BOMBAY LIFE ASSURANCE SOCIETY LTD Vs. COUNCIL CORPORATION OF MADRAS
HIGH COURT OF MADRAS
BOMBAY LIFE ASSURANCE SOCIETY LTD.
CORPORATION OF MADRAS
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Rajamannar, C.J. -
(1.) This is a reference made by the Ct of Small Causes, Madras, under Rule 17, Sen. IV, Madras City Municipal Act IV (4) of 1919 (hereinafter referred to as the Act). The questions of law referred for the decision of this Ct are the following :
"1. Whether by reason of the issue of two notices, Exs. A. 1 & A. 2, simultaneously with Ex. A. 3, the last mentioned notice is invalid & as a consequence, the levy of tax on escaped assessment under Section 137 B, City Municipal Act is also invalid?
2. Whether Section 137B, City Municipal Act applies to a case of escape of tax on property?
3. Whether the operation of Section 137 B is confined to cases of complete escape of assessment or extends also to cases where there has already been an assessment, but at a lesser amount than what is proper?" The Bombay Mutual Life Assurance Society Ltd, which was the applt before the Ct below is the owner of premises No 378 China Bazar Road, Madras. An amount of Rs. 856-2-0 was demanded from the Company as the property tax due in respect of the said premises for the first half year 1946-47 & was duly paid. The tax was demanded in that sum calculated on an annual valuation of the property at Rs. 7644. On 28-2-1947 three notices were issued by the Corpn of Madras purporting to be under Rule 3, Rule 3A, Schedule IV & Section 137B of the Act. The notice under Rule 3 (Ex. A. 2) intimated to the applt that the property tax assessment books would be amended by altering the annual value of the property & the amount of the property tax payable thereof from the valuation of Rs. 7644 & tax of Rs. 856-2-0 to the valuation of Rs. 23380 & tax of Rs. 2618-8-11 in respect of the property in question for the first half year 1946-47 & further intimated that any objection to the amendment would be heard by the Revenue Officer on 6-3-1947. The notice under Rule 3A Ex. A. 1 bearing the same date was to the effect that the assessment on the property had been enhanced by raising the annual value thereof from Rs. 7644 to Rs. 23380 for the first half year 1946-47 & intimated that a petn for revising the assessment would be considered if it reached the Municipal Office within thirty days from the date of service of the notice. The third notice Ex. A. 3 also of the same notice purporting to be under Section 137 B of the Act was as follows :
"Whereas you are the owner of the buildings & lands shown in the schedule below (hereinafter referred to as the premises) ; Whereas under Section 104, City Municipal Act you are the person liable to pay the property tax assessed on the premises; Whereas the premises were assessed for property tax for the half year ending 30-9-1946 on an annual value of Rs. 7644 & on such assessment a sum of Rs. 956-2-0 was paid; Whereas the annual value of the premises which shall be deemed to be the gross annual rent at which they may reasonably be expected to let from month to month in the abovemen-tioned half year, namely, the half year ending 30-9-1946, was Rs. 23380 & the property tax payable thereon was Rs. 2618-8-11 & not Rs. 856-2-0 at which the premises were assessed; Whereas you have in consequence escaped assessment in the aforesaid half year & you are liable to pay the amount of tax which has escaped assessment, namely, a sum of Rs. 2618-8-11. I hereby in exercise of the powers conferred upon the Comr by Section 137 B, Madras City Municipal Act & delegated to me under Section 16 thereof give you notice assessing you to the tax of Rs. 2618-8-11 which has escaped assessment & I hereby demand payment thereof within fifteen days from the date of service of this notice. Please take notice that if payment is not made within the period abovementioned, steps will be taken against you for realisation of the aforesaid amount of Rs. 2618-8-11. Premises above referred to No. 378 China Bazar Road, Division 8."
(2.) The applt availed himself of the remedies provided by the Act. There was an appeal to the Taxation Appeals Committee before whom he was successful (sic) & there was a further appeal to the Ct of Small Causes which was also dismissed. The applt thereafter applied to that Ct to make a reference to this Ct under Rule 17, Schedule IV of the Act & accordingly this reference was made.
(3.) The first point need not detain us long. Dr. John the learned counsel for the Corpn did not attempt to justify the issue of the three notices above mentioned simultaneously. Undoubtedly, they are mutually contradictory & would certainly have the effect of leaving the applt completely confused. By the notice Ex. A. 2 under R. 3, the applt was informed of a proposal to alter the annual value & the tax; whereas by the notice Ex. A. 1 under Rule 3A he was informed that the valuation had been increased. The third notice without making any reference to the other two notices called upon the applt to pay the enhanced tax within 15 days from the date of service of the notice. By Ex. A. 2 the applt was informed that his objection would be heard on 6-3-1947. In Ex. A. 1 he was given 30 days to file a revn petn. The third notice did not give him any opportunity to raise any objection. But I do not think it necessary to discuss this question, because it will be academic in the view we are disposed to take on the construction of Section 137 B of the Act.;
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