Dismissed

J K Cement Works, Muddapur v. the Principal Secretary

Karnataka HC21 Nov 2024WP/103499/2024

Case brief

AI extract

What is this about?

Writ petition challenging an exorbitant property tax demand notice issued by the Gram Panchayat was dismissed on the ground that the petitioner had an alternative efficacious remedy under Section 201 of the Karnataka Gram Swaraj and Panchayat Raj Act 1993. The Court held that neither fundamental rights nor natural justice were violated, so the writ jurisdiction was not invoked.

What did the court decide?

Petition dismissed; liberty reserved to approach appellate authority.

J K Cement Works, Muddapur Vs the Principal Secretary — Property and Title | Karnataka HC (2024)

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1 - NC: 2024:KHC-D:16989 WP No. 103499 of 2024

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IN THE HIGH COURT OF KARNATAKA

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DHARWAD BENCH

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DATED THIS THE 21^ST DAY OF NOVEMBER, 2024

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BEFORE

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THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR

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WRIT PETITION NO. 103499 OF 2024 (LB-TAX)

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BETWEEN:

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J.K. CEMENT WORKS, MUDDAPUR, (UNIT OF J.K. CEMENT LIMITED) PRESENTED BY ITS AUTHORIZED SIGNATORY, ARUN S/O. DATTU NAIK, AGE: 45 YEARS, MANAGER (LAND & LEGAL), MUDDAPUR, TQ: MUDHOL, DIST: BAGALKOT-587313.

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…PETITIONER

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(BY SRI K.S. PATIL, ADVOCATE.)

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AND:

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MANJANNA E

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Location: HIGH COURT OF KARNATAKA DHARWAD BENCH

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THE PRINCIPAL SECRETARY, DEPARTMENT OF RURAL DEVELOPMENT AND PANCHAYATRAJ, M.S. BUILDING, BENGALURU-560 001.

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THE DEPUTY COMMISSIONER, BAGALKOT DISTRICT, BAGALKOT-587 101.

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THE CHIEF EXECUTIVE OFFICER, ZILLA PANCHAYAT BAGALKOT, BAGALKOT, TQ: AND DIST: BAGALKOT-587101.

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THE PRESIDENT, KASABA-JAMBAGI GRAM PANCHAYAT, TQ: MUDHOL, DIST: BAGALKOT-587 122.

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NC: 2024:KHC-D:16989 WP No. 103499 of 2024

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PANCHAYAT DEVELOPMENT OFFICER, KASABA-JAMBAGI GRAM PANCHAYAT, TQ: MUDHOL, DIST: BAGALKOT-587 122.

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…RESPONDENTS

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(BY SRI V.S. KALASURMATH, ADDL. GOVERNMENT ADVOCATE FOR R1 & R2;

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SRI BHUSHAN B. KULKARNI, ADVOCATE FOR R3 AND R5; SRI RAHUL DEV AND SRI SHANKAR S.Y. ADVOCATES FOR R4.)

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THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO:

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A. ISSUE WRIT IN THE NATURE OF CERTIORARI OR ANY OTHER APPROPRIATE WRIT, QUASHING THE DEMAND NOTICE DATED 24.05.2024 ISSUED BY RESPONDENT NO.5 OF LEVY OF PROPERTY TAX IN RESPECT OF PROPERTY ID NO.150100601700300568 SITUATED AT MUDDAPUR VILLAGE, TQ: MUDHOL, DIST: BAGALKOT BELONGING TO THE PETITIONER COMPANY DEMANDING EXORBITANT AND BASELESS TAX OF RS.3,78,25,264.00 FOR THE YEAR 2024-25 VIDE ANNEXURE-A.

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B. ISSUE WRIT IN THE NATURE OF MANDAMUS OR ANY OTHER APPROPRIATE WRIT, DIRECTING THE RESPONDENTS TO CALCULATE THE TAX DEMAND STRICTLY IN ACCORDANCE WITH SEC 200 AND 201 AND OTHER PROVISIONS OF KARNATAKA GRAM SWARAJ AND PANCHAYAT RAJ ACT 1993 AND ETC.,.

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THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, THE COURT MADE THE FOLLOWING:

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ORAL ORDER

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(PER: THE HON'BLE MR. JUSTICE PRADEEP SINGH YERUR)

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Heard the learned counsel for the petitioner, learned Addl. Government Advocate for respondents No.1 and 2 and

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learned counsel Sri Bhushan Kulkarni, for respondents No.3 and 5.

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2. The petitioner is aggrieved by the demand notice issued by respondent No.5 for levy of property tax in respect of the property bearing No.453/1 situated at Muddapur village in Mudhol taluk of Bagalkot district, belonging to the petitioner company which is a cement industry whereby an exorbitant baseless tax of rupees Rs.3,78,25,264/- is demanded showing Rs.1,52,02,641/- for the current year and Rs.1,48,92,027-99 for the year 2023-24.

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3. It is the contention of learned counsel for the petitioner that the petitioner company established a cement industry in the year 2009 manufacturing gray cement. 50% of the area is covered under the garden. After the construction of the structure, respondent No.4 Panchayat Development Officer of the Panchayat visited the plant, after measurement issued a demand notice for payment of property tax of Rs.1,60,800/- for the year 2009-10. The petitioner paid the property tax and thereafter he has been paying regularly the property tax to the Panchayat.

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4. This being the state of affairs, respondent No.5 issued a demand notice for tax on 14.06.2023 of Rs.88,59,788/- for the year 2023-24, which is an increase nearly seven times without revision of property tax. This order of the demand for payment of tax came to be challenged by the petitioner in W.P.No.105515/2023. The matter came to be allowed and respondent No.3 was directed to comply with the sub-section (1) of section 202 of Panchayat Raj and Gram Swaraj Act and the petitioner was directed to participate in accordance to the provisions of the Act and the matter could be referred to the CEO, who shall follow the procedure under sub-section (2) of section 202 of Panchayat Raj Act and pass necessary orders thereafter. Thereafter Respondent No.4 on 24.05.2024 issued a tax demand notice for Rs.3,78,25,264/- for the year 2024-25.

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5. It is the vehement contention of learned counsel

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for the petitioner that such issuance of tax demand notice is exorbitantly high without any proper basis and proper assessment with regard to the construction of the building and the open areas is illegal, contrary, arbitrary and against

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the judgments rendered by this Court. It is also contended by learned counsel that the impugned tax demand notice is unscientific, exorbitant and deserves to be quashed as it is increased by more than 20 times from the previous demand of tax made for the year 2022-23. The demand notice so made for tax has no proper basis and logic, neither it is based on any rules or regulations and therefore it is violative of Article 14, 19 and 300A of the Constitution of India. On these grounds learned counsel seeks to allow this petition and quash the demand notice issued by respondent No.5.

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6. Per contra, learned counsel for respondents No.3 and 5 vehemently resists with the preliminary objection of the writ petition being not maintainable in view of there being an alternative and efficacious remedy available as provided under section 201 of the Act, which contemplates appeal against assessment of tax. Therefore, he contends that any order that is passed for demand of tax and any assessment made is subject matter of an appeal to be filed before the Appellate authority which has not been exhausted and the petitioner is before this Court having approached the

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discretionary jurisdiction under Article 226 is not maintainable when there is an alternative efficacious remedy available under the statute.

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7. It is further contended by learned counsel for respondents No.3 and 5 that the calculation of tax is not arbitrary and illegal as the same is calculated by a portal designed for fixing of taxes by the State Government on the basis of the PDOs filling the details pertaining to the concerned property in the portal, namely “Panchatantra 2.0” which automatically calculates the taxes which are applicable to the concerned properties fixed by the State government. It is also contended by him that none of the Gram Panchayat officials are conferred with the power of calculating the tax of the property. Therefore, the allegations made by the petitioner that the property tax calculated is baseless without application of mind would not hold water. Therefore, it is a vehement contention of learned counsel for the respondents No.3 and 5 that the present petition would not be maintainable. The petitioner would have to be relegated to approach the Appellate Authority to exhaust his remedy

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urging all the grounds which are stated in this petition. It is also contended that that there is no illegality or perversity in the calculation of tax as stated above. It is done by virtue of E-portal and calculated by a computerized manner automatically in the ‘Panchatantra 2.0’. Under the circumstances, the petition is liable to be dismissed.

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8. Learned counsel for the petitioner in reply relies upon the judgment of the Hon’ble Apex Court in the case of Whirlpool Corporation vs. Registrar of Trademarks, Mumbai and others, reported in (1998) 8 SCC 1 and Harbanslal Sahnia and another vs. Indian Oil Corporation Limited and others, reported in (2003) 2 SCC 107, more specifically relying on paragraph No.15.

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9. On a careful perusal of this judgment of the Hon’ble Apex Court, it is seen that alternative remedy is not a constraint and does not operate as a bar in three contingencies namely 1) where writ petition has been filed for enforcement of any of the fundamental rights; 2) where there has been violation of principle of natural justice; 3)

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where the order of proceedings are wholly without jurisdiction or virus of an Act is challenged.

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10. In the present case on hand, it is not the case of the petitioners that the there is a violation of fundamental rights or violation of principles of natural justice and so also the proceedings are wholly without jurisdiction. Section 201 of the Karnataka Gram Swaraj and Panchayat Raj Act reads as under.

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Appeal against assessment, etc.Subject to such rules as may be prescribed, any person aggrieved by the assessment, levy or imposition of any tax, rate or fee under section 199 may appeal to the prescribed authority, whose decision shall be final.

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11. In the present case on hand, it is not the case of petitioner that there is violation of fundamental rights or violation of principles of natural justice and neither the proceedings are wholly without jurisdiction. Section 101 of the Karnataka Gram Swaraj and Panchayat Raj Act reads as under:

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Power of owner or occupier of buildings or lands to drain into Grama

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Panchayat drains.- The owner or occupier of any building or land within a panchayat area shall be entitled to cause his drain to empty into sewer of the Grama Panchayat, provided that he first obtains the written permission of the Grama Panchayat and that he complies with such conditions as the Grama Panchayat prescribes as to the mode in which and the superintendence under which the communications are to be made between drains not vested in the Grama Panchayat and drains which are so vested.

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12. In the present case the petitioner has been levied

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and imposed with the tax for the building by the assessment authority. Hence any such assessment or levy of imposition of tax is a subject matter of appeal before the prescribed Authority under Section 201 of the Act of 1993. In my humble opinion, the judgment relied by the learned counsel for the petitioner in the case of Whirlpool Corporation (supra) would not be applicable to the present facts of the case as the order passed cannot be said to be without jurisdiction. There is no fundamental right that involves or affects the petitioner. So also principles of natural justice have not been violated. Under the circumstances, I pass the following:

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