Partly allowed

Raj Dadarkar and Associates, v. Muncipal Coporation of Greater Mumbai

Bombay HC31 Jan 2012WP/726/2011

Case brief

AI extract

What is this about?

Petitioners, licensees of market stalls, challenged a demand notice for property tax despite paying stallage charges and the Corporation being the owner. Court set aside notice and directed Corporation to decide liability after hearing.

What did the court decide?

Impugned demand notice set aside. Petitioners directed to appear before Commissioner for hearing on 13/2/2012. Commissioner to pass reasoned order within 15 days.

Raj Dadarkar and Associates, Vs Muncipal Coporation of… — Landlord and Tenant | Bombay HC (2012)

oswp-726-11

pdp

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

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WRIT PETITION NO. 726 OF 2011

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Raj Dadarkar & Associates Vs.

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.. Petitioner

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Municipal Corporation of Gr.Mumbai and ors. .. Respondents

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Mr. R. D. Soni i/by Mr. Bipin Joshi and Bhavin Bhatia for petitioners. Mrs. Vidya Gharpure for BMC.

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CORAM: S. A. BOBDE & R. D. DHANUKA, JJ.

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JANUARY 31, 2012.

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P.C.

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Rule, returnable forthwith. Respondents waive service. Heard

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finally by consent of parties.

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The petitioners are a registered partnership firm, who are

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licensee of an area in the market owned by the Corporation. The petitioners were granted license on certain terms and conditions which are entered into

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between the parties on 11/3/1993. The petitioners have approached this

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court against a demand notice issued to them by the Corporation that they

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are liable to pay property tax in respect of the stalls. It is not disputed that

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the petitioners are already paying the stallage charges. Mr. Soni, the learned counsel for the petitioners submitted that though Clause 15 of the terms and conditions indicated that the licensee shall pay the municipal assessment, it has throughout been the understanding between the parties and the practice that the property tax will be paid by the Municipal Corporation. In fact, according to the learned counsel, even in the present case when the petitioners received the notice and they responded in pursuance of the notice, the Corporation wrote a letter dated 16/9/2000 informing the petitioners that the tax liability vests with the Corporation, which reads as under:-

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“....As the tax liability vests with Corporation, you are requested to give the authority in the form of AC-34 attached with the intimation notice, to Ward Officer/Markets to enable him to attend hearing at the time of complaint.”

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This letter is not disputed by the learned counsel for the Corporation, who relies on Clause 15 of the Terms and Conditions of Auction which reads as

under:-

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“15. The successful bidder shall pay water charges, electricity charges, telephone bills, minor repairs/maintenance cost etc. The licensee shall pay Municipal Assessment, N.A. Assessment taxes etc.

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We find from the petition that there are several documents written by the Ward Officer which indicate that the tax liability was the responsibility of the Corporation, which is undisputedly the owner of the property. For instance, in the letter dated 18/6/1999 at Exhibit-E, the Corporation has stated as follows:-

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“ They are responsible for payment of monthly stallage charges of ground floor area admeasuring 17.925 sq.mtrs. They are not at all concerned for payment of property tax & other charges for upper floors of the building.”

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Thereafter in the letter dated 28/2/2000 at Exhibit -F1 the Ward Officer stated that assessment bill will be paid by the Market Department. The fact that the tax liability vests with the Corporation is also reiterated in the letter

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dated 16/9/2000 at Exhibit-M and in the letter dated 28/2/2000.

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In the circumstances, we are satisfied that even though Clause

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15 of the Terms and Conditions of Auction suggests that the tax liability is

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to be borne by the stall owner, such as petitioners, the understanding between the parties has been that the tax liability vests with the Corporation indeed. This is plausible since the Corporation is the owner of the property. Mrs. Gharpure, the learned counsel for the Corporation submitted that the petitioners were given a hearing before rateable value was finalized. However, we are of the view, having regard to the confusion created by the respondents in this case, it would be appropriate if the Commissioner of the Corporation, either himself or through authorized officer grants a hearing to the petitioners and decide the question of the tax liability. The Commissioner or the authorized officer, as the case may be, shall pass a reasoned order within fifteen days of hearing the petitioners. The petitioners are directed to appear before the Commissioner on 13/2/2012. In the meanwhile, the impugned demand notice is hereby set aside.

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Rule is made absolute in above terms. No costs.

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(R. D. DHANUKA,J.) (S. A. BOBDE, J.)

Raj Dadarkar and Associates, v. Muncipal Coporation of Greater Mumbai

Case brief

What is this about?

What did the court decide?

Raj Dadarkar and Associates, v. Muncipal Coporation of Greater Mumbai

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

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