The Madras Sanskrit College & S.S.V. Patasala v. Chennai Metropolitan Water Supply And Sewerage Board

IN THE HIGH COURT OF JUDICATURE AT MADRASDate : 27.07.2009CORAMTHE HONOURABLE MR. JUSTICE N. PAUL VASANTHAKUMARWrit Petition Nos.8958 to 8960 of 2001The Madras Sanskrit College & S.S.V. Patasala,Represented by its SecretaryB.Madhavan,No.84, Royapettah High Road,Mylapore,Chennai – 600 004. ..Petitioner in all the WPs.- Vs -1. Chennai Metropolitan Water Supply And Sewerage Board, represented by its Managing Director, No.1, Pumping Station Road, Chennai – 600 002.2. Senior Accounts Officer, Area Office VI, No.1, Dr. Ranga Road, Abhiramapuram, Chennai – 600 018. ..Respondents in all the WPs. Writ Petition No. 8958 of 2001 has been filed under Article 226of the Constitution of India praying for the issuance of a Writ ofCertiorari calling for the records of the 1st respondent inCMC.No.6/096/0613/00-01 being arrears slip of tax & charges dated25.09.2000 intimating an arrear of water tax of Rs.7385.90 for theperiod 1/93-94 to 1/2000-01 relating to 7, Royapettah High Road,Mylapore, Chennai and quash the said notice in so far as the demandof the alleged arrear of Rs.7168.05 relating to 1/94-95 to 2/2000-01is concerned. Writ Petition No.8959 of 2001 has been filed under Article 226of the Constitution of India praying for the issuance of a Writ ofCertiorari calling for the records of the 1st respondent inCMC.No.6/096/0612/00-01 being arrears slip of tax & charges dated05.06.2000 intimating an arrear of water tax of Rs.7,319.05 for the https://hcservices.ecourts.gov.in/hcservices/ period 1/93-94 to 1/2000-01 relating to 6, Royapettah High Road,Mylapore, Chennai and quash the said notice in so far as the demandof the alleged arrear of Rs.7120.30 relating to 1/94-95 to 2/2000-01is concerned. Writ Petition No.8960 of 2001 has been filed under Article 226of the Constitution of India praying for the issuance of a Writ ofCertiorari calling for the records of the 1st respondent inCMC.No.6/096/0142/00/2 being arrear slip of tax & charges dated25.07.2000 intimating an arrear of water tax of Rs.28,631.80 for theperiod 2/96-97 to 1/2000-01 relating to 84, Royapettah High Road,Mylapore, Chennai and quash the said notice in so far as the demandof the alleged arrear of Rs.10,449.40 relating to 1/99-2000to 2/2000-01 is concerned For the Petitioner : Mr. R. Sivaraman for Mr.V.RamanathanFor the Respondents : Mr. V. Manoharan COMMON ORDERThe prayer in these writ petitions is to quash the orders dated25.9.2000, 5.6.2000 and 25.7.2000 respectively intimating arrears ofwater tax of Rs.7,385.90, Rs.7,319.05 and Rs.28,631.80 respectivelyfor the period in first half of 1993-1994 to first half of 2000-2001,first half of 1993-1994 to first half of 2000-2001 and in second halfof 1996-1997 to first half of 2000-2001 relating to the buildingsituated at No.7, Royapettah High Road, Mylapore, Chennai, No.6,Royapettah High Road, Mylapore, Chennai, and No.84, Royapettah HighRoad, Mylapore, Chennai respectively.2. The case of the petitioner is that the Madras SanskritCollege is an educational and charitable institution affiliated tothe University of Madras since 1911 and recognised by the Governmentof Tamil Nadu under grant in aid scheme from the year 1907 and from1977, aided by the Government of India. The institution is owned bya Trust constituted under a Trust Deed dated 27.10.1907. The aim ofthe Trust is to run a Sanskrit College for the development oforiental learning, including Sanskrit. The Sanskrit College is givingfree instructions and no income is received except the grant given bythe Government. In the said premises, Oriental Higher SecondarySchool for Boys and Girls is also functioning for promoting Sanskritlanguage and coaching students for appearing in the Higher Secondaryexamination conducted by the Government of Tamil Nadu. 3. The Kuppuswamy Sastri Research Institute is yet anothereducational institution situated within the same campus run onprivate donations. The petitioner also owns house properties at No.6and 7, Royapettah High Road, First Lane, Mylapore, Chennai-600 004,where the staff of the petitioner institution are permitted to reside https://hcservices.ecourts.gov.in/hcservices/ free of rent. The said properties have been settled in favour of thepetitioner by settlement deed executed on 27.1.1966 bySmt.K.Saraswathi Ammal and Smt.K.Savitri Ammal registered as DocumentNos.101 and 100 of 1966 respectively. The Chennai Metropolitan WaterSupply and Sewerage Board is supplying water to the petitionerinstitution and the petitioner has been paying water and sewerage taxregularly to the second respondent till 31.3.1994. 4. Section 101 of the City Municipal Corporation Act, 1919 wasamended under which exemption is granted to all the educationalinstitutions from payment of property tax. The petitioner being aneducational institution is also exempted from payment of CorporationProperty Tax under the amended provisions of the City MunicipalCorporation Act. The demand for water and sewerage tax was made basedupon the annual value as determined by the Corporation of Chennai inrespect of property tax. From 1.4.1994, no property tax is payableand the petitioner stopped payment of metro water and sewerage taxfor the period from 1.4.1994. 5. Water and sewerage tax is a specific tax assessed based on 7%of the annual value of the building as fixed by the Corporation.According to the petitioner, Section 35 of the Chennai MetropolitanWater Supply and Sewerage Board Act 1978 governs assessment andannual value however the Board uniformly adopted the annual value asfixed by the Chennai Corporation. The petitioner, who was assessed toproperty tax upto 31.3.1994 ceased to be taxable entity on and from1.4.1994 under the City Municipal Corporation Act, 1919 andtherefore, there has been no demand from the Chennai Corporation. 6. Section 34(1) of the Chennai Metropolitan Water Supply andSewerage Board Act, 1978 clearly states that the Board shalldetermine the annual value for each year for assessing the water andsewerage tax. However, insofar as the petitioner is concerned, nosuch assessment is made by the Metro Water Board. The impugned demandnotices are issued on the basis of the property tax assessment madeupto 31.3.1994 by the Chennai Corporation. The said action of theBoard is challenged in these writ petitions by contending thatseparate assessment of the water and sewerage tax has to be made asper Section 34 of the Chennai Metropolitan Water Supply and SewerageBoard Act, 1978 and as a temporary measure even though under Section35 of the Act, the annual value as determined by the ChennaiCorporation can be taken as a basis till date, no assessment is madeby the respondents under Section 34 of the Act.7. The learned counsel for the petitioner cited the judgments ofthis Court reported in 1995 (2) MLJ 467 (Kutty Flush Board andFurnitures Co.Pvt. Ltd., vs. Chennai Metro Water and Others), 2002(2) CTC 219 (Kasi Theatre vs. Chairman, M.M.W.S.S.B., Chennai and TwoOthers and in 2007(3) CTC 270 (M.O.P.Iyengar vs. Charities, TheSpecial Tahsildar in support of his contention and contended that https://hcservices.ecourts.gov.in/hcservices/ unless and until there is an assessment of tax as required underSection 34 of the Chennai Metropolitan Water Supply and SewerageBoard Act, 1978, no demand could be made against the petitioner.8. The learned counsel for the respondents on the other handsubmitted that the property tax assessment made by the ChennaiCorporation upto 31.3.1994 was relied upon by the respondents forcalculating the water and sewerage tax and the same is permissibleunder Section 35 of the Chennai Metropolitan Water Supply andSewerage Board Act, 1978.9. I have considered the rival submissions made by the learnedcounsel for the petitioner as well as the respondents.10. Admittedly, from 1.4.1994, when Corporation is not demandingany property tax and no assessment of property tax is also madeagainst the petitioner's property. The demand of water and seweragetax is made by the respondents under Section 35 of the ChennaiMetropolitan Water Supply and Sewerage Board Act, 1978, even thoughthe said section permits determination of annual value as determinedby Chennai Corporation till the assessment is made under Section 34of the Chennai Metropolitan Water Supply and Sewerage Board Act,1978.11. Section 34 of the Chennai Metropolitan Water Supply andSewerage Board Act, 1978 reads as follows:-" Taxes leviable by the Board: (1) For the purpose of thisAct, the Board shall levy on premises situated within itsarea-a) a water tax : andb) a sewerage tax2) The taxes mentioned in sub-section (1) shall be leviedat such rates as may be prescribed which the case of watertax shall not be more than twenty per cent and in case ofsewerage tax shall not be more than ten per cent of theassessed an value of the premises.3) The Board may, with the sanction of Government, exemptany local area from the whole portion of the water tax andsewerage tax on the ground that such area is not derivingany or the full benefit from the water apply or seweragesystem, or the Board may remit a portion of such taxes notexceeding one half on the ground that the premisesconcerned has remained vacant. https://hcservices.ecourts.gov.in/hcservices/ Explanation: For the purposes of this chapter theexpression 'premises' shall mean any land or building.4) Where water tax or drainage tax is comprised in theproperty tax or house-tax levied and collected by theexisting authority such existing authority shall reduce theproperty tax or house tax by an amount equal to the amountattributable to water tax and drainage tax."12. As rightly pointed out by the learned counsel for thepetitioners that the very same issue was considered by this Court inthe decision reported in 1995 (2) MLJ 467 (Kutty Flush Board andFurnitures Co.Pvt. Ltd., vs. Chennai Metro Water and Others), whereinthe scope of Sections 34 and 35 of the Act has been considered and inthe said judgment, it is held as follows:-"Section 35 provides for the manner of the assessment theannual value and says that till such time as the annualvaluation is determined under the Act, the annual value ofa building for the purpose of assessment shall be theannual value as assessed by Municipal Corporation orMunicipality or Panchayat. The tax is taken as a percentageof the annual value of a building or land. Similarly, thesewerage tax also is taken as a percentage of the annualvalue. Therefore, the Board has to determine the annualvalue and then adopt percentage of tax. But it is notdisputed that the Board has not started making assessmentof annual value as provided under Section 35 of the Act andthey are adopting only the annual value as made by theMunicipal Corporation, Municipality or Panchayat.Therefore, the question of assessment does not arisebecause the annual value as provided by the Municipalityor Corporation is adopted by the Board. But the Board has aduty under Section 34 of the Act to levy tax by adoptingthe annual value. Unless there is a levy by the Board,there cannot be a demand for payment of the water tax orsewerage tax. In fact, in respect of every half year, theCity Municipal Corporation Act says that the tax should bedemanded before the end of the half year and the liabilityof the tax-payer arises only when a demand is issued on thebasis of a levy. In this particular case, there isabsolutely no record to show whether there was any levy atall at any point of time, leave alone a demand notice.Consequently, I have to hold that the impugned notice,dated 17.1.1990 is totally without jurisdiction andillegal. Accordingly, that writ petition is allowed asprayed for. No costs. Liberty is given to the respondentsto proceed in accordance with law and demand the tax, ifthey are so authorised under the Act. If any amount hasbeen recovered from the petitioner under orders of this https://hcservices.ecourts.gov.in/hcservices/ Court, the same shall be returned to the petitioner subjectof course to say future demands that may be made by therespondents in which event the Board can make someadjustment of the amount already recovered."13. In the judgment reported in 2002 (2) CTC 219 (Kasi Theatrevs. Chairman, M.M.W.S.S.B., Chennai and Two Others also, the scopeand ambit of Section 34 of the Act was considered and the viewexpressed by this Court in the decision above cited was affirmed. Inparagraphs 9 and 10, it is held as follows:-" 9. Section 34 of the Act provides for the levy of watertax and sewerage tax, Section 35 provides for the method ofassessment of annual value. The annual value of the premisesfor the purposes of levy of taxes mentioned in Section 34shall be assessed by such authority as may be prescribed.Till such time as the annual valuation of land and buildingsis determined under this Act, the annual value of the landand buildings for the purposes of this Act, shall be theannual value as assessed by the local bodies. It is evidentthat under Section 35, the respondents have to determine theannual value and assess the tax. Though the Board is makingthe assessment adopting the annual value made by the localbodies, the board has a duty under Section 34 of the Act tolevy tax. The respondents have not produced any evidence toshow that they have levied tax.I concur with the view taken by the learned Judge inthe decision relied on by the petitioner viz., 1995 II MLJ467 and I dissent the view taken by the learned Judge in thedecision relied on by the respondents viz.,W.P.No.14392/2000, dated 11.10.2001. Hence, I come to theconclusion that the impugned notice is unsustainable in lawand liable to be quashed.10. The petitioner has not produced any iota ofevidence to show that they have not availed the facilityprovided by the respondents. On the other hand, thepetitioner had been paying taxes and charges yeteryearswhich prove that they have been enjoying the facilitiesrendered by the board. As rightly pointed out by the learnedcounsel for the respondent, water and sewerage taxes are notrelated or referable to any particular service rendered to aparticular individual but it is a general levy collectedfrom the public for providing and implementing the welfaremeasures. As such the petitioners are liable to pay taxes.Hence, it is open to the respondents to proceed inaccordance with law and demand the tax." https://hcservices.ecourts.gov.in/hcservices/ The same is reiterated in the subsequent decision by the very samelearned Judge in the decision reported in 2007 (3) CTC 270(M.O.P.Iyengar vs. Charities, The Special Tahsildar). The learnedcounsel for the respondents fairly submitted that no appeal againstthe said orders were preferred and the said orders have become final. 14. The learned counsel for the respondents relied upon anunreported judgment of this Court made in W.P.No.15243 of 1997, dated20.10.1998 and contended that the metro water and sewerage tax can beassessed on the basis of the property tax assessed by theCorporation. In fact in the said judgment, the scope and ambit ofSection 34 and 35 of the Chennai Metropolitan Water Supply andSewerage Act, 1978 was not considered. Therefore, I am of the viewthat the said judgment will not give any help to the respondents incontending their case.15. In view of the said statutory provision as stated above viz.Sections 34 and 35 of the Chennai Metropolitan Water Supply andSewerage Act, 1978, the impugned demand notices are set aside as noassessment as required under Section 34 of the Chennai MetropolitanWater Supply and Sewerage Act, 1978 has been made by the respondent-Board for all these years while making the impugned demand. Whenthe statute namely Section 34 of the Act mandates the Board to assessthe water and sewerage tax in a particular manner it is not open tothe respondents to assess the tax on the basis of property taxasessed earlier by Chennai Corporation. Section 35 permits to relyon property tax assessment which is a stop gap arrangements and thesame cannot be continued for years together. 16. It is a settled proposition of law that when a statuteprescribes to do a particular thing in a particular manner, the sameshall not be done in any other manner than prescribed under the law.The said proposition is well recognised as held by the HonourableSupreme Court in the decision reported in AIR 1964 SC 358 (State ofUttar Pradesh v. Singhara Singh). In paragraphs 7 and 8 of theJudgment, it is held thus,"7.In Nazir Ahmed's case, 63 Ind App 372:(AIR 1936 PC 253 (2)) the Judicial Committeeobserved that the principle applied in Taylor v.Taylor, (1876) 1 Ch.D 426 to a Court, namely, thatwhere a power is given to do a certain thing in acertain way, the thing must be done in that way ornot at all and that other methods of performanceare necessarily forbidden, applied to judicialofficers making a record under S.164 and,therefore, held that the magistrate could not giveoral evidence of the confession made to him whichhe had purported to record under S.164 of theCode. It was said that otherwise all the https://hcservices.ecourts.gov.in/hcservices/ precautions and safeguards laid down in Ss.164 and364, both of which had to be read together, wouldbecome of such trifling value as to be almost idleand that "it would be an unnatural construction tohold that any other procedure was permitted thanthat which is laid down with such minuteparticularity in the sections themselves."8.The rule adopted in Taylor v. Taylor(1876) 1 Ch D 426 is well recognised and isfounded on sound principle. Its result is that ifa statute has conferred a power to do an act andhas laid down the method in which that power hasto be exercised, it necessarily prohibits thedoing of the act in any other manner than thatwhich has been prescribed. The principle behindthe rule is that if this were not so, thestatutory provision might as well not have beenenacted. A magistrate, therefore, cannot in thecourse of investigation record a confession exceptin the manner laid down in S.164. The power torecord the confession had obviously been given sothat the confession might be proved by the recordof it made in the manner laid down. If proof ofthe confession by other means was permissible, thewhole provision of S.164 including the safeguardscontained in it for the protection of accusedpersons would be rendered nugatory. The section,therefore, by conferring on magistrates the powerto record statements or confessions, by necessaryimplication, prohibited a magistrate from givingoral evidence of the statements or confessionsmade to him."The said proposition is also reiterated in the decision reported in(1999) 3 SCC 422 (Babu Verghese v. Bar Council of Kerala). Inparagraphs 31 and 32 of the Judgment, the Honourable Supreme Courtheld thus,"31.It is the basic principle of law longsettled that if the manner of doing a particularact is prescribed under any statute, the act mustbe done in that manner or not at all. The originof this rule is traceable to the decision inTaylor v. Taylor ((1875)1 Ch D 426) which wasfollowed by Lord Roche in Nazir Ahmad v. KingEmperor (AIR 1936 PC 253) who stated as under:"(W)here a power is given to do acertain thing in a certain way, the thingmust be done in that way or not at all." https://hcservices.ecourts.gov.in/hcservices/

32.This rule has since been approved bythis Court in Rao Shiv Bahadur Singh v. State ofV.P. (AIR 1954 SC 322) and again in Deep Chand v.State of Rajasthan (AIR 1961 SC 1527). Thesecases were considered by a three-Judge Bench ofthis Court in State of U.P. v. Singhara Singh (AIR1964 SC 358) and the rule laid down in Nazir Ahmedcase (AIR 1936 PC 253) was again upheld. Thisrule has since been applied to the exercise ofjurisdiction by courts and has also beenrecognised as a salutary principle ofadministrative law."The said principle is followed in the decision reported in 2007(2)SCC 588 (Ramachandra Murarilal Bhattad V. State of Maharashtra). 17. Admittedly, there is no limitation to demand metro water andsewerage tax and water charges as per Section 74 of the ChennaiMetropolitan Water Supply and Sewerage Act, 1978. In view of thesame, it is open to the respondents to properly assess the taxpayable by the petitioner. The amount already paid by the petitioneris directed to be adjusted after making proper assessment. Therespondents are directed to assess the value of the tax as requiredunder Section 34 of the Chennai Metropolitan Water Supply andSewerage Act, 1978 and demand the same from the petitioner. On suchassessment as already stated, the amount already paid can be givencredit to and the arrears if any can be demanded from the petitioner.The writ petitions are disposed of accordingly. No costs.sd/-Asst.Registrar/true copy/Sub Asst.Registrarkb/am To1. The Managing Director, Chennai Metropolitan Water Supply and Sewerage Board, No.1, Pumping Station Road, Chennai – 600 002. https://hcservices.ecourts.gov.in/hcservices/

2. The Senior Accounts Officer, Area Office VI, No.1, Dr. Ranga Road, Abhiramapuram, Chennai – 600 018.+ 1 c.c. to Mr. V. Manoharan, Advocate. S.R.No.34575. W.P.Nos.8958 to 8960 of 2001RB (CO)GSK 17.08.2009.