Municipal Corporation of Delhi Vs. Sant Lal Malik and Another
EmailAppeal: Civil Appeal No. 13377 of 1996 ,
( Arising out of SLP (C) No. 19311 of 1991 )
( Arising out of SLP (C) No. 19311 of 1991 )
Petitioner: Municipal Corporation of Delhi
Respondent: Sant Lal Malik and Another
Apeal: Civil Appeal No. 13377 of 1996 ,
( Arising out of SLP (C) No. 19311 of 1991 )
( Arising out of SLP (C) No. 19311 of 1991 )
Judges: S.C. AGRAWAL & G.T. NANAVATI , JJ.
Date of Judgment: Oct 29, 1996
Head Note:
MUNICIPALITIES
Delhi Municipal Corporation Act, 1957 Section 124
Section 124 , 126 – House Tax assessment -Earlier assessment on comparative rental basis – After tenant vacated , additional construction of garage and servant quarter and a store -Subse-quent assessment w.e.f. 1.4.80 under Section 6(1) of Delhi Rent control Act by talking prince of land and cost of construction of entire building .Held that in view of Dr. Balbir Singh’s case , the rateable value has to be determined in accordance with Section 6 (1) (A)(2)(b) of DRC Act . Matter remanded back for fresh determi-nation , if assessment in accordance with Section 6 (1) (A) (2)(b) (Para 6)
Cases Reffered:
1. Court in Balbir Singh ( Dr ) v. Municipal Corpn. of Delhi. ( (1985) 1 SCC 167 (Para 3 & 5)
JUDGEMENT:
ORDER
1 . Special leave granted .
2 . This appeal relates to the assessment of property tax in respect of house property bearing No. B.B. 16 , G.K. Enclave , New Delhi , belonging to Respondent 1. The said property was initially let out to a tenant and it was being assessed at a rateable value of Rs 4860 per annum fixed on comparative rental basis , with effect from 1971 . Subsequently the tenant vacated the premises and it is in occupation of Respondent 1. Additional construc-tions , i.e. , a garage , a servant quarter and a store , were made by Respondent 1 during October 1979 to July 1980 . The servant quarter was let out but the garage and store were in self-occupa-tion of Respondent 1 . Assessment proceedings were initiated by the Deputy Assessor and Collector of the appellant who passed an order dated 28-6-1988 whereby the rateable value with effect from 1-4-1980 was assessed at Rs 9120 per annum and for the subsequent period with effect from 1-4-1988 the rateable value was assessed at Rs 8970 per annum . The said amount of Rs 8970 was determined under Section 6(l) of the Delhi Rent Control Act , 1958 ( herei-nafter referred to as ” the Act ” ) by taking into consideration the price of the land and the total cost of construction of the entire building . Respondent 1 filed an appeal against the said order passed by the Deputy Assessor and Collector which was disposed of by the Additional District Judge , Delhi by judgment dated 15-10-1990 . The Additional District Judge has upheld the assessment of rateable value of Rs 9120 for the period from 1-4-1980 to 31-3-1985 , but has differed from the assessment made by the Deputy Assessor and Collector in respect of the period from 1-4-1985 and has assessed the rateable value at Rs 6900 per annum with effect from 1-4-1985 . The Additional District Judge has arrived at the rateable value of Rs 6900 by adding to the rate-able value of Rs 4860 for the original structure the rateable value for Rs 2040 determined in respect of the additional struc-ture on costs basis .
3 . Feeling aggrieved by the judgment dated 15-10-1990 passed by the Additional District Judge , the appellant filed a writ peti-tion in the High Court , which has been dismissed by the High Court by the impugned order dated 24-7-1991 on the view that the order passed by the Additional District Judge is in accordance with the law laid down by this Court in Balbir Singh ( Dr ) v. Municipal Corpn. of Delhi. ( (1985) 1 SCC 167
4 . Ms Madhu Tewatia , the learned counsel appearing for the ap-pellant , has submitted that in the matter by assessing the rate-able value of Rs 6900 for the period from 1-4-1985 the Additional District Judge has not correctly applied the law laid down by this Court in Balbir Singh v. Municipal Corpn. of Delhi and that the said rateable value had been correctly assessed by the Deputy Assessor and Collector at Rs 8970 . The learned counsel concedes that the Deputy Assessor and Collector had wrongly fixed the rateable value of Rs 9120 for the period up to 31-3-1988 and that it should have been fixed up to 31-3-1985 only and that from 1-4-1985 the rateable value has to be fixed by taking into considera-tion the price of land and cost of construction of entire build-ing and determining the standard rent in accordance with Section 6(l)(A)(2)(b) of the Act .
5 . We have perused the judgment in Balbir Singh v. Municipal Corpn. of Delhi. In the said judgment this Court , while dealing with the fourth category of premises , i.e. , where the premises are constructed in stages , has observed .
” The basic point to be noted in all these cases is – and this is what we have already emphasised earlier – that the formula set out in sub- sections (1)(A)(2)(b) and (1)(B)(2)(b) of Section 6 cannot be applied for determining the standard rent of an addition , as if that addition was the only structure standing on the land . The assessing authorities cannot deter-mine the standard rent of the additional structure by taking the reasonable cost of construction of the additional structure and adding to it the market price of the land and applying the statutory percentage of 7 1/2 to the aggregate amount . The market price of the land cannot be added twice over , once while determining the standard rent of the original structure and again while determining the standard rent of the additional structure . Once the addition is made , the formula set out in sub-sections (1)(A)(2)(b) and (1)(B)(2)(b) of Section 6 can be applied only in relation to the premises as a whole and where the additional structure consists of a distinct and separate unit of occupation , the standard rent would have to be appor-tioned in the manner indicated by us in the earlier part of this judgment . ”
6 . In view of these observations , it must be held that the rateable value should have been assessed in accordance with Section 6(l)(A)(2)(b) of the Act for the premises as a whole . In the present case , the Deputy Assessor and Controller has made the assessment of rateable value under Section 6(l) of the Act for the building as a whole . As to whether the said assessment of rateable value has been correctly made under Section 6(l)(A)(2)(b) of the Act is a matter which was required to be considered by the Additional District Judge in the appeal filed by Respondent 1 . The Additional District Judge has , however , not examined the matter in this light .
7 . The appeal is , therefore , allowed , the impugned judgment of the High Court dated 24-7-1991 and the judgment of the Additional District Judge , Delhi dated 15-10-1990 are set aside and the matter is remanded to the Additional District Judge who will decide the appeal of Respondent 1 on merits on the question whether the assessment of the rateable value of Rs 8970 by the Deputy Assessor and Controller has been made in accordance with Section 6(l)(A)(2)(b) of the Act . There will be no order as to costs .
1 . Special leave granted .
2 . This appeal relates to the assessment of property tax in respect of house property bearing No. B.B. 16 , G.K. Enclave , New Delhi , belonging to Respondent 1. The said property was initially let out to a tenant and it was being assessed at a rateable value of Rs 4860 per annum fixed on comparative rental basis , with effect from 1971 . Subsequently the tenant vacated the premises and it is in occupation of Respondent 1. Additional construc-tions , i.e. , a garage , a servant quarter and a store , were made by Respondent 1 during October 1979 to July 1980 . The servant quarter was let out but the garage and store were in self-occupa-tion of Respondent 1 . Assessment proceedings were initiated by the Deputy Assessor and Collector of the appellant who passed an order dated 28-6-1988 whereby the rateable value with effect from 1-4-1980 was assessed at Rs 9120 per annum and for the subsequent period with effect from 1-4-1988 the rateable value was assessed at Rs 8970 per annum . The said amount of Rs 8970 was determined under Section 6(l) of the Delhi Rent Control Act , 1958 ( herei-nafter referred to as ” the Act ” ) by taking into consideration the price of the land and the total cost of construction of the entire building . Respondent 1 filed an appeal against the said order passed by the Deputy Assessor and Collector which was disposed of by the Additional District Judge , Delhi by judgment dated 15-10-1990 . The Additional District Judge has upheld the assessment of rateable value of Rs 9120 for the period from 1-4-1980 to 31-3-1985 , but has differed from the assessment made by the Deputy Assessor and Collector in respect of the period from 1-4-1985 and has assessed the rateable value at Rs 6900 per annum with effect from 1-4-1985 . The Additional District Judge has arrived at the rateable value of Rs 6900 by adding to the rate-able value of Rs 4860 for the original structure the rateable value for Rs 2040 determined in respect of the additional struc-ture on costs basis .
3 . Feeling aggrieved by the judgment dated 15-10-1990 passed by the Additional District Judge , the appellant filed a writ peti-tion in the High Court , which has been dismissed by the High Court by the impugned order dated 24-7-1991 on the view that the order passed by the Additional District Judge is in accordance with the law laid down by this Court in Balbir Singh ( Dr ) v. Municipal Corpn. of Delhi. ( (1985) 1 SCC 167
4 . Ms Madhu Tewatia , the learned counsel appearing for the ap-pellant , has submitted that in the matter by assessing the rate-able value of Rs 6900 for the period from 1-4-1985 the Additional District Judge has not correctly applied the law laid down by this Court in Balbir Singh v. Municipal Corpn. of Delhi and that the said rateable value had been correctly assessed by the Deputy Assessor and Collector at Rs 8970 . The learned counsel concedes that the Deputy Assessor and Collector had wrongly fixed the rateable value of Rs 9120 for the period up to 31-3-1988 and that it should have been fixed up to 31-3-1985 only and that from 1-4-1985 the rateable value has to be fixed by taking into considera-tion the price of land and cost of construction of entire build-ing and determining the standard rent in accordance with Section 6(l)(A)(2)(b) of the Act .
5 . We have perused the judgment in Balbir Singh v. Municipal Corpn. of Delhi. In the said judgment this Court , while dealing with the fourth category of premises , i.e. , where the premises are constructed in stages , has observed .
” The basic point to be noted in all these cases is – and this is what we have already emphasised earlier – that the formula set out in sub- sections (1)(A)(2)(b) and (1)(B)(2)(b) of Section 6 cannot be applied for determining the standard rent of an addition , as if that addition was the only structure standing on the land . The assessing authorities cannot deter-mine the standard rent of the additional structure by taking the reasonable cost of construction of the additional structure and adding to it the market price of the land and applying the statutory percentage of 7 1/2 to the aggregate amount . The market price of the land cannot be added twice over , once while determining the standard rent of the original structure and again while determining the standard rent of the additional structure . Once the addition is made , the formula set out in sub-sections (1)(A)(2)(b) and (1)(B)(2)(b) of Section 6 can be applied only in relation to the premises as a whole and where the additional structure consists of a distinct and separate unit of occupation , the standard rent would have to be appor-tioned in the manner indicated by us in the earlier part of this judgment . ”
6 . In view of these observations , it must be held that the rateable value should have been assessed in accordance with Section 6(l)(A)(2)(b) of the Act for the premises as a whole . In the present case , the Deputy Assessor and Controller has made the assessment of rateable value under Section 6(l) of the Act for the building as a whole . As to whether the said assessment of rateable value has been correctly made under Section 6(l)(A)(2)(b) of the Act is a matter which was required to be considered by the Additional District Judge in the appeal filed by Respondent 1 . The Additional District Judge has , however , not examined the matter in this light .
7 . The appeal is , therefore , allowed , the impugned judgment of the High Court dated 24-7-1991 and the judgment of the Additional District Judge , Delhi dated 15-10-1990 are set aside and the matter is remanded to the Additional District Judge who will decide the appeal of Respondent 1 on merits on the question whether the assessment of the rateable value of Rs 8970 by the Deputy Assessor and Controller has been made in accordance with Section 6(l)(A)(2)(b) of the Act . There will be no order as to costs .
