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Case Number

W.P No. 1671/1974

Attorney(S)

Mr. Tej Raj Kapoor, Advocate for petitioner.
Mr. T. Vijayaraghavachary, Standing Counsel for Hyderabad Municipal Corporation on behalf of the Respondent.

Judges

A. Sambasiva Rao
A.C.J
Chennakesava Reddy, J.

Acts

5 rule 15

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Smart Summary

Summary of Opinion — Service of Municipal Property Tax Bill (Hyderabad)

Factual and Procedural Background

The petitioner is the owner of certain premises within the area of the Municipal Corporation of Hyderabad and was alleged to have fallen into arrears of property tax for the years 1969 to 1974. The corporation issued a demand notice dated 6-2-1974 for arrears. The petitioner challenged the demand on the ground that a bill for the tax had not been served on him as required by section 266 read with sections 630 and 631 of the Hyderabad Municipal Corporations Act, 1955.

The corporation filed a counter-affidavit asserting that bills had been sent; upon the court's request for clarity, an additional affidavit dated 6-10-1975 by the bill collector was filed. The bill collector stated that on 19-1-1974 he went to the petitioner's house at about 10 a.m., the petitioner was not present, the maid said she did not know anything, and the bill was left on a table with a request that the maid give it to the petitioner. The court accepted that the bill was left in the petitioner's premises when he was absent.

The petitioner sought quashing of the subsequent notice of demand issued under section 268. The writ petition was heard on the question of adequacy of service of the bill; other points raised by the petitioner were not fully pursued before the court because of the decision reached on service.

Legal Issues Presented

Whether a bill for property tax issued by the Municipal Corporation of Hyderabad is properly served upon the owner if it is left inside the premises with a servant when the owner or occupier is absent.
Whether service effected in the manner described satisfies the statutory requirements of section 266 read with sections 630 and 631 of the Hyderabad Municipal Corporations Act, 1955, so as to permit the issuance and enforcement of a notice of demand under section 268.

Arguments of the Parties

Petitioner's Arguments

The petitioner (represented by Sri Tej Raj Kapoor) contended that leaving the bill on the premises with a servant while the owner was absent did not constitute proper or adequate service under the statute, and therefore the subsequent demand must fail.
Additional points raised by the petitioner (but not decided due to the court's finding on service) were: (a) claims for more than three years are barred by limitation; (b) the amount claimed is incorrect; and (c) the demand improperly clubbed three premises together when two were joint family assets and one was self-acquired.

Corporation's Arguments

The Municipal Corporation maintained that bills had been sent to the petitioner and that service had occurred. In an additional affidavit, the bill collector deposed that he attended the petitioner's residence, found the petitioner absent, left the bill on a table and asked the maid servant to give it to the petitioner.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Hardyal v. Pir Sant Das, (10 Indian Cases 242) (Punjab High Court)	Holding that where a person was absent from home and the summons were handed to his father without any attempt to find him, such service was not within the meaning of section 78 CPC.	The court relied on this decision to support the view that mere absence from home and handing a process to a family member without reasonable attempts to locate the person does not satisfy the statutory requirement of "not found."
Drasarh Chand Gain v. Kanak Sarkar, AIR 1921 Cal 638 (Calcutta High Court)	Construction of Order 5 Rule 15 (then in CPC): an attempt must be made to find the defendant, including enquiries from neighbours or others, before treating a person as "not found."	The court cited it to buttress the interpretation that "not found" implies diligent search and reasonable efforts, not mere physical absence when one visit is made.
Writ Petitions Nos. 1652 & 1655 of 1968 (order dated 9-12-1969) — Chinnappa Reddy, J.	Observed that a bill addressed to the landlord and left at the premises cannot be treated as a bill served on the occupier merely because it was left on the premises.	Used as supporting authority for the proposition that leaving a bill at the premises without adequate attempt to serve the person is insufficient.
W.P. No. 4737/70 (order dated 9-2-1972) — Valdya, J.	Similar view to Chinnappa Reddy J.'s order that leaving a bill at premises does not amount to service on the occupier in all circumstances.	Relied upon as further judicial support for the court's construction of "not found" and the necessity for reasonable efforts to effect personal service.

Court's Reasoning and Analysis

The court's analysis proceeded by reference to the statutory scheme and the factual record as follows:

Statutory framework: Section 266 of the Hyderabad Municipal Corporations Act, 1955 requires that when property tax has become due, the commissioner "shall" cause a bill to be served upon the person liable for payment. The bill must specify details and provides the basis for an appeal; a notice of demand under section 268 can only be issued if the amount charged in the bill is not paid within fifteen days of service.
Because the statute uses mandatory language ("shall") and ties subsequent enforcement (notice of demand, distress) to the prior service of the bill, valid and effective service of the bill is essential to the collection process. The bill determines the taxpayer's rights (opportunity to object and appeal) and duties.
The Act itself prescribes modes of service in sections 630 and 631. Clause (b) of these sections permits leaving the notice at the person's last known place of abode or giving it to an adult male member or servant only "if a person is not found."
The court focused on the meaning of the phrase "if such person is not found." It rejected the argument that "not found" equates simply to the person's absence at the time of a single visit. The court explained that a person may be absent from his residence at times but still be "found" if reasonable inquiries or attempts to locate him were not made. Thus, "not found" contemplates cases where the person cannot be located despite reasonable and diligent efforts (for example, whereabouts unknown or indications of evasion), not mere temporary absence.
The court reinforced this construction by reference to authorities construing similar language in the Code of Civil Procedure and earlier judicial decisions which held that handing process to a family member because the defendant happened to be absent, without efforts to find him, did not constitute valid service.
Applying this principle to the facts: the bill collector made one visit at about 10 a.m., found the petitioner absent, the maid said she did not know anything, and the bill was left on a table with a request that the maid give it to the petitioner. The bill collector did not make further enquiries (for instance, ask the maid where the petitioner had gone or when he would return) and did not otherwise attempt to locate the petitioner. The court held that these facts did not show the required diligence or reasonable efforts to find the petitioner; therefore the petitioner could not be said to have been "not found" within the meaning of the service provisions.
Conclusion of reasoning: because effective service of the bill as required by the statute had not been shown, the subsequent notice of demand issued under section 268 could not be enforced.

Holding and Implications

Final Disposition: The writ petition was ALLOWED IN PART. The court quashed the notice of demand bearing S. No. 27, Book No. 761 dated 6-2-1974 issued under section 268 of the Act.

Consequences and practical implications:

Direct effect on the parties: The notice of demand challenged by the petitioner is quashed and cannot be enforced as it was predicated on a bill that was not validly served.
On constitutional challenge: The court refused to grant relief for any declaration that sections 268 and 269 of the Act were ultra vires Article 14 of the Constitution because no grounds for such a declaration had been presented.
On other contentions: Because the court's decision rested on inadequacy of service, it did not decide the petitioner's other contentions (limitation, correctness of amount, and clubbing of premises). The petitioner remains at liberty to raise those contentions if the corporation pursues alternate remedies to recover the tax.
On future conduct by the corporation: The decision does not prevent the corporation from issuing another bill and serving it in accordance with the statutory requirements (i.e., after making reasonable and diligent efforts to locate the person so that service by leaving the bill with a servant or at the last known abode would be lawful if the person is truly "not found").
Costs: The parties were directed to bear their own costs; an advocate's fee of Rs. 100 was noted.

This summary is based exclusively on the contents of the provided opinion and does not add or infer information beyond what is stated therein.

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Raj Kumar v. Commissioner (Now Special Officer) Municipal Corporation Of Hyderabad .

Chennakesava Reddy, Acj.:-

(1) (judgment of the court delivered by the hon'ble the acting chief justice) how is a bill for property tax issued by the municipal corporation of hyderabad to be served on the owner? would it been effective and adequate service, if it is left in the premises after informing the same to a servant, when the owner or occupier is absent at the time when the corporation official takes notice to the premises ? the petitioner in this case contends that ic is not proper service, while the corporation maintains that it is.

(2) The petitioner is the owner of certain premises within the area of the municipal corporation of hyderabad. It is said that he fell into arrears of property tax from 1969 to 1974. It is the case of the petitioner that no bill of tax of the property had been served in regard to the amount claimed in the demand notice dated 6 - 2 - 1974 as required under sec. 266 read with sections 630 and 631. In the counter affidavit the corporation has asserted that before issuing the demand notice, bills were sent to the petitioner. Since the manner of sending the bills has not been explicitly stated in the counter affidavit, we have given an opportunity to the corporation to file another affidavit stating the manner of sending the notice. Accordingly, an affidavit of 6th october, 1975 has been filed. It has been sworn to by the biil collector who claims to have taken the notice to the petitioner's premises. This is what he says in additional affidavit:

"on 19 - 1 - 1974 1 went to the house of the petitioner bearing no. 10 - 2 - 350 situated at asifnagar, hyderabad to serve the bill showing the arrears of house tax of rs 5,906 - 02 ps at about 10 a. M. But the petitioner was not there at that time. The maid servant said that she does not know anything. Thereupon i left the said bill on the table asking her to give it to the petitioner and came away."

(3) We have no reason to doubt the statements made in the two counter affidavits so, we accept that the notice was left in the premises of the petitioner when he was absent.

(4) Sri tej ra4 kapoor for the petitioner, contends that this is not an adequate service and so, the entire demand, falls to the ground. In addition, he raises three other points that the claim for more than three years is barred by limitation, that the, amount claimed is, not. Correct and that the demand is for three premises and the clubbing of them is unwarranted, since two of the premises are joint family assets while one is a self - acquired property. The point that has been debated before us is in regard to the. Adequacy of service of the bill.

(5) Sec. 266 of. The hyderabad municipal corporations act, 1955 (here inafter called "the act") lays down that when any property tax has become due, the commissioner, shall, with the least practicable delay, cause to he served upon the, person liable for the payment thereof a bill for the sum due. In sub - sec. (2) what should be specified in the bill, are stated. Equally important is the provision for an appeal against the decision indicated in the bill. Then comes the notice of demand which is provided under sec. 268. Its provisions also art very materiel and important. It says that when the amount of tax for which any bill has been served as aforesaid is not paid into the municipal office within fifteen days from the service thereof, the commissioner may cause to be served upon the person liable for the payment of the same a notice of demand in the form prescribed. Then the succeeding sections lay down the procedure for collecting the amounts in demand through process of distress. Now these provisions read together clearly show that service of bill for tax upon the person liable for the payment is essential; we may say mandatory. Sub - sec. (i) of sec. 266 uses the word 'shall' when it provides for service of the bill upon the person liable for the payment. Apart from the use of the word 'shall' the very fact that it should contain all the details about the amount charged demonstrates that service of the bill is very important. The person on whom the bill fs served can raise objections and prefer an appeal. Thus, his rights and duties are sought to be determined through the bill. Further, a notice of demand can be issued only when the person liable for the payment does not pay the amount charged under the bill within fifteen days from the service if he does not. Distress proceedings will follow. The importance of service of notice on the concerned person is thus easily discernible and that is why the statute uses the mandatory language in regard to its service. It should follow that if there is no bill or no service as postulated under sec. 266, there cannot be any demand for tax.

(6) The act itself provides for the manner of service of bills, notices etc. On owners or occupiers of premises in sections 630 and 631. For the purpose of this case it is immaterial whether the earlier section or the later section that applies. Sec. 630 provides for four modes of effecting service on owners of premises and other persons, while sec. 631 provides for three modes of service on owner or occupier of premises. From the counter affidavits filed on behalf of the corporation, it is to be seen whether clause (b) of either section has been followed. With some variations both the clauses say that if a person " is not found", the notice will have to be left in the last known place of abode in the city or by giving or tendering the same to some adult male member or servant of his family. What is crucial is the meaning of the expression 'if such person fs not found'. Cculd it be said that the person is not found if he is absent when the corporation official goes to his house to serve the bill? we do not think so. If that were the intention of the legislature then it could have simply said "if such person is absent. " certainly there is difference a vital difference at that between a person being absent and a person not being found. The owner or occupier of the premises is not expected to be in the house all the time though it is his residence. If he is absent from his residence when the corporation official goes to serve the bill, it cannot be said that he is not found. We have already noticed what importance the statute attaches to the service of the bill on the person liable to pay tax. That fs why in sections 630 and 631 various modes of service were provided. The statute enables the corporation official to leave the bill in the premises or give or tender it to an adult male member or servant of the family, only when the person liable is not found and not when he is absent.

(7) This idea is further strengthened by the other expressions used in claust (b) of sec. 630. It requires the bill to be left at the last known place of abode of the person if he is not found. There cannot be any question of leaving a notice or bill at the last known place of abode if the person is merely absent. That need arises only when he is not found despite reasonable diligence and effort made by the corporation official to find him. Take for instance, his whereabouts are not known, or the person is not in the house at reasonable times though the corporation official has gone to his residence more than once, thereby suggesting an attempt to evade the service of notice or bill. These are only a few illustrations of the person not being found and are, by no means, exhaustive. The concise oxford dictionary gives the meaning of the word "find" as "discover by search: discover". When a person is merely absent, it would be to pervert the language of the expression if ft is said that he is not found. So, reading sections 266, 630 and 631 together a bill for tax can be left in the residence of the person liable only "if he is not found" despite diligent and reasonable effort made by the corporation official to find him.

(8) We may usefully refer to a few decisions which support this construction we have laid on the expression 'not found', under sec. 78 of the code of civil procedure of 1882 summons can be handed over to some member of the family if the person concerned was not found. The punjab high court held in hardyal vs. Pir sant das (1) 10 indian cases 242 that in the case of the person's absence from home and when the summons were handed over to the father, the summons was not duly served within the meaning of sec. 78. As it could not be said that the defendant ''could not be found" when no attempt whatever was made to find him and there was nothing to show that he was deliberately keeping out of the way to avoid service. A division bench of the calcutta high court in drasarh chand gain vs. Kanak sarkar (2) (air 1921 calcutta 638) took the same view while construing the language of order 5 rule 15 c. P. C as it then stood. The court held that an at attempt should be made to find out the defendant by an enquiry from his neighbours or other persons. In w. P. Nos. 1652 and 1655 of 1968 chinnappa reddy. J. Held in his order daced 9 - 12 - 1969 that the bill addressed to the landlord and left at the premises cannot be treated as a bill served on the occupier merely because it is left on the premises. Valdya, j. Took the 'same view in his order dated 9. 2. 1972. In w. P. No. 4737/70.

(9) Now applying this principle to the facts of the case, the bill collector has gone to the house of the petitioner only once. The petitioner was not there at that time. The maid servant merely said that she did not know anything. Thereupon the bill was left on the table asking the maid servant to give it to the petitioner. The bill collector does not even pretend to have made any other enquiries, at least from the maid servant, as to where the petitioner has gone or when he would return. So, it is impossible to say that he has made any attempt to find the petitioner. With the result it cannot be held that the petitioner was not found, so that the leaving of the notice on the table in his premises could be held to be sufficient service. The conclusion is that there is no service of the bill and therefore the subsequent demand cannot be enforced.

(10) In the result, the petition will have to be allowed to the extent that it seeks a direction to quash the notice of demand bearing s. No. 27 book no. 761 dated 6 - 2 - 1974 under sec. 268 of the act. No grounds have been stated before us for declaring sections 268 and 269 of the act as ultra vires of art. 14 of the constitution and so that part of the relief is refused.

(11) In view of the view we have taken on the question of inadequacy of service of the bill and in consequence we are quashing the notice of demand, we need not go into the other questions raised on behalf of the petitioner. If the corporation pursues other remedies to recover the tax, the petitioner will beat liberty to raise those contentions. Nor this decision of ours prevents the corporation from issuing another bill and serve it on the petitoner in accordance with the statute, if it is advised that the said procedure is still available to it.

(12) The writ petition is. Therefore, allowed partly, but in the circumstances of the case, we direct the parties to bear their own costs. Advocate's fee rs. 100/ -

Raj Kumar v. Commissioner (Now Special Officer) Municipal Corporation Of Hyderabad .

Summary of Opinion — Service of Municipal Property Tax Bill (Hyderabad)

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Petitioner's Arguments

Corporation's Arguments

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Raj Kumar v. Commissioner (Now Special Officer) Municipal Corporation Of Hyderabad .

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