@JUDGMENTTAG-ORDER
Vinod K. Sharma, J.@mdashThe Petitioner has approached this Court, with a prayer for issuance of a writ, in the nature of Certiorari, for
quashing the demand notice, dated 22.11.2007, calling upon the Petitioner to pay the licence fee for the Tele Communication Towers erected by
the various private companies, including State and Central Government.
2. The demand has been raised in pursuant to the resolution passed by Trichy Corporation Council, dated 22.09.2003, in exercise of powers u/s
451 (2) of the Coimbatore City Municipal Corporation.
3. Section 451 (2) of the Coimbatore City Municipal Corporation, reads as under:
451. General Provisions regarding licences, registration and permissions -(1) Every licence or permission granted under this Act or any rule or by-
law made under it shall specify the period, if any, for which and the restrictions, limitations and conditions subject to which the same is granted and
shall be signed by the Commissioner.
(2) (a) Save as otherwise expressly provided in or may be prescribed under this Act for every such licence or permission fee shall be paid in
advance on such units and at such rates as may be fixed by the council;
4. The Learned Counsel for the Petitioner challenged the resolution, and the demand, for want of jurisdiction with the Respondent to demand the
licence fee for erection of the towers. The contention of the Learned Counsel for the Petitioner is that the licence was granted to the Petitioner by
the Government of India, Ministry of Communication, on 22.05.1998, therefore, the licence fee can be claimed only by the Government of India,
and the Respondent has no jurisdiction to impose any licence fee on erection of towers, as the subject matter falls under Schedule 7 Item 31 of the
Union list of Constitution of India, therefore, the Respondent has no jurisdiction to impose licence fee.
5. It is also the contention of the Learned Counsel for the Petitioner that for imposing the licence fee u/s 451 (2) of Coimbatore City Municipal
Corporation, there has to be quid pro quo; the Respondent is not rendering any service qua the installing of the towers, therefore no licence fee can
be imposed by the Municipal Corporation under the Act, in absence of any service being rendered.
6. Learned Counsel for the Petitioner also contended that Section 120 of the Coimbatore City Municipal Corporation Act 1981, bars the levy of
tax on the subject, with which the State legislature is not competent to impose license tax in the State under constitution.
7. Section 120 of the Coimbatore City Municipal Corporation Act 1981 reads as under:
120. Saving for certain provisions of the Constitution -Nothing in this Chapter shall authorize the council to levy any tax which the State Legislature
has no power to impose in the State under the constitution.
8. The Writ Petition is contested by the Learned Counsel for the Respondent, by contending, that in the demand notice, it is wrongly mentioned as
licence fee, but it is infact the property tax imposed u/s 121 of the Coimbatore City Municipal Corporation Act 1981.
9. Section 121 of the Act reads as under:-
121. Description of Property Tax: -(1) If the council by resolution determines that a property tax for general purposes shall be levied, such tax shall
be levied on all buildings and lands within the City save those exempted by or under this Act or any other law.
(2) Save as otherwise provided in this Act, the property tax shall be levied at such percentage of the annual value of buildings, or lands which are
occupied by, or adjacent and appurtenant to buildings or both, as may be fixed by the council subject to the provisions of Section 118:
Provided that the aggregate of the percentages so fixed shall not in the case of any land or building be less than fifteen and a half per cent or greater
than thirty five percent of its annual value.
(3) for the purpose of assessing the property tax the annual value of any building or land shall be determined by the Commissioner;
Provided that the annual value of any building or land the tax for which is payable by the Commissioner shall be determined by the mayor.
(4) (a) Save as otherwise provided in Clause (b), the council shall, in the case of lands which are not used exclusively for agricultural purposes and
are not occupied by, or adjacent and appurtenant to buildings, levy the property tax on the capital value of such lands at such percentages as it
may fix which shall not exceed six percent of their capital value;
(b) In the case of railway lands, which are not used exclusively for agricultural purposes and are not occupied by, or adjacent and appurtenant to,
buildings, the council shall levy property tax on the annual value of such lands at such percentages which shall not exceed seventeen and one-third
per cent of their annual value and the Government shall have power to make rules regarding the matter in which the person or persons by whom
and the intervals at which the annual value of such lands shall be estimated or revised and they may also by such rules, restrict or modify the
application of the provisions contained in Schedule II to such lands.
(5)(a) the council shall, in the case of lands used exclusively for agricultural purposes, levy property tax at such proportions as it may fix, of the
annual value of such lands calculated in the manner specified in Clause (b):
Provided that the proportion shall not exceed the maximum, if any, fixed by the Government.
(b) (i) In the case of lands held direct from Government on ryotwari tenure or on lease or licence, the assessment, lease amount, royalty or other
sum payable to Government for the lands together with any water-rate which may be payable for their irrigation, shall be taken to be the annual
value;
(ii) In the case of lands held on any tenure other than ryotwari tenure, the annual rent payable to the landholder, sub-landholder or any other
intermediate land-holder holding on an under tenure created, continued or recognized by a landholder or sub-land-holder, as the case may be, by
his tenants together with any water-rate which may be payable for their irrigation, shall be taken to be the annual value; and where such lands are
occupied by the owner himself or by any person holding the same from him free of rent or at a favourable rent, the annual value shall be calculated
according to the rates of rents usually paid by occupancy ryots for ryoti lands in the neighbourhood with similar advantages, together with any
water-rate which may be payable for the irrigation of the lands so occupied;
(iii) In the case on lands, the assessment of rent of which is paid in kind, the annual value shall be calculated according to the rates of rent
established or paid for neighbouring lands of a similar description and quality, together with any water-rate which may be payable for the irrigation
of the lands first mentioned;
(c) If such lands be occupied by tenants, the council shall levy the taxes in equal shares, from the landholder and the tenant respectively;
(d) Subject to any rules which the Government may make in this behalf, the Commissioner shall have the power to require the staff of the Land
Revenue Department to collect the taxes due to the council in respect of such lands on payment of such remuneration not exceeding five per
centum of the gross sum collected as the district collector having jurisdiction over the City of Coimbatore may, be general or special order
determine.
10. Learned Counsel for the Petitioner also referred to Section 2 of the Act, to contend, that the tower would fall within the definition of building,
and thus covered u/s 121 of the Act, for the purpose of imposition of property tax. No fault, therefore, can be found on the resolution or the
impugned demand challenged by the Petitioner.
11. On consideration, I find force in the contention raised by the Learned Counsel for the Petitioner. The impugned order specifically mentions that
the licence fee is demanded u/s 451(2) of the Act. It is well settled, that the order impugned, cannot be justified by raising new pleas in the counter,
which go contrary to the findings in the impugned order.
12. Otherwise also, impugned resolution can not be sustained in law, as procedure laid down for imposing tax was not followed. In absence of
imposition of tax in terms of statute, no demand can be raised. No prosecution of imposition of tax can be drawn.
13. The contention of the Respondent, that this may be treated as a property tax, therefore, is argument of frustration, which deserves to be
noticed to be rejected. The license fee u/s 451 (2) of the Coimbatore City Municipal Corporation Act 1981, cannot be imposed in the absence of
licence by the Corporation and rendering of any service.
14. Even otherwise, in view of Section 120 of the Coimbatore City Municipal Corporation Act 1981, read with Schedule 7 of the Constitution, the
Respondent do not have any jurisdiction, with regard to imposition of licence fee as noticed above.
15. The demand also cannot be termed to be one u/s 121 of the Coimbatore City Municipal Corporation Act 1981, as contended by the Learned
Counsel for the Respondent, as no procedure to impose tax on property was followed.
16. The Learned Counsel for the Respondent placed reliance on the judgment of the Hon''ble Karnataka High Court, in the case of Hutchison
Essar South Ltd., v. Corporation of the City of Belgaum, in W.P. No. 19530 of 2005, decided on 25.11.2010, to contend, that the imposition of
licence fee deserves to be upheld u/s 121.
17. This judgment cannot be of any help the Respondent, as in the said case, the imposition of the property tax was upheld, and not imposition of
licence fee.
18. The property tax can be imposed by following due process of law, as envisaged u/s 121 of the Coimbatore City Municipal Corporation Act
1981 and licence fee u/s 451 (2) of the Act can be imposed, in view of Section 120 of the Act.
19. For the reasons stated above, the Writ Petition is allowed, and the impugned order is set aside.
20. The connected Miscellaneous Petitions are closed.
21. No costs.
