CHIEF GENERAL MANAGER SOUTH EASTERN COALFIELDS LTD KORBA Vs. MUNICIPAL CORPORATION KORBA
LAWS(CHH)-2005-8-14
HIGH COURT OF CHHATTISGARH
Decided on August 05,2005

Chief General Manager South Eastern Coalfields Ltd Korba Appellant
VERSUS
Municipal Corporation Korba Respondents

JUDGEMENT

- (1.) THE petitioner has preferred this writ petition under Article 226 of the Constitution of India questioning the legality, propriety and correctness of the resolution No. 10 dated 30 th March 2005 whereby the property tax in respect of residential building has been increased from 8% to 9% and in respect of commercial from 8% to 10%. Brief facts leading to filing of this writ petition are that petitioner South Eastern Coalfields Limited, Korba is having residential and commercial buildings in the municipal corporation area, Korba and based on the impugned resolution respondent Corporation issued a letter dated 23rd April 2005 ( Annexure-P/2).
(2.) IN response to that the petitioner sent a cheque of Rs. 34, 42, 991/- on 12-5-2005 along with objection dated 10-5-2005. It has been mentioned that in view of the provisions of Section 143 of the Chhattisgarh Municipal Corporation Act, 1956 (hereinafter referred to as the Act, 1956) resolution No. 10 is illegal and bad for the reason that annual letting value of land and building cannot be assessed every year as the law prescribes that once assessment is made, it will continue for 5 years. The said action of respondent has been challenged being contrary to the provisions of Section 143 and also contrary to the provisions of Sections 145 to 148 of the Act 1956. Return has been filed on behalf of respondent Corporation in which it has been mentioned that as per the provisions of Section 132 (1) of the Act, 1956, the Corporation shall, subject to any general or special order which the State Government may make in this behalf, impose in the whole or in any part of the Municipal Area under sub-section (a) a tax payable by the owners of buildings or lands situated within the city with reference to the gross annual letting value of the buildings or lands, called the property tax, subject to the provisions of Sections 135,136 and 138. Section 136 speaks about exemption from property tax which provides that the property tax levied under Section 135 shall not be leviable in respect of the buildings and lands enumerated in Section 136. Section 136(i) of the Act provides that buildings and lands in occupation of owner for his residence shall be exempted from property tax to the extent of fifty percent. Amended provision of Section 138(1) provides that notwithstanding anything contained in this Act or any other law for the time being in force, the annual letting value of any building or land, whether revenue paying or not, shall be determined as per the resolution of the Corporation adopted in this behalf. Section 138(2) provides that on the basis of the resolution adopted by the Corporation under sub-section (1), every owner of land or building shall assess the annual letting value of his land or building and deposit the amount of property tax. Rule 6-A of the Chhattisgarh Municipality (Determination of annual letting value of building/land) Rules, 1997 (for shot the Rules, 1997) speaks about prevailing of the last year rates in case the resolution is not adopted. Rule 8 speaks about publication of resolution. Rule 9 speaks about calculation of annual letting value. Rule 10 speaks about self assessment of the property tax. The respondent Corporation in accordance with the provisions of Section 135 (1) of the Act passed a resolution determining the rate of property tax to be 8% for the financial year 2000-01 and for the year 2002 the property tax was assessed in accordance with the resolution Annexure-R/2 and the same was made effective for the year 2000-01. The petitioner filed a writ petition No. 775/2001 and during the pendency of the writ petition, parties entered into a compromise (Annexure-R/3). During the pendency of that writ petition, a resolution No. 141 was passed and considering the representation of the petitioner, the annual letting value was also reduced to some extent. The resolution passed on 23-3-2002 was made effective from 1-4-2000. As per the compromise, some property tax was realized up to 2004-05. Now, resolution has been passed in this year on 30th March 2005 in which only rate of tax under Section 135 (1) of the Act has been increased from 8% to 9% for residential areas and for commercial buildings, it has been increased from 8% to 19%. However, the annual letting value of the land or building is same as it was in the resolution dated 23 rd February 2002. I have heard learned counsel for the parties. Shri H.B. Agrawal, learned Senior Counsel for the petitioner argued that as per the provisions of Section 143 of the Act assessment cannot be changed for 5 years and as per the compromise arrived at between the parties on 29-6-2002 respondent is not entitled to increase the property tax up to 2007. On the other hand, Shri Sanjay K. Agrawal, learned counsel for respondent, while drawing the attention of the Court towards the last para of the said compromise, argued that the compromise was for 3 years i.e. 2000-01, 2002-03 and 2003-04. Even thereafter, during the financial year 2004-05 rate was not increased and the same has been increased under the provisions of Section 135 of the Act. The said exercise of respondent Corporation comes under the legislative power and increase of rate has not been specifically challenged in this petition, therefore, the writ petition be dismissed.
(3.) I have perused the record and relevant law. Under Article 243 x (a) of the Constitution of India the Municipalities are entitled to levy, collect and appropriate such taxes, duties, tolls and fees in accordance with such procedure and subject to such limits. Under the enabling powers which have been delegated to the respondent Corporation, the Corporation vide its resolution dated 30th March 2005 has increased the rate of property tax in respect of residential buildings from 8% to 9 % and in respect of commercial buildings from 8% to 10%. As far as residential buildings are concerned, in view of the exemption under Section 136 (i) of the Act, 1956 the petitioner is entitled for 50% exemption, therefore, practically the increase is of 1/2%. The said resolution can be challenged only on the ground of violation of Article 14 of the Constitution of India or any other illegality. Section 135 envisages that 'notwithstanding any thing contained in this Act, the tax under clause (a) of sub-section (1) of Section 132 shall be charged, levied and paid, at the rate not less than six percent and not more than [twenty] percent of the annual letting value, as may be determined by the Corporation for each financial year 20% increase has been inserted by the amendment in the Act, 1956 by notification dated 19-1-2002.;


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