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PETITIONER: MUNICIPAL CORPN. OF DELHI

       Vs.

RESPONDENT: DELHI URBAN HOUSE OWNERS WELFARE ASSN

DATE OF JUDGMENT:       03/10/1997

BENCH: S.C. AGRAWAL, G.B. PATTANAIK

ACT:

HEADNOTE:

JUDGMENT:                       J U D G M E N T PATTANAIK. J.      Leave granted      This appeal  by special  leave is  directed against the judgment dated  18th September,  1995 passed by the Division Bench of  the Delhi  High Court  in Civil  Writ Petition No. 5102 of 1994 and Civil Writ Petition No. 555 of 1995. By the impugned judgment  the provisions  of Explanation to Bye-law 3(i) (a),  Bye-law 3(i)(c)(ii), Bye-law 3(i)(e) of the Delhi Municipal Corporation  (Determination of  Ratable Valuation) Bye-laws, 1994  ("R.V. Bye-laws" for short) and Bye-law 8 of the Delhi  Municipal Corporation  (property Tax Return) Bye- laws, 1994  (for short  "Property Tax Return Bye-laws") have been struck  down. Though  the legality of the said judgment had been  challenged in  appeal but  in course of hearing of this appeal  the learned counsel for the appellant restricts the challenge  only to  the  declaration  of  invalidity  of Explanation to Bye-law 3(i)(a) of the R.V. Bye-Laws and Bye- law 8 of the property Tax Return Bye-Laws. Consequently, the judgment of  the High Court declaring the provisions of Bye- laws 3(i)(c)(ii)  and 3(i)(e)  of R.V.  Bye-Laws as  invalid remain unaltered.      Coming to  the question,  as to  whether the High Court was justified in invalidating Explanation to Bye-Law 3(i)(a) of the  R.V. Bye-Laws, the High Court is of the opinion that the said  provision is repugnant to Section 135 of the Delhi Municipal Corporation  Act, 1957 thereinafter referred to as ‘the Act’)  inasmuch as  it encroaches upon the powers given to the  Commissioner under  Section 135 to employ valuers to give him advice in connection with the valuation of any land or building.  The High  Court is further of the opinion that the  Explanation  to  Bye-law  3(i)(a)  bind  the  Assessing Officer to  determine the  prevalent rent  on the basis of a Panel which  is not  permissible under  the Act. The learned counsel appearing  for the  appellant contends that both the aforesaid  reasons   indicated  by   the  High   Court   for invalidating the  Explanation is wholly unsustainable in law as the  same has  been arrived  at on  a misreading  of  the relevant  provisions  of  the  Act  and  as  such  the  said conclusion has  to be  set  aside  by  this  Court.  Bye-law

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3(i)(a)  together   with  the   Explanation,  is   extracted hereunder in extenso for better appreciation of the point in issue:      "(3)(i) For  the purposes  of  sub-      section (1)  of Section  116 of the      Act,  the   annual  rent  shall  be      determined as under:      (a) Where the premises are on rent,      the  rent   actually  realised   or      reasonable,  unless   the  same  is      collusive or concessional, shall be      the annual  rent. Where the tenancy      commences on  or after  the 1st day      of  April,   1995  and   where  the      Commissioner has  reason to believe      that the  declared  rent  does  not      represent the prevalent rent of the      year of  letting and the difference      between declared rent and prevalent      rent is  more than  twenty five per      cent  of  the  declared  rent,  the      annual rent  shall be the prevalent      rent;      Explanation:- For the purposes of        this  clause the  prevalent rents      shall be  determined by  a Panel of      Assessors to  be appointed  by  the      Commissioner.  Such   Panel   shall      include a  representative from  the      Government, a representative of any      Taxation Department (other than the      Corporation)  or  a  valuer  and  a      representative  of   the   Property      Owners of  the zone  of  which  the      prevalent   rents    are   to    be      determined.      Under the Delhi Municipal Corporation Act power to make Bye-laws has  been provided  in Section  481. Obviously,  no bye-law can  be  framed  which  would  be  contrary  to  the provisions of the Act. The R.V. Bye-Laws relate to taxation. It may  be noticed that under Section 481 A of the Act, Bye- laws framed  are required  to be  laid before the Parliament and thus  the Bye-laws also have the legislative sanction of the Parliament  itself.  Bye-law  3  of  the  R.V.  Bye-Laws prescribed the  procedure for  determination of  annual rent for the  purpose of  sub-section (1)  of Section  116 of the Act. Section  116 indicates  the mode  of   determination of rateable  value  of  any  land  or  building  assessable  to property taxes.  Section 116(1)  of the Act does not provide as to  how the  annual rent  of the  land or  building which might reasonably  be expected to be arrived at. Bye-law (3), therefore, provides the mode of determination of such annual rent. The  Explanation to  Bye-law 3(i)(a) provides that for the  clause   in  question   the  prevalent  rent  shall  be determined by  a Panel  of Assessors  to be appointed by the Commissioner and  such Panel should include a representative of  the   Government,  a   representative  of  any  Taxation Department or  a valuer and a representative of the Property Owner of  the zone  of which  the prevalent  rents ar  to be determined.  The   bye-law,  therefore,   is  essentially  a safeguard  provided   for  the   property  owners   and  the determination thus  made by  a Panel  of Assessors will be a safeguide for  the Commissioner  to  exercise  his  ultimate power, so that, the exercise of such power cannot be said to be arbitrary  or excessive.  In this  view of the matter, we

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fail to understand how the aforesaid Explanation can be said to be  repugnant to  the independent  application of mind of the Commissioner  under the  Act. The High Court, therefore, was in  error to  hold such  Explanation binds the Assessing Officer and  controls the  power of  such Assessing  Officer under the Act. In our considered opinion, the High Court was not right  in arriving  at the aforesaid conclusion. Further on a  plain reading of Section 135 of the Act, we are not in a position  to sustain the conclusion of the High Court that the Explanation contravenes the provisions of Section 135 of the  Act.   Section  135   is  an   enabling  power  of  the Commissioner to  appoint one  or more  competent persons  to give advice  or assistance  in connection with the valuation of any  land or  building. The  Bye-law in question together with Explanation  merely states  as to how the persons could be appointed  to advice  the Commissioner in connection with the valuation  of any land or building and we see nothing in that Explanation which can be said to be in contravention of the provisions  of Section 135 of the Act. The conclusion of the High Court on this score, therefore, is unsustainable in law. In  the aforesaid  premises we  are of  the  considered opinion that  the Explanation to Bye-law 3(i)(a) of the R.V. Bye-Laws does not suffer from the vice of any invalidity and we accordingly set aside the conclusion of the High Court on this score and hold that the said provision is a valid piece of legislation.      Coming now  to the  question of validity of Bye-law (8) of the  Property Tax  Return Bye-Laws,  the said  Bye-law is quoted hereunder in extenso:      8. Whosoever  fails  to  furnish  a      true return  to  the  best  of  his      knowledge and belief, shall be:-      (a) liable  to  penalty  which  may      extend to  five hundred  rupees.  A      penalty of  Rs. 20/-  per  day  may      further be  imposed for  the period      the default continues:      (b) precluded from objecting to any      assessment made by the Commissioner      in respect  of land and building of      which the  owner or occupier failed      to file  the return  or true return      to the  best of  his knowledge  and      belief:      Provided that  before imposition of      penalty    or    precluding    from      obtaining to  any  assessment,  the      Commissioner    shall     give    a      reasonable  opportunity   of  being      heard to  the owner or occupier, as      the case may be.      In the  impugned judgment  the High  Court being of the opinion that  the aforesaid  Bye-law is  in contravention of section 131  of the  Act,  struck  down  the  said  Bye-law. Section 131 of the Act is extracted hereunder in extenso for better appreciation of the point in issue:      131. Power  of Commissioner to call      for information  and returns and to      enter and  inspect premises- (i) To      enable   him   to   determine   the      rateable  value   of  any  land  or      building and  the person  primarily      liable  for   the  payment  of  any      property taxes  leviable in respect      thereof,   the   Commissioner   may

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    require the  owner or  occupier  of      such land  or building,  or of  any      portion  thereof   to  furnish  him      within such  reasonable  period  as      the  Commissioner   fixes  in  this      behalf, with  information or with a      return  signed  by  such  owner  or      occupier -      (a) as  to the  name and  place  of      residence of the owner or occupier,      or of  both the  owner and occupier      of such land or buildings;      (b)  as   to  the  measurements  or      dimensions of such land or building      or of  any portion  thereof and the      rent, if  any,  obtained  for  such      land or  building  or  any  portion      thereof; and      (c) as  to the actual post or other      specified  details  connected  with      determination of  the value of such      land or building.      (2) Every owner or occupier on whom      any such  requisition is made shall      be bound  to comply  with the  same      and to  give true information or to      make a  true return  to the best of      his knowledge or belief.      (3) Whoever  omits to  comply  with      any such  requisition or  fails  to      give the  true  information  or  to      made a  true return  to the best of      his knowledge  or belief, shall, in      addition to any penalty to which he      may be  liable, be  precluded  from      objecting to any assessment made by      the Commissioner in respect of such      land or building of which he is the      owner or occupier.      Under Section  131, the  Commissioner is  empowered  to call for  information or returns to be filed by the owner or occupier of  any land  or building whenever the Commissioner decides to  determine the  rateable value  of  any  land  or building and  under sub-section(2) of Section 131 every such owner or  occupier who  is required  by the  Commissioner to give the  necessary information or return is bound to comply with the same. Sub-section (3) of the said Section indicates that non-furnishing  of such  information or  return by  the person concerned  makes him  liable to  pay the  penalty and also is  precluded from  objecting to any assessment made by the Commissioner  in respect  of such land or building. Thus under Section  131 an  owner or  occupier  of  any  land  or building is required to file return or information only when the Commissioner requires the same from him. In the Property Tax Return  Bye-Laws, however,  filing of an annual property tax return  by the  owner or occupier of land or building is obligatory under  Bye-law (3)  irrespective of  whether  the Commissioner requires the same or not. The liability to file the return arises under the Bye-law, if the land or building is assessable to the property tax. The conditions for making such filing  of return  have  been  indicated  in  different paragraphs of  Bye-law (3)  with which  we are  actually not concerned in  the present  appeal. Bye-law (8) provides that if a  person fails  to furnish  a true return to the best of his knowledge and belief, then he shall be liable to penalty

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which may extend to Rs. 500/- and further a Rs. 20/- per day could be  imposed for  the period the default continues. The return required  to be  filed under  the Property Tax Return Bye-Laws and  the return  required to be filed only when the Commissioner requires  the same under Section 131 operate in two different  fields. The  former is  in the  nature  of  a statutory return  required to  be filed  by every  owner  or occupier annually  when the conditions mentioned in the Bye- law are  attracted whereas,  latter only makes it obligatory for the  person  concerned  to  file  the  return  when  the Commissioner so  requires. The two provisions operate in two different fields  and the  High Court,  therefore,  was  not justified in reaching the conclusion that the Regulation (8) Providing for penalty of Rs. 500/- for non-furnishing of the return as  contemplated under  the Bye-law  is repugnant  to Section 131 of the Act. The aforesaid conclusion of the High Court, therefore,  is set  aside and  Regulation (8)  of the Property Tax Return Bye-Laws is declared to be a valid piece of legislation.  In view  of our aforesaid conclusions these appeals are  allowed in  part to  the extent indicated above but in the circumstances there will be no order as to costs.