THE HON’BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE ASHUTOSH MOHUNTA WRIT PETITION No. 30162 of 2010. ORDER: (Per Goda Raghuram, J) The demand notice dt. 4.10.2010 issued by the 1st respondent calling upon the petitioner to pay property and attendant taxes and cesses, of Rs. 14,378/- for the period ending 31st March, 2011 is challenged inter alia on the ground that the 1st respondent has no authority or jurisdiction to issue the demand notice. The principal contention urged by the petitioner is that no notification was issued by the State Government in consultation with the 1st respondent and the Kadapa Muncipal Corporation (the 2nd respondent) directing that the powers and functions vested in the 2nd respondent Corporation under the provisions of the Greater Hyderabad Municipal Corporations Act 1955 as applicable to the 2nd respondent Corporation, under the provisions of the A.P. Municipal Corporations Act 1994, transferring and to be exercised and performed by the 1st respondent, in the matter of demanding and collection of the property tax, otherwise payable by the petitioner to the 2nd respondent Corporation. Section 679-F reads as under: 679-F Power to transfer functions of the Corporation to the A.P. Industrial Infrastructure Corporation—Notwithstanding anything contained in this Act, as or in any other law for the time being in force relating to the Municipal Corporations, the Government may, in consultation with the Corporation and also the A.P. Industrial Infrastructure Corporation, by notification in the A.P. Gazette, and subject to such restrictions and conditions including those relating to the remittance of such percentage of the property tax to the Corporation and to such control and revision as may be specified therein direct that any power or function vested in the Corporation by or under this Act shall be transferred to and exercised and performed by the A.P. Industrial Infrastructure Corporation. The above provision is in para materia section 389-B of the A.P. Municipalities Act, 1965 wherein as well a similar notification is required to be issued by the Government in respect of Municipalities covered by the provisions of the A.P. Municipalities Act, 1965, transferring the exercise of functions to be performed by the Municipality, to the 1st respondent. Sri.Palle Nageshwar Rao, the learned Standing Counsel for the 2nd respondent Corporation states on instructions that after the upgradation of the erstwhile Kadapa Municipality into a Municipal Corporation in 2004, no fresh notification was issued by the State Government as per the provisions of Section 679-F of the GHMC Act, 1955. In defense to the challenge in the writ petition, Sri. Roy Reddy, learned Counsel representing the 1st respondent states that the notification issued by the State Government in G.O.Ms.No. 338 (M.A.U.D) Department dt. 29.11.1997, in exercise of powers under Section 379-B of the 1965 Act inhering powers in the 1st respondent to inter alia collect taxes including property tax, by transferring the power of the Kadapa Municipality would operate proprio vigore even after the Kadapa Municipality is upgraded as a Municipal Corporation, in view of the transitory provisions in Section 16 of the A.P. Municipal Corporations Act 1994. Section 14 of the 1994 Act (subject to exception) makes applicable all the provisions including the provisions relating to levy and collection of tax or fee except Chapter V and the specified sections enumerated in the said provision mutatis mutandis to a Corporation constituted under this Act and further enjoins that the GHMC Act shall in relation to such Corporation be read and construed as if the provisions of the said Act had formed part of this Act. Section 16 of the 1995 Act sets out transitional provisions. Sri. Roy Reddy, the learned Counsel for the 1st respondent would lay strenuous emphasis on the provisions of Sub-sections 4 and 5 of Section 16, which read: (4) all proceedings taken by or against the Council or authority or any person under the A.P. Municipalities Act, 1965, may be continued by or against the Corporation, authority or person as if such proceedings had started under the provisions of this Act; (5) any action taken under the A.P. Municipalities Act, 1965, by any authority before such commencement shall be deemed to have been taken by the authority competent to take such action under this Act as if this Act had then been in force. On a true and fair construction of the provisions of the Sub-sections 4 and 5 of Section 16, the interpretation and inference is compelling that only proceedings taken by or against the Council or authority or any person under the A.P. Municipalities Act, 1965 may be continued by or against the Corporation, authority or person as if such proceedings had started (commenced) under the provisions of the 1995 Act and any action taken by any authority before such commencement shall be deemed to have been taken by the authority competent to take such action under the 1995 Act as if this Act had then been in force. The infusion of vitality by the transitional provision set out in sub- sections 4 and 5 of Section 16 extends only to proceedings or actions which are commenced while the A.P. Municipalities Act 1965 was in force but would not extend to proceedings or actions initiated after the provisions of the A.P. Municipalities Act 1965 have ceased to operate. On the aforesaid analysis, the contention urged on behalf of the 1st respondent that the transitional provisions set out in Section 16 of the 1994 Act would vitalise and operationalize the notification issued by the State Government in G.O.Ms.No. 338 dt. 28.11.1997 to validate or legitimise a demand notice for property tax issued by the 1st respondent in respect of the property tax otherwise due to the 2nd respondent Corporation, after Kadapa Municipal Corporation coming into force on 30.11.2004, cannot be countenanced. On the aforesaid analysis, the impugned demand notice dt. 4.10.2010 issued by the 1st respondent calling upon the petitioner to pay property tax specified therein in respect of premises bearing No. 4/758, 1st Floor, Commercial Complex, Old Anjaneya swamy Temple Street, Kadapa, is unsustainable and is accordingly quashed. Nothing in this order shall however be construed as inhibiting the 2nd respondent Corporation for collecting the property due from the petitioner in accordance with law. The other challenges to the impugned demand notice are not considered herein since the writ petitioner must, on the basis recorded above, succeed on the point of jurisdiction. The petitioner would be at liberty to challenge a property tax demand notice if and when issued by the 2nd respondent, in accordance with law and in appropriate proceedings. The writ petition is allowed at the stage of admission. However, there shall be no order as to costs. ________________________ GODA RAGHURAM, J ______________________________ ASHUTOSH MOHUNTA, J 09.08.2011. KRB. THE HON’BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE ASHUTOSH MOHUNTA WRIT PETITION No. 30162 of 2010. ORDER: (Per Goda Raghuram, J) Dt. 09.08.2011