TATA MOTORS LTD Vs. TALATHI OF VILLAGE CHIKHALI

JUDGEMENT

(1.) Under Lease Deed dated 3.1.1995, Pimpri-Chinchwad New Town Development Authority (6th Respondent herein - for short the Development Authority) granted a lease of land measuring 164.5 acres in Sectors No. 15 and 15A in Village Chikhali, Taluka Haveli, District Pune, converted to industrial use, to the Appellant herein for a term of 99 years commencing from 21.11.1994. The consideration for the lease was a premium of Rs. 17,91,40,500/- (at the rate of Rs. 25/- per sq.ft.) paid by the Appellant apart from a yearly rent of rupee one. The Appellant utilized the said plot and adjoining plot obtained on lease from Maharashtra Industrial Development Corporation (for short MIDC) for construction of its factory. The Appellant commenced construction of its plant in or about the year 1997 and on completion, commenced actual use for industrial purpose, in the year 1999.

(2.) The Appellant was served with a demand notice dated 26.2.2002 by the Gar Kamgar Talathi, Chikhali, demanding payment of Rs. 45,25,538/- as non-agricultural cess and additional non-agriculture cess, for the period 1995-96 to 2001-02. As the said payment was not made, default notices dated 1.3.2002 and 5.3.2002 were issued under Section 174 of the Maharasthra Land Revenue Code, 1966 (Code for short) informing that if the amount demanded was not paid within seven days, the amount due will be recovered with 25% of the amount due as penalty. At that stage the Appellant filed a writ petition before the Bombay High Court for quashing the demand notice 26.2.2002, 1.3.2002 and 5.3.2002. The Appellant contended that it was a "government lessee". Alternatively, it was contended that it was the tenant of the Development Authority. It was submitted that neither a government lessee nor a tenant of the Development Authority was liable to pay the non-agricultural assessment under the provisions of the Code.

(3.) The High Court, by judgment dated 4.7.2007 rejected the contention that Appellant was a government lessee. It held that as lessee under the Development Authority, the Appellant was liable to pay the non-agricultural assessment. The High Court however held that having regard to Section 115 of the Code, non-agricultural assessment could be levied only with effect from the date on which the land was actually used for non-agricultural purpose, and as Appellant commenced actual non-agricultural use in the year 1999, the non-agricultural assessment was, due by it only from 1999-2000. As a consequence, the High Court allowed the writ petition in part, quashed the demand relating to the period 1995-96 to 1998-99 and upheld the claim for the non-agricultural assessment from the year 1999-2000 onwards. The said order is challenged in this appeal by special leave contending that it is not liable to pay the non-agricultural assessment as it is a government lessee. Alternatively it is contended that being the tenant of the occupant, it is liable to pay the land revenue, as only the occupant is liable to pay the land revenue under Section 39 of the said Code. On the contentions raised, the following questions arise for consideration: