Delhi District Court
M/S Bharat Petroleum Corporation Ltd vs New Delhi Municipal Council on 8 September, 2022
IN THE COURT OF SH. SUDHANSHU KAUSHIK :
ADDITIONAL DISTRICT JUDGE-02 & WAQF TRIBUNAL :
PATIALA HOUSE COURTS : NEW DELHI
(1) HTA NO.11/2018 (CNR NO.DLND01-004406-2018)
(2) HTA NO.12/2018 (CNR NO.DLND01-004407-2018)
(3) HTA NO.13/2018 (CNR NO.DLND01-004408-2018)
(4) HTA NO.14/2018 (CNR NO.DLND01-004403-2018)
(5) HTA NO.15/2018 (CNR NO.DLND01-004409-2018)
(6) HTA NO.16/2018 (CNR NO.DLND01-004401-2018)
(7) HTA NO.17/2018 (CNR NO.DLND01-004410-2018)
(8) HTA NO.18/2018 (CNR NO.DLND01-004396-2018)
(9) HTA NO.19/2018 (CNR NO.DLND01-004397-2018)
(10) HTA NO.20/2018 (CNR NO.DLND01-004398-2018)
(11) HTA NO.21/2018 (CNR NO.DLND01-004399-2018)
(12) HTA NO.22/2018 (CNR NO.DLND01-004400-2018)
IN THE MATTER OF :-
M/S BHARAT PETROLEUM CORPORATION LTD.
BIJWASAN INSTALLATION,
NEW DELHI
.....APPELLANT
VERSUS
NEW DELHI MUNICIPAL COUNCIL
THROUGH ITS CHAIRMAN
PALIKA KENDRA, SANSAD MARG,
NEW DELHI
.....RESPONDENT
DATE OF INSTITUTION : 15.05.2018
DATE OF CONCLUSION OF FINAL ARGUMENT : 08.09.2022
DATE OF PRONOUNCEMENT OF ORDER : 08.09.2022
HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 1 of 30
JUDGMENT
1. These are twelve appeals filed under Section 115 of the New Delhi Municipal Council Act, 1994 (hereinafter referred to as 'the Act') against the assessment order dated 13.07.2017 passed by Joint Director (Tax)/Assessing Authority, NDMC whereby the rateable value of a petrol pump of Bharat Petroleum Corporation Limited situated at property No.T-9429, Man Singh Road, Prithvi Raj Road, New Delhi (hereinafter referred to as 'the property') was fixed at Rs.23,300/- for the year 1999-2000 to 2004-2005 and Rs.19,44,000/- for the year 2005-2006 to 2016-2017. Appellant has not assailed the assessment order in respect of the year 1999-2000 to 2005-2006. He has filed 12 separate appeals in respect of each year from 2005-2006 to 2016-2017.
2. Since similar issues have been raised in all the appeals and they were heard together, therefore, by this common judgment, all the twelve appeals are being disposed off. The appeal bearing HTA No.22/2018 is the main file containing all the relevant documents.
Brief facts as disclosed in the appeal
3. Appellant Bharat Petroleum Corporation Limited is stated to be a Public Sector Undertaking (PSU) under the administrative control of Ministry of Petroleum & Natural Gas. The present appeal has been HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 2 of 30 filed through Sh. Rakesh Kumar Sinha, Territory Manager (Retail), who has been authorized to do so vide GPA dated 22.11.2016. Appellant is running a petrol pump in the plot of land measuring 1240 Sq.Ft. This plot was taken on lease by the predecessor in interest of the appellant M/s Burma Shell Storage & Distributing Company Limited vide lease deed dated 16.07.1938 at a premium of Rs.293/4 (Rupees Two Hundred Ninety-Three and Four Annas only). The said plot of land demised in perpetuity with effect from 27.04.1937 and as per clause-5 of lease deed, the demised plot of land could only be used for the business of petrol pump and for no other purpose.
3.1 The appellant received a notice dated 23.12.1999 under Section 77 of NDMC Act whereby information regarding land and structure was sought from him. Thereafter, the appellant received a notice dated 13.03.2000 under Section 72 of NDMC Act wherein the existing rateable value of Rs.5217 less 10% was proposed to be enhanced to Rs.25,967/- less 10% on account of expenditure on additions and alterations. Appellant has alleged that existing rateable value was shown incorrectly in the notice;
3.2 Subsequently, appellant received a notice dated 31.03.2006 under Section 72 of NDMC Act whereby the existing rateable value was HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 3 of 30 proposed to be enhanced to Rs.21,60,000/- less 10% on comparable rent basis. In response, appellant gave reply dated 12.05.2006 objecting to the proposed enhancement mentioning that no criteria and details of the proposed enhancement were given. Besides this, appellant also submitted the details regarding the area of land and the annual rent being paid to the office of L&DO.
3.3 Respondents did not take steps to assess the rateable value for a considerable period of time and appellant gained an impression that the objections filed by him have been accepted. After around four years, appellant received a notice dated 22.02.2011 under Section 77 of NDMC Act, whereby, information regarding land and infrastructure was sought from him. On 30.04.2014, appellant received an another notice under Section 77 of NDMC Act. He filed reply to this notice vide letter dated 16.05.2014 submitting complete details sought by the respondent.
3.4 Appellant received a letter dated 10.05.2014 whereby respondent intimated him that the personal hearing would be given on 19.05.2014 at 10:30 AM. He replied by writing a letter dated 27.05.2014 mentioning therein that the letter of personal hearing was received by him on 19.05.2014 at 03:30 PM and therefore, he could not attend it. He requested that a fresh date of personal hearing may HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 4 of 30 be fixed.
3.5 In the meantime, appellant kept receiving property tax bills till the year 2016 on the basis of rateable value of Rs.4,600/-. On 21.06.2017, appellant received a letter from the respondent wherein the personal hearing was fixed for 03.07.2017 but this letter was received by him on 05.07.2017. He wrote a letter dated 08.07.2017 to the respondent making a request for personal hearing but no response was received. He wrote a reminder dated 09.09.2017 to the respondent requesting for personal hearing in the matter. In response, respondent sent a letter dated 03.10.2017 informing the appellant that impugned order has been passed on 13.07.2017;
3.5 Appellant wrote a letter dated 17.10.2017 to the respondent informing him about the previous letter dated 08.07.2017 and reminder dated 09.09.2017 but no response was received. Appellant's representative met the concerned officer of respondent and made a request for personal hearing. The concerned officer made a noting in the file and re-fixed the matter for 27.10.2017 at 03:00 PM. On 27.10.2017, the concerned officer was not available and fresh date of 31.10.2017 was fixed for personal hearing. On 31.10.2017, the authorized representative attended the personal hearing and he was asked to submit certain information which was submitted by him HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 5 of 30 vide covering letter dated 08.11.2017. No assessment order was passed after this hearing and a bill dated 26.12.2017 demanding a sum of Rs.56,79,434/- was sent to the appellant. Appellant addressed a letter dated 28.02.2018 to the respondent and also met the officials of respondent but the respondent's officials refused to entertain him; 3.6 Appellant challenged the bill No.189109 dated 11.12.2017 demanding a sum of Rs.56,79,434/- by filing a writ petition before the High Court of Delhi. The High Court of Delhi disposed off the writ petition vide order dated 16.04.2018 after granting liberty to the appellant to file statutory appeal within 30 days. Respondent applied the certified copy of the impugned order on 18.04.2018 and the present appeal was filed.
Grounds of appeal
4. Appellant has challenged the impugned order dated 13.07.2017 on following grounds;
a) That the impugned order is a non-speaking order and the same has been passed mechanically;
b) That the impugned order has been passed arbitrarily in violation of the principles of natural justice as the objections filed by the appellant were not considered and order was passed without giving personal hearing to the appellant; HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 6 of 30
c) That while passing the impugned order, the assessing authority ignored crucial details regarding the area of land and the annual rent paid to L&DO;
d) That assessing authority has incorrectly observed in the impugned order that no one appeared on behalf of appellant on 03.07.2017 and no request for adjournment was received by him;
e) That assessing authority ought to have passed a fresh assessment order after hearing was granted to the appellant on 31.10.2017 but instead of doing so, he sent a demand bill dated 11.12.2017;
f) That assessing authority failed to consider that the property had never been let out by the appellant and the lease deed contains a restrictive covenant, which restricted its user to the business of petrol pump and for no other purpose.
5. Notice of the appeal was issued to the respondent. Respondent filed a detailed reply to the appeal and took preliminary objection of limitation and maintainability of the appeal.
Arguments
6. Counsel for the appellant supported the grounds taken in the appeal. He contended that the impugned order is a non-speaking order and HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 7 of 30 the same has been passed in a mechanical manner. He has contended that respondent failed to take note of the restrictive clause of the lease deed whereby the property can be used only for the purpose of running a petrol pump. He has argued that although, respondent has mentioned that the rateable value was revised on the basis of comparable rent but no such similarly situated property was available in the vicinity. He has mentioned that respondent has arbitrarily revised the rateable value of the property and the same is not permissible. He has contended that no reasons were furnished in the order for revising the rateable value of the property. He has mentioned that the impugned order is liable to be set-aside as the principles of natural justice were not complied with. He has mentioned that the assessment order was passed hurriedly and the appellant was not provided a fair hearing. He has argued that while passing the impugned order, respondent ignored crucial details regarding the area of land and the annual rent payable to L&DO.
7. On the other hand, counsel for respondent has questioned the maintainability of the appeal. He has contended that the appeal is not maintainable as the same was not filed within the period prescribed under Section 116 of the Act. He has mentioned that the impugned order was passed according to the provisions contained under the Act HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 8 of 30 and all the relevant factors were taken into consideration before passing the order. Counsel has submitted that due notice under Section 72 of the Act was issued to the appellant and there is no infirmity in the impugned order. He has pointed out that appellant was granted numerous opportunities to present documents and make submissions but he failed to avail those opportunities. He has submitted that notices under Section 72 of the Act were served on the appellant wherein it was clearly indicated that the rateable value is proposed to be enhanced on comparable rent basis. He has mentioned that the written objections filed by the appellant were taken into consideration at the time of passing of impugned order. He has stated that appellant was repeatedly granted opportunities for personal hearing but he deliberately chose to remain absent and accordingly, the impugned order was passed. He has mentioned that appellant 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 has argued that there is an inordinate delay in filing the appeal and even otherwise, there is no merit in the contentions raised by the appellant. He has prayed for dismissal of the appeal.
Finding
8. I have perused the record in the light of respective arguments. HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 9 of 30
9. In order to adjudicate upon the present controversy, it would be appropriate to refer to the relevant provisions of the Act.
10. 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.
11. 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 proviso to Section 61(1) of the Act states that the NDMC may, while fixing the rate at which the property tax shall be levied during any year, determine the rate leviable in respect of lands and buildings or portions of lands and buildings in which any particular class of trade or business is carried on shall be higher than the rate determined in respect of other lands and buildings or portion of other lands and buildings by an amount not exceeding one-half of the rate so fixed.
12. 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 HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 10 of 30 with the provisions of this Act and the Bye-laws made thereunder for the purpose of assessment to property taxes.
13. Section 62 of the Act relates to the 'premises in respect of which tax is to be levied'. Section 62 (1) of the Act lists out such lands or buildings or portions thereof which will not be subject to levy of property tax. This includes lands exclusively occupied and used for public worship or by a society or body for a charitable purpose. It also includes lands and buildings vested in the NDMC in respect of which the tax, if levied, would be leviable primarily on the NDMC and agricultural lands and buildings (other than dwelling houses). Section 62 (3) of the Act clarifies that if a portion of the land or building is exempted from property tax by reason of the exclusive use or occupied for public worship or charitable purpose then such portion shall be deemed to be a separate property for the purpose of municipal taxation.
14. 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 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 HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 11 of 30 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.
15. Section 63(2) of the Act states that the rateable value of any land which is not built upon but is capable of being built upon and any land on which a building is in process of erection shall be fixed at five per cent of estimated capital value of such land. Under Section 63(3) the Chairperson of the NDMC can by public notice, with the approval of the NDMC, specify a plant and machinery which will be deemed to form part of such land and building for the purposes of determination of rateable value. Section 65(1) of the Act clarifies that lands and buildings being properties of the Union shall be exempt from the property tax specified in Section 61 of the Act.
16. Section 66 of the Act speaks of the incidence of the property tax. It is primarily on the lessor if a building or land is given on lease. It is on the superior lessor if the land or building is given on a sub-lease. If it is not leased then on the person on whom the right to let the same HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 12 of 30 vests.
17. Section 67 of the Act talks of apportionment of liability of the property tax when the premises are let or sub-let. Section 68 of the Act clarifies who will be primarily liable for the property tax due in respect of any land or building and in the event of default of the person liable to pay such property-tax as specified in Section 66 of the Act. It is clarified that this would be the occupier of such land or building.
18. 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 HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 13 of 30 filed to the Assessment List 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.
19. The question of the assessment of house-tax by NDMC was considered in detail by the Hon'ble Supreme Court in the matter of "New Delhi Municipal Council Vs Association of concerned Citizen of New Delhi & Ors." (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 HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 14 of 30 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; "We shall first look at the provisions of the section to ascertain the meaning: The crucial words are "gross annual rent at which the land or building might at the time of assessment 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.
20. 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:
"80. 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 HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 15 of 30 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.
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."HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 16 of 30
21. 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 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.
22. Coming to the facts of the present case. Appellant has challenged the assessment order dated 13.07.2017 whereby the rateable value of the property was increased; (i) from Rs.5217/- less 10% to Rs.25,967/- less 10% with effect from 01.04.1999, (ii) Rs.21,60,600/- less 10% with effect from 01.04.2005. He has not challenged that part of the order whereby the rateable value of the property was increased to Rs.25967/- less 10% with effect from 01.04.1999. Before proceeding on the merits of the matter, it would be appropriate to dispose off the HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 17 of 30 legal objections raised by the respondent on the aspect of limitation and maintainability of the present appeal. Counsel for the respondent has submitted that Section 116 of the Act mandates that appeal against the assessment order should be filed within a period of 30 days. He has mentioned that the present appeal has been filed beyond the prescribed period of limitation and therefore, the same should be dismissed. He has further pointed towards the provisions of Section 77 of the Act. He has mentioned that Section 77(3) of the Act expressly provides that in case a persons omits to furnish the information sought by the Chairperson of NDMC as contemplated under Section 77(1) of the Act or a person fails to give true information, he shall be precluded from objecting to the assessment made by the Chairperson in respect of the land and building occupied by him. Counsel has submitted that there is material on record to show that the Chairperson of NDMC sought information from the appellant by issuing notices dated 22.09.1999, 13.03.2000 and 31.03.2006 but no response was received from the appellant. He has mentioned that since, appellant failed to furnish the requisite information, therefore, in terms of Section 77(3) of the Act, he is precluded from objecting the assessment order by filing the present appeal. On the other hand, counsel for the appellant has submitted HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 18 of 30 that the appeal was filed within limitation and the provisions of Section 77(3) of the Act are not applicable as all the requisite details were furnished to the respondent.
23. In order to appreciate the respective arguments on limitation and the maintainability of the appeal, it would be expedient to narrate the chain of events as revealed from the record.
i. Appellant received a notice dated 23.12.1999 under Section 77 of NDMC Act whereby information regarding land and structure was sought from him;
ii. Thereafter, appellant received a notice dated 13.03.2000 under Section 72 of NDMC Act wherein the existing rateable value of Rs.5217 less 10% was proposed to be enhanced to Rs.25,967/- less 10% on account of expenditure on additions and alterations;
iii. Subsequently, appellant received a notice dated 31.03.2006 under Section 72 of NDMC Act whereby the existing rateable value was proposed to be enhanced to Rs.21,60,000/- less 10% on comparable rent basis.
iv. In response, appellant gave reply dated 12.05.2006 objecting to the proposed enhancement mentioning that no criteria and details of the proposed enhancement were given. Besides this, HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 19 of 30 appellant also submitted that details regarding the area of land and the annual rent being paid to the office of L&DO. v. Thereafter, appellant again received a notice dated 22.22011 under Section 77 of the Act whereby information regarding land and structure was sought from him.
vi. Subsequently, appellant received another notice dated 30.04.2014 under Section 77 of the Act and the reply to the said notice vide letter dated 16.05.2014 submitting the details.
vii. Appellant received a letter dated 10.05.2014 whereby he was intimated that personal hearing would be given to him on 19.05.2014 at 10:0 AM. He gave reply to the letter on 27.05.2014 mentioning that the letter was received late and therefore, he could not attend the personal hearing. He requested that a fresh date for personal hearing may be fixed. viii. Appellant received letter dated 21.06.2017 from the respondent that final opportunity of personal hearing has been fixed for 03.07.2017. In response, he wrote a letter dated 08.07.2017 mentioning therein that the letter dated 21.06.2017 was received on 05.07.2017 and therefore, he could not attend the personal hearing on 03.07.2017. HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 20 of 30 ix. On 13.07.2017, the assessment order was passed. x. On 09.09.2017, appellant gave a reminder to the respondent that he has not received any reply to the letter dated 08.07.2017.
xi. On 03.10.2017, respondent wrote a letter to the appellant disclosing that the assessment order dated 13.07.2017 has been passed after providing ample hearing opportunity followed by the final opportunity on 03.07.2017 and the appellant was directed to clear the outstanding dues of Rs.52,43,417/- up to the period 31.03.2017 within 15 days. xii. Appellant wrote a letter dated 17.10.2017 reiterating that he could not avail the final opportunity of hearing on 03.07.2017 as the letter was received only on 05.07.2017.
xiii. Thereafter, the representative of appellant approached the office of respondent and made a request for personal hearing. The concerned officer made a noting in the file that the assessment order was made ex-parte and fixed the matter for hearing for 27.10.2017. On 27.10.2017, the officer of respondent was not available and a fresh date of personal hearing was fixed as 31.10.2017.
xiv. On 31.10.2017, the representative of appellant appeared HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 21 of 30 before Joint Director of respondent and he was directed to submit certain documents which were submitted by him vide covering letter dated 08.11.2017.
24. Appellant narrated the above said chain of events in the appeal and respondent has not disputed these facts in its reply. Coming of the first argument of the respondent that the appeal has not been filed within the prescribed period of limitation. Appellant has stated that after the impugned order dated 13.07.2017 was communicated to him, he approached the respondent's office wherein the concerned officer met him and the matter was re-fixed for hearing on 27.10.2017. He has stated that on 27.10.2017, the concerned officer was not available and therefore, the matter was re-posted for personal hearing on 31.10.2017. He has stated that the concerned official met him on 31.10.2017 and after giving him a personal hearing, granted liberty to submit information in respect of the property. In response, appellant submitted a letter dated 08.11.2017 containing details of the property and objecting the assessment. Appellant has submitted that no order was passed by the Assessing Officer after the personal hearing and a bill dated 26.12.2017 demanding a sum of Rs.56,79,434/- was issued. Thereafter, appellant approached the office of respondent but he was not entertained. He challenged the HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 22 of 30 bill by filing a Civil Writ Petition No.W.P(C) No.3694/2018 before the High Court of Delhi. The Writ Petitioner was disposed off by the High Court of Delhi vide order dated 16.04.2018 with the following observations:
"In view of the undertaking given by learned counsel for the respondent, to provide a copy of the Assessment Order to learned counsel for the petitioner within two days, the learned counsel for the petitioner seeks leave to withdraw the present petition with liberty to file an appropriate appeal under Section 115 of the NDMC Act and prays that the respondent may be restrained from taking any coercive steps till the petitioner's appeal is listed.
Learned counsel for the petitioner submits that immediately upon receipt of the copy of the assessment order, the petitioner will take steps to file a statutory appeal within the provided period of thirty days. In view of the above facts, the respondent is directed not to take any coercive action against the petitioner for the next thirty days."
25. Appellant has submitted that the information about the impugned order dated 13.07.2017 was received by him vide letter dated 03.10.2017. Thereafter, he approached the office of respondent and made a representation dated 17.10.2017 that the earlier correspondence made by him vide letter dated 08.07.2017 and 09.07.2017 were not taken into consideration. He has stated that the concerned officer of respondent met him and made a noting in the file to the effect that the matter is re-fixed for hearing on 27.10.2017 at 03:00 PM. He has mentioned that on 27.10.2017, the officer was HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 23 of 30 not available and a fresh date of 31.10.2017 was fixed for personal hearing. The submissions made by the appellant in para-12, 13 & 14 of the appeal have been admitted by the respondent in its reply. Appellant has submitted that on 31.10.2017, the officer of respondent directed him to submit certain information and in compliance of the orders, the information was submitted by him on 08.11.2017. He has mentioned that he challenged the bill dated 11.12.2017 by filing a writ petition in the High Court of Delhi.
26. 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. Record demonstrates that appellant approached the office of respondent and he was under a bonafide belief that his case is being reconsidered as he was afforded personal hearing and the respondent directed him to submit certain documents. Thereafter, he approached the High Court of Delhi challenging the bill raised on the impugned assessment order. Record suggests that appellant had been prosecuting his cause with due diligence. He has been able to satisfy that there was sufficient cause for not preferring the present appeal. Thus, the argument that the appeal deserves dismissal HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 24 of 30 because of being filed after the limitation period deserves rejection.
27. Now coming to the second argument of the counsel that the appeal is not maintainable in view of Section 77(3) of the Act. It has been argued by the counsel for the respondent that the appellant did not furnish the required information pursuant to the notices issued under Section 77 of the Act on 22.09.1999, 31.03.2006 and 22.02.2011 and therefore, he has no right to file the present appeal. The argument is flawed. It cannot be conceived that the right to file an appeal against the assessment order as conferred under Section 115 of the Act is lost, in case, a person omits to comply with a requisition made by the Chairperson of NDMC under Section 77(1) of the Act. I am of the considered opinion that the right to appeal under Section 115 of the Act is independent of compliance under Section 77 of the Act. Any other interpretation would lead to miscarriage of justice and it would nullify the provisions of Section 115 of the Act.
28. Now coming to the merits of the matter. It is the case of appellant that the impugned order was passed by the respondent without affording him a personal hearing. Counsel for the appellant has argued that the orders were passed arbitrarily and in violation of principles of natural justice. On perusal of the Act, it becomes apparent that the principles of natural justice have been incorporated HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 25 of 30 in various provisions. Section 70 of the Act vests a power with the counsel of NDMC for preparation of an assessment list in respect of each land and building in New Delhi. Section 70(2) of the Act provides that after preparing the assessment list, Chairperson shall give public notice so as to facilitate the inspection of assessment list by the interested persons. Section 70(3) of the Act states that the Chairperson shall also give public notice of not less than a month as to when he will proceed to consider the rateable value of land & building entered in the assessment list and in case, the rateable value is increased, he shall also given written notice to the owner or occupier of land & building. Section 70(4) of the Act conceives that an objection on the rateable value could be made to the Chairperson before the date fixed in the notice. Section 70(5) of the Act states that the objection filed by the effected party shall be inquired into and investigated and the person making them shall be allowed an opportunity of being heard. Similarly, Section 72 (2) of the Act dealing with the amendment of assessment list also provides that Chairperson shall give a notice to a person effected and consider any objection that may be made by him. Thus, giving notice and considering the objections raised by the effected persons is sacrosanct before passing an assessment order.
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29. In the present matter, appellant has not denied that the notice dated 27.06.2017 was received by him. His case is that this notice was received by him only on 05.07.2017 and therefore, he had no knowledge that he had been provided final opportunity of hearing on 03.07.2017 at 03:00 PM. Record shows that on receiving the said notice on 05.07.2017, appellant wrote a letter on 08.07.2017 expressly mentioning therein that the notice dated 27.06.2017 was received by him only on 05.07.2017. In this letter, appellant again sought an opportunity of personal hearing, however, in the meantime, on 13.07.2017, respondent passed the assessment order. Record further suggests that even after the impugned order was passed by the respondent, appellant had no information as he wrote a reminder on 09.09.2017 again demanding personal hearing from the respondent. Finally, respondent communicated to him vide letter dated 03.10.2017 that the impugned order has been passed on 13.07.2017. Thus, it is apparent that appellant was not at fault in attending the personal hearing fixed on 03.07.2017 as he had no information about the hearing till 05.07.2017. It leads to the inevitable conclusion that impugned order has been passed without affording a fair hearing to the appellant and therefore, the same is liable to be set-aside.
30. Further, the argument that the order has been passed mechanically HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 27 of 30 and arbitrarily finds support from record. I have gone through the impugned order dated 13.07.2017. It has been stated in the order that the assessee has filed objections dated 31.03.2000 against the proposed rateable value of Rs.25,967/- less 10%. Record shows that those objections were not dealt with in the impugned order. Appellant has placed on record a letter dated 12.05.2006 raising objection that increasing the rateable value was not justified. In this letter, appellant disclosed the annual rent of the property as Rs.1218.86/- and further disclosed that the property is self occupied. The Assessing Authority has mechanically mentioned in the impugned order that the rateable value is being increased on comparable rent basis. No doubt, the rateable value can be increased on the basis of comparable rent of a similar property but there is nothing on record to indicate as to on what basis the comparison was done. It is an admitted case that the appellant has taken the property on lease and as per clause-5 of the lease deed, the property can be used only for the business of petrol pump and no other purpose. There is a peculiar clause attached in respect of usage of the property. The impugned order does not demonstrate that this aspect was taken into consideration. The rateable value can be increased only on the basis of expected rent of a property. The criterion is the rent releasable by the landlord and not HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 28 of 30 the value of holding in the hands of tenant. The rent which the landlord might realized, if the building was let is made the basis for fixing the annual value of the property. In case, there is a proof or material to find out that the reasonable rent could have been more than at which it is 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 those cases, where the property is self occupied or vacant, it can be gathered from the rent at which a comparable property is let out. However, there must be some material to show the rent of a comparable property. In the present matter, the respondent has mechanically stated that the rateable value has been revised on comparable rent basis but the order is silent as the comparable rent of which property was taken into consideration for increasing the rateable value of appellant's property. The order is bad and deserves to be set aside.
31. In view of the discussions in the aforesaid paras, I am of the considered opinion that the impugned order dated 13.07.2017 has been passed mechanically and arbitrary. The impugned order has been passed without affording a fair and reasonable hearing to the appellant, which negates the mandate of NDMC Act. The order is devoid of reasoning and the same has been passed without taking HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 29 of 30 note of the objections filed by the appellant. The order is accordingly set aside and the matter is remanded back to NDMC to pass a fresh speaking order for assessing the rateable value of the property bearing property No.T-9429, Man Singh Road, Prithvi Raj Road, New Delhi for the year 2005-2006 to 2016-2017. NDMC shall issue fresh notice to the appellant for the assessment order under Section 72 of NDMC Act.
32. Copy of the judgment be sent to the NDMC.
33. Decree Sheet be prepared. Ahlmad is directed to return the trial court record forthwith as per rules.
34. File be consigned to record room.
Announced in the open court on 08.09.2022 (Sudhanshu Kaushik) Addl. District Judge-02 & Waqf Tribunal New Delhi District, Patiala House Courts, New Delhi/08.09.2022 HTA No.11/2018 to 22/2018 M/s Bharat Petroleum Corporation Ltd. Vs NDMC Page 30 of 30