Sunday, 12 September 2021

Whether Municipal Corporation can recover property tax if it has refused to give development permission for development of property?

 In so far as the levy of taxes is concerned, Sections 128 and 129 of the Bombay Provincial Municipal Corporation Act, which governs the present Municipal Corporation, would reveal that the

recovery of municipal taxes has to be done after following the procedure prescribed therein. Nothing has been brought on record by the Municipal Corporation to point out that before the recovery of such taxes, assessment was done as required under the provision of Section 129 of the said Act, or as to whether any Bill or notice of demand as required under Section 128 of the B.P.M.C. Act was served on the petitioner. In that view of the matter, the levy of said taxes was also unsustainable in law.

IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH ATAURANGABAD

WRIT PETITION NO. 2395 of 2006

 Abhikesh Omprakash Agrawal Vs  The State of Maharahtra


CORAM : B.R. GAVAI &

N.D.DESHPANDE,JJ.

DATE : 26th August, 2009.

ORAL JUDGMENT :-[per B.R. Gavai,J.}

1] Rule. Rule made returnable forthwith.

2] By way of present petition, the petitioners are seeking directions

to the respondent No.2 and 3 to refund the amount of Development Charges

and property tax, recovered from them. The petitioners who are the owners of

the Plot, having area of 565.6 sq. Mtrs., situated in City Survey No. 5071

situated within the territorial jurisdiction of Municipal Corporation Jalgaon

desired to make construction on the plot and, therefore, submitted a plan to

the competent authority of the Municipal Corporation. The said plan was

rejected on 25th October, 2002. Again, on 29/7/2003, the petitioner submitted

an application for permission under Section 44 of the Maharashtra Regional

and Town Planning Act ( hereinafter referred to as the “MRTP Act”. )

3] It is the contention of the petitioner that alongwith the

application, the petitioner was compelled to pay the Development Charges

under Section 124E of the MRTP Act, by the authorities, under coercion. The

petitioner submits that he has deposited the Development Charges to the

tune of Rs. 18,365/-. It is the contention of the petitioner that the respondent

Corporation has recovered an amount of Rs.14,081/- towards the property

taxes. It is the contention of the petitioner that the said amount is also

recovered without there being any assessment.

4] In so far as the recovery of Development Charges is concerned,

it is governed under Section 124E of the M.R.T.P. Act. The relevant portion

reads thus :-

“124E :- (1) Any person who, after the commencement of the

Maharashtra Regional and Town Planning (Amendment) Act,

1992, intends to carry out any development or institute or

change any use of any land or building for which permission is

required under this Act, whether he has applied for such

permission or not, or who ha commenced carrying out any

such development or has carried out any such development or

instituted or changed any such use, shall apply to the Authority

within such time and in such manner as may be prescribed, for

the assessment of development charge payable in respect

thereof.

(2). The Authority shall, on such application being made

or if no such application is made, by a person instituting or

changing any use of any land or building, then after serving

a notice in writing on the person liable to such payment and

after calling for a report in this behalf from the concerned

officer of the Authority, after taking into consideration the

report aforesaid, determine whether or not and if so, what

development charge is leviable in respect of that

development or, institution of use or change of use, and

after giving the person concerned an opportunity to be

heard, shall then assess the amount of development charge

payable by such person and give to such person a notice in

writing of such assessment;

Provided that :

(a) where permission under this Act has not been granted

for carrying out the said development, the Authority may

postpone the assessment of the development charge;

(b) where the application relates to the carrying out of any

development, the Authority may refuse to assess the

amount of development charge payable by such person

concerned unless it is satisfied that the applicant has an

interest in the land or building sufficient to enable him to

carry out such development or that the applicant is able to

acquire such interest and that the applicant shall carry out

the development within such period as the Authority may

determine.

(3).The amount of Development charge as shown in the notice

of assessment shall be paid within thirty days of the date of

receipt thereof by such person and where the amount has

not been so paid or has been partly paid an interest at the

rate of eighteen percent per annum upon any amount

outstanding shall be payable from the date immediately

following the date on which the period of thirty days as

aforesaid expires till the date of payment of such amount.”

5] Perusal of the said provision would reveal that under subsection

(1) of Section 124, that if any person, who intends to carry out

any development or change any use of any land, for which permission

is required, is required to make an application for such permission.

Perusal of sub-section (2), would reveal that the Authority shall, on such

application being made or if no such application is made, by a person

instituting or changing any use of any land or building, then after serving

a notice in writing on the person liable to such payment and after calling

for a report in that behalf from the concerned officer of the authority, and

after taking into consideration the report aforesaid, determine whether or

not and if so, what development charge is leviable in respect of that

development or institution of use or change of use. It furthers reveals

that this has to be done after giving the person concerned an opportunity

to be heard.

6] Admittedly, the respondent Corporation has not been in a

position to point out any determination which is done as per the provisions of sub-section (2) of Section 124E of the M.R.T.P. Act. On the contrary, proviso (a) of the said subsection reveals that where the permission under this Act has not been granted for carrying out the said development, the authority may postpone the assessment of the development charge. Admittedly, in the present case, neither any development permission has been granted, nor any determination has been done as required under sub-section (2) of Section 124E.

In that view of the matter, without going into the question as to

whether the amount of development charge was required to be deposited under coercion, we find that the respondent is not entitled to retain the said amount of Development Charges which is recovered dehors the provisions of Section 124E of the M.R.T.P. Act. In so far as the levy of taxes is concerned, Sections 128 and 129 of the Bombay Provincial Municipal Corporation Act, which governs the present Municipal Corporation, would reveal that the

recovery of municipal taxes has to be done after following the procedure prescribed therein. Nothing has been brought on record by the Municipal Corporation to point out that before the recovery of such taxes, assessment was done as required under the provision of Section 129 of the said Act, or as to whether any Bill or notice of demand as required under Section 128 of the B.P.M.C. Act was served on the petitioner. In that view of the matter, the levy of said taxes was also unsustainable in law.

7] Rule is therefore made absolute in terms of prayer clause (B).

Needless to state that, if the petitioner develops the land in accordance with

Section 44 of the M.R.T.P. Act, the Corporation would be entitled to levy the

development charges, after following the procedure prescribed under Section

124 of the said Act. It is also further needless to state that the Corporation

would be entitled to recover the property taxes from the petitioner, however,

after following the procedure as prescribed by law.

[N.D. DESHPANDE, J.] [B.R. GAVAI,J.]


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