Delhi High Court

M/S Associated Journals Ltd vs Mcd on 7 February, 2012

Author: Indermeet Kaur

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

%                             Date of Judgment: 07.02.2012

+                    CM(M) No. 250/2009


M/S ASSOCIATED JOURNALS LTD.               ..... Petitioner
                  Through: Mr.A.K.Singla, Sr. Adv. with Mr.
                           J.K.Sharma and Mr.Shitesh
                           Khanna, Advocates.

                     Versus


MCD                                                 ..... Respondent
                          Through:        Ms.Maninder Acharya, Advocate.

      CORAM:
      HON'BLE MS. JUSTICE INDERMEET KAUR

INDERMEET KAUR, J. (Oral)

1. Order impugned before this Court is the order dated 20.02.2009

whereby the Tax Tribunal had directed the petitioner to deposit the

entire amount of tax in terms of the mandatory requirement of Section

169 of the Delhi Municipal Corporation Act (hereinafter referred to as

the 'said Act'), before his appeal could be heard. This order is the

subject matter of the present petition.

2. Record shows that the petitioner M/s Associated Journals Limited

had filed an appeal against an order passed by the Assessing Officer

wherein the property tax assessed qua his property i.e. Herald House, 5A

Bahadur Shah Zafar Marg, New Delhi had been fixed at `1,73,800/-. He

had filed an appeal before the appellate body. As a precondition for

hearing his appeal, in view of provisions of Sections169-170 of the said

Act, he had been directed to pay the entire tax amount failing which his

appeal could not be heard.

3. Learned counsel for the petitioner has addressed a three fold

argument:

i. His first argument is that although Section 169 of the said Act

has been amended but there is no difference in the language of

the amended and un-amended sections; even in the unamended

provision of Section 169 (prior to the amendment Act 2003) no

orders could be obtained from the Appellate Forum unless and

until the disputed amount was deposited; the amended provision

while making a reference to the full amount is a reference to the

disputed amount. Further contention being that the judgment of

the Apex Court Shyam Kishore v. Municipal Corporation of

Delhi reported in AIR 1992 SC 2279 followed by the Division

Bench of this court in 48 (1992) DLT 621 DB titled as Sunil Rai

vs. MCD & Ors. is fully applicable and the petitioner has to

deposit only the tax for the base year; the question of deposit of

the entire amount does not arise;

ii. the second submission of the petitioner is based upon the

judgment of the Apex Court reported in AIR 1957 SC 540 titled

as Garikapati Veeraya vs. N. Subiash Choudhry & Ors.;

contention being that in para 23 (iv) it has clearly been enunciated

that a right of appeal which is a right available to every litigant

exists as on the date when the lis commenced and the law

prevailing on the date of the institution of the suit or proceedings

will be the applicable law. To elaborate this submission it is

pointed out that objections had been filed by the petitioner before

the Assessing Officer on 04.06.1988 which were finally dismissed

on 01.12.1988; lis having commenced prior to the amendment of

2003, unamended provision of the said Act would be applicable

and as such ratio of Shyam Kishore and Sunil Rai (supra) being

applicable, it is only the tax for the base year which has to be

deposited and not the entire tax.

(iii) Last submission of the petitioner is founded upon a

submission that the impugned order has noted that the total tax

demand is ` 3,66,65,533/- against which a deposit of `

2,87,83,890/- has been made; contention being that this demand

of ` 3,66,65,533/- has wrongly been mentioned as the notice

which has been received by the petitioner from the Department

(page 4 of the paper book) dated 23.03.2010 has made a demand

of ` 2,62,30,861/-. On this ground also the impugned order is

liable to be set aside; as more than the demanded amount has

already been deposited by the petitioner.

4. Arguments have been countered.

5. Last submission of the learned counsel for the petitioner shall be

dealt with first. Impugned order has noted certain amounts referred to

above; show cause notice filed alongwith the paper book has also been

perused. This petition is confined only to the impugned order; impugned

order dated 20.02.2008 had directed the petitioner to pay the entire tax

amount before his appeal could be heard. This petition is the subject

matter of this order only; the contention of the petitioner that the

demanded amount is in fact lesser than the amount already deposited by

him cannot be gone into by this court at this stage; even if this

submission is factually correct it will only be a plea available to the

petitioner in the appellate forum. This submission, therefore, at this

stage has no force and cannot be gone into.

6. Record shows that on 13.03.2006 at the option of the present

petitioner/assessee the matter had been remanded back to the Assessing

Officer to assess his assessment as per the new assessment formula laid

down under the said Act which was as per the unit area method. This

assessment was for a period of 15 years i.e. with effect from 01.12.1988

to 31.03.2004. The order of the Assessing Officer is dated 13.03.2006.

Appeal was filed before the Appellate Forum i.e. before Municipal

Taxes Tribunal on 05.11.2008. This appeal was directed against

assessment made by the Assessing Officer as per unit area method

which was in terms of the option exercised by the petitioner. The

judgment of Shyam Kishore (supra) is inapplicable in this scenario. The

Apex Court in this case while upholding the vires of Section 170 (b) of

the said Act had noted that an appeal can be admitted/entertained

without pre-deposit of the disputed tax but it can only be heard and

disposed of after the disputed tax amount has been deposited; in this

intervening period the appellate forum can adjourn the hearing giving

time to the assessee to deposit the tax. The judgment of Sunil Rai

(supra) which had followed Shyam Kishore (supra) had noted that the

proper exercise of discretion by the appellate forum in cases where

assessment orders have been framed for a number of years, is to direct

the assessee to deposit the disputed tax in respect of the base year and

then to proceed to hear and decide the appeal in respect to the base year

assessment and after deciding the said appeal the decision of the appeal

in respect of the base year would automatically govern the assessment

for the subsequent years. These judgments were delivered admittedly at

the time when assessment of property tax was being done according to

the old method i.e. as per the rate-able value. In the instant case the

assessee had opted for the assessment of his taxes by the new method

which is the unit area method. It was not on the ratable value (RV)

which was an assessment for collective years. The ratio of Shyam Kisore

and Sunil Rai (supra) is not applicable.

7. Moreover the amendment of 2003 has brought about a clear

change in the amended provision of Section 169 and 170 of the said Act.

The relevant unamended provisions read as herein below as under:-

"Delhi Municipal Corporation Act, 1975:

169. Appeal against assessment, etc. (1) An appeal against the levy or assessment of any tax under this Act lie to the court of the district judges of Delhi.

(2)-(6)................

170. Conditions of right to appeal-No appeal shall be heard or determined under Section 169 unless-

(a)................

(b) The amounts, if any, in dispute in the appeal has been deposited by the appellant in the office of the Corporation."

After the amendment of 2003, the amended provision reads as

under:-

"Delhi Municipal Corporation (Amendment) Act, 2003:

169. Appeal against assessment, etc.- (1) An appeal against the levy or assessment or revision of assessment of any tax under this Act shall lie to the Municipal Taxation Tribunal constituted under this section: