AoQ \. IN THE mOH COURT OF CHHATTISGARH AT BILASPUR WRITPETITIONNO. ll^'^~/2005 PETITIONER \^9% ^y^f ^yy y. .y .^' ^y/t ^yy^" ^•^ Agrawal Navyuvak Mandal, A Society registered under the Registrar Firms and Societies, through - Its •President Kamal Narayan Rungta, son 'pf Late Gajadhar Prasad Rungta, aged a'bout 56 years, occupation - business, resident of Rungta Nivas, Ganjpara, Durg (Chhattisgarh) VERSUS RESPONDENTS 1. "7- \»{1 ^ [^y; USlsASPQy' ^ ^. State of Chhattisgarh, through : Secretary, Department of Local self Govemment, Dau Kalyan Singh Bhawan, Raipur (Chhattisgarh) s>y.3®i The Municipal Corporation, thr8ugh : Its Commissioner, Distt. Durg (C.G.) f 3. The Revenue Officer, Municipal Corporation, Durg (Chhattisgarh) WRIT PETITION UNDER ARTICLE 226/227 OF THE CONSTITUTION OF DWIA. HLGH COURTOF CHHATTISGARH : BILASPUR Sinale Bench: Hon'ble Shri Manindra Mohan Shrivastava, J. W.P.N0.1157of2005 Petitioner Agrawal Navyuvak Mandal, Durg Versus State of Chhattisgarh and Others Respondents (Writ Petition under Article 226/227 ofthe Cojastitution of India) Present: - Shri Rajeev Shrivastava, counsel for tbe petitioner. Shri Sumesh Bajaj, Government Advocate for the State/respondent No.1. Shri Sudeep Agrawal, counsel for respdndents No.2 & 3. ORAL ORDER (Passedon 16-03-2011) This petition has been filed by the petitioner aggrieved by the notice dated 01-03-2005 (Annexure P-11), by which, the Corporation has raised a demand for payment of property tax against the petitioner. 2. Case of the petitioner is Shat the petitioner is running a Dharamshala, which has been established and operated for charitable purposes, and therefore, the petitioner is exempted from payment of property tax in terms of provisions contained in Section 136 (e) of the Madhya Pradesh Municipal Corporation Act, 1956 (In short, theAct of 1956"). 3. In the petition, the petitioner has stated that the petitioner is a society, registered on 05-04-1974. The society has been constituted for charitable purposes. The society obtained a land on lease in the year 1978 and the allotment was made for construction of Dharamshala. The society is engaged in charitable activities and the building is being used for charitable purposes. On 20-03-2001 (Annexure P-8), the Municipal Corporation, Durg issued a memo, by which, the petitioner was informed that he has been held liable for payment of agSS®%j "JiS^ 2_ ^ -< property tax of Rs. 1,53,9857- in respect of the period from 1990-1991 to 1996- 1997 and the memo also reads that the petitioner has been exempted from payment of property tax from the year1998-1999 onwards. The petitioner was thereafter, called by the respondent No.3 for hearing with entire records and documents on 26-09-2001, vide notice dated 24-09-2001 (Annexure P-9). In compliance thereof, the petitioner appeared before the Revenue Officer on 26-09-2001 and submitted that the petitioner-society )§fully indulged in carrying on charitable activities and claimed for exemption from payment of property tax with regard to building of Dharamshala. Thereafter, a representation was also *t. made to the Commissioner, Municipal Corporation, Durg on 05-02-2002 (Annexure P-10). For almost three years, no action was taken by the Corporation towards claim of the petitioner for grant of exemption from payment of property tax in respect of the period 1990-1991 to 1996-1997. However, thereafter on 01- 03-2005, a notice has been issued, demanding payment of property tax in respect of the period from 1990-1991 to 1996-1997, to thetune of Rs.1,53,461/-. 4 . Learned counsel for the petitioner submitted that the petitioner had placed before the respondent No.3, ample material to demonstrate that even in respect of the period, in respect of which, the petitioner-society has been held liable for payment of property tax, it was not liable and entitled to exemption under the provision contained in Section 136 (e) of the Act of 1956. He further submits that the representative of the petitioner also placed the documents and material before the respondent No.3, pursuant to notice dated 24-09-2001, but thereafter, the petitioner was not informed as to what decision has been taken. He submits that without making due and proper enquiry and examination of the records of the socjety on relevant aspects with reference to the provisions contained in Section 136(e) of the Act of 1956, issuance of notice, demanding property tax, is arbitrary and contrary to the provisions of law. Learned counsel submits that •- 3> once exemption is claimed, the same is required to be decided after due application of mind to the relevant records and it is only when a decision is arrived at that no exemption is permissible, that tax could be levied. 5. In reply, learned counsel for the respondent-Corporation submitted that in the memo dated 22-03-2001, it has been clearly informed to the petitioner that on the basis of utility certificate/documents, the petitioner was found entitled for exemption from payment of properi:y tax, from the year 1998-1999 and it was clearly stated that the petitioner is ligble to pay property tax in respect of the period prior to that. hle submits that at that point of time, the Corporation had considered all the material available on record, which is reflected from the said memo dated 22-03-2001, wherein it has been categorically stated that on the basis of the records submitted by the petitioner with regard to utilization of building on 13-03-2001, the petitioner's claim for exemption from payment of property tax has been considered and the petitioner has been found entitled for exemption from the year 1998-1999 only. 6. Learned State counsel submitted that the dispute relating to recovery of property tax is between the petitioner and the Corporation. He however submits that in the facts and circumstances of the case, the action of the respondent- Corporation is in accordance with law. 7. The petitioner in his petition has claimed to be exempted from payment of property tax claiming itself to be a charitable institution statihg that the building is being used for the charitable purposes. From the document Annexure P-8, it is revealed that the petitioner had placed certain records before the Corporation on 13-03-2001, and upon examination of those records, the Corporation found the petitioner entitled to exemption from payment of property tax from the year 1998- 1999, but in respect of the period prior to that, it did not grant such exemption to ^ the petitioner. The petitioner has, however, submitted in his petition that this fact has not been specifically denied by the respondent-Corporation that pursuant to memo dated 22-03-2001, the petitioner was called by the respondent No.3, i.e. the Revenue Officer, along with entire documents vide notice dated 24-09-2001, on 26-09-2001. It has also been averred, which goes undisputed, that the petitioner appeared before the respondent No.3 on that day and submitted that the petitioner-society is engaged in running charitabfe activity, and therefore, entitled to exemption frompayment of property tax. From the return of the respondents, it is nowhere reflected that as to how the matter was dealt with and what was the result of the inspection of the records, which was produced by the petitioner on 26-09-2001. From the pleadings of the petitioner, it is found that a representation, which was subsequently made by the petitioner on 05-02-2001 to the Commissioner, Municipal Corporation, Durg and also taking into consideration the fact that the Corporation itself exempted the petitioner from payment of property tax from the year 1998-1999, claim of the petitioner for exemption in respect of the period prior to that cannot be said to be totally frivolous or baseless. It appears that even though, a letter dated 22-03-2001 was issued, the matter was not set at rest and on petitioner's claim, he was given a notice and asked toappear before the respondent No.1 on 26-09-2001 with records. However, thereafter, what decision has been taken has not been placed before this Court. 8. It therefore appears that the petitioner's claim for exemption from payment of property tax in respect of the period prior to 1998-1999 has not been properly considered by the respondent-Corporation. The provisions contained in Section 136(e) of the Act of 1956 provide entitlement of exemption from payment of property tax by submitting certain records and upon fulfillment of pre-conditions and pre-requisites. The matter therefore required proper consideration in the light Tjmane of the statutory provision. That does not appear to have been done. In these circumstances, the action of the respondents in proceeding to issue demand notice is hot justified. Consequently, the demand notice dated 01-03-2005 (Annexure P-11) is hereby quashed. The respondent-Corporation shall consider the case of the petitioner for grant of exemption from payment of property tax in respect of the period 1990-1991 to 1996-1997 by taking into consideration the records with regard to utilization of building in terms oflhe provision contained in Section 136(e) of the Act of 1956. The petitioner shall also be afforded an opportunity of hearing, forwhich, the re^pondent-Corporation may issue notice to the petitioner to produce before it relevant records of the society relating to the building and its utilization. The Corporation shall be at liberty to take appropriate steps after taking decision on the daim of the petitioner for grant of exemption from payment of property tax in respect of the period 1990-1991 to 1996-1997. 9. In view of foregoing, the petition is allowed to the extent indicated above. No orders as to cost. ~. ~ --—— —--.. ManindraMohanShrivasteva