ISMAIL ESSAK CHAND NAGORI Vs. ABDULLA HAJI CASSUM

JUDGEMENT

(1.) This is an appeal from the decision of Mr. Justice Baker and it raises an important question between lessor and lessee as to the liability to pay property tax based on an increased assessment made after the date of the lease.

(2.) The lease was made between one Tarmahomed Haji Ali-mahomed, who has since died and whose executors are the plaintiffs, as the lessor and the defendant as the lessee. The lease demised certain property, which consisted of buffalo stables, for a term of three years from September 1, 1924, at a monthly rent of Rs. 2,501, and the lessee covenanted with the lessor that he would, during the continuance of the term, pay and discharge the Municipal bill for water consumed in the premises. That is the only material covenant by the lessee. The lessor covenanted for himself his heirs executors administrators and assigns with the lessee that he would, during the said term, pay all existing and future rates and taxes charges and outgoings whatsoever for the time being payable in respect of the said premises thereby demised except such rates taxes charges and outgoings as were thereinbefore covenanted to be paid by the lessee. So that, apart from the water rate which the lessee has to pay, the lessor is, under the contract between the parties, to pay all existing and future rates and taxes charges and outgoings whatsoever for the time being payable in respect of the demised premises.

(3.) The question to be determined is what is the effect of that covenant having regard to the provisions of Secs.146 and 147 of the City of Bombay Municipal Act, 1888. Section 146 provides, so far as is material- (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 Government 01- from the corporation or from a fazendar." that does not apply here. " (2) Otherwise the said taxes shall be primarily leviable..., (a) if the premises are let, from the lessor." Then Section 147 provides :- (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. This is not a very happily worded section, but, I think, its meaning is tolerably plain. It means that if the rateable value exceeds the amount of rent at which the premises are let, then the landlord is to be entitled to recover-the word used in the section is receive but I think that must mean recover -from the tenant the tax attributable to that excess.