M.O.P. Iyengar Charitiesrep. by its Secretary153/72 v. The Special Tahsildar (Revenue Recovery) C.M.W.S.S. Board

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 10.04.2007CORAMTHE HONOURABLE MR. JUSTICE A. KULASEKARANWRIT PETITION NO.1996 OF 2007andM.P.No.1 & 2 of 2007M.O.P. Iyengar Charitiesrep. by its Secretary153/72, Venkatrangam Pillai StreetTriplicaneChennai – 600 005.... PetitionerVs.

The Special Tahsildar (Revenue Recovery) C.M.W.S.S. Board, Area II 1, M.C. Road, Anna Poonga Royapuram, Chennai – 600 021.

The Senior Accounts Officer Area Office II C.M.W.S.S. Board, 1, M.C. Road Anna Poonga Royapuram, Chennai – 600 021.

The Commissioner Corporation of Chennai Rippon Buildings Chennai – 600 003.... Respondents Writ Petition filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorarified Mandamus as stated therein. For Petitioner : Mr. P. Haridas Senior Counsel for Mr.Puran KhemkaFor R1 & R2 : Mr. B. ManiFor R3 : Mr. T. Mathi https://hcservices.ecourts.gov.in/hcservices/

O R D E RThis writ petition is listed today for admission and Iheard the learned Senior Counsel appearing for the petitioner, Mr.B.Mani, learned counsel for respondent Nos.1 and 2 andMr.T.Mathi, learned counsel for respondent No.3.2. The prayer in this writ petition is for a Writ of Certiorarified Mandamus calling for the records of the first respondent dated 3.1.2007, being the distraint warrant notice bearing Sl.No.5626 in respect of premises bearing No.41, BunderStreet, Kothaval Chavadi, Chennai – 600 001, consequent to the demand contained in the impugned letter of the second respondent dated 10.10.2006 vide CMWSSB/Area II/R4/7498/2006 and the demand contained in intimation slip dated 14.8.2006 vide Sl.No.238 forCMC Bill No.02/030/1575/000000/1 and quash the same and forbear the respondents, their men, agents or any one acting under themor for them from in any manner attaching the property or for bringing for distraint auction properties (both movable and immovable) of the petitioner in the premises bearing MunicipalDoor No.41, Bunder Street, Kothaval Chavadi, Chennai – 600 001.3.

The case of the petitioner is as follows:- The petitioner is a public and charitable trust, which owns the property bearing Door No.41, Bunder Street, Chennai-1. Thepetitioner has been regularly paying property, water and sewerage tax due to the said property to the authorities concerned. As per the provisions of the Chennai Metropolitan Water Supply and Sewerage Act, 1978 (hereinafter referred to as the 'Act'), the respondents are entitled to levy water and sewerage tax. UnderSection 34 of the said Act, the water tax shall not be more than35% and the sewerage tax shall not be more than 15% of the property tax. For the purpose of levy of water and sewerage tax, the Chennai Metropolitan Water Supply and Sewerage Board(hereinafter referred to as the 'Board') has to arrive at the annual value of the property. Since, the Board has not arrived at the annual value, the Board has been adopting the annual value arrived at by the Corporation of Chennai for the purpose of assessment of levy, demand and collection of water and sewerage tax.

The annual value fixed by the Corporation of Chennai wasRs.1,44,184/- and the property tax was collected by the Corporation of Chennai at Rs.17,230, per half year. The annual value was increased to Rs.2,87,524/- restrospectively with effect from 2/1998-1999 and consequently the property tax was revised to Rs.34,359/- per half year. The petitioner filed an appeal before the Taxation Appeals Tribunal, Corporation of Chennai, which reduced the annual value from Rs.2,87,524/- toRs.2,16,271/- and consequently reduced the half yearly tax fromRs.34,359/- to Rs.25,844/- with effect from 2/1998-1999. With the https://hcservices.ecourts.gov.in/hcservices/ result, the petitioner has been paying property tax ofRs.25,844/- per half year. Following the same, the petitioner paying the water tax of Rs.7569/- per half year to the Board. The water and sewerage tax were regularly remitted by the petitioner upto 1/2006-2007. While things are such, the respondents sent an intimation dated 14.8.2006, which was received by the petitioner on 6.9.2006 directing them to payRs.1,47,233/- towards water and sewerage tax and surcharges from2/1999-2000 to 1/2006-2007, which is challenged in this writ petition.

The case of the respondent is that following the enhancement of property tax by the Corporation, the impugned communications were sent by the respondents 1 and 2 calling upon the petitioners to pay the tax amount at the enhanced rate.

Mr.P. Haridas, learned Senior counsel appearing for the petitioner submitted that the petitioner has sent a letter dated 25.9.2006 informing the respondent-Board that they have not received any communication from the Chennai Corporationincreasing the annual value to Rs.4,10,974/- as referred to in the impugned arrears intimation slip dated 14.8.2006. While so, in the absence of any increase by the Corporation of Chennaidemanding the enhanced rate of tax for water and sewerage is untenable in law. The petitioner by letter dated 25.09.2006categorically stated that they have not received any communication from the Corporation about the enhancement of property tax, as referred to in the said order dated 14.08.2006,the alleged corresponding increase made by the Board is untenable besides that it is disproportionate and exorbitant, for which, no reply was given by the respondent-Board. The respondent-Boardsent the distraint warrant notice dated 3.1.2007, which was received by the petitioner on 8.1.2007 wherein the petitioner was directed to pay arrears of Rs.1,67,495/- towards water and sewerage tax and surcharges within three days, which isunsustainable in law. In any event demanding such exorbitant rate of tax retrospectively with effect from 2/1999-2000 to 1/2006-2007 is exfacie illegal. The said distraint warrant notice was issued in total violation of the principles of natural justice and contravention of the statutory provisions. It is further submitted by the learned Senior counsel that in the absence of enhancement of property tax by the Corporation, it is not open to the respondents to enhance the water and sewerage tax, that too without granting opportunity.

On the above said contention, this Court heard Mr.B.Mani, learned standing counsel for respondent Nos.1 and 2 andMr.T.Mathi, learned counsel for respondent No.3. https://hcservices.ecourts.gov.in/hcservices/

The petitioner has enclosed in its typed set, the property tax book issued by the third respondent-Corporation for 1/2006-2007.The Corporation levied the half yearly tax of Rs.25,844/-, which is corresponding to the annual value of Rs.2,16,271/-. However, the respondents 1 and 2 in their communication dated 14.8.2006,arrived at the annual value at Rs.4,10,974/- without any basis. It is asserted by the learned Senior counsel appearing for the petitioner that the third respondent-Corporation has not enhanced the annual value till date. At this juncture, it is necessary to mention the argument of the learned Senior Counsel that therespondent-Board has not given any opportunity or notice prior to the impugned communications dated 14.8.2006, 10.10.2006 and3.1.2007. It is also not in dispute that the petitioner'srepresentation dated 25.9.2006, questioning the demand dated14.08.2006 by the Board, has not yet been disposed of by the second respondent till date.