Calcutta High Court (Appellete Side)

The Kolkata Municipal ... vs Sri Sukanta Chakraborty on 31 July, 2023

                IN THE HIGH COURT AT CALCUTTA
                 CIVIL REVISIONAL JURISDICTION
                         APPELLATE SIDE

PRESENT:

THE HON'BLE JUSTICE AJOY KUMAR MUKHERJEE

                            C.O. 1808 of 2019

                     The Kolkata Municipal Corporation
                                    Vs.
                          Sri Sukanta Chakraborty

For the petitioner                  :     Mr. Alak Kumar Ghosh
                                          Mr. Fazlul Haque


For the opposite parties            :     Mr. Arunangshu Chakraborty
                                          Ms. Geniya Mukherjee
                                          Mr. Arijit Bera
                                          Ms. Jeva Rashid
                                          Ms. Shaika Amrin

Heard on                            :     17.07.2023

Judgment on                         :     31.07.2023


Ajoy Kumar Mukherjee, J.

1. Two applications being aforesaid C.O. 1804 of 2019 and C.O. 1808 of

2019 have been preferred against fixation of annual valuation in respect of

a flat at 3rd Floor, at premises no. 6/6 Kali Charan Ghosh Road Kolkata -50,

for the period with effect from 2nd quarter of 2012-2013 which relates to

present C.O. 1804 of 2019 and the other application being C.O. 1808 of

2019 relates to 3rd quarter of 2011-2012 in respect of self same property.

Due to commonality of issues involved in both the applications, they are

taken up together and disposed of by this common order.

2. Subject matter of challenge in the present revisional application is

order of modification of annual valuation by the Municipal Assessment

Tribunal in MAA Appeal No. 655 & 656 of 2013 dated 18 th April, 2016.

3. The opposite party herein had raised objection against the annual

valuation at Rs. 27020/- with effect from 3 rd quarter of 2011-2012 and 2nd

quarter of 2012-2013 as proposed by the Assessment officer of the

corporation in respect of flat measuring covered area of 1906 square meter

on the 3rd Floor of the building at premises no. 6/6 Kali Charan Ghosh

Road, Kolkata-50. The Hearing officer of KMC after considering the objection

filed by the opposite party fixed the annual valuation of the said flat at Rs.

24,860/- for the period with effect from 3rd quarter, 2011-2012 and

25,450/- for the period from 2nd quarter 2012-2013. Being aggrieved by the

said order, regarding fixation of annual valuation by the assessment officer,

opposite party preferred appeal being MAA No. 655 of 2013 and 656 of 2013

for the said two quarters before the learned Municipal Assessment Tribunal

of KMC. Learned 2nd Bench of the Tribunal, upon hearing the parties in the

appeal passed the impugned order, allowing the appeal in part upon

modification of the order of hearing officer by reducing the amount of annual

valuation and fixed the annual valuation at Rs. 10061/- for the period with

effect from 3rd quarter of 2011-2012 and 2nd quarter of 2012-2013.

4. Challenging said impugned order, Mr. Ghosh appearing on behalf of

the petitioner/KMC argued that the Tribunal has reduced the annual

valuation more than cent percent without any basis. The Tribunal

committed wrong in fixation of the annual valuation of the premises in

question at Rs. 10,060/- upon taking into account the order passed in MAA

No. 141 of 2000, which case is factually different and has got no

applicability in the present context. His contention is Tribunal should have

assessed reasonable rent on the basis of existing market rent. Merely

because the road or the postal zone area are same with that of MAA No. 141

of 2000, that cannot give rise to make equal valuation of all the premises in

the said locality. In fact the tribunal without considering the legal provisions

as laid down in section 174 of the Kolkata Municipal Corporation (KMC) Act

of 1980 and without assigning any reason has made the said re

assessment. The Tribunal even failed to ascertain the estimated market

rental value of the flat for the purpose of determination of annual valuation

of the premises in question. The Tribunal also violated the principles of

natural justice. The Tribunal even did not consider the copies of inspection

book referred by the petitioner at the time of hearing of the appeal in its

proper perspective. The Tribunal also did not consider the cost price of the

premise and the rise of rent in the locality and has wrongfully exercised its

jurisdiction. He further contended that the judgment of the said Tribunal

passed in other case being MAA No. 141 of 2000, relying upon which the

said impugned order was passed , has already been set aside by this High

Court and learned Tribunal should not have relied upon and passed the

impugned order, modifying order of the hearing officer. Accordingly the order

is bad in law and liable to be set aside.

5. Mr. Chakraborty learned counsel appearing on behalf of the opposite

parties raised objection contending that assessment made by the hearing

officer of the KMC was exorbitant and also without any basis and as such

the Tribunal after considering the issue in its proper perspective has revised

the same. In such view of the mater and considering the other aspect

prevailing in the locality the order impugned does not call for any

interference.

6. I have heard both the parties and also considered submissions made

by the parties. On perusal of the order impugned it appears that while the

hearing officer of KMC, after considering the objection raised by the

opposite party herein, fixed the annual valuation of the said flat amounting

to Rs. 24,860/- and 25,450/- with effect from 3/2011-2012 and 2/2012-

2013, the Appellate Tribunal by the impugned order has reduced it to Rs.

10,060/- with effect from 3rd quarter of 2011-2012 and second quarter of

2012-2013.

7. The relevant portion of the order passed by the Tribunal in support of

such reduction may be quoted

"The Ld. Advocated for the appellant has argued that the Ld. Hearing Officer arbitrarily fixed the A.V without paying any respect to the provision of the Act of 1980. In support of his contention copy of judgment of the Tribunal in M.A.A-141 of 2000 wherein R.R was fixed @Rs.0.60 per sq.ft per month for covered area & Rs. 0.30 per sq.ft per month for C.P space w.e.f 1/98-99.

On the other hand, it is argued by the Ld. Advocate for the respondent that the order of the Ld Hearing Officer is reasonable and should be affirmed.

On careful perusal of the referred cases of the appellant, it appears that the referred case of the appellant is situated at same road and same postal zone i.e. premises no. 6D/1, Kali Charan Ghosh Road, Kol-700050 within ward no 02.

Having regard to the submission of both the parties, documents relied on specially the location, R.R & the effective Qts of the referred case of the appellant, we are of the considered view that the R.R of the premises in question should be fixed at Rs.0.85 per sq.ft per month w.e.f. 3/2011- 2012 & 2/2012-2013.

Therefore, the A.V of the said demised premises under present appeal w.e.f 3/2011-2012 & comes to:

Therefore the annual valuation of the said flat w.e.f. 3/2011-2012 & 2/2012-2013 comes to:

(1096 X Rs.0.85 X12-10%)

=Rs. 10061.28 or say Rs.10,060/-"

8. It further appears that while passing the impugned order, the court

below has considered one of its earlier order passed in MAA No.141 of 2000

where in Rate of Rent (RR) was fixed at Rs. 0.60 per square feet per month

for covered area and Rs. 0.30 per square feet per month for car parking

space with effect from 1st quarter of 1998-1999. Needless to say that said

MAA was disposed of more than 12 years back. It has not been explained in

the order impugned as to how the order passed in aforesaid MAA No. 141 of

2000 is relevant in the present context, specially when mode of assessment

made in said MAA No. 141 of 2000 has already been set aside by this court.

If that be so how it can be the comparable unit. It is needless to mention

that since the annual valuation in connection with premises in MAA No. 141

of 2000 was tested almost 12 years back, obviously during this long period

of 12 years the rental value has been substantially increased. Not only that

learned tribunal has not discussed about the entries made in the inspection

book.

9. The Kolkata Municipal Corporation Act 1980 provides the detailed

provisions of taxations and property tax under part IV chapter XII of the

said Act. Under section 180 of the said Act the annual valuation of a land

or building may be revised on the grounds mentioned in the said provisions

under the said Act. Section 184(4) of the said Act mandates that before

making any revision/fixation of annual valuation, the Municipal

Commissioner shall give notice not less than 30 days to the owner enabling

the said person to raise objection to the proposed annual valuation. Section

188 of the Act deals with hearing and determination of objection of

valuation. Section 189 of the Act of 1980 provides for preferring appeal

before the Municipal Assessment Tribunal for disposal of appeal preferred

against the order passed under section 188 of the Act.

10. The State Government by virtue of section 170 read with section 600

of the Act of 1980 has framed Calcutta Municipal Corporation (Taxation)

Rules 1987. Section 188 of the said Act read with rule 9(3) of the said Rule

of 1987 provides detailed procedure for hearing and disposal of an objection

to the proposed annual valuation of the property in question. Said

provisions make it clear that the duty casts upon Hearing Officer to adhere

to the said procedure while dealing with the objection under section 186 of

the Act. The Hearing officer under Rule 9(3) (c) of the said Rule of 1987 is

vested with the jurisdiction to call upon the person appearing before him at

the time of hearing to file written statement supported by duly sworn-in

affidavit, if necessary, giving particulars of his submission in support of the

disputes raised against the proposed annual valuation of the property.

Similarly Tribunal by virtue of Rule 15 enjoys the power of civil court and to

summon any witness or for production of any document which the Tribunal

may require for disposal of the appeal before it and the detailed procedure

for hearing of the appeal has been laid down in Rule 19 of the said Rule,

which includes local inspection, in case of necessity, of such premises,

which are the subject matter of appeal as provided in rule 20 of the Rule of

1987.

11. Here the Tribunal by the order impugned has modified annual

valuation of the flat in question on the basis of one of its earlier judgment in

connection with a completely different premises passed in MAA No. 141 of

2000. Merely on the ground that property situates under the same ward of

Kolkata Municipal Corporation or may be within the same locality where the

suit flat situates, cannot be the yardstick of assessment for computing

annual valuation of the present flat. The Tribunal being the quasi judicial

authority is bound to follow the procedure while discharging their duty.

Accordingly it is apparent, while modifying order of hearing officer, the

learned Tribunal has not recorded any cogent reason for such modification

in violation of principle of natural justice and he has passed the order in

violation of the statutory/obligation casted upon the Tribunal for

assessment of annual valuation.

12. On careful reading of section 174 (a) of the Kolkata Municipal

Corporation Act, 1980 (in short KMC Act, 1980) it appears that the

corporation is empowered to fix the annual valuation of a premises for the

purpose of determining, the tax to be paid in respect of said premises. Apex

Court while dealing with Municipal laws in force in different states in India

laid down guideline for determination of annual rent, which should be

determined on the basis of:-

(a) Actual gross annual rent, where the premises has been let out.

(b) If the premises has not been let out then on rent of hypothetical

tenancy basis.

(c) Valuation arrived on the basis of capital value from which the

annual value has to be found applying a suitable percentage,

where either of the first two modes is not available.

(Bombay Municipal Corporation Vs. LIC, AIR 1970 SC 1584: 1970

(1) SCC 791 (para-8) & Guntur Municipal Council Vs. Guntur town

Rate Payers' Association (AIR 1971 SC 353): 1970 (2) SCC 803

(para 5& 6).

13. In this context it should be made clear that fixation of annual

valuation arbitrarily (as has been done in the present context) is not

permissible under the law. Either the corporation or the Tribunal is not free

to assess any arbitrary annual value and corporation has to look to what is

"fair rent" which would be payable for the premises in question during the

year of assessment under the West Bengal premises Tenancy Act, 1997. The

premises in question, if not actually let out, then the hypothetical fair rent,

rent of neighboring premises and other attending facts and circumstances of

the potentialities should be taken into account for the purpose of

assessment of annual valuation.

14. In India Automobiles Vs. Calcutta Municipal Corporation,

reported in AIR 2022 SC 1089, Apex Court observed:-

24. "......... We are of the view that the basis for determination of annual rent value has to be the standard rent where the Rent Control Act is applicable and in all other cases reasonable determination of such rent by the municipal authorities keeping in view various factors as indicated herein earlier, including the rent which the tenant is getting from his sub-tenant. In appropriate cases the owner of the property may be in a position to satisfy the authorities that the gross annual rent of the building of which the annual valuation was being determined cannot be more than the actual rent received by such owner from his tenant. The municipal authorities shall keep in mind the various pronouncements of this Court, the statutory provisions made in the specified Municipal Acts, keeping in mind the applicability or non-applicability of the Rent Act and the peculiar circumstances of each case, to find out the gross annual rent of the building including service charges, if any, at which such land or building might, at the time of assessment, be reasonably expected to let from year to year in terms of Section 174 of the 1980 Act."

15. Since the Tribunal below failed to exercise jurisdiction vested in it by

law and also the Tribunal did not pass cogent speaking order while deciding

annual valuation of the premises, which caused grave miscarriage of justice,

this court has no other alternative but to interfere with the order impugned

invoking power under Article 227 of the Constitution of India.

16. In such view of the subject matter I have no other option but to set

aside the impugned order concerning annual valuation made by the

Tribunal for 2nd quarter of 2012 -2013 and 3rd quarter of 2011-2012 in MAA

655 of 2013 & MAA 656/2013 dated 7th July, 2013 with a direction to

decide MAA 655 of 2013 and MAA 656 of 2013 afresh keeping in mind the

guidelines and also on the basis of available materials on record including

the inspection Book copies and also following statutory Rules in respect of