Case Note & Summary
The dispute pertains to the fixation of rateable value (RV) of a shop premises in Pune. The respondents, Moreshwar Ganesh Bhalerao and Pralhad Moreshwar Bhalerao, purchased the shop from a developer on 26.07.1984 for Rs.21,000/-. The Pune Municipal Corporation (petitioner) claimed that it had issued a notice to the previous owner, S.N. Pawaskar, on 15.03.1985, and after hearing him, passed an assessment order on 10.07.1986 fixing the RV at Rs.1800/- per annum. However, the respondents were not aware of this order. On 08.02.1990, the Corporation issued a tax bill for Rs.6509/- for the period 01.08.1984 to 30.04.1990 based on the said RV. The respondents filed an appeal under Section 406 of the Bombay Provincial Municipal Corporation Act, 1949 before the Small Causes Court, Pune, contending that they were the first purchasers and that the Corporation had not fixed the RV after giving them notice and hearing. The Small Causes Court allowed the appeal on 15.02.1994, setting aside the tax bill and directing the Corporation to fix the RV afresh after giving notice and hearing to the respondents. The Corporation challenged this order by way of a writ petition before the Bombay High Court. The High Court examined the facts and found that the Corporation had not proved that the notice dated 15.03.1985 was served on the respondents or that the assessment order was communicated to them. The court held that the assessment order was not binding on the respondents as it was passed without notice to them. The appeal under Section 406 was maintainable as the respondents were challenging the tax bill, not the assessment order. The High Court dismissed the writ petition, upholding the Small Causes Court's order and directing the Corporation to fix the RV after giving notice and hearing to the respondents.
Headnote
A) Municipal Law - Rateable Value - Fixation of Rateable Value - Notice and Hearing - Section 406, Bombay Provincial Municipal Corporation Act, 1949 - The Corporation must give notice and hearing to the owner/occupier before fixing rateable value. In this case, the Corporation failed to prove that notice was served on the respondents before passing the assessment order. The Small Causes Court rightly set aside the tax bill and directed fresh fixation after hearing the respondents. (Paras 1-7) B) Municipal Law - Appeal - Maintainability of Appeal under Section 406 - Section 406, Bombay Provincial Municipal Corporation Act, 1949 - An appeal under Section 406 is maintainable against a tax bill if no assessment order was communicated to the appellant. The respondents' appeal against the tax bill was maintainable as they were not aware of any prior assessment order. (Paras 2.5-7) C) Municipal Law - Natural Justice - Assessment Order - Validity - Bombay Provincial Municipal Corporation Act, 1949 - An assessment order passed without notice and hearing is void ab initio. The Corporation's assessment order dated 10.07.1986 was not communicated to the respondents, and the Corporation failed to prove service of notice. Hence, the order was not binding on the respondents. (Paras 2.2-7)
Issue of Consideration
Whether the Small Causes Court was justified in setting aside the tax bill and directing the Corporation to fix the rateable value afresh after giving notice and hearing to the respondents, when the Corporation had already passed an assessment order fixing the rateable value at Rs.1800/- per annum.
Final Decision
The High Court dismissed the writ petition and upheld the Small Causes Court's order dated 15.02.1994. The Corporation was directed to fix the rateable value of the shop premises afresh after giving notice and hearing to the respondents.
Law Points
- Rateable value must be fixed after notice and hearing to the owner/occupier
- Assessment order without prior notice is void
- Appeal under Section 406 of BPMC Act is maintainable against tax bill if no assessment order was communicated
- Burden on Corporation to prove compliance with natural justice
