CMSA/20/2012 of K.Satyanarayana Rao Vs Greater Hyderabad Municipal Corporation on 31 December 2013

IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESHAT HYDERABAD

TUESDAY,THE THIRTY FIRST DAY OF DECEMBERTWO THOUSAND AND THIRTEEN

PRESENT

THE HON’BLE SRI JUSTICE VILAS V. AFZULPURKAR

CIVIL MISCELLANEOUS SECOND APPEAL Nos.19, 20, 21 and 22 of 2012

CMSA Nos.19 and 22 of 2012:

BETWEEN

K. Rajeshwar Rao.

AND

…APPELLANT

Greater Hyderabad Municipal Corporation, Hyderabad.

…RESPONDENT

CMSA Nos.20 and 21 of 2012:

BETWEEN

K. Satyanarayana Rao.

AND

…APPELLANT

Greater Hyderabad Municipal Corporation, Hyderabad.

…RESPONDENT

Counsel for the Appellants: MR. P. CHANDRASEKHARA REDDY

Counsel for the Respondents: MR. C. DAMODAR REDDY SC for GHMC

The Court made the following order:COMMON JUDGMENT:

All the appeals are substantially between the same parties relating tothe same property and arising out of appropriate tax assessments made bythe respondent corporation under the Hyderabad Municipal Corporation Act,1955.

2. The appellant in CMSA.Nos.19 and 22 of 2012 is the brother of theappellant in CMSA.Nos.20 and 21 of 2012 and each of the aforesaid two setsof appeals relate to separate properties of respective brothers. The dispute,which was subject matter of all these proceedings, relates to theenhancement of property tax proposed by the respondent corporation underspecial notice dated 22.02.2012, with respect to each of the premises, givento the respective owner. By the aforesaid notice, the gross annual ratablevalue was revised and accordingly, the impugned tax applicable was revisedby enhancing the same with effect from 01.04.2009. The appellants gaveobjections whereupon a detailed hearing was conducted and the DeputyCommissioner, Circle No.8, GHMC, disposed of all the said objections underhis proceedings dated 24.11.2010 upholding the special notice dated22.02.2010. Questioning the same, the appellants herein filed municipalappeals, being M.A.Nos.252, 217, 218 and 253 of 2010, respectively beforethe Chief Judge, City Small Causes Court, Hyderabad, which is the appellateauthority under the HMC Act.

All the said four appeals were disposed of by similar but separate orderswhereby the appellate authority upheld the contention of the appellants thatthe retrospective effect given to the enhanced property tax and its recoveryunder the special notice dated 22.02.2012 is not sustainable. Consequently,the appellate authority set aside the impugned property tax confirmationletters and also further directed that the respondent corporation shall beentitled to recovery of tax at the enhanced rate with effect from 22.02.2010.

3. Aggrieved to the extent of the said directions, the present appeals arefiled on the substantial questions of law under para 2 of the grounds ofrespective appeals. All the appeals were admitted, accordingly, by this Court

4. Heard learned counsel for the appellants and the learned counsel forthe respondent corporation.

5. The primary contention raised by the learned counsel for theappellants is that there cannot be recovery of enhanced tax under the specialnotice dated 22.02.2010. The enhancement of property tax effected underthe special notice is with retrospective effect i.e. from 01.04.2009 and thelower appellate Court having held that the retrospective effect cannot begiven to the special notice seeking recovery of enhanced tax with effect from01.04.2009, ought not to have granted liberty to the respondent to recover theenhanced tax from 22.02.2010.

6. Learned standing counsel for the respondent corporation submits thatthe enhancement of tax is clearly based upon G.O.Ms.No.635 MA & UDDepartment dated 27.08.2007, which is in turn based on Area Based UnitRate System. The enhancement, therefore, according to the learnedstanding counsel has scientific basis and is uniformly adopted throughout thecity.

7. The objections of the appellants before the respondent corporation aswell as before the lower appellate Court were, primarily, with respect to theaction of the respondent corporation in seeking to recover the enhancedproperty tax with retrospective effect.

The proceedings of confirmation of the said demand by the DeputyCommissioner dated 24.11.2010 rejected the said contentions of theappellants by upholding the retrospective recovery of enhanced tax. The saidproceedings clearly states that from 01.04.2007 the appellants are entitled topay at the pre-revised rate and from 01.04.2009 at the revised rate with penalinterest. The lower appellate Court has rightly considered the said aspectand has rightly declared that retrospective effect from 01.04.2009 cannot begiven to the said enhancement under the special notice dated 22.02.2010.The order of the lower appellate Court to that extent, having not appealed against by respondent corporation, therefore, protects the appellants and theappellants also have no grievance. So far as the direction in the lastsentence in para 10 of the impugned order is concerned, the enhanced tax ispermitted to be recovered with effect from 22.02.2010, which is the date ofspecial notice enhancing the tax. Thus, the lower appellate Court has takenoff the retrospective effect under the said special notice and directed that itwould operate only prospectively from the date of notice.

8. I have seen the copy of the special notice issued to each of theappellant, copy of which was placed before this court by the learned standingcounsel and I have also seen the details furnished by the learned counsel forthe appellants with respect to each appellant showing payment of tax up-to-date so far as appellant in CMSA.Nos.19 and 22 is concerned and suchpayment up to 2010, so far as appellant in CMSA.No.20 and 21 isconcerned. Since the order of the lower appellate Court gives rise to someambiguity with respect to the period from which the revised tax is to berecovered, it is just and necessary to clarify the said aspect.

9. Accordingly, these appeals are disposed of by holding that the revisedtax payable by the appellants shall be effective only from the date of specialnotice i.e. 22.02.2010 and arrears, if any, in that respect may be paid by therespective appellant on or before 31.03.2013 for which no penalty or interestshall be levied by the respondent corporation. In the event of amount ofarrears remaining due after 31.03.2014 from any of the appellant, therespondent corporation shall be free to recover arrears together with interestand penal charges as per rules. In view of the said limited grievance of theappellants having redressed, it is not necessary to consider the questions oflaw independently.

10. So far as the complaint of the appellants with regard to mutation isconcerned, the respondent corporation itself stated before the lower appellateCourt that mutation is already effected before passing the adjudicatory orderdated 24.11.2010. However, since the grievance of the appellants remains,the respondent corporation is directed to consider and pass appropriate orders with regard to mutation, as sought for by the appellants, if not alreadydone.

The appeals are, accordingly, disposed of. As a sequel, the miscellaneous applications, if any, shall stand closed. There shall be noorder as to costs.

December 31, 2013DSK

_____________________

VILAS V. AFZULPURKAR, J