Municipal Corporation of Ahmedabad V. New India Assurance Co. Ltd

FA/2500/1993

AI Insights

The case revolves around a dispute concerning the assessment of the Gross Rateable Value (GRV) of a rented premises occupied by The New India Assurance Co. Ltd. The premises, located in Ward Ellis Bridge-A/1, were initially assessed at Rs. 4,47,548 by the Assessor and Tax Collector of the Ahmedabad Municipal Corporation. The New India Assurance Co. Ltd., after appealing to the Small Causes Court, had the GRV reduced to Rs. 2,37,384, as the tax paid directly by them to the Corporation was deducted from the assessment. The Municipal Corporation of Ahmedabad challenged this reduction, leading to the present appeal.

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 816098 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 28-10-2015
• Assessment Year: misc
• Other Referred Cases: MUNICIPAL CORPORATION OF THE CITY OF AHMEDABAD vs. CANARA BANK, CANARA BANK AND ANOTHER vs. MUNICIPAL CORPORATION OF AHMEDABAD
• Laws Referred To: Bombay Provincial Municipal Corporations Act, 1949
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: RAJNI MEHTA
• Assessee Lawyers: SN SHELAT
• Keywords: Assessment year 1988-89; Municipal tax; Small Causes Court; Gross Rateable Value; Municipal Valuation Appeal
• Section: 406; 411

Judgement Text

"C/FA/2500/1993 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL NO. 2500 of 1993 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE S.R.BRAHMBHATT and HONOURABLE MR.JUSTICE R.P.DHOLARIA ========================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ? ================================================================ MUNICIPAL CORPORATION OF AHMEDABAD....Appellant Versus NEW INDIA ASSURANCE CO. LTD....Defendant ================================================================ Appearance: MR SN SHELAT, ADVOCATE for the Appellant MR RAJNI H MEHTA, ADVOCATE for the Defendant ================================================================ CORAM: HONOURABLE MR.JUSTICE S.R.BRAHMBHATT and HONOURABLE MR.JUSTICE R.P.DHOLARIA Date : 28/10/2015 Page 1 of 6 C/FA/2500/1993 JUDGMENT ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE S.R.BRAHMBHATT) 1. Challenge in the instant Appeal filed under Section­411 of the Bombay Provincial Municipal Corporations Act, 1949 (“BPMC Act” for short) is to the correctness of the judgment and order dated 4.6.1990, rendered in Municipal Valuation Appeal No. 15689 of 1988, by the learned Judge, Small Causes Court, Ahmedabad, by which the Municipal Valuation Appeal, filed by the respondent – The New India Assurance Co. Limited, under Section­406 of the Act, has been partly allowed and thereby the Gross Rateable Value (“GRV” for short) of the premises situated in Ward Ellis Bridge­A/1, bearing F.P. No.173 of 302, which was fixed at Rs.4,47,548/­ by the Assessor and Tax Collector of the Municipal Corporation has been reduced and fixed at 2,37,384/­ for the Assessment Year 1988­89. 2. Brief facts of filing of the instant Appeal are that the respondent­ The New India Assurance Co. Ltd. having its registered Office at Bombay and Regional Office at the address stated in the Appeal Memo, hired the above premises, situated in Ward Ellis Bridge­A/1, bearing F.P. No.173 of 302 on rent in the year 1985 at monthly rent of Rs. 6/­ per sq. feet and had also agreed to pay Rs. 6/­ per month as the service charges for air­conditioning of the whole building, which has to be provided by the landlord. The area of the premises is 2198 sq. feet. The premises is situated at 3rd Floor of Popular House, Near Income Tax Office, Ashram Road. Since the landlord did not provide the air conditioning facility, respondent also did not pay the air­conditioning charges, but later on they compromised and settled the rent of the premises at Rs. 9/­ per month per sq. feet, which works out at Rs. 19,782/­ per month. The Page 2 of 6 C/FA/2500/1993 JUDGMENT Municipal Taxes are paid by the respondent – tenant directly to the Municipal Corporation. The Assessor and Tax Collector of the Ahmedabad Municipal Corporation had assessed the GRV at Rs. 4,47,548/­ for the Assessment Year 1988­89 in respect of the premises occupied by the respondent – Insurance Company. 3. Aggrieved thereby, the respondent had filed an Appeal being Municipal Valuation Appeal No. 15689 of 1988 under Section­406 of the BPMC Act, before the learned Judge, Small Causes Court at Ahmedabad. 4. The learned Judge, Small Causes Court, Ahmedabad, on appreciation of evidence and considering the fact that the tax of the premises, which was paid by the respondent directly to the Municipal Corporation, is required to be deducted and, accordingly, the GRV was fixed at Rs. 2,37,384/­ instead of Rs. 4,47,548/­ fixed by the Assessor and Tax Collector of the Ahmedabad Municipal Corporation, which has given rise to the instant Appeal filed at the instance of the Ahmedabad Municipal Corporation ­ original respondent. 5. Mr. Shelat, learned Senior Advocate for the appellant ­ Ahmedabad Municipal Corporation, submitted that if the Municipal Tax was paid by the tenant directly to the Corporation, then in that case, the said amount has to be included in the annual letting value of the rented premises. In support of the aforesaid submission, Mr. Shelat has relied upon the decision of the Full Bench of this Court in the case of MUNICIPAL CORPORATION OF THE CITY OF AHMEDABAD vs. CANARA BANK, reported in Vol, XXXIII (2) GLR, 1086, which has been confirmed by the the Supreme Court in the case of CANARA BANK AND ANOTHER vs. MUNICIPAL CORPORATION OF AHMEDABAD, reported in (1996) 7 SCC 298. He therefore submitted that in view of the settled Page 3 of 6 C/FA/2500/1993 JUDGMENT principle enunciated by the Supreme Court, the impugned judgment and order passed by the learned Judge, Small Causes Court, Ahmedabad, reducing the GRV of the premises in question, deserves to be quashed and set aside by allowing this Appeal and thereby restoring the GRV fixed at Rs. 4,47,548/­ by the Assessor and Tax Collector of Ahmedabad Municipal Corporation. He, therefore, urges to allow this Appeal. 6. Mr. Mehta, learned Senior Advocate for the respondent – The New Indian Assurance Co. Limited has supported the impugned judgment and order and submitted that the learned Judge of the Small Causes Court, Ahmedabad, has committed no illegality since the Full Bench decision of this Court, which has been confirmed by the Supreme Court, cited by Mr. Shelat, learned Senior Advocate for the appellant – Corporation, has been delivered on 19.6.1992, whereas the judgment and order impugned in the instant appeal has been delivered by the learned Judge, Small Causes Court, Ahmedabad, on 4.6.1990 i.e. prior to judgment of this Court. Mr. Mehta, learned Senior Advocate for the respondent– Insurance Company submitted that in view of the settled principle of law enunciated by the Supreme Court, appropriate order may be passed. 7. We have considered the submissions advanced by Mr. Shelat, learned Senior Advocate for the appellant and Mr. Mehta, learned Senior Advocate for the respondent. We have also perused the impugned judgment and order as well as the decisions cited at the Bar. 8. It has been held by the Full Bench of this Court in the case of MUNICIPAL CORPORATION OF THE CITY OF AHMEDABAD vs. CANARA BANK (supra) that if the Municipal Tax paid by the tenant directly to the Corporation, the said amount has to be included in the annual letting value of the rented premises. The principle enunciated by Page 4 of 6 C/FA/2500/1993 JUDGMENT the Full Bench of this Court has been confirmed by the Supreme Court in the case of CANARA BANK AND ANOTHER vs. MUNICIPAL CORPORATION OF AHMEDABAD (supra). In view of the settled principle of law enunciated by the Full Bench of this Court, which has been confirmed by the Supreme Court, it has to be held that, if the Municipal Tax paid by the tenant directly to the Municipal Corporation, the said amount has to be included in the annual letting value of the rented premises. 9. Seen in the above context, the impugned judgment and order passed by the learned Judge, Small Causes Court, Ahmedabad, deserves to be quashed and set aside by allowing this Appeal and thereby restoring the GRV of the premises in question fixed at Rs. 4,47,548/­ by the Assessor and Tax Collector of the Ahmedabad Municipal Corporation for the Assessment Year 1988­89. 10. For the foregoing reasons, the Appeal succeeds and accordingly it is allowed with no order as to costs. The impugned judgment and order dated 4.6.1990, rendered in Municipal Valuation Appeal No. 15689 of 1988 passed by the Judge, Small Causes Court, Ahmedabad, is hereby quashed and set aside. Resultantly, the Gross Rateable Value of the premises in question fixed at Rs. 4,47,548/­ by the Assessor and Tax Collector, Ahmedabad Municipal Corporation for the Assessment Year 1988­90 is hereby confirmed and restored. (S.R.BRAHMBHATT, J.) Page 5 of 6 C/FA/2500/1993 JUDGMENT (R.P.DHOLARIA,J.) pallav Page 6 of 6 "