BALBIR SINGH M G D SMT K ULDEEP KAUR I S BHATIA PT JAGESHWAR PARSHAD Vs. M C D:USHA RANI:N D M C:M G D :N D M C

JUDGEMENT

(1.) This group of writ petitions and appeals raise interesting questions of law in regard, to determination of rateable value of certain categories of properties situate in the Union territory of Delhi. The questions are of great importance since they affect the liability of a large number of property owners in the Union territory of Delhi to pay property tax under the Delhi Municipal Corporation Act 1957 and the Punjab Municipal Act 1911. The appeals before us arise out of writ petitions filed in the High Court of Delhi challenging assessments made by the Municipal Corporation while the writ petitions fall broadly into two categories - one category consisting of writ petitions which were originally filed in the High Court of Delhi but were subsequently transferred to this Court, while the other consisting of writ petitions which were filed directly in this Court. We are definitely of the view that the writ petitions filed directly in this Court are not maintainable under Art. 32 of the Constitution since none of them complains of violation of any fundamental right and ordinarily we would have rejected them straightway without going into the merits, but the parties before us agreed that in view of the fact that these writ petitions involve identical questions as the appeals and the other writ petitions transferred to this Court and those questions would in any event have to be determined by us, we should not dismiss these writ petitions on the ground of non-maintainability but should proceed to dispose them of on merits on the assumption that they are maintainable.

(2.) We are concerned in these appeals and writ petitions with four different categories of properties namely:(i) where the properties are self-occupied, that is, occupied by the owners; (ii) where the properties are partly self-occupied and partly tenanted; (iii) where the land on which the property is constructed is leasehold land with a restriction that the leasehold interest shall not be transferable without the approval of the lessor and (iv) where the property has been constructed in stages. The question is as to how the rateable value is to be determined in respect of these four categories, of properties. So far as properties sittuate, in the Union territory of Delhi except New Delhi are concerned, the determination of purpose -of assessability to property tax is governed by the Delhi Municipal Corporation Act 1957 while the determination of rateable value for the purpose of assessability to property tax in respect of properties situate in New Delhi is governed by the Punjab Municipal Act 1911. The relevant provisions of both these statutes in respect of determination of rateable value for the purpose of assessability of property tax are almost identical as observed by this Court in Dewan Daulat Ram v. New Delhi Municipal Committee, (1980) 2 SCR 607 and it would therefore be sufficient if we refer to the provisions of the Delhi Municipal Corporation Act 1957. Whatever we say in regard to determination of rateable value under the provisions of the Delhi Municipal Corporation Act 1957 would apply equally in relation to determination of rateable value under the provisions of the Punjab Municipal Act 1911.

(3.) The definitions of the expressions used in the Delhi Municipal Corporation Act 1957 are to be found in S 2 of that Act. Sub-sec. (3) of S. 2 defines building to mean "a house, out-house, stable latrine, urinal, shed, hut, wall (other than a boundary wall) or any other structure, whether of masonry, bricks, wood, mud, metal or other material but does not include any portable shelter." 'Rateable Value' is defined in S. 2 sub-sec. (47) to mean "the value of any land or building fixed in accordance with the provisions of this Act and the bye-laws made thereunder for the purpose of assessment to property taxes". Chap. VIII of the Act deals with the subject of taxation and it comprises Ss. 113 to 184. Clause (a) of sub-s. (1) of S. 113 provides that the Corporation shall, for the purposes of the Act, levy property taxes. The subject of property taxes is then dealt with in Ss. 114 to 135, S. 114 sub-s. (1) lays down that property taxes shall be levied on lands and buildings in Delhi and shall consist inter alia of a general tax of not less than 10 and not more than 30 per cent of the rateable value of lands and buildings within the urban areas. There is a proviso to sub-sec. (1) of S. 114 which says that the Corporation may, when fixing the rate at which the general tax shall be levied during any year, determine that the rate leviable, in respect of lands and buildings or portions of lands and buildings in which a particular class of trade or business is carried on, shall be higher than the rate determined in respect of other lands and buildings or portions of other lands and buildings by an amount not exceeding one-half of the rate so fixed. Then follows as Explanation which provides that where any portion of a land or building is liable to a higher rate of general tax, such portion shall be deemed to be a separate property for the purpose of municipal taxation. Section 115 sub-sec. (4) lays down that save as otherwise provided in the Act, the general tax shall be levied in respect of all lands and buildings in Delhi, except lands and buildings or portions of lands and buildings exclusively occupied and used for public worship by a society or body for a charitable purpose and two other categories of lands and buildings. Sub-sec. (6) of S. 115 provides that where any portion of any land or building is exempt from the general tax by reason of its being exclusively occupied and used for public worship or for a charitable purpose, such portion shall be deemed to be a separate property for the purpose of municipal taxation. It would appear from these provisions that the general tax is leviable on land and building as a whole and separate portions of lands and buildings are not assessable to general tax as distinct and independent units save and except where any portion of the land or building is liable to a higher rate of general tax under the Proviso to cl. (d) of sub-sec. (1) of S. 114 or is exempt from the general tax by reason of its being exclusively occupied or used for public worship or for a charitable purpose under sub-sec. (4) of S. 115 in which case such portion of the land or building is deemed to be a separate property for the purpose of municipal taxation. We may point out that apart from the general tax, three other categories of taxes, namely water tax, scavenger tax and fire tax are also included in the property taxes and they too are leviable at a percentage of the rateable value of lands and buildings. Now how is the rateable value to be determined. The answer is provided by S. 116. sub-sec. (1) of S. 116 lays down that the rateable value of any land or building assessable to property taxes shall. be the annual rent at which such land or building may reasonably be expected to be let from year to year, less a sum equal to 10% of such annual rent. Section 116 Sub-s. (2) provides that the rateable value of any land which is not built upon but is capable of being built upon and any land on which a building is in process of erection shall be fixed at five per cent of the estimated capital value of such land. Section 120 provides for the incidence of property taxes. Sub-s. (1) of that section says that the property taxes shall be primarily leviable, if the land or building is let, upon the lessor, if the land or building is sublet, upon the superior lessor and if the land or building is sublet, upon the person in whom the right to let the same vests. Sub-sec. (2) (2) of S. 120 deals with an exceptional case where any land has been let for a term exceeding one year to a tenant and such tenant has built upon the land and in such case, the sub-section provides that the property taxes shall be primarily leviable upon the tenant. Sub-sec. (3) of S. 120 is an important provision and we may, therefore, reproduce it in extenso;