Harbanslal Malhotra And Sons Pvt. Ltd. vs Kolkata Municipal Corpn..

2) The issue involved in the appeal lies in narrow compass. However, in order to appreciate the short controversy, few relevant facts need mention infra.

5) By two orders dated 22.06.1996, the Assessing Officer (Hearing Officer) determined the valuation of the premises. So far as annual valuation for the Assessment Year (1988-89) (3rd quarter) is concerned, it was done at Rs.59,400/-, whereas so far as it was for the Assessment Year (1994-95) (3 rd quarter) is concerned, the same was done at Rs.4,25,600/-.

6) The appellants (assessee), felt aggrieved of the orders of Assessing Officer, filed two appeals before the Tribunal. So far as the order pertaining to the period (1988-89), valuing the premises at Rs.59,400/- was concerned, the appellant filed appeal being M.A.A. No. 1702 of 1996 whereas so far as the order relating to period (1994-95), valuing 3 the premises at Rs.4,25,600/- was concerned, the appellant filed appeal being M.A.A. 1701 of 1996.

7) Both the appeals were heard analogously by the Tribunal and were disposed of by common order dated 18.11.2002. So far as M.A.A. No. 1702/96 is concerned, it was dismissed by upholding the valuation whereas M.A.A. No. 1701/96, was allowed in part wherein the Tribunal reduced the annual valuation made by the Assessing Officer, from Rs.4,25,000/- to Rs.75,400/-. The Tribunal held that the annual valuation of the premises which was made at Rs.4,25,000/- by the Assessing Authority was wrong and should have been done at Rs.75,400/- in accordance with the procedure prescribed in Section 174 (1).

8) The Municipal Corporation, felt aggrieved of the order of the Tribunal, filed revision petition before the High Court. By impugned order, the High Court allowed the revision and remanded the case to the Tribunal to re-determine the annual value of 4 the premises. The High Court held that the Tribunal was not right in making an assessment of the premises by clubbing land and building. According to the High Court, it should have been done separately, i.e., building and land should have been assessed separately for determining their respective annual value under Section 174(1) and (2) of the Act.

22) We are, therefore, of the considered opinion that Section 174(1) and (2) operate in separate field. Both cannot be clubbed for determination of the gross annual rental value of land or building. In other words, both the Sections have to be applied independently depending upon the fact as to whether the premises is “building with land” or it is an “open land” and accordingly their gross annual rental value would be determined.

26) The view taken by the High Court does not command its acceptance to us in the light of what we have held above. We, however, find that the Tribunal followed proper procedure by applying Section 174(1) for determining the gross annual value. The Tribunal’s order, therefore, deserves to be restored.

27) In the result, the appeal succeeds and is allowed. The impugned orders dated 28.06.2004 in C.O. No.368 of 2004 and dated 17.08.2005 in Review Application No. 2963 of 2004 in C.O. No.368 of 2004 are set aside and the order of the Tribunal dated 18.11.2002 is restored.

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