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Case Number

C.R No. 295 of 1999

Advocates

Mr. H.L Narula, Adv. for the Petitioner.
Ms. Amita Gupta, Adv. for the Respondent.

Judges

K. Ramamoorthy, J.

Acts

provisions of Sections 124 and 126 of the Delhi Municipal Corporation Act, 1957
SECTION 126 DELHI MUNICIPAL CORPORATION ACT 1957
SECTION 169 DELHI MUNICIPAL CORPORATION ACT 1957
SECTION 124 DELHI MUNICIPAL CORPORATION ACT 1957
provisions of Section 124(3) of the D.M.C Act, 1957,
provision to Sub-section (1) and Sub-section (2),

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Smart Summary

Judgment Summary — K. Ramamoorthy, J.

Factual and Procedural Background

The petitioner purchased a flat in the Amrit Cooperative Group Housing Society (Rashmi Apartments), Harsh Vihar, Pitampura, Delhi. On 6 July 1992 the petitioner informed the Municipal Corporation of Delhi (the Corporation or M.C.D) that he had paid the dues to the Society, had become the owner and had taken possession of the flat.

The Corporation, being aware of this position, proceeded to pass an assessment order on 25 March 1998 fixing the rateable value at Rs. 31,990. The petitioner filed an appeal under Section 169 of the Delhi Municipal Corporation Act, 1957 to the learned Additional District Judge, contending that no notice was served on him and that he was not given an opportunity to file objections, rendering the assessment order void.

The M.C.D's position before the Additional District Judge was that a consolidated notice had been served on the Amrit Cooperative Group Housing Society and that such notice sufficed for the petitioner. The Additional District Judge found that no personal notice had been served on the petitioner, and noted that the petitioner was not given an opportunity to file objections. The Additional District Judge nevertheless considered the merits and fixed the rateable value at Rs. 20,400 with effect from 1 April 1994. The petitioner challenged that decision by way of a revision petition.

Legal Issues Presented

Whether, when a property is assessed for the first time, the Commissioner is obliged under Section 124(3) of the Delhi Municipal Corporation Act, 1957 to give written notice to the owner (or lessee/occupier), and whether failure to give such notice vitiates the assessment.
Whether serving a consolidated notice on the housing society (Amrit Cooperative Group Housing Society) sufficed as notice to the petitioner/owner in the circumstances of a first-time assessment.
Whether the doctrine requiring mutation of title (i.e., that mere intimation is insufficient without mutation) applies to negate the petitioner's entitlement to written notice under Section 124(3).
Whether precedents relied upon by the M.C.D (including Municipal Corporation of Delhi v. Trigon Investment & Trading Pvt. Ltd. & Anr. and M.C.D v. C.L. Madhok & Anr.) are applicable to the scope and requirements of Section 124(3).

Arguments of the Parties

Petitioner's Arguments (as recorded)

The petitioner contended that no notice under Section 124(3) was served on him and that he was not given an opportunity to file objections to the proposed rateable value; this, he argued, rendered the assessment order void.
The petitioner relied on the provisions of Sections 124 and 126 of the Delhi Municipal Corporation Act, 1957 to submit that the Corporation was obliged to give the written notice and that failure to do so vitiated the proceedings.

Respondent / M.C.D's Arguments (as recorded)

The M.C.D's plea was that a consolidated/public notice was served on Amrit Cooperative Group Housing Society and that such notice constituted notice to the petitioner—no separate personal notice was required for passing the assessment order.
The M.C.D also pointed out that no mutation had been effected in the petitioner's name and relied upon precedent (Municipal Corporation of Delhi v. Trigon Investment & Trading Pvt. Ltd. & Anr., 62 (1996) DLT 222 (SC)) to argue that the Additional District Judge's order reducing the rateable value could not be disturbed.
Additionally, the M.C.D relied on this Court's decision in M.C.D v. C.L. Madhok & Anr. (1999 I AD (Delhi) 869) to submit that mere intimation was not sufficient and that the petitioner should have taken steps to get the property mutated.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Municipal Corporation of Delhi v. Trigon Investment & Trading Pvt. Ltd. & Anr., 62 (1996) DLT 222 (SC)	Relied upon by the M.C.D to contend that the Additional District Judge's assessment could not be challenged and, implicitly, to support that consolidated notice sufficed.	The Court held that the ratio in Trigon did not apply to the facts of this case because the Supreme Court in that case did not deal with the scope of Section 124(3) of the Delhi Municipal Corporation Act, 1957.
M.C.D v. C.L. Madhok & Anr., 1999 I AD (Delhi) 869	Relied upon by the M.C.D for the proposition that mere intimation is not enough and that mutation is necessary to establish the petitioner's status as owner for assessment purposes.	The Court observed that the Madhok decision dealt with the scope of Section 128 of the Act and therefore was not relevant to the scope of Section 124(3) relied upon in the present matter.

Court's Reasoning and Analysis

The Court proceeded by reference to the statutory scheme set out in the Delhi Municipal Corporation Act, 1957. It emphasized the text of Section 124, particularly Sub-section (3), which provides that when any land or building is for the first time assessed the Commissioner "shall also give written notice thereof to the owner or to any lessee or occupier of the land or building." The Court treated the first-time assessment of the petitioner's flat as falling squarely within the situation contemplated by Section 124(3).

The Court also quoted Section 126 (amendment of assessment list) to show the statutory framework for amendments and notice requirements, and noted that the M.C.D did not contend that the case fell within Section 126's amendment provisions.

On the facts recorded by the Additional District Judge—namely, that no personal notice was served on the petitioner and that the petitioner was not given an opportunity to file objections—the Court concluded that the statutory obligation under Section 124(3) had not been complied with. The Court rejected the M.C.D's contention that notice to the housing society sufficed as notice to the petitioner in circumstances of a first-time assessment where Section 124(3) required written notice to the owner/lessee/occupier.

With respect to precedents: the M.C.D relied on the Supreme Court decision in Trigon and on this Court's decision in Madhok. The Court analyzed applicability and found both inapposite. It concluded that Trigon did not address the scope of Section 124(3) and therefore its ratio could not be treated as governing the present case. Similarly, Madhok concerned Section 128 and therefore did not speak to the Section 124(3) obligation that was decisive here.

As a result of the statutory requirement and the factual finding of non-service of personal notice, the Court held that the assessment order could not be sustained. The Court therefore set aside the impugned decision insofar as it was adverse to the petitioner and directed the Assessing Authority to comply with Section 124(3) by serving written notice on the petitioner and then to pass an assessment order in accordance with law, allowing the petitioner the opportunity to file objections.

Holding and Implications

Holding: The Court set aside the order of the learned Additional District Judge insofar as it was against the petitioner and directed that the Assessing Authority (Assistant Assessor and Collector, M.C.D) shall serve notice on the petitioner in accordance with Section 124(3) of the Delhi Municipal Corporation Act, 1957 and thereafter pass an assessment order in accordance with law. The Court allowed the revision petition (C.R.) and made no order as to costs.

Implications:

Direct effect: The existing assessment (and the Additional District Judge's determination of rateable value insofar as it was adverse to the petitioner) is set aside. The Assessing Authority must issue the statutorily required written notice to the petitioner, provide an opportunity to object, and then make a fresh assessment in conformity with the statutory procedure.
On precedential impact: The Court explicitly stated that the Supreme Court's decision in Trigon did not address the scope of Section 124(3) and that the Madhok decision addressed Section 128; accordingly, the Court did not treat those decisions as controlling the interpretation or application of Section 124(3) in this case. The opinion does not purport to lay down a new, broader principle beyond enforcing the statutory notice requirement of Section 124(3) in first-time assessments.
Monetary adjustment: The petitioner informed the Court (without prejudice) that he had paid tax; the Court noted that after the determination of the rateable value pursuant to the fresh assessment, the M.C.D shall make any necessary adjustment of amounts paid.

This summary is based exclusively on the text of the provided opinion and does not add information beyond that opinion.

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K.S Gupta (Justice) v. Municipal Corporation Of Delhi.

K. Ramamoorthy, J.— The petitioner had purchased a flat in the Complex put up by Amrit Cooperative Group Housing Society (Rashmi Apartments), Harsh Vihar, Pitampura, Delhi. On 6.7.1992 the petitioner informed the Corporation that he had paid the dues to the Society and he had become owner and he had taken the possession of the flat also.

2. The respondent Corporation being fully aware of the position proceeded to assess the flat for the purpose of determining the property tax payable thereon. Assessment order was passed on 25.3.1998 fixing the rateable value at Rs. 31,990/-. The petitioner preferred an appeal under Section 169 of the Delhi Municipal Corporation Act, 1957 to the learned Addl. District Judge contending inter alia that no notice was served on the petitioner and no opportunity was given to him to file his objections and the order of assessment was wholly void.

3. The plea before the learned Addl. District Judge by the M.C.D was that notice was served on Amrit Cooperative Group Housing Society and that is notice on the petitioner. No separate notice was required to be served on the petitioner for concerning the issue of rateable value for passing the assessment order.

4. The learned Addl. District Judge has given a finding that no notice was served on the petitioner. The finding by the learned Addl. District Judge is :

“The appellant Counsel first of all contended that in this case no notice was served upon the appellant for proposing the R.V On the other hand, JLO submits that a consolidated notice was served upon Amrit Cooperative Group Housing Society and the copy of such notice has been placed on record. No doubt the personal notice was not served upon the appellant and so the appellant was not given the opportunity to file the objections.”

5. Having given the finding the learned Addl. District Judge proceeded to consider on the merits with reference to fixing of rateable value and the learned Addl. District Judge fixed the rateable value at Rs. 20,400/- as against that was fixed by the Assessing Officer at Rs. 31,990/- w.e.f 1.4.1994 This is challenged by the petitioner in the revision petition.

6. The learned Counsel for the petitioner Mr. H.L Narula submitted that by virtue of provisions of Sections 124 and 126 of the Delhi Municipal Corporation Act, 1957 the Corporation when it had received intimation on 6.7.1992 while making the first assessment order in respect of the flat is obliged to give notice under Section 124(3) of the Act. The failure to do so was completely vitiated the proceedings.

7. The learned Counsel for the respondent Ms. Amita Gupta submitted that there was no mutation effected showing the petitioner as the owner of the flat and notice was issued to Amrit Cooperative Group Housing Society and according to the learned Counsel the ratio laid down by the Supreme Court in the case reported in Municipal Corporation of Delhi v. Trigon Investment & Trading Pvt. Ltd. & Anr., 62 (1996) DLT 222 (SC), would govern this case and, therefore, the order of assessment passed by the Assessing Authority, as notified by the learned Addl. District Judge, fixing the rateable value at Rs. 20,400/- cannot be called in question by the petitioner.

8. The fact that the order of assessment was made for the first time with reference to the flat of the petitioner is not in dispute. The Assessing Authority proceeded to pass the assessment order treating the petitioner as owner of the flat cannot also be disputed. Section 124 of the Delhi Municipal Corporation Act, 1957 reads as under:

“124 Assessment list—(1) Save as otherwise provided in this Act, the Corporation shall cause an assessment list of all lands and buildings in Delhi to be prepared in such form and manner and containing such particulars with respect to each land and building as may be prescribed by bye-laws.

(2) When the assessment list has been prepared the Commissioner shall give public notice thereof and of the place where the list or a copy thereof may be inspected, and every person claiming to be the owner, lessee or occupier of any land or building included in the list and any authorised agent of such person, shall be at liberty to inspect the list and to take extracts therefrom free of charge.

(3) The Commissioner shall, at the same time, give public notice of a date, not less than one month thereafter, when he will proceed to consider the rateable values of lands and buildings entered in the assessment list; and in all cases in which any land or buildings is for the first time assessed [or the rateable value of any land or building is increased,] he shall also give written notice thereof to the owner or to any lessee or occupier of the land or building.

(4) Any objection to a rateable value or [any other matter] as entered in the assessment list shall be made in writing to be Commissioner before the date fixed in the notice and shall state in what respect the rateable value, [or other matter] is disputed, and all objections so made shall be recorded in a register to be kept for the purpose.

(5) The objections shall be inquired into and investigated, and the persons making them shall be allowed an opportunity of being heard either in person or by authorised agent, by the Commissioner or by officer of the Corporation authorised in this behalf by the Commissioner.

(6) When all objections have been disposed of, and the revision of the [rateable value] has been completed, the assessment list shall be authenticated by the signature of the Commissioner or, as the case may be, the officer authorised by him in this behalf, who shall certify that except in the cases, if any, in which amendments have been made as shown therein no value objection has been made to the [rateable values] or any other matters entered in the said.

(7) The assessment list so authenticated shall be deposited in the office of the Corporation and shall be open, free of charge during office hours to allow owners, lessees and occupiers of lands and buildings comprised therein or the authorised agents of such persons, and a public notice that it is so open shall forthwith be published.”

9. Under Sub-section 3, the Commissioner is obliged to give notice in a situation like the one in this case. Section 126 empowers the Commissioner to amend the assessment list. That section reads as under:

“Amendment of assessment list—(1) The Commissioner may, at any time, amend the assessment list—

(a) by inserting therein the name of any person whose name ought to be inserted; or

(b) by inserting therein any land or building previously omitted; or

(d) by increasing or reducing for adequate reasons the amount of any rateable value and of the assessment thereupon; or

(e) by making or cancelling any entry exempting any land or building from liability to any property tax; or

(f) by altering the assessment on the land or building which has been erroneously valued or assessed through fraud, mistake or accident; or

(g) by inserting or altering an entry in respect of any building, re-eracted, altered or added to, after the preparation of the assessment list:

Provided that no person shall by reason of any such amendment become liable to pay any tax or increase of tax in respect of any period prior to the commencement of the year [in which the notice under Sub-section (2) is given].

(2) Before making an amendment under Sub-section (1) the Commissioner shall give to any person affected by the amendment, notice of not less than one month that he proposes to make the amendment and consider any objections which may be made by such person.

(3) Notwithstanding anything contained in the provision to Sub-section (1) and Sub-section (2), before making any amendment to the assessment list for the years [commencing on the 1st day of April, 1988 the 1st day of April, 1989 and the 1st day of April, 1990 under Sub-section (1), the Commissioner shall give to any person affected by the amendment, notice of not less than one month at any time before the 1st day of April, 1992] that he proposes to make the amendment and consider any objection which may be made by such person.

(4) No amendment under Sub-section (1) shall be made in the assessment list in relation to—

(a) Any year prior to the year commencing on the 1st day or April, 1988, after the 31st of March, 1991;

(b) the year commencing on the 1st day of April, 1988, or any other year thereafter, after the expiry of three years from the end of the year in which the notice is given under Sub-section (2) or Sub-section (3), as the case may be:

Provided that nothing contained in this sub-section shall apply to a case where the Commissioner has to amend the Assessment list in consequence of or to give effect to any direction or order of any Court.”

10. In is not the case of M.C.D that it is a case of amendment coming under the purview of Section 126 of the Delhi Municipal Corporation Act, 1957.

11. The learned Counsel for the M.C.D Ms. Amita Gupta submitted relying upon the judgment of this Court reported in M.C.D v. C.L Madhok & Anr., 1999 I AD (Delhi) 869, that mere intimation is not enough. The petitioner should have taken steps to get the property mutated in his name.

12. In view of the provisions of Section 124(3) of the D.M.C Act, 1957, in my view, the order of assessment cannot be sustained and the determination of the rateable value by the learned Addl. District Judge at Rs. 20,400/- also cannot be sustained. The Assessing Authority after serving notice under Section 124(3) of the Act and giving opportunity to file objections then proceed to pass an order assessing the property fixing the rateable value in accordance with law. The ratio laid down by the Supreme Court in the case of 62 (1996) DLT 222 (supra), would not apply to the facts of this case because the Supreme Court did not deal with the scope of Section 124(3) of the Act. In the case reported in 1999 I AD (Delhi) 869 (supra), this Court dealt with the scope of Section 128 of the Act and, therefore, that case is not relevant.

13. The order of the learned Addl. District Judge, insofar as it is against the petitioner, is set aside. The Assessing Authority i.e the Asstt. Assessor and Collector, M.C.D shall serve notice to the petitioner and then pass assessment order in accordance with law.

14. The learned Counsel for the petitioner. Mr. Narula states that without prejudice to the rights and contention of the petitioner, the petitioner had paid the tax. After the determination of the rateable value, there shall be adjustment of the amount by the M.C.D

15. C.R is allowed. There shall be no order as to costs.

K.S Gupta (Justice) v. Municipal Corporation Of Delhi.

Judgment Summary — K. Ramamoorthy, J.

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Petitioner's Arguments (as recorded)

Respondent / M.C.D's Arguments (as recorded)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

K.S Gupta (Justice) v. Municipal Corporation Of Delhi.

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