VIDYA PARKASH Vs. MUNICIPAL COMMITTEE

JUDGEMENT

(1.) The sole question for decision in this petition is whether the building of the petitioner at Simla which is in existence from bifore the year 1938 but with respect to which no fair rent has been fixed under Section 4 of the East Punjab Urban Rent Restriction Act, 1949 is to be assessed by respondent No. 1, Municipal Committee Simla, to a tax payable by the owner on building on the annual value as ascertained according to the definition in Section 3(1)(b) of the Punjab Municipal Act, 1911 or as restricted by the definition of fair rent enacted in Section 4 of the East Punjab Urban Rent Restriction Act, 1949.

(2.) We may, therefore, read the relevant portions of Section 3(1) (b) of the Punjab Municipal Act, 1911 and of Section 4 of the East Punjab Urban Rent Restriction Act, 1949 which are as follows :- "S. 3. Definition.- In this Act, unless there is something repugnant in the subject or context,- (1) "annual value" means- (a) ................................................ (b) in the case of any house or building, the grosss annual rent at which such house or building, together with its appurtenances and any furniture that may be let for -use or enjoyment therewith, may reasonably be expected to let from year to year, subject to the following deductions -- (i) such deduction not exceeding 20 per cent of the gross annual rent as the committee in each particular case may consider a reasonable allowance on account of the furniture let therewith ; (ii) a deduction of 10 per cent for the cost of repairs and for all other expenses necessary to maintain the building in a state to command such gross annual rent. The deduction under this sub-clause shall be calculated on the balance of the gross annual rent after the deduction (if any) under sub-clause (1) ; (iii) where land is let with a building such deduction, not exceeding 20 per cent, of the gross annual rent, as the committee in each particular case may consider reasonable on account of the actual expenditure, if any, annually incurred by the owner on the upkeep of the land in a state to command such gross annual rent ; Explanation I.-For the purposes of this clause it is immaterial whether the house or building, and the furniture and the land let for use or enjoyment therewith, are let by the same contract or by different contracts, and if by different contracts, whether such contracts are made simultaneously or at different times. Explanation II.-The term "gross annual rent" shall not include any tax payable by the owner in respect of which the owner and tenant have agreed that it shall be paid by the tenant. Section 4. (1) Determination of fair rent.-The Controller shall on application by the tenant or landlord of a building or rented land fix the fair rent for such building or rented land after holding such inquiry as the Controller thinks fit.

(3.) In determining the fair rent under this section, the Controller shall first fix a basic rent taking into consideration- (a) the prevailing rates of rent in the locality for the same or similar circumstances during the twelve months prior to the 1st January. 1939, and (b) the rental value of such building or rented land if entered in property tax assessment register of the municipal town or notified area committee, cantonment, board as the case may be, relating to the period mentioned in clause (a)."