Mam Chandra Agarwal, J. - (1.) THESE two petitions under Article 226 of the Constitution of India have been preferred by the Nagar Palika/City Board, Dehradun and are directed against the orders of the appellate authority, namely, Chief Judicial Magistrate under Section 140 of the U.P. Municipalities Act, 1916 (hereinafter referred to as 'the Act'). Since the petitioner is common, the points raised are also identical, and the contesting respondents were represented by the same counsel, namely, Sri Ranjit Saxena. The petitions were heard together and are disposed of by this common order. The dispute relates to the assessment of tax of lands and buildings. The Tax is related to the annual value of the lands and buildings. Section 140 of the Act prescribes the manner in which the annual value shall be determined. The said provision of law stands as under: - - 140. Definition of annual value, - -(1) 'Annual value' means, (a) in the case of railway stations, hotels, colleges, schools, hospitals, factories and other such buildings, a proportion not exceeding five per centum to be fixed by rule made in this behalf of the sum obtained by adding the estimated present cost of erecting the building to the estimated value of the land appurtenant thereto; and (b) in the case of a building or land not falling within the provisions of clause (a), the gross annual rent for which such building exclusive of furniture or machinery therein, or such land is not let or in the opinion of the board is let for a sum less than its fair letting value, night reasonably be expected to let from year to year. (2) Provided that where the annual value of any building would, by reason of exceptional circumstances, in the opinion of the Board be excessive if calculated in the aforesaid manner, the Board may fix the annual value at any less amount which appears to it equitable.
(2.) THE contesting respondents have set up adjacent hotels within the territorial jurisdiction of the petitioners and the petitioner has admittedly jurisdiction to levy the tax on them. In the case of M/s. Relax Builders (P) Ltd. (writ petition No. 1575 of 1991) the Nagar Palika estimated the cost of the lands and buildings at Rs. 1.5 crores. Notice was accordingly issued to the respondents proposing to determine the annual value at Rs. 7,50,000/ - and the house tax payable at Rs. 75,000/ - and for the five year period 1989 -94. The respondents filed objections and the Assessment Committee reduced the annual value to Rs. 5,00,000/ - on which a house tax amounting to Rs. 50,000/ - per year was payable. The respondents preferred Municipal Appeal No. 52, of 1991 against the assessment and the learned Chief Judicial Magistrate by the impugned order has reduced the annual value to Rs. 1,25,000/ -. The petitioner's grievance is that in the appeal the Additional Engineer of the petitioner had filed an affidavit justifying the assessment and the order reducing the annual value to Rs. 1,25,000/ -is wholly arbitrary and illegal. It is also contended that the discretionary power contained in Section 140(2) of the Act authorising the Municipal Board to fix the annual value at any less amount which appears to it equitable in the exceptional circumstances is not available to the appellate authority and the Board having reduced the annual value to a figure lower than determinable under Section 140(1) the Chief Judicial Magistrate could not reduce the annual value further. In the case of M/s. Hotel Eketa (P) Ltd. (writ petition No. 1575 of 1991) the petitioner board estimated the cost of the lands and buildings at Rs. 1.2 crores and proposed to determine the annual value at Rs. 6,00,000/ - for which requisite notice was issued to the respondents for the years 1989 -94. On the objections of the respondents the annual value was reduced to Rs. 2,00,000/ -. The respondents preferred Municipal Appeal No. 15 of 1991 and the learned Chief Judicial Magistrate reduced the same to Rs. 90,000/ -. This reduction is also challenged on grounds referred to above.
(3.) IN the counter affidavits filed on behalf of the respondents, it has been contended that the annual value as proposed and ultimately determined by the Nagar Palika was excessive and that the learned Chief Judicial Magistrate rightly reduced the same.;