Ajaib Singh vs Municipal Corporation Ludhiana

K. Kannan, J.

I. Civil Writ Petition No.1318 of 1989

The petitioner, who is in possession of the property under an agreement of sale from the municipality resists an action for imposition of tax on the

property agreed to be purchased by the petitioner. The agreement that the petitioner hold is dated 07.04.1979 and the property is a shop

measuring 28'' x 12 1/4'' at Gill Road, Ludhiana, for a price of Rs.37,056/-. Admittedly, the petitioner is in possession of the property. The

contention is that the provision for levying tax arises only u/s 97 of the Punjab Municipal Corporation Act, 1976 that casts a liability on a lesser, if

the property is let; on a superior lesser, if it is sublet and if it is unlit upon the person in whom the right to let the same vests. The petitioner''s

contention is that although the Section does not talk about a liability on an owner, it gives a primacy to a person, who is in a position to let, but

through clause (4) of the agreement of purchase, there is a restriction on the power to alienate. A lease or letting involves a transfer of interest in

immovable property and if such alienation is interdicted by an express provision, then the liability cannot be attached.

The learned counsel appearing on behalf of the Corporation contends that it is not as if clause 4 prohibits alienation but it requires a prior written

permission of the vendor and allows the vendor to resume possession if there is contravention of such a provision. Section 97, according to him,

must be read in the context of an ability of a person to let and if that letting is possible with the prior consent, then the liability u/s 97 will also be

applied. The learned counsel refers to a judgment in Basappa Rudrappa Betgeri and Others Vs. The Hubli Dharwar Municipal Corporation, that

allowed for a municipality to impose house tax on its own building and realize it from a lessee-occupiers of those buildings. I will not find that this

judgment is directly applicable, for, the Hon''ble Supreme Court was dealing with the provisions of Bombay Municipal Boroughs Act which

contained a provision in Section 85 that allowed for imposition of tax on actual occupier of the property if he was the owner or held it on a building

or other lease from the Government or from the municipality. In this Act also, there is a provision for recovery against an occupier in a case where

the recovery is not possible u/s 97 and allowing an occupier to an indemnity from the person who is liable u/s 97.

In a case where the petitioner is in actual possession of the property under the agreement and the agreement itself allows the petitioner to make

a letting of the premises with the permission of the municipality, I would take this to be a situation that Section 97 itself provides that through clause

(c) of Section 97(1). The said clause reads, ""if the land or building is unlit, upon the person in whom the right to let the same vests."" It cannot be

denied that the petitioner can let the premises, if he secures the permission. I would hold that even a prospect would make the vendee liable for

payment of tax. I will not find a requirement of even invoking Section 99 to make the person liable for tax as an occupier. The challenge to

imposition of tax is repelled and the respondent shall be entitled to raise appropriate demands and secure the tax in accordance with law. The writ

petition is, consequently, dismissed.

II. Civil Writ Petition Nos.4823 of 1989 & 1029 of 1990

Both these cases involve the same issue and they are also dismissed for the reasons enumerated above.