Delhi District Court
Nitin Gupta Nd Anr vs New Delhi Municipal Council on 21 October, 2023
IN THE COURT OF SH. SUDHANSHU KAUSHIK :
ADDITIONAL DISTRICT JUDGE-02 & WAQF TRIBUNAL :
PATIALA HOUSE COURTS : NEW DELHI
HTA NO.10/2018
CNR NO.DLND01-004267-2018
IN THE MATTER OF :-
1. SH. NITIN GUPTA
S/O LATE SH. CHANDER MOHAN GUPTA
HAVING OFFICE AT:
50/8, 1st FLOOR, TOLSTOY LANE,
JANPATH, NEW DELHI-110001
2. SH. ARUN KUMAR JAIN
S/O SH. BIMAL PRASHAD JAIN
R/O D-1083, NEW FRIENDS COLONY,
NEW DELHI
.....APPELLANTS
VERSUS
NEW DELHI MUNICIPAL COUNCIL
THROUGH ITS SECRETARY,
PALIKA KENDRA, SANSAD MARG,
NEW DELHI
.....RESPONDENT
DATE OF INSTITUTION : 10.05.2018
DATE OF CONCLUSION OF FINAL ARGUMENT : 21.10.2023
DATE OF PRONOUNCEMENT OF ORDER : 21.10.2023
JUDGMENT
1. This is an appeal under Section 115 of the New Delhi Municipal Council Act, 1994 (hereinafter referred to as 'the Act') against a composite assessment order dated 29.12.2017 passed by Joint Director (Tax), NDMC, whereby the rateable values of Properties No.F1 to F7, HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 1 of 23 F-31-32 and F-48-49, Connaught Place, New Delhi were revised with effect from 01.04.2002 onwards.
2. The brief facts as disclosed in the appeal are;
A) Sh. Nitin Gupta (Appellant No.1) and Sh. Arun Kumar Jain (Appellant No.2) have joined together and filed the present appeal. It is the case of appellants that they are co-owners of the properties. Initially, Sh. Chander Mohan Gupta (father of appellant No.1), appellant No.2 and late Sh. Nihal Chand Jain were the co-owners each having 50%, 33.33% and 16.67% share in the properties. During lifetime, Sh. Chander Mohan Gupta sold his undivided share in some of the properties. On his demise, his share in the remaining properties devolved upon appellant No.1. Similarly, on the demise of Sh. Nihal Chand Jain, his 16.67% undivided share devolved upon his legal representative.
B) It has been stated that all the properties except property No.F- 49 were rented out to different tenants. The tenants occupying the properties are protected under Delhi Rent Control Act, 1958 as the rent of each property varies from Rs.142.80/- to Rs.2525.60/. Litigation in respect of some of the properties is stated to be going on under Delhi Rent Control Act, 1958, wherein the rate of rent stands confirmed. Appellants have claimed that all the properties were assessed separately for the purpose of house-tax and separate annual HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 2 of 23 value of each property was considered for raising the bill for the year 1986-87.
C) It has been disclosed that the father of appellant No.1 received a notice dated 26.03.2001 under Section 72 of the Act whereby respondent proposed to revise the existing ratable value of the properties to Rs. Rs.1,08,91,584/- less 10% with effect from 01.04.2000. In response to the said notice, a reply dated 30.04.2001 was filed by the father of appellant No.1 wherein he disclosed the details of the rent received in respect of the properties and provided the details of pending litigation. Thereafter, vide a communication dated 09.06.2004, respondent granted a personal hearing to the father of appellant No.1 on 21.06.2004. The father of appellant No.1 attended the hearing and provided the copies of relevant documents. Respondent did not act upon the notice for a considerable period of time.
D) After about 4 years, the father of appellant No.1 received another notice dated 27.03.2008 under Section 72 of the Act whereby respondent proposed to enhance the rateable value of the property to Rs.2,70,00,000/- w.e.f 01.04.2007 on comparable rent basis. In response, father of appellant No.1 submitted a reply on 29.04.2008 disclosing that he has sold his undivided share in property No.F-1, F- 2, F-5 to F-7 to the tenants who were occupying the properties. He HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 3 of 23 further intimated that the remaining properties No.F-3, F-4, F-31, F- 32 & F-48 were in possession of tenants and provided details of the rent of each property. He disclosed that property No.F-49 was self occupied.
E) On 20.10.2010, in continuation of the previous notices pertaining to the assessment years 2000-01 and 2007-08, respondent issued a notice for personal hearing on 27.10.2010 for deciding the objections. The notice was also issued to the owner of property No.F-
7. The assessee attended the hearing and submitted the relevant documents. On 25.02.2011, respondent issued another notice to the father of appellant No.1 under Section 77 of the Act seeking information in respect of occupiers of the properties. In reply to the said notice, the requisite information was provided. On the demise of his father on 17.01.2014, appellant No.1 stepped into his shoes. F) On 29.11.2016, respondent issued another notice for personal hearing on 08.12.2016 for deciding the objections. Appellant No.1 issued reply to the said notice and reiterated the facts. He filed a letter on 09.12.2016 seeking time for personal hearing as the Assessing Officer was not available on 08.12.2016. Respondent kept silent for about 13 months and did not communicate any decision on the objections of appellant No.1. On 19.01.2018, appellant No.1 received a bill dated 08.01.2018 wherein respondent raised an additional HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 4 of 23 demand of Rs.3,57,76,192/- on the owners of the properties. On 22.01.2018, appellant No.1 wrote a letter to the respondent seeking details of computation of the additional demand raised in the bill dated 08.01.2018 but no response was received. Appellant No.1 has stated that he received the impugned order on 26.02.2018 and filed the present appeal.
3. Appellants have challenged the assessment order on following grounds;
(a) That the impugned order is a non-speaking order and the same has been passed mechanically;
(b) That the assessing authority ignored the provisions of Section 63(1) of NDMC Act while passing the impugned order;
(c) That the impugned order does not provide any justification for assessing the properties at comparable rent basis despite it being apparent that the properties were let out to tenants whose tenancies were protected under Delhi Rent Control Act;
(d) That the Assessing Officer had no material to arrive at a finding about comparable rent of the properties;
(e) That the impugned order makes the appellants liable for property tax at an enhanced rate for a period much prior to the commencement of the year in which the notice was issued under Section 72 of the Act;
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(f) That assessing authority failed to consider the observations made by the Hon'ble Supreme Court in the matter of 'State Trading Corporation of India Ltd. Vs NDMC' 2016 (12) SCC 603;
(g) That there was considerable time gap between the notice and the impugned assessment order. The assessment ought to have been completed within three year of notice under Section 72 of NDMC Act.
(h) That the impugned order contains a finding that the rent of the properties seems to be suppressed, although, there was no material to arrive at the said finding;
(i) That the impugned order was based on incorrectly calculated plinth area of the properties;
(j) That the Assessing Officer ought to have excluded the area measuring 2069.162 from its computation as the said area was being utilized as a public veranda.
4. Notice of the appeal was issued to the respondent. Respondent filed a detailed reply and took preliminary objections of limitation.
5. Arguments were heard.
6. Counsel for the appellant supported the grounds taken in the appeal.
He contended that the impugned order is a non-speaking order and the same has been passed in a mechanical manner. He contended that respondent failed to take note of the fact that the properties were covered under the Delhi Rent Control Act and the same were occupied HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 6 of 23 by tenants. He argued that although respondent mentioned in the assessment order that the rateable value is being revised on the basis of comparable rent but there was no material basis to provide the comparable rent of similarly situated property. He mentioned that respondent has arbitrarily revised the rateable value of the property and the same is not permissible. He mentioned that the Assessing Officer arbitrarily arrived at a finding that the rent of the properties has been suppressed. He mentioned that no opportunity was granted to the appellants to controvert this aspect. He mentioned that the impugned order is liable to be set-aside as the principles of natural justice were not complied with. He argued that while passing the impugned order, respondent also included the plinth area of the veranda of the shop. He mentioned that the Assessing Officer ignored the proviso of Section 63(1) of the NDMC Act, which expressly provides that the ratable value shall not exceed the annual amount of standard rent, in case, the standard rent of the properties has been fixed under the Delhi Rent Control Act. Counsel submitted that the provisions of Section 63 of the Act has not become redundant merely because the the criteria of standard rent has been declared ultra virus. He mentioned that liability of increased tax cannot be imposed under Section 72 of the Act for any period prior to the commencement of the period in which the notice has been issued under Section 72(2) of the Act. He filed written HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 7 of 23 submissions and relied on the decision in the matter of "State of Punjab & Ors. Vs. Bhathinda District Cooperative Milk" 2007 (11) SCC 363, "Delhi Development Authority Vs Ram Prakash" 2022 (4) SCC 180, "Ved Marwah & Ors. Vs NDMC & Ors." 2018 (248) DLT 781 and NDMC Vs Pyare Lal & Sons" (SLP 25403 of 2018, decided on 01.08.2003).
7. On the other hand, counsel for respondent questioned the maintainability of the present appeal. He contended that the appeal is not maintainable as the same was not filed within the limitation period prescribed under Section 116 of the Act. He contended that the impugned order was passed according to the provisions of the Act and all the relevant factors were taken into consideration before passing the order. He submitted that notice under Section 72 of the Act was served on the appellant wherein it was clearly indicated that the rateable value is proposed to be enhanced on comparable rent basis. He mentioned that the comparable rent of the property No.F-7 was taken into consideration in fixing the ratable value of the properties. He mentioned that written objections filed on behalf of appellant were taken into consideration at the time of passing the impugned order. He mentioned that appellants kept silent for a considerable period of time and approached the court only after receiving the bill raised on the basis of revised rateable value. He contended that the appellants are HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 8 of 23 precluded from objecting to the assessment as they omitted to give information pursuant to the notice issued under Section 77(1) of the Act. He mentioned that inter-se dispute between the landlord, tenants and co-owners has no bearing on the assessment proceedings. He stated that no period of limitation has been prescribed under the Act for fixing the ratable value of the property pursuant to the notice issued under Section 72 of the Act. He mentioned that provisions of Section 4, 6 & 9 of the Delhi Rent Control Act have been declared ultra virus by the Hon'ble High Court of Delhi in the matter of "Raghunandan Saran, Ashok Saran Vs Union of India" 95 (2002) DLT 508. He has contended that the concept of standard rent is no longer available and therefore, the properties were assessed on the basis of annual expected hypothetical reasonable rent.
8. I have perused the record in the light of respective arguments.
9. Let us first deal with the preliminary objection of the respondent about the maintainability of the appeal on the ground that it has been filed beyond the prescribed period of limitation. Counsel for respondent has submitted that the appeal has been filed beyond the mandatory period of limitation of 30 days as provided under Section 116(a) of the Act. Record shows that the impugned assessment order was passed on 29.12.2017 while the present appeal has been filed on 10.05.2018. It is an admitted fact that prior to filing of the present appeal, appellant HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 9 of 23 filed a writ petition before the High Court of Delhi bearing No.WP(C) 2882 of 2018 and CM No.11607-609/2018 titled as "Nitin Gupta & Anr. Vs New Delhi Municipal Council" which was disposed of by the High Court of Delhi vide order dated 24.04.2018 with the following observation :
"11.Accordingly, it is directed that if an appeal is filed by the petitioner within 15 days along pre-deposit for the base year 2001-02, the appellate tribunal would consider the petitioner's appeal on its own merit by following the procedure of law.
12. The petition is dismissed as withdrawn with liberty as prayed for granted. The pending applications also stand disposed of."
10. It can be observed that in terms of order dated 24.04.2018, petitioner was granted 15 days period by the High Court of Delhi for filing the appeal. Record shows that there is one day delay in filing the appeal. Section 117 of the Act provides that notwithstanding anything contained under clause (a) of Section 116, an appeal may be admitted after the expiration of prescribed period if the appellant satisfies the court that he had sufficient cause for not preferring the appeal within the prescribed period. Section 5 of the Limitation Act, 1963 also empowers the court to condone the delay. I am of the considered opinion that every endeavour should be made to proceed with the matter on merits and technicalities should not defeat the rights of the parties. In view of this, the delay of one day in filing the appeal stands HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 10 of 23 condoned.
11. Now, coming to the aspect of revising the rateable value of the properties. In order to adjudicate the present controversy, it would be appropriate to refer to the relevant provisions of the Act.
12. Section 60 of the Act is the charging section, which authorizes the NDMC to levy various type of taxes including property tax. Section 60(3) of the Act states that the property tax shall be levied, assessed and collected in accordance with the provisions of the Act and the bye- laws made thereunder. Section 61 of the Act prescribes the rates of the property tax. Section 61 (1) of the Act provides that property tax shall be levied on lands and buildings in New Delhi and shall consist of not less than ten and not more than thirty per cent of the rateable value of lands and buildings. The expression rateable value is defined under Section 2 (42) of the Act to mean the value of any land or building fixed in accordance with the provisions of this Act and the Bye-laws made thereunder for the purpose of assessment to property taxes. Section 62 of the Act relates to the 'premises in respect of which tax is to be levied'.
13. Section 63 of the Act sets out the method of determination of the rateable value of lands and buildings assessable to property tax. Section 63 (1) of the Act provides that the rateable value of any land or building assessable to property tax shall be the annual rent at which HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 11 of 23 such land or building might reasonably be expected to let from year to year less a sum equal to 10% of the said annual rent which shall be in lieu of all allowances for cost of repairs and insurance, and other expenses necessary to maintain the land or building in a state to command that rent. The proviso to Section 63 (1) of the Act states that in respect of any land or building the standard rent of which has been fixed under the Delhi Rent Control Act, 1958, the rateable value thereof shall not exceed the annual amount of the standard rent so fixed.
14. Section 70 of the Act deals with the Assessment List. This is a list of all lands and buildings which contains such particulars with respect to each land and building as may be prescribed by the Bye-laws. When such Assessment List is prepared, the Chairperson under Section 70 (2) of the Act gives a public notice thereof and every person claiming to be an owner, lessor or occupier of a land or building included in the List shall be at liberty to inspect the List and take extracts therefrom free of charge. Under Section 70 (3) of the Act, the Chairperson is to give a public notice of a date not less than one month thereafter when he would proceed to consider the rateable value of the lands and buildings entered in the Assessment List. He is also to give the written notice where the rateable value is proposed to be increased. Section 70 (4) of the Act provides for objections to be filed to the Assessment List HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 12 of 23 in writing to the Chairperson. Section 70 (5) of the Act talks of an objection being notified into and investigated, and the person making them shall be allowed an opportunity of being heard either in person or by authorized agent before the final Assessment List is prepared under Section 70 (6) of the Act. Section 72 of the Act provides for amendment of the Assessment List and Section 73 for preparation of new Assessment List.
15. It was observed in the matter of "Government Servant Cooperative House Building Society Limited and Others Vs Union of India and Ors." 16 (1998) 6 SCC 381;
"Therefore, the annual rent actually received by the landlord, in the absence of any special circumstances, would be a good guide to decide the rent which the landlord might reasonably expect to receive from a hypothetical tenant. Since the premises in the present case are not controlled by any rent control legislation, the annual rent received by the landlord is what a willing lessee, uninfluenced by other circumstances, would pay to a willing lessor. Hence, actual annual rent, in these circumstances, can be taken as the annual rateable value of the property for the assessment of property tax. The municipal corporation is, therefore, entitled to revise the rateable value of the properties which have been freed from rent control on the basis of annual rent actually received unless the owner satisfies the municipal corporation that there are other considerations which have affected the quantum of rent.
16. The observations made in Government Servant Cooperative Housing Building Society Ltd. (Supra) were reiterated by the Supreme Court in the matter of 'New Delhi Municipal Corporation Vs. Association of HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 13 of 23 concern Citizen of New Delhi, Civil Appeal No.903/2019, decided on 22.01.2019' wherein it was held that the annual realizable rent shall be the basis for calculating the rateable value and the value of holding cannot be taken into consideration. In this matter, the Apex Court referred to various previous decisions on the matter and held that the realizable rent of a property is the only criteria for determining the rateable value of the property. The court cited with approval the decision in the matter of "The Corporation of Calcutta Vs. Smt. Padma Debi and Ors." 1962 (3) SCR 49 wherein a provision similar to Section 63(1) of the Act was present in Calcutta Municipal Act, 1923 and it was held that the criteria for assessment should be rent of the property realizable by the landlord and not the value of the property. It was observed in this matter that the crucial words under Section 63 (1) of the Act are "gross annual rent at which the land or building might reasonably be expected to let from year to year". The dictionary meaning of the words "to let" is "grant use of for rent or hire". It implies that the rent which the landlord might realize if the house was let is the basis for fixing the annual value of the building. The criterion, therefore, is the rent realizable by the landlord and not the value of the holding in the hands of the tenant. The Supreme Court made the following observations in Associates of concerned Citizen's case (Supra);
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"81) In case there is a proof and/or material to find out that the reasonable rent could have been more than at which it is actually let out, the actual rent receipt can be discarded by adopting the expected rent which, on the basis of material, can be said to be reasonable. In those cases where the property is self-occupied or is vacant and not let out, it can be gathered from the rent at which a comparable property is let out. However, in such a case there would be two situations. Going by the dicta laid down in Dewan Daulat Rai Kapoor and other cases, the reasonable rent would be the standard rent which can be determined under the provisions of Delhi Rent Control Act. However, this principle would be applicable only in respect of those properties where Delhi Rent Control Act applies. In other cases, the yardstick would be the letting value of comparable properties, i.e., the rent at which comparable properties are let out. However, such criteria of fixation of standard rent has lost its relevance after the judgment of the Delhi High Court in Raghunandan Saran Ashok Saran (HUF) vide which Sections 4,6 and 19 of the Delhi Rent Control Act which deal with fixation of standard rent, were declared as ultra vires of the Constitution of India.
The aforesaid decision has been affirmed by this Court in State Trading Corporation of India Ltd. case.
82) Be as it may, in the context of the issue at hand, we emphasize that it is the annual letting value fixed in the aforesaid manner which can be the annual rent and not the value of the property in question. The expression annual rent is to be read in contradistinction to annual value. Two concepts are altogether different. In as much as the latter expression relates to annual value of the property which may be based on parameters different from fixing the annual rent of the property."
17. The aforesaid judgments give a clear indication that annual rent is to be the one which the landlord might realize if the house was let. The criteria, thus, is the rent realizable by the landlord and not the value of the holding. The test essentially is what rent the premises can lawfully fetch if let out to a hypothetical tenant. NDMC is not free to assess any HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 15 of 23 arbitrary annual value and has to look to and is bound by the rent realizable by the landlord and not the value of holding. No doubt, in case, there is proof or material to find out that the reasonable rent could have been more than at which the property has been actually let out, the actual rent can be discarded by adopting the expected rent which, on the basis of material, can be said to be reasonable. In such cases, the letting value of comparable property can be taken into account for revising the rateable value. Thus, the only criteria for determining the rateable value of a property is the one laid down under Section 63 of the Act. The impugned order shows that the Assessing Officer arbitrarily mentioned that the declared rent has been suppressed by the assessee. The order does not indicate as to on what basis the Assessing Officer arrived at the said finding more particularly when the appellants have placed on record irrefutable evidence indicating the rate of rent of the property. The order does not record the reasons for adopting this approach. The approach and the method of the Assessing Officer in calculating rateable value of the property runs counters to the mandate of Section 63 (1) of the Act. The impugned order cannot be sustained on this ground.
18. Coming to the other grounds of appeal. One of the main grounds of appeal is that there is an inordinate delay in finalizing the assessment. It is an admitted position that the impugned assessment order dated HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 16 of 23 29.12.2017 has been passed in respect of notices dated 26.03.2001 and 27.03.2008 issued under Section 72 of the Act. Although, the Act does not specify any period of limitation for finalizing the assessment but this does not mean that respondent is at liberty to sleep over the matter for a period of more than 16 years. It is expected that after issuance of notice, respondent should finalize the assessment within a reasonable period. The Division Bench of the High Court of Delhi has observed in the matter of "Ved Marwah & Ors. Vs. New Delhi Municipal Corporation & Ors." 248 (2008) DLT 781 that the proceedings initiated pursuant to Section 72 of the NDMC Act should be concluded in a reasonable period of not more than three years. In the said matter, notices for revising the assessment list were issued over a decade prior to passing of the final orders by the NDMC. The High Court observed that the inordinate delay was unreasonable and quashed the assessment orders.
19. The High Court of Delhi categorically held in Ved Marwah's case (supra) that there cannot be any unreasonable delay in finalizing the assessment after a notice has been issued under Section 72 of the Act. The High Court relied on various decisions of the Supreme Court of India and observed that the Assessing Officer must finalize the assessment within a reasonable period. It made the following observations;
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"Analysis and Conclusions
13. The notices for revising the assessment list in all these cases were issued over a decade prior to the passing of final orders. In one case, it was 16 years; in others, it was 14 years. In two cases, the same property was subject to multiple notices for later periods, without finalization of rateable value, for the previous year. Clearly, the finalization of these cases after inordinate delay of 14 to 16 years was plainly unreasonable. Where such open ended power-like in the present case, in Section 72 was conferred upon a statutory authority, i.e. a sales tax authority official in Punjab, the Supreme Court had outlined the correct approach in State of Punjab & Ors. v. Bhatinda District Co- op Milk P. Union Ltd 2007 (11) SCC 363 with respect to the limitations to exercise of such power. It was held that:
"5. In respect of the assessment for the year ending 31.3.2000, the assessment proceedings were completed relying on the return filed by the appellant on 20.3.2001. Indisputably, in terms of Section 11 of the 1948 Act, a period of three years has been prescribed as a period of limitation as contained under sub-section (3) of Section 11 for completing assessment from the last date for filing of return. Sub- section (6) of Section 11 reads as under : "_If upon information which has come into his possession, the Assessing Authority is satisfied that any dealer has been liable to pay tax under this Act in respect of any period but has failed to apply for registration, the Assessing Authority shall, within five years after the expiry of such period, after giving the dealer a reasonable opportunity of being heard, proceed to assess to the best of his judgment, the amount of tax, if any, due from the dealer in respect of such period and all subsequent periods and in case where such dealer has willfully failed to apply for registration, the Assessing Authority may direct that the dealer shall pay by way of penalty, in addition to the amount so assessed, a sum not exceeding one and a half times that amount. Section 21 of the said Act provides for revision. Section 21 of the Act with which we are concerned herein reads as under :HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 18 of 23
"21. Revision-(1) The Commissioner may of his own motion call for the record of any proceedings which are pending before, or have been disposed of by any authority subordinate to him, for the purpose of satisfying himself as to the legality or propriety of such proceedings or order made therein and may pass such order in relation thereto as he may think fit.
(2) The State Government may by notification confer on any Officer the powers of the Commissioner under sub-
section (1) to be exercised subject to such conditions and in respect of such areas as may be specified in the notification.
(3) A Tribunal, on application made to it against an order of the Commissioner under sub-section (1) within ninety days from the date of communication of the order, may call for and examine the record of any such case and pass such orders thereon as it thinks just and proper.
(4) No order shall be passed under this section which adversely affects any person unless such person has been given a reasonable opportunity of being heard".
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15. Sub-section (1) of Section 11 empowers the Commissioner to extend the period of three years for passing the order of assessment where for reasons are required to be recorded in writing subject, however, to the maximum period of five years. Ordinarily, therefore, a period of three years has been prescribed for completion of the assessment in terms of the provisions of the Act. We may also notice that in cases where an assessment order is to be reviewed, the same should be done within a period of one year.
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16. A bare reading of Section 21 of the Act would reveal that although no period of limitation has been prescribed therefor, the same would not mean that the suo-moto power can be exercised at any time.
17. It is trite that if no period of limitation has been prescribed, statutory authority must exercise its jurisdiction within a reasonable period. What, however, shall be the reasonable period would depend upon the nature of the statute, rights and liabilities thereunder and other relevant factors.
18. Revisional jurisdiction, in our opinion, should ordinarily be exercised within a period of three years having regard to the purport in terms of the said Act. In any event, the same should not exceed the period of five years. The view of the High Court, thus, cannot be said to be unreasonable. Reasonable period, keeping in view the discussions made hereinbefore, must be found out from the statutory scheme. As indicated hereinbefore, maximum period of limitation provided for in sub-section (6) of Section 11 of the Act is five years.
14. Bhatinda (supra) was noticed and followed subsequently in Ram Prakash (supra). In a more recent decision Ram Karan (D) by LRs v. State of Rajasthan 2014 (8) SCC 282, it was held that:
"38. State of Punjab & Ors v Bhatinda District Co-op Milk P. Union Ltd (supra) this Court held that if no period of limitation has been prescribed, statutory authority must exercise its jurisdiction within a reasonable period. However, what shall be the reasonable period would depend upon the nature of the statute, rights and liabilities thereunder and other relevant factors. In the present case, neither any objection was raised nor was any application filed by vendors for restoration of land in their favour. The suit was filed by the Tehsildar, Viratnagar after more than 31 years. No ground is shown to file such petition after long delay nor it was mentioned as to whether the vendors i.e. original landholders made any application for restoration of land in their favour.HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 20 of 23
39. In view of the matter, we hold that the suit being filed beyond the reasonable period was fit to be dismissed. The Additional Collector rightly dismissed the suit being barred by limitation."
15. In the present case, the finalization of assessment list or its revision, after over 12 years in all the cases, cannot be countenanced. It is clearly unreasonable and arbitrary and calls for interference.
17. In view of the above reasoning, it is held the impugned final orders of assessment and the demands issued are clearly unreasonable and void. They are hereby quashed. Consequently, it is held that the NDMC is at liberty to rework the assessments in respect of the properties that are the subject matter of these proceedings, by issuing fresh notices for the periods commencing from 3 years prior to the date on which the final notices were issued, and finalize the assessments within reasonable time. In the event of grievance on the part of the assessee to such fresh assessment orders, it is open to them to approach the appellate tribunal; provided they deposit the amount towards the tax liability for the base year."
20. As observed in the preceding paras, the High Court of Delhi held in Ved Marwah's case (supra) that a delay of over 12 years in finalizing the assessment of property tax is arbitrary and the same cannot be countenanced. In the said matter, the High Court quashed the order of the assessing authority on the ground of unreasonable delay. While quashing the order, it granted liberty to NDMC to rework the assessment by issuing fresh notice for the period commencing from three years prior to the date on which final notices were issued. NDMC was further directed to finalize the assessment within a reasonable time. NDMC challenged the order of the High Court by HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 21 of 23 filing a Special Leave Petition No.25403/2018 titled as "New Delhi Municipal Council Vs. Pyare Lal & Sons Pvt. Ltd." but the same was dismissed by the Supreme Court of India vide order dated 01.08.2023. Resultantly, the findings in Ved Marwah's case (supra) attained finality.
21. Coming back to the present case. In the present matter, there is an inordinate delay in finalizing the assessment. The initial notice under Section 72 of the NDMC Act was issued on 26.03.2001 while the final assessment order was passed on 29.12.2017. There is a time gap of around 16 years between the issuance of notice and the finalization of the assessment. Similarly, there is time gap of around 8 years between the subsequent notice dated 27.03.2008 and the assessment order. This, in itself, is a sufficient ground for setting aside the impugned order.
22. In view of the discussions in the aforesaid paras, I am of the considered opinion that the impugned order dated 29.12.2017 is bad in law. The Assessing Officer arrived at an arbitrary finding that the petitioner has suppressed the rent of the property. The Assessing Officer ignored vital material to assess the rateable value of the property. There is an inordinate delay on the part of NDMC in finalizing the assessment. Relying on the observations made in Ved Marwah's case (supra), the delay is certainly inordinate and arbitrary. HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 22 of 23 Accordingly, the appeal is allowed and the impugned order is set aside.
23. Copy of the judgment be sent to the respondent/NDMC.
24. Decree Sheet be prepared.
25. File be consigned to record room.
Announced in the open court on 21.10.2023 (Sudhanshu Kaushik) Addl. District Judge-02 & Waqf Tribunal New Delhi District, Patiala House Courts, New Delhi/21.10.2023 HTA No.10/2018 Nitin Gupta & Anr. Vs New Delhi Municipal Council Page 23 of 23