The Correspondent Vs The Commissioner — Writ and Judicial Review | Madras HC (2026)

The Correspondent Vs The Commissioner — Writ and Judicial Review | Madras HC (2026)

What the court decided

AI extract

Outcome

Impugned Demand Notice dated 24.01.2025 quashed; case remitted to respondents to redo the determination of actual tax liability by furnishing particulars of the zone area and rate of tax, with a Show Cause Notice to be issued containing the built-up area particulars from the joint inspection; fresh assessment to clearly specify zone area, total built-up area and rate of tax; excess payments to be adjusted towards ensuing assessment periods and surcharge leviable on any deficit in accordance with law; petitioner's recorded undertaking to deposit a further Rs.5,00,000/- within one week; Writ Petition disposed of accordingly and connected Miscellaneous Petitions closed.

Issue for consideration

Whether the impugned demand validly determined the petitioner's half-yearly property tax in accordance with Sections 82 and 83 of the Tamil Nadu Urban Local Bodies Act, 1998, when the zone applicable and the rate of tax payable were not determined or indicated in the impugned order. +1 more

Court's answer

A reading of the impugned order indicates there is no clear indication as to how the half-yearly tax liability of Rs.2,50,590/- has been arrived at.

Ratio / Principle

This is a case where the petitioner had claimed exemption from payment of tax under Section 122(c) of the Madurai City Municipal Corporation Act, 1971; that exemption was withdrawn with effect from 2013, and therefore the petitioner became liable to pay tax.

Key takeaways

The records do not reveal that the tax determination was made on the basis of the calculation of the built-up area arrived at pursuant to the joint inspection carried out in terms of the order dated 16.10.2024 in W.P.(MD) No.23978 of 2024.ratio¶¶35
Despite the defects in the impugned order, the petitioner is indeed liable to pay tax, and the amounts paid pursuant to the orders of this Court and voluntarily may not be sufficient to discharge the petitioner's tax liability.ratio¶¶41
The impugned order is quashed and the case is remitted back to the respondents for redoing the exercise of determining the actual tax liability by furnishing the particulars of the zone area and the rate of tax; the fresh assessment order shall clearly specify the zone area, the total built-up area, and the rate of tax at which the petitioner is liable to be taxed.

Detailed headnote1 paragraphs

Property tax – Madurai Corporation – Certiorari against Demand Notice dated 24.01.2025 (Ref. Letter No.Ma2A8B8/005372/2024) fixing half-yearly tax at Rs.2,50,590/- (reduced from Rs.4,38,531/-) after a joint inspection – Second round of litigation: earlier Demand Notice dated 25.07.2024 for tax period 2018-2019 to 2024-2025 had been set aside by order dated 16.10.2024 in W.P.(MD) No.23978 of 2024, directing deposit of Rs.10,00,000/- and reassessment in terms of Section 82 of the Act with a hearing; deposit complied with on 27.02.2025 and a further Rs.10,00,000/- paid in two installments of Rs.5,00,000/- (05.03.2025 and 15.03.2025). Held: (i) the records do not reveal that the determination was made on the basis of the built-up area calculated pursuant to the joint inspection, the petitioner claiming 21,163 sq.ft. against the 34,055 sq.ft. adopted by the respondents; (ii) the impugned order gives no clear indication of how the half-yearly tax of Rs.2,50,590/- was computed, the zone and rate of tax not being determined, contrary to Sections 82 and 83 of the Tamil Nadu Urban Local Bodies Act, 1998, whose requirements are complemented by Rules 258 and 259 of the Tamil Nadu Urban Local Bodies Rules, 2023; (iii) yet the petitioner is indeed liable to pay tax, its exemption under Section 122(c) of the Madurai City Municipal Corporation Act, 1971 having been withdrawn with effect from 2013, and payments made may not suffice. Impugned order quashed; case remitted for redoing the assessment with particulars of zone area and rate of tax, the fresh assessment to specify zone area, total built-up area and rate; Show Cause Notice to be issued with the joint-inspection built-up area particulars; excess deposits adjustable against ensuing assessment periods, surcharge leviable on deficit in accordance with law; petitioner to deposit a further Rs.5,00,000/- within one week (statement recorded). Writ Petition disposed of; connected Miscellaneous Petitions closed.

W.P.(MD) No.11211 of 2025

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT

DATED : 28.07.2026

CORAM

THE HON'BLE MR.JUSTICE C.SARAVANAN

W.P.(MD) No.11211 of 2025 and

W.M.P.(MD) Nos.8355 & 8360 of 2025

The Correspondent, P.S.Y.Matriculation Higher Secondary School, No.19-A, Pandian Saraswathi Street, Narayanapuram, Madurai - 625 014.

... Petitioner

Vs.

1.The Commissioner, Madurai Corporation, Madurai - 625 002.

2.The Assistant Commissioner, Division - II (North), Madurai Corporation, Madurai - 625 002. ... Respondents

Prayer : Writ Petition filed under Article 226 of the Constitution of India, for issuance of a Writ of Certiorari to call for the records pertaining to the impugned Demand Notice of the second respondent vide his Letter No.Ma2A8B8/005372/2024 dated 24.01.2025 and quash the same as illegal.

For Petitioner : Mr.J.Lawarance

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W.P.(MD) No.11211 of 2025

For Respondents : M/s.S.Devasena Standing Counsel

O R D E R

The petitioner is before this Court challenging the impugned Demand Notice dated 24.01.2025 issued by the second respondent bearing Reference Letter No.Ma2A8B8/005372/2024.

This is the second round of litigation before this Court. Earlier, the petitioner was issued with a Demand Notice dated 25.07.2024, whereby a demand was raised for the tax period from 2018-2019 to 2024-2025. The said Demand Notice was challenged by the petitioner before this Court in W.P.(MD) No.23978 of 2024, which came to be disposed of by order dated 16.10.2024 with the following directions:

“5. In view thereof, the impugned order dated 25.07.2024 is set aside. The petitioner is directed to deposit a sum of Rs.10,00,000/- (Rupees Ten Lakh only), within a period of three weeks from the date of receipt of a copy of this order. On such deposit, the respondents shall redo the assessment in terms of Section 82 of the Act, after affording reasonable opportunity of hearing to the petitioner. The payment of deposit of Rs.10,00,000/- shall be adjusted on the liability that may be determined pursuant to the above proceedings.”

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W.P.(MD) No.11211 of 2025

The petitioner has also complied with the above direction issued

by the Writ Court on 27.02.2025. It is the case of the petitioner that post facto , the petitioner has paid a further sum of Rs.10,00,000/- (Rupees Ten Lakhs only) in two installments of Rs.5,00,000/- each on 05.03.2025 and 15.03.2025, respectively.

As per the impugned order, a joint inspection was carried out, pursuant to which the respondents have come to a conclusion that there was no difference in the built-up area. However, the tax was reduced from Rs.4,38,531/- to Rs.2,50,590/- on a half-yearly basis. Relevant portion of the impugned order reads as under:

“vdNt Nkw;fz;l jPu;g;ghizapy; cj;jutplg;gl;Ls;sthWk;> jq;fsJ Nfhupf;ifapd; mbg;gilapYk;> jq;fs; Kd;dpiyapy; fl;blk; mstPL nra;ag;gl;ljpy;> fl;bl msTfspy; khWjy; VJk; ,y;yhj fhuzj;jhy; 01.04.2022f;F Kd; epu;zak; nra;ag;gl;l Nfl;Gj; njhif nrd;id cau;ePjpkd;w kJiuf;fpis jPu;g;gpid epiwNtw;Wk; nghUl;L nghJtup rPuha;Tf;F Kd; epu;zak; nra;a Ntz;ba rupahd Nfl;Gj; njhiff;F khWjy; nra;a eltbf;if Nkw;nfhs;sg;gl;L 01.04.2018 Kjy; miuahz;L tup &.4>38>531/- vd ,Ue;jij jw;NghJ &.2>50>590/-vd epu;zak; nra;Jk;> Nkw;gb tuptpjpg;G vz;zpw;F tpjpf;fg;gl;l tpjpkPwy; mguhjj; njhif &.2>38>392-Ak; ePf;fk; nra;ag;gl;Ls;sJ. mjd;gb nkhj;j epYitj; njhif &.64>24>138/-ypUe;J jw;NghJ &.46>86>218/Mf Fiwf;fg;gl;Ls;sJ. ”

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The learned counsel for the petitioner would submit that the determination of tax in the impugned order is contrary to Sections 82 and 83 of the Tamil Nadu Urban Local Bodies Act, 1998. That apart, it is submitted that the petitioner had submitted all the relevant particulars. However, without determining the Zone and the rate of tax payable by the petitioner, the impugned demand has been raised. That apart, it is submitted that according to the petitioner, the total built-up area is only 21,163 sq.ft., as against which the respondents have determined the tax liability by taking the built-up area as 34,055 sq.ft.

However, the records do not reveal that the determination has been made on the basis of the aforesaid calculation of the built-up area pursuant to the joint inspection carried out in terms of the order of this Court dated 16.10.2024 passed in W.P.(MD) No.23978 of 2024.

Suffice it to state that this is a case where the petitioner had claimed exemption from payment of tax under Section 122(c) of the Madurai City Municipal Corporation Act, 1971. The said exemption was withdrawn with effect from 2013 and therefore, the petitioner became liable to pay tax. The petitioner was required to comply with the

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W.P.(MD) No.11211 of 2025

requirements of Rule 258 of the Tamil Nadu Urban Local Bodies Rules, 2023, followed by the procedure prescribed under Rule 259 of the Tamil Nadu Urban Local Bodies Rules, 2023, which is intended to complement Sections 82 and 83 of the Tamil Nadu Urban Local Bodies Act, 1998.

A reading of the impugned order indicates that there is no clear indication as to how the half-yearly tax liability of Rs.2,50,590/- has been arrived at. However, the fact remains that the petitioner is indeed liable to pay tax. The amount paid pursuant to the order of this Court and the amount stated to have been paid by the petitioner subsequently may not be sufficient to discharge the petitioner's tax liability.

The learned counsel for the petitioner would therefore submit that the petitioner will deposit a further sum of Rs.5,00,000/- within a period of one week from today. The statement made by the learned counsel for the petitioner stands recorded.

Hence, the impugned order is quashed and the case is remitted back to the respondents for redoing the exercise of determining the actual tax liability of the petitioner by furnishing the particulars of the zone area

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W.P.(MD) No.11211 of 2025

and the rate of tax at which the petitioner is liable to pay tax. Needless to state, the fresh assessment order shall clearly specify the zone area, the total built-up area, and the rate of tax at which the petitioner is liable to be taxed.

Since these particulars are not available in the impugned order, I direct the respondents to issue a Show Cause Notice furnishing the particulars of the built-up area determined during the joint inspection carried out pursuant to the order of this Court dated 16.10.2024 passed in W.P.(MD) No.23978 of 2024. The petitioner shall thereafter submit his response, and the respondents shall determine the tax liability in accordance with law.

In case the amount already paid by the petitioner pursuant to the orders of this Court and voluntarily is in excess of the tax so determined, the excess amount shall be adjusted towards the ensuing assessment period. In case there is a deficit, the respondents are at liberty to levy surcharge on the delayed payment of tax, in accordance with law.

With the above observations, this Writ Petition stands disposed

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W.P.(MD) No.11211 of 2025

of. No cots. Consequently, the connected Miscellaneous Petitions are

closed.

28.07.2026

JEN

NCC : Yes / No Index : Yes / No

To

1.The Commissioner, Madurai Corporation, Madurai - 625 002.

2.The Assistant Commissioner, Division - II (North), Madurai Corporation, Madurai - 625 002.

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W.P.(MD) No.11211 of 2025

C.SARAVANAN, J.

JEN

W.P.(MD) No.11211 of 2025

28.07.2026

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