Ramaswami, J. - (1.) The question of law involved in this appeal is whether the primary liability is imposed on the appellant under the Bombay Municipal Corporation Act, 1888 (Act No. 3 of 1888) to pay property taxes to the respondent, i.e., the Municipal Corporation of Greater Bombay in respect of land owned by the appellant and let on a monthly basis to a third party who has constructed a building thereon.
(2.) The appellant is a banking company incorporated in the United Kingdom and has established places of business in India. The appellant is the sole trustee of the estate of the late Mr. F. E. Dinshaw and in that capacity is the owner of a plot of land at Manchubhai Road, Malad, Greater Bombay in the State of Maharashtra, bearing No. P. Ward No. 6418, Street No. 299B. The said plot of land had been leased by the former trustee of the estate to one Mr. R. R. Pande (hereinafter referred to as the lessee) since a number of years at a monthly rent of Rs. 12.50. The lessee had constructed at his own cost a tiled house on the said plot of land. The Malad area merged into Greater Bombay on lst February, 1957. Upto the date of the merger the Malad District Municipality was assessing and levying taxes on the land and the structure separately and recovering the same from the landlord and the tenant. After the merger, the Bombay Municipal Corporation issued a notice to the appellant under Section 167 of the Act informing him that the assessment book had been amended by inserting the name of the appellant and that the rateable value of the house had been fixed at Rs. 430/-. Being aggrieved by this order the appellant preferred an appeal to the Chief Judge, Small Causes Court Bombay under Section 217 of the Act. The appeal was dismissed by the Chief Judge, Small Causes Court by his order dated 3rd August, 1960. The appellant took the matter in further appeal to the Bombay High Court. The appeal was heard by Mr. Justice Patel and was dismissed on the 14th January, 1964. The learned Judge felt that he was bound by the decision of Chagla, C. J. and Shah, J., in Ramji Keshavji vs. Municipal Corporation for Greater Bombay, (1954) 56 Bom LR l132. The appellant thereafter preferred a Letters Patent Appeal No. 28 of 1964 which was summarily dismissed by Chief Justice H. K. Chainani and Mr. Justice Gokhale on 25th March, 1964. The present appeal is brought by special leave from the judgment of the Bombay High Court dated 25th March, 1964.
(3.) Section 3 (r) of the Bombay Municipal Corporation Act, 1888 (Act No. 3 of 1888) (hereinafter called the Act) defines land' as including land which is being built upon or is built upon or covered with water ...." Section 3 (s) defines 'building as including a house, out-house, stable, shed, hut and every other such structure, whether of masonry bricks, wood, mud, metal or any other material whatever. Section 3 (gg) defines 'premises' as including messages, buildings and lands of any tenure, whether open or enclosed, whether built on or not and whether public or private. Section 140 states: "140. The following taxes shall be levied on buildings and lands in Greater Bombay and shall be called "property taxes", namely: (a) a water tax of so many per centum of their rateable value as the corporation shall deem reasonable for providing a water-supply for Greater Bombay. (b) a halalkhor-tax of so many per centum, not exceeding five of their rateable value as will, in the opinion of the corporation, suffice to provide for the collection, removal and disposal, by municipal agency, of all excrementitious and polluted matter from privies, urinals and cesspools and for efficiently maintaining and repairing the municipal drains constructed or used for the receptions or conveyance of such matter, subject however, to the provisions that the minimum amount of such tax to be levied in respect of any one separate holding of land, or of any one building or of any one portion of a building which is let as a separate holding, shall be six annas per month, and that the amount of such tax to be levied in respect of any hotel, club or other large premises may be specially fixed under Section 172; (c) a general tax of not less than eight and not more than twenty-six per centum of their rateable value, together with not less than one-eighth and not more than three-quarters per centum of their rateable value added thereto in order to provide for the expense necessary for fulfilling the duties of the corporation arising under clause (k) of Section 61 and Chapter XIV; (ca) the education cess leviable under Section 195E; (d) betterment charges 1eviable under Chapter XII-A." Section 146 provides: "146. (1) Property taxes shall be leviable primarily from the actual occupier of the premises upon which the said taxes are assessed, if such occupier holds the said premises immediately from the Government or from the corporation or from a fazendar: Provided that the property taxes due in respect of any premises owned by or vested in the Government and occupied by a Government servant or any other person on behalf of the Government for residential purposes shall be leviable primarily from the Government and not the occupier thereof. (2) Otherwise the said taxes shall be primarily leviable as follows, namely: (a) if the premises are let, from the lessor; (b) if the premises are sub-let, from the superior lessor; and (c) if the premises are unlet, from the person in whom the right to let the same vests. (3) But if any land has been let for any term exceeding one year to a tenant, and such tenant or any person deriving title howsoever from such tenant has built upon the land, the property taxes assessed upon the said land and upon the building erected thereon shall be leviable primarily from the said tenant or such person, whether or not the premises be in the occupation of the said tenant or such person". Section 147 states: "147. (1) If any premises assessed to any property tax are let, and their rateable value exceeds the amount of rent payable in respect thereof to the person from whom, under the provisions of the last preceding section, the said tax is leviable, the said person shall be entitled to receive from his tenant the difference between the amount of the property tax levied from him, and the amount which would be leviable from him if the said tax were calculated on the amount of rent payable to him. (2) If the premises are sub-let and their rateable value exceeds the amount of rent payable in respect thereof to the tenant by his sub-tenant, or the amount of rent payable in respect thereof to a sub-tenant by the person holding under him, the said tenant shall be entitled to receive from his sub-tenant or the said sub-tenant shall be entitled to receive from the person holding under him, as the case may be, the difference between any sum recovered under this Section from such tenant or sub-tenant and the amount of property-tax which would be leviable in respect of the said premises if the rateable value thereof were equal to the difference between the amount of rent which such tenant or sub-tenant receives and the amount of rent which he pays. (3) Any person entitled to receive any sum under this Section shall have, for the recovery thereof, the same rights and remedies as if such sum were rent payable to him by the person from whom he is entitled to receive the same". Section 154 (1) enacts as follows:- "In order to fix the rateable value of any building or land assessable to a property tax, there shall be deducted from the amount of the annual rent for which such land or building might reasonably be expected to let from year to year a sum equal to ten per centum of the said annual rent and the said deduction shall be in lieu of all allowances for repairs or on any other account whatever". Section 155 enacts:- "155. (1) To enable him to determine the rateable value of any building or land and the person primarily liable for the payment of any property tax leviable in respect thereof the Commissioner may require the owner or occupier of such building or land, or of any portion thereof, to furnish him, within such reasonable period as the Commissioner prescribes in this behalf, with information or with a written return signed by such owner or occupier- (a) as to the name and place of abode of the owner or occupier, or of both the owner and occupier of such building or land; and (b) as to the dimensions of such building or land, or of any portion thereof, and the rent, if any, obtained for such building, or land, or any portion thereof. (2) Every owner or occupier on whom any such requisition is made shall be bound to comply with the same and to give true information or to make a true return to the best of his knowledge or belief. (3) The Commissioner may also for the purpose aforesaid make an inspection of any such building or land." Section 156 states: "The Commissioner shall keep a book, to be called "the assessment book" in which shall be entered every official year (a) a list of all buildings and lands in Greater Bombay distinguishing each either by name or number, as he shall think fit; (b) the rateable value of each such building and land determined in accordance with the foregoing provisions of this Act; (c) the name of the person primarily liable for the payment of the property taxes, if any, leviable on each such building or land . . . . . . . . . . ********** " ;