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Judgment
ARINDAM MUKHERJEE, J.
1) The appellants have challenged the judgment and order dated 6th January, 2017 by which its writ petition being WP No. 46 of 2016 had been partly
allowed in terms of prayers (b),(c) and (d) and the rest of the prayers were disallowed. The main prayers in the writ petition are reproduced
hereinbelow for the convenience of understanding:-
“a) A writ of in the nature of Mandamus and/or order or orders and/or direction or directions of like nature commanding the respondents to cancel
and/or rescind and/or revoke the comprehensive property tax bill for the year 2015-2016 for premises No. 37A, Bentick Street, Kolkata to the extent
of the purported demands for the periods 2nd quarter of 2015-16, 3rd quarter of 2015-16 and 4th quarter of 2015-16 as contained therein;
b) A writ of or in the nature of Mandamus do issue commanding the respondents to forebear from raising any bill or demand for property tax or
surcharge in respect of premises No. 37A, Bentick Street, Kolkata for the period starting on and from 1st July, 2015 or from otherwise doing or
refraining from doing any act, deed or thing on the premise that the annual valuation of Rs. 1,82,480.00 with effect from 1st July, 2015 of the premises
No. 37A, Bentick Street, Kolkata-700069 survives beyond 30th June, 2015;
c) A writ of or in the nature of Mandamus do issue commanding the respondents to forthwith refund the sum of Rs. 70,498.00 being the aggregate of
the amounts illegally realized towards property tax and commercial surcharge for the periods 2nd quarter of 2015-16, 3rd quarter of 2015-16 and 4th
quarter of 2015-16 along with interest at the same rate as imposed by the Kolkata Municipal Corporation on its assesses, from the date of receipt of
the said sum till the date of refund;
d) A writ of in the nature of Certiorari and/or order or orders and/or direction or directions of like nature commanding the respondents to quash and/or
set aside the comprehensive property tax bill for the premises No.37A, Bentick Street, Kolkata for the year 2015-16 to the extent of the purported
demands for the 2nd quarter of 2015-16 to 4th quarter of 2015-16;
e) A writ of or in the nature of Certiorari do issue commanding the respondents to certify and transmit all records pertaining to the instant case before
this Hon’ble Court and upon perusal thereof quash and/or set aside any purported demand of property tax or commercial surcharge or any other
act or actions of the Kolkata Municipal Corporation or any of its functionaries on the basis of annual value of Rs. 1,82,480/- with effect from the
period 2nd quarter of 2009-2010 on and from the period starting from 1st July, 2015 so as to render conscionable justice to the petitioners;
f) Rule NISI terms of prayers (a), (b), (c), (d), (e) and (f) above;
g) Rule Nisi be made absolute if insufficient cause is shown to the respondents;†Interim orders in terms of the main prayers were also prayed for.
2) The Kolkata Municipal Corporation has preferred a cross-objection challenging the order impugned dated 6th January, 2017 to the extent it has
allowed the writ petition.
3) The case of the writ petitioners is as follows:-
The writ petitioner No. 1 is the person primarily liable to pay property tax in respect of 6638 square feet area on the ground floor and 4621 square feet
area on the first floor aggregating to 11260 square feet in premises No. 37A, Bentinck Street, Kolkata-700069 (hereinafter referred to as the said
property). The annual valuation of the said property was fixed by the Hearing Officer IV of the Kolkata Municipal Corporation (in short
‘KMC’), by an order dated 10th May, 2010 at Rs. 1,82,480/- with effect from 2nd quarter of 2009-10. Out of such valuation, Rs. 1,29,1760/-
was on account of non-residential purpose.
4) The said valuation according to the writ petitioners remained in force for a period of 6 years, that is, till the end of first quarter of 2015-16 ending on
30th June, 2015. The KMC is statutorily obliged to revise the annual valuation in terms of the provisions of Section 179 of the Kolkata Municipal
Corporation Act, 1980 (hereinafter referred to as the said ‘Act’) by making the periodic assessment, on expiry of 30th June, 2015 failing which
they were to record reasons in writing as to why such periodic assessment could not be done and not having done so the KMC is precluded from
realising property tax on the basis of the old annual valuation from the appellants. The previous annual valuation in absence of any reason being
recorded in writing cannot continue to remain in force according to the writ petitioners until it is so revised. In other words, there will be no annual
value for the said property on expiry of 30th June, 2015 on the basis whereof the KMC could realize property tax from the petitioner no.1 on and from
1st July, 2015. It is also the case of the petitioners that the Municipal Authorities could not have raised property tax bill on the basis of the annual
valuation which had become inoperative on the expiry of 30th June, 2015. The bills raised for the periods subsequent to 30th June, 2015 are required to
be quashed and/or set aside and the payment made in the interregnum by the petitioner No.1 to be refunded back to the petitioners.
5) The records further reveal that the appellants had challenged the legality of a notice issued by KMC under sub-sections (3) and (4) of sections 184
of the said Act for assessing annual valuation of the said premises commencing from first quarter of 2011-12. The challenge of the appellants
succeeded and the said notice was quashed and the proceedings taken by KMC on the basis of such notice was held unsustainable by an order dated
4th December, 2012 as corrected by the order dated 14th December, 2012. The said order dated 4th December, 2012, however, made it clear that the
said order will not preclude the Municipal Authority from assessing the annual valuation of the said premises for the said assessment period afresh by
following the provision of the law and in the event, the Municipal Authority intends to do so, the Municipal Authority will follow the decision of the
Hon’ble Supreme Court passed in the case of Calcutta Gujarati Education Society & Anr. Vs. C.M.C. & Ors., reported in (2003) 10 SCC 533, by
keeping it in mind that the premises in question is a multi-storied building occupied by several occupiers in different capacities.
6) Prior to filing of the writ petition the appellants served the KMC with a demand for justice dated 23rd November, 2015. In the said representation,
the appellants, however, did not make out a case that the prevailing annual valuation has ceased to operate on expiry of 30th June, 2015, as the KMC
did not record any reason in writing as to why KMC could not do the periodical assessment under Section 179 of the KMC Act before 30th June,
2015 which is the basis of its writ petition.
7) The learned Single Judge after examining the relevant provisions of the said Act, has come to the conclusion that the valuation up to first quarter of
2015-16 cannot be enforced for the 2nd quarter of 2015-16 onwards although such valuation subsists as KMC did not record in writing the reasons for
its inability to compute a fresh Annual valuation before the expiry of the 2nd quarter of 2015-16. It has been further held that the respondent
Corporation ought not to have raised bills on the petitioner claiming property tax for the period starting from 1st July, 2015 on the basis of the old
annual valuation.
8) We do not agree with such finding. After the order dated 4th December, 2012 was passed the Municipal Authorities had to make fresh assessment
of property tax in respect of the said property incompliance with the said order. The periodic assessment under the provisions of section179 of the
KMC Act is fixation of annual value for the purpose of assessment of property tax. At the time of the said Act coming into effect, the annual value
which had been determined before and was in force on the date of commencement of the said Act was deemed to be annual value for the purpose of
assessment of property tax and was to remain in effect until a fresh annual valuation was enforced. The fresh annual valuation under the KMC Act is
to be made by the Municipal Commissioner or if the State Government directs by the Central Valuation Board established under the West Bengal
Central Valuation Board Act, 1978. Sub-sections (1) and (4) of section 9 of the 1978 Act also provides for the same. The annual valuation on being so
determined shall remain in force in respect of each ward for a period of 6 years as per the provisions of Section 179(2) (c). The annual valuation may
be revised on expiration of each of such period. As such, it is not a simple task which can be carried out after observing all formalities before expiry of
the 6 years term in view of more than 140 number of wards. The Municipal Commissioner in order to record reasons has to gather the same which
may not be possible prior to expiry of the six years period as several factors are involved. Prior to expiry of 1st quarter 2015-16 it may not have been
possible for the Municipal Authorities to carry out such periodic assessment in respect of the ward concerned wherein the said property is situated to
collect the property tax assessed on such fresh valuation immediately on expiry of 30th June, 2015 as the same is dependent on several factors
including the involvement of State Government. This does not mean that the writ petitioners will enjoy all civic amenities without paying a penny for
the same from 1st July, 2015. If such a view has to be subscribed then, the administration of the local self-Government like the KMC will come to a
standstill for being unable to collect municipal rates and taxes for their inability to do the periodic assessment before expiry of the last quarter for
which the previous annual valuation remains in force. The civic amenities cannot be rendered in such a case for want of money. The Municipal
Commissioner may not also be in a position to record in writing the reasons for not being able to revise the valuation as he may not even know the
reasons prior to expiry of six years, if the State Government involves the Valuation Board for the purpose of valuation.
9) We also find that the judgments reported in 2011(10) SCC 292 (paragraph 14) and 2010 (8) SCC 739 (Paragraph 36) referred to and relied upon by
the appellants have no manner of application in the facts of the instant case though there can be no divergence of opinion as to the ratio laid down
therein.
10) We, therefore, are of the view that till the fresh annual value in respect of the said premises is not fixed, and property tax on basis thereof
computed, the appellants should continue to pay property tax at the old rate computed on the basis of the previous annual valuation and the KMC
should raise bills for such purpose if not already done and continue to accept the same until the periodic assessment is not complete. KMC will realise
the difference in the municipal rates and taxes realised at the old rate and that on the new rate immediately after the new annual valuation is fixed for
the period from 1st July, 2015.
11) We are also alive to the fact that the KMC cannot be allowed to sit over the issue of computation of annual valuation for time memorial without
recording any reason and thereby not complete the assessment within a reasonable period of time from expiry of 6 years from the previous
assessment in terms of the provisions of Section 179 of the said Act. The KMC is under a statutory obligation to do so. That apart, the till of the KMC
will continue to remain depleted if property tax is not collected at the proper rate.
12) We, therefore, direct the KMC to proceed with the assessment of the said premises in accordance with law without awaiting for any further
period and to complete the same as expeditiously as possible preferably within eight weeks from the date of communication of a photostat certified
copy of this order. The Municipal Authorities should be at liberty to realise any excess amount that may fall due after the fresh assessment is
conducted, for the period July 1, 2015 till the quarter in which the new annual value will come into effect, as being assessed, that is to say the
difference between the amount, if any, received at the old rate and to be received at the new rate from July 1, 2015 and, thereafter, continue to collect
municipal rates and taxes at the new rate that may be fixed. Needless to mention proper opportunity of hearing is to be given to the petitioners while
assessing the new rate and the petitioners shall be bound to pay at such rate, even if, they chose to challenge the new rate at a subsequent stage. We
also make it clear that the writ Court is normally not the forum for challenging the valuation or the municipal rates at taxes in view of clear procedure
laid down under the statute.
13) We, therefore, set aside the order impugned so far as it allows prayers (b), (c) and (d) of the writ petition.
The appeal along with all applications is disposed of accordingly. There shall be, however, no order as to costs. In view of our decision in the appeal
no further order in the cross-objection filed by KMC needs to be passed. The cross-objection is also disposed of accordingly without any order as to
costs. Urgent photostat certified copy of this judgment and order, if applied for, be supplied to the parties on a priority basis.