipal

Corporation passed a Resolution No.4 in the meeting held on 19 th May

2004 by which it was resolved that the rates mentioned in the Annexure

to the order dated 7th July 2003 have been cancelled and in fact, all the

properties should be assessed on the basis of the rates fixed in the year

1996-97 for the purposes of the assessment of the rateable value. The

Resolution provided that on the basis of the representation made by the

concerned person, necessary refund orders should be issued by the

municipal administration.

4. By a letter dated 7th December 2004, the Municipal

Commissioner applied to the State Government for rescinding the said

Resolution No.4 by exercising the power under Section 451 of the

Maharashtra Municipal Corporations Act, 1949 ( for short "the said

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Act"). By the impugned order, in exercise of powers under Section 451

of the said Act, the said order dated 7th July 2003 stands rescinded.

5. The challenge to the impugned decision taken under

Section 451 of the said Act is mainly on two grounds. The first ground

is that the opinion or subjective satisfaction which is required to be

recorded by the State Government as a condition precedent for the

exercise of the powers under Section 451 of the said Act has not been

recorded. The second ground is that a cryptic order without recording

reasons cannot be passed for rescinding the resolution passed by

majority. Reliance is placed on the decisions of this Court in the case of

Netaji Pratishthan v. Government of Maharashtra and Others 1 and

Anil Moreshwar Ravetkar v. State of Maharashtra and others 2.

6. The learned AGP appearing for the State Government

supported the impugned order. However, he states that the concerned

file is not available. The learned counsel appearing for the Municipal

Corporation while submitting to the orders of the Court contended that

at this stage, no interference is called for.

7. We have given careful consideration to the submissions.

Section 451 of the said Act reads thus:

 1     2004(4) ALL MR 567
 2     2007(1) Mh.L.J. 701





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"451. Power of [State] Government to suspend or rescind any resolution or order, etc. of Corporation or other authority in certain cases.

(1) If the State Government is of opinion that the execution of any resolution or order of the Corporation or any other authority or that the doing of any act which is about to be done or is being done by or on behalf of the Corporation of such authority is in contravention of or in excess of the powers conferred by or under this Act or any other law for the time being force, or is likely to lead to a breach of the peace or to cause injury or annoyance to the public or any class or body of persons, or is likely to lead to abuse or misuse of or to cause waste of municipal funds against the interest of the public [or is likely to be against the financial interest of the Corporation or against larger public interest] the State Government may, by order in writing, suspend the execution of such resolution or order or prohibit the doing of any such act, for such period or periods as it may specify therein. A copy of such order shall be sent forthwith by the State Government to the Corporation and to the Commissioner or the Transport Manager.

(2) On receipt of a copy of the order as aforesaid, the Corporation or Commissioner or Transport Manager may, if it or he thinks fit, make a representation to the State Government against the said order.

(3) The State Government may, after considering any representation received from the Corporation or Commissioner or Transport Manager and where no such representation is received within a period of thirty days, either cancel, modify or confirm the order made by it under sub- section (1) or take such other action in respect of the matter as may in its opinion be just or expedient, having regard to all the circumstance of the case. Where any order made under sub-section (1) is confirmed the State Government may direct that the resolution or order of the Corporation or its authority in respect of which suspension order was made under sub-section (1) shall be deemed to be rescinded.

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(4) Where any order is made by the State Government under sub-section (3), it shall be the duty of every Councillor and the Corporation and any other authority or officer concerned to comply with such order. "

8. In what contingencies a Resolution passed by the General

Body of the first Respondent Municipal Corporation can be rescinded or

suspended is precisely laid down under Sub-section (1) of Section 451

of the said Act. The impugned order does not record that the

ingredients of Sub-section (1) of Section 451 of the said Act which are

condition precedent for exercising the power have been satisfied. The

drastic power under Sub-section (1) of Section 451 of the said Act can

be exercised when the order of the Municipal Corporation is likely to

lead to breach of the peace or to cause injury or annoyance to the

public or any class or body of persons, or is likely to lead to abuse or

misuse of or to cause waste of municipal funds against the interests of

the public. Thus, the power in a sense is an extra-ordinary power.

9. On a plain reading of the impugned order, it becomes

crystal clear that the satisfaction in terms of Sub-section (1) of Section

451 of the said Act has not been recorded. Therefore, the impugned

order of the State Government is unsustainable.

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10. In normal course, we would have set aside the impugned

order. However, the question whether writ jurisdiction should be

exercised will have to be examined in the light of the decision of the

Apex Court in the case of Maharaja Chintamani Saran Nath Shahdeo

v. State of Bihar and Others3. The Apex Court held that the order

lacking jurisdiction need not be set aside if the result of setting aside

such order was a revival of an illegal order. In such a case, the Court

will be justified in refusing to interfere in writ jurisdiction.

11. It will be necessary to look at the nature of the Resolution

which is impugned in this Petition. The English translation of the

Resolution No.4 dated 19th May 2014 reads thus;

"This General Body Meeting after considering the above proposal hereby approves the schedule of rates of the rateable value for the official year 1996-97 and cancels the schedule of rates of rateable value made by the administration for the official year 2003-2004 and as a result, if a person makes a representation as regards entries in the assessment book for the year 2003-2004 within six months from date of payment of house tax, necessary refund be issued by the Administration."

12. The effect of the said Resolution is that the assessment of

the rateable value from the year 2003-2004 will have to be made on the

basis of the rates fixed by the Government in the year 1996-97. The

Government Resolution provides that the excess amount collected shall 3 (1999)8 SCC 16

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be refunded. The effect of the impugned Resolution is that while

making the assessment of the rateable value for the year 2003-2004,

the rates of rent determined in the year 1996-97 will have to be applied

and in fact, the excess amount collected will have to be refunded on an

Application being made by the concerned person. The General Body

had no legal authority to direct that the rateable value from the year

2003-2004 shall be determined on the basis of the rates of 1996-1997.

As far as the fixation of rateable value is concerned, there are elaborate

provisions in Chapter VIII of the Taxation Rules forming part of the

schedule to the said Act. The rateable value has to be determined in

terms of the Taxation Rules in case of each property on merits. The

Taxation Rules also lay down the procedure for amending

assessment/revising assessment of the rateable value. Therefore, in our

view, Resolution No.4 is per se illegal being completely contrary to the

said Act and the Taxation Rules. If the impugned order is set aside, the

said Resolution will be revived.

13. In the facts of the case in the case of Anil Moreshwar

Ravetkar, a finding was recorded on the facts that the Resolution which

was sought to be revived was not illegal. Though the impugned order

passed by the State Government is bad-in-law, in the light of the law

laid down by the Apex Court in the case of Maharaja Chintamani

Saran Nath Shahdeo, we decline to exercise writ jurisdiction under

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Article 226 of the Constitution of India. The result of exercising writ

jurisdiction will be the restoration of Resolution No.4 passed on 19 th

May 2004 which is completely illegal.

14. Accordingly, the Writ Petition is rejected. Rule is

discharged with no order as to costs. However, no adjudication is made

on legality of the order dated 7 th July 2003 passed by the Municipal

Commissioner.

  (VIBHA KANKANWADI, J)                                       ( A.S. OKA, J )