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2015 (4) TMI 1349 - HC - Indian LawsEntitlement to receive rebate as provided under Section 171(5) of the Kolkata Municipal Corporation Act, 1980 - It is contended on behalf of the writ petitioners that a flat in a building should be considered as a separate unit for the purpose of assessment of property keeping in view the ground realities and the definition building as obtaining in the Act of 1980 - writ petitioners contend that if any benefit is conferred by a provision of a statute imposing tax, the same should be interpreted in a manner to allow such benefit to be availed by the maximum number of the members of the public as possible. HELD THAT - In Bajaj Tempo Ltd. 1992 (4) TMI 4 - SUPREME COURT it has held that a provision in a taxing statute granting incentives for promoting growth and development should be construed liberally. Similar view has been expressed in Mysore Minerals Ltd. 1999 (9) TMI 1 - SUPREME COURT . In Ranbaxy Laboratories Ltd. Ors. 2008 (5) TMI 653 - SUPREME COURT , R B Falcon (A) Pty. Ltd. 2008 (5) TMI 2 - SUPREME COURT , A.N. Roy, Commissioner of Police Anr. 2006 (7) TMI 660 - SUPREME COURT , Dr. Sattur's Sushrushalaya Nurshing Home Anr. 1991 (8) TMI 26 - KARNATAKA HIGH COURT and Gian Chand Ashok Kumar and Company Ors. 1990 (3) TMI 13 - HIMACHAL PRADESH HIGH COURT it has been held that in construing a provision of an Act, a situation giving rise to anomaly and absurdity must be avoided. The flat occupied by the petitioner is to be considered as a separate unit or a newly constructed building within the meaning of Section 171(5) of the Act of 1980. This is amplified by the second proviso to Section 171(5) of the Act of 1980. The second proviso mandates rebate in respect of such building in so far as it is a single unit of assessment under Chapter XII of the Act of 1980. The writ petitioners therefore satisfy the conditions laid down in sub-section (5) of Section 171 of the Act of 1980. The writ petitioners therefore are entitled to a rebate of 25 percent in the property tax as laid down in Section 171(5) of the Act of 1980. The first ground of refusal under Section 171(5) of the Act of 1980 recorded in the impugned communication is, therefore, perverse. Whether the assessment of the flat has to be made on the date of the completion certificate and not the date of possession letter? - HELD THAT - Sections 171(5) and 178(5) of the Act of 1980 allow benefits to assessees. Since the legislature has granted benefits to the assessees in the form of rebate under Section 171(5) and relaxation in the period of assessment under Section 178(5), these beneficial provisions of the Act of 1980 have to be construed so as to allow the benefits to these tax provisions to be made available to the maximum number of persons that may be found eligible thereto. The word building used in Sections 171(5) and 178(5) should be read in the context of the definition of building given in Section 2(5) of the Act of 1980 - A flat in a building should be construed as a separate unit for the purpose of assessment of property tax of a building within the meaning of Section 171(5) and 178(5) of the Act of 1980. Multistoried buildings are divided into flats or units. A flat comes within the definition of building given in Section 2(5) of the Act of 1980. Consequently, a flat would also come within the meaning of building used in Sections 171(5) and 178(5) of the Act of 1980. Such an interpretation would be harmonious, and would not lead to an absurdity or an abnormality. This interpretation would also extend the benefit of Sections 171(5) and 178(5) of the Act of 1980 to the individual flat owners, who, in my view, these provisions are intended to benefit. The orders impugned herein are quashed. The tax bills raised on the basis of the quashed impugned orders are set aside - petition allowed.
Issues Involved:
1. Challenge to Orders dated March 27, 2012, and July 11, 2012, by the Corporation authorities. 2. Entitlement to a 25% rebate under Section 171(5) of the Kolkata Municipal Corporation Act, 1980. 3. Assessment date for property tax under Section 178(5) of the Kolkata Municipal Corporation Act, 1980. Issue-wise Detailed Analysis: 1. Challenge to Orders dated March 27, 2012, and July 11, 2012: The writ petitioners challenged the Orders dated March 27, 2012, and July 11, 2012, issued by the Corporation authorities. The petitioners claimed they did not receive the Order dated March 27, 2012. The Corporation authorities failed to disclose this order despite the petitioners' averment, leading to the quashing of the Order dated March 27, 2012. The July 11, 2012 order was contested on the grounds that the reasons provided were contrary to Sections 171(5) and 178(5) of the Kolkata Municipal Corporation Act, 1980. The court found the rejection grounds in the July 11, 2012 order to be legally untenable. 2. Entitlement to a 25% rebate under Section 171(5) of the Kolkata Municipal Corporation Act, 1980: The petitioners argued that they were entitled to a 25% rebate on property tax as per Section 171(5) of the Act, which applies to newly constructed buildings used exclusively for residential purposes. The court noted that the definition of "building" in Section 2(5) of the Act includes parts of a building, such as individual flats. Consequently, the petitioners' flat was considered a separate unit, qualifying as a "newly constructed building" under Section 171(5). The court emphasized that beneficial legislation should be construed liberally to extend benefits to the maximum number of eligible individuals. Hence, the petitioners were entitled to the 25% rebate, and the first ground for refusal was deemed perverse. 3. Assessment date for property tax under Section 178(5) of the Kolkata Municipal Corporation Act, 1980: The petitioners contended that their property tax liability should commence from the quarter following the receipt of the completion certificate, not from the date on the certificate. The court examined the meaning of "the date of issue" in Sections 171(5) and 178(5) and concluded that it should be interpreted as the date the completion certificate was served to the petitioners. The completion certificate, dated December 31, 2005, was served in January 2006. Thus, the property tax assessment should start from the quarter following January 2006. The court's interpretation aimed to avoid absurdity and ensure the provisions' benefits were accessible to eligible individuals. Conclusion: The court allowed the writ petition, quashed the impugned orders, and set aside the tax bills based on these orders. The Corporation authorities were permitted to raise fresh property tax bills in accordance with the court's observations. The judgment emphasized a liberal interpretation of beneficial provisions to extend their advantages to the maximum number of eligible individuals.
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