Sikandar Lal and Others vs The State of Haryana and Others

Laxmi Narain Mittal, J.—In this writ petition filed under Articles 226 and 227 of the Constitution of India, petitioners, who have shops in New Mandi Township, Pehowa, have assailed action of respondent No. 2-Municipal Committee, Pehowa in demanding house tax from the petitioners for their shops and have thus challenged notice Annexure P/4 issued by respondent No. 2 regarding proposed assessment of house tax and consequent demand notice Annexure P/6 demanding house tax from the petitioners. Facts in this case are not in dispute. New Mandi Township, Pehowa came into existence under the Punjab New Mandi Township (Development and Regulation) Act, 1960 (in short, "the New Mandi Act"). State of Haryana respondent No. 1 issued notification dated 15.2.1971 Annexure P/1 u/s 17(1) of the New Mandi Act directing that all the powers under the Punjab Municipal Act, 1911 (now Haryana Municipal Act, 1973) shall cease to operate in the area of New Mandi Township, Pehowa, as described in the notification. Director Colonization Department, Haryana also issued letter Annexure P/2 to respondent No. 2 for not charging house tax and not to impose fines for not getting sanctioned building plans in the area of New Mandi Township. Inspite thereof, respondent No. 2 has levied house tax on the shops in the New Mandi Township and is also insisting on the petitioners to get building plans sanctioned failing which they are subjected to fines by respondent No. 2.

Respondent No. 2 in its written statement pleaded that provisions of the Municipal Act are applicable in so far as imposition of house tax is concerned. Provisions of the Municipal Act in this regard are not inconsistent with the provisions of the New Mandi Act. It-was alleged that respondent No. 2 can exercise powers under the Municipal Act. It was also pleaded that respondent No. 2 is providing civic amenities in the New Mandi and house tax is being imposed after completion of buildings and not on vacant land. Various other pleas were also raised.

Respondent No. 3 Haryana Urban Development Authority (H.U.D.A.) also filed written statement to contest the claim of the petitioners. It was pleaded that it was within the competence and power of respondent No. 2-Municipal Committee to impose tax and respondent No. 3 has nothing to do with it.

I have heard counsel for the parties and perused the case file.

Counsel for the petitioners reiterated that in view of notification Annexure P/1 issued by the State of Haryana u/s 17(1) of the New Mandi Act, respondent No. 2-Municipal Committee has no power to impose house tax on the shops situated in the New Mandi nor respondent No. 2 can require the shop owners to get building plans sanctioned from it.

On the other hand, counsel for respondents No. 2 and 3 vehemently contended that even according to writ petition, Colonization Department has since been merged with H.U.D.A.. It was argued that u/s 29, of the H.U.D.A. Act, 1977, H.U.D.A. has transferred the New Mandi to respondent No. 2-Municipal Committee and therefore, respondent No. 2 has jurisdiction to impose house tax on the buildings in the New Mandi because respondent No. 2 is providing civic amenities there.

I have carefully considered the rival contentions. Section 17 of the New Mandi Act is reproduced hereunder:--

Partial exclusion of jurisdiction of Municipal Committees, Panchayats and Town Improvement Trusts in new mandi townships.--(1) If any new mandi township or a part thereof lies within the limits of a municipality, notified area, Gram Panchayat area or local area, under the Punjab Town Improvement Act, 1922, the State Government may, by notification in the official Gazette, direct that any or all the powers under the Punjab Municipal Act, 1911, the Punjab Gram Panchayat Act, 1952, or the Punjab Town Improvement Act, 1922, as are relevant to the purposes of this Act, shall, subject to such conditions and restrictions as may be specified in the notification, cease to operate in such new mandi township or a part thereof, and the Municipal Committee, the President or any officer of the Committee, the Gram Panchayat or the Town Improvement Trust, as the case may be shall thereafter cease to have jurisdiction over that new mandi township or a part thereof, as the case may be in respect of such powers.

(2) The provisions of the Punjab Municipal Act, 1911, the Punjab Gram Panchayat Act, 1952 and the Punjab Town Improvement Act, 1952, in so far as they are inconsistent with the provisions of this Act shall not apply to a new mandi township or a part thereof.

Section 29 of the H.U.D.A. Act is reproduced hereunder:--

Power of Authority to require local authority to assume responsibility for amenities in certain cases.

Where any area has been developed by the Authority, the Authority may entrust the local authority [discharging municipal functions] within whose local limits the area so developed is situated, with the responsibility for the maintenance of the amenities which have been provided in the area by the Authority and for the provision of the amenities which have not been provided by the Authority but which in its opinion should be provided on terms and conditions agreed upon between the Authority and the local authority, and where such terms and conditions cannot be agreed upon, on terms and conditions settled by the State Government in consultation with the local authority on a reference of the matter to the State Government by the Authority.

State of Haryana has issued notification dated 15.2.1971 Annexure P/1 u/s 17(1) of the New Mandi Act and consequently, all powers under the Municipal Act have ceased to operate in the New Mandi. Consequently, respondent No. 2 Municipal Committee has no power under the Municipal Act to levy house tax on the buildings in the New Mandi or to take any other action under the Municipal Act. Jurisdiction of respondent No. 2 to exercise any power under the Municipal Act in the area of New Mandi has been completely ousted by notification Annexure P/1 issued u/s 17(1) of the New Mandi Act.

As regards contention of counsel for respondent No. 2 with reference to section 29 of the H.U.D.A. Act, it has to be noticed that respondent No. 2 has not even pleaded in the written statement that H.U.D.A. u/s 29 of the H.U.D.A. Act has entrusted respondent No. 2-Municipal Committee with the responsibility for the maintenance of amenities provided in the New Mandi by H.U.D.A. and for provision of amenities which have not been provided by H.U.D.A. nor there is any material on record in this regard. There had to be specific entrustment by H.U.D.A. to respondent No. 2 and for the said entrustment, terms and conditions thereof also had to be agreed to between H.U.D.A. and respondent No. 2 and in the absence of any agreement between them in this regard, the terms and conditions had to be settled by the State Government. u/s 29 of the H.U.D.A. Act, there is no automatic entrustment of amenities etc. in area developed by H.U.D.A. to the Municipal Committee. In the instant case, however, respondent Nos. 2 and -3 have not pleaded that u/s 29 of the H.U.D.A. Act, respondent No. 3 has entrusted the amenities to respondent No. 2 and if so when and on what terms and conditions. There is also no material on record to substantiate this contention. In the absence of any factual foundation and relevant material for applicability of section 29 of the H.U.D.A. Act, the contention raised by counsel for respondent No. 2 in this regard cannot be accepted. Mere plea of respondent No. 2 that it is providing civic amenities in the New Mandi does not depict that H.U.D.A. entrusted, the responsibility of amenities and maintenance thereof in New Mandi to respondent No. 2.

In addition to the aforesaid, even assuming that u/s 29 of the H.U.D.A. Act, H.U.D.A. entrusted the amenities to respondent No. 2, it would not automatically vest respondent No. 2 with power and jurisdiction to levy house tax and to perform other functions and duties under the Municipal Act in the New Mandi area because powers and functions of respondent No. 2 under the Municipal Act have ceased to operate in the New Mandi Area in view of notification Annexure P/1 issued u/s 17(1) of the New Mandi Act. Consequently, even if respondent No. 2 is providing civic amenities in the New Mandi area, respondent No. 2 nevertheless has no power to impose house tax or to require sanction of building plans in the New Mandi area so long as notification Annexure P/1 issued u/s 17(1) of the New Mandi Act continues to be in operation. For the reasons aforesaid, I find that notices Annexures P/4 and P/6 issued by respondent No. 2 regarding assessment and demand of house tax are completely non est and without jurisdiction. Accordingly, the instant writ petition is allowed and notices Annexures P/4 and P/6 and similar notices pertaining to all the petitioners issued by respondent No. 2 are quashed holding that so long as notification Annexure P/1 issued u/s 17(1) of the New Mandi Act continues to be in operation, respondent No. 2 has no power, authority or jurisdiction to levy house tax or to demand sanction of building plans in New Mandi area of Pehowa.