Case: Municipal Corporation of Delhi through its Commissioner Vs. M.G. Jain

2. For the sake of convenience, the brief facts are taken from Civil Appeal No. 948 of 2008. It is also clear that the facts in Civil Appeal No. 963 of 2008 are also similar in nature.Respondent was allotted Flat No.II at Malviya Nagar Extension (Saket), underScheme of Delhi Development Authority on 16.11.1978; the said flat was let out to Jay Engineering Works at a rental of Rs. 2,100/per month by the respondent on 21.03.1981; the servant quarter was let out earlier to Mr. Akin and thereafter to Mr. Balveer Singh and subsequently to Mr. Anand Mukund Tigga at the monthly rent of Rs.the Delhi Municipal Corporation sent a call letter dated 05.02.1994 pursuant to a notice under Section 126 of the Delhi Municipal Corporation Act, 1957 (since repealed after introduction of the Unit Area System) proposing ratable value at Rs. 5,360/and invited the respondent for personal hearing; the Commissioner of Municipal Corporation amended the assessment list under Section 126 of the Delhi Municipal Corporation Act, 1957 (now repealed), inter alia, for increasing the amount of ratable value and assessment thereupon; the assessment order was passed against the respondent in respect of his premises on 28.03.1994 and ratable value was fixed at Rs. 14,810/with effect from 01.04.1988, as also, at Rs. 21,830/with effect from 12.07.1999; however, the ratable value of the flat along with servant quarter was fixed at Rs. 56,380/vide another assessment order dated 18.03.1997.3. As against the same, the respondent approached the appellate forum, i.e., Additional District Judge, Delhi, who by his order dated 01.03.1999 held that since the respondent was actually receiving the rental value of Rs. 2,100/per month, the assessing authority was not justified to assess the property on estimated rental. Having concluding so, the Additional District Judge, Delhi remanded the matter for assessment afresh on actual rental basis to the concerned authority of Delhi Municipal Corporation with a specific direction that the assessing authority of the Delhi Municipal Corporation shall afford a due and proper opportunity of being heard to the respondent.4. Municipal Corporation of Delhi, being aggrieved by the order of the Additional District Judge, Delhi dated 01.03.1999, approached the High Court of Delhi. The order of Additional District Judge, Delhi dated 01.03.1999 was confirmed by the High Court of Delhi on 06.02.2007 holding that Section 116G of the Delhi Municipal Corporation Act, 1957 is applicable to assessments even at the remanded stage, pursuant to the orders passed in appeals or in writ petitions. It was also clarified by the High Court that if the assessee at the remanded hearing, claims benefit of Section 116G of the Delhi Municipal Corporation Act, 1957, the same shall be granted to him. The said order of the High Court is under challenge in these appeals.

Court's reasoning:
s, the Delhi Municipal Corporation has taken upon itself the determination of rateable value of lands and buildings according to the principles laid down therein. The Delhi Municipal Corporation while determining the rateable value of the lands and buildings assessable to property tax at the annual rent which the building or land reasonably be expected to let from year to year under Section 116(1) of the Delhi Municipal Corporation Act, 1957. The rateable value of lands and buildings will be determined as perThereafter, this Court proceeded to observe that the word "settlement" would not in this context mean a consensual arrangement between both parties but would only mean a determination to be made by the Tribunal on the basis of annual value. This Court upheld the view of the Delhi High Court in the case of Major General Inderpal Singh Kahai(supra) that if the assessment order passed by the assessing officer is accepted by the assessee and is not challenged in appeal, then such assessment order must be taken to be finalized for the purpose of Section 116G (2) of the Delhi Municipal Corporation Act, 1957. However, where the assessment order itself has been set aside with a direction by the learned Additional District Judge tothe rateable value and no fresh order has been passed by the joint assessor or collector in terms of the directions by the Additional District Judge, it cannot be said that the assessment has been finalized at least at the hands of the joint assessor or collector.In view of the aforesaid, we are of the view that the issue involved in the present appeals is squarely covered by the judgment of this Court in Mehrasons Jewellers case (supra). Thus, the High Court was justified in concluding that the assessment has been finalized inasmuch as the matter is remanded by the District Court to the assessing officer for fresh determination, in accordance with law. The matter has not become final in respect of the assessment of the property tax prior to 2003.