Ashim Kumar Banerjee, J.@mdashThe appellants were the owners of premises No. P-8, CIT Scheme XLII, Calcutta. There had been long standing dispute with regard to payment of property taxes payable by the appellants to the corporation. The appellants challenged the notice of demand served upon them by the Corporation in respect of the property taxes due to the period commencing from 1st Quarter, 1995 to 4th Quarter, 1996. The appellants filed a writ petition challenging the said notice of demand. They also challenged the vires of several provisions of the Kolkata Municipal Corporation Act, 1980. The writ petition filed by the appellants being Matter No. 342 of 1996 was pending up till January 2006 when the said writ petition was disposed of by the learned single Judge by judgment and order dated January 18, 2006 appearing at page 75 of the Paper Book. During the pendency of the said writ petition the Corporation framed Waiver Scheme in 2001-2002. Being encouraged by its success the Corporation repeated the same in 2004. The guidelines and the said scheme are appearing at pages 64-67 of the Paper Book. On perusal of the guidelines it appears that the Corporation decided to waive interest and penalty on the outstanding property taxes due up to March 31, 2003. The scheme, inter alia, provides that it would be an incentive in case of defaulting rate payers who would be willing to clear off the outstanding dues on bills presented up to 31st March. 2003. On a combined reading of the guidelines and the said scheme it clearly appears that the Corporation intended to waive interest and penalty to the extent mentioned therein. There was, however no concession given in respect of the property taxes or any part of it outstanding as on the stipulated date. The appellants availed the said scheme and applied before the Corporation, inter alia, inquiring as to the exact amount of outstanding as on that date. The Corporation informed the appellants that there had been an outstanding to the extent of Rs. 14,84,819.41.00 as on the stipulated date. The Corporation asked the appellants to pay a net sum of Rs. 15,59,401.00 to avail the benefit of the Waiver Scheme. The appellants duly paid the said sum as would appear from the receipts annexed to the pleadings appearing at the Paper Book. The Corporation, however, issued subsequent notices for a general revision, inter alia, for the period commencing from 3rd Quarter, 1990-91, 3rd Quarter, 1996-97. 3rd Quarter, 2002-03. The appellants filed an objection and prayed for personal hearing. The authority, after considering the objections raised by the appellants revised the annual valuation for the aforesaid periods.
2. In the above backdrop the appellants approached the learned single Judge by filing a writ petition, inter alia, praying for quashing of the said revision of valuation as well as the notices of demand issued as a consequence of such revision for the differential amount which became due by the appellant in view of such general revision. The learned single Judge by judgment and order dated March 12. 2008 appearing at pages 124-126 of the Paper Book, dismissed the writ petition. His Lordship held that such revision was done in accordance with law. Such revision was not affected by the Waiver Scheme referred to above. His Lordship dismissed the writ petition by observing that it was made on "entirely wrong premise". Hence, this appeal by the appellants.
3. Dr. Debi Prosad Pal, learned senior counsel appearing for the appellants contended before us that once the outstanding as on March 31, 2003 was paid by the appellants under the Waiver Scheme there could not have been any occasion for the Corporation to revalue for the period covered by the said scheme. Dr. Pal further contended that the Corporation being a public authority invited the defaulting tax payers to avail the benefit of the Waiver Scheme and assured the tax payers that they would be given a clear discharge with regard to the outstanding as on that date. It would be unfair to allow a public body to resile from their promise and go on revising the valuation for the period covered under the Waiver Scheme. To support his contention Dr. Pal cited the decision of the Apex Court in the case of M/s. Motilal Padampat Sugar Mills Company Ltd. v. The State of Uttar Pradesh & Ors., reported in All India Reporter, 1979, SC 621. Dr. Pal highlighted the observation made by the Apex Court appearing at head note-C of the said decision. The relevant extract is quoted below:
It is elementary that in a republic governed by the rule of law, no one, however high or low, is above the law. Every one is subject to the law as fully and completely as any other and the Government is no exception. It is indeed the pride of constitutional democracy and rule of law that the Government stands on the same footing as a private individual so far as the obligation of the law is concerned: the former is equally bound as the latter. The Government cannot claim to be immune from the applicability of the rule of promissory estoppel and repudiate a promise made by it on the ground that such promise may fetter its future executive action. If the Government does not want its freedom of executive action to be hampered or restricted, the Government need not made a promise knowing or intending that it would be acted on by the promisee and the promisee would alter his position relying upon it. But if the Government makes such a promise and the promisee acts in reliance upon it and alters his position, there is no reason why the Government should not be compelled to make good such promise like any other private individual. But since the doctrine of promissory estoppel is an equitable doctrine, it must yield when the equity so requires.
Dr. Pal handed over a chart to show that the period for which revision of annual valuation was done, was covered by the Waiver Scheme which stood resolved upon payment of the amount so notified by the Corporation to the appellants.
4. Dr. Pal also referred to and relied on two other Apex Court decisions in the case of
5. Opposing the appeal Mr. Ashok Kumar Das Adhikari, learned senior counsel appearing for the Corporation contended that the subject scheme was for waiver of interest and penalty and not the tax. Such benefit could be availed by a defaulting tax payer only when he agreed to pay the outstanding as on the stipulated date in respect of the bills presented by the Corporation for the said period. Mr. Das Adhikari supported the judgment of the learned single Judge and contended that it did not deserve any interference by the Court of Appeal.
6. On perusal of the cited decisions we find that the decision of the Apex Court in the case of Motilal Padampat Sugar Mills (supra) was affirmed by a subsequent three Judge Bench decision in the case of Union of India (supra). The same principle was reiterated in the case of State of Orissa & Ors. (supra). To decide the subject controversy let us have a close look to the provisions of the relevant statute being the said Act of 1980.
7. Section 171 empowers the Corporation to levy Property Tax on land and buildings within its jurisdiction. For the purpose of levy of the Property Tax the Corporation is entitled to determine the annual valuation of a property u/s 174. u/s 179 the Corporation is empowered to have periodic re-assessment of the annual value. It also provides that so long the annual value is not freshly assessed the earlier valuation would continue. u/s 180 the Corporation has a special power to revise the annual valuation on some eventualities prescribed in the said provision. Hence, an annual valuation once fixed is the determining factor to levy the Property Tax and such valuation remains the determining factor so long it is not revised either u/s 179 or u/s 180. There are other provisions in the said statute with regard to fixing of responsibility for payment of tax and the mode of payment which we need not discuss being not strictly relevant herein.
8. Chapter XVI, inter alia, provides for the mode of payment and recovery of taxes. u/s 214 the tax so levied could be recovered, inter alia by presenting a bill. Such bill is presented u/s 216. If it is not paid within this stipulated period notice of demand is followed u/s 217. There are other provisions with regard to recovery in the said chapter which we need not discuss at the present.
9. In the instant case on perusal of the earlier writ petition we find that the bills were not paid by the appellants. Hence, those bills were followed by a notice of demand u/s 216 which became the subject matter of challenge in the said writ petition. During the pendency of the writ petition the Corporation decided to waive interest and penalty on the outstanding bills under waiver scheme. The appellants availed the said benefit by making payment of the entire outstanding at a time along with the reduced interest as per the scheme. The learned Judge thus, disposed of the earlier writ petition by observing that it had become infructuous. If we analyse such sequence of events in the light of the legal provisions so discussed above we can safely infer that the dues as on March 31, 2003 so remained outstanding on the day when the Waiver Scheme was introduced, stood resolved upon payment of the amount so notified by the Corporation under the said scheme at the instance of the appellants. Hence, there could be no dispute with regard to those outstanding to be raised either by the Corporation or by the appellants. It was a comprehensive settlement between both the parties.
10. Hence, the issue involved in this appeal comes in a narrow campus. Is the Corporation entitled to revise the annual valuation u/s 179 for the period covered under the scheme?
11. To decide this issue let us hypothetically examine an eventuality where a tax payer had paid Corporation taxes as and when bills had been raised and the Corporation attempted to revise the annual valuation for those period and demanded the differential amount of the tax. Dr. Pal in his usual fairness conceded that the answer would be in affirmative. We also feel so on a combined reading of the aforesaid provisions of the said Act of 1980. The revision of valuation has no direct nexus with regard to payment and recovery of tax. Such revision does not depend upon the fact as to whether the taxes were paid as per the earlier valuation or those are still outstanding as on the date of revision. If the answer is positive we do not find any logic as to how the situation would be different in case of another tax payer who defaults to pay the taxes of the said period and avails the Waiver Scheme to get benefit of waiver of interest and penalty. On a close reading of the Waiver Scheme we are fully convinced that the said scheme was only to give an incentive to the defaulting tax payer to have waiver of interest and penalty. It was only to recover the outstanding and not for any other purpose from including the benefit of waiver from re-assessment and/or revision of valuation. As we have already observed, the taxes are levied on the basis of the annual valuation prevalent as on the date of presentation of the bills. The amount becomes outstanding once it is not paid despite presentation of bills, within the stipulated period. It has no nexus with the revision of annual valuation either u/s 179 or section 180.
12. Once the Corporation accepted payment from the appellants under the Waiver Scheme so notified by them the Corporation was not entitled to raise any further demand or any dispute with regard to the outstanding as on March 31, 2003. Admittedly, annual valuation was revised for the subject periods mentioned above in 2006. The appellants raised objection. Those objections were considered and the annual valuation was re-determined by way of revision u/s 179. The Corporation then became entitled to raise a supplementary bill for the said period, inter alia, demanding the differential amount. Once such bill was raised it would only become outstanding if it was not paid beyond the stipulated period mentioned in the said bill. Admittedly the supplementary bills were raised much after March 31, 2003. Hence, in no stretch of imagination those bills could be recovered under the Waiver Scheme which became effective for the period upto March 31, 2003 and not beyond.
13. The learned single Judge approached the problem in a right direction. The interpretation of the provisions made by the learned single Judge, so highlighted in the judgment and order impugned is accurate and does not deserve any interference at all.
14. The appeals fails and is hereby dismissed.
15. There would be no order as to costs. Urgent xerox certified copy would be given to the parties, if applied for.
Prasenjit Mandal, J.
16. I agree.
