# [1968] 2 S.C.R. 125 - **Citation:** [1968] 2 S.C.R. 125 - **Court:** Supreme Court of India - **Decided:** 1967-10-31 - **Bench:** J. c. SHAH, S. M. S!Kri, J.M. Shelat - **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/1968-2-s-c-r-125-4299 - **Pages:** 8 ## Headnote Madhya B11arGt Municipalities· Act (Act 1 of 1954) repealing !1tdorc City Mt1nicipa/ Act 4 of 1909-S. 79 of nel\-' Act pcrn1ittin;: an .• assessment lisfi for taxes on houses and lands heing prepared once in 4 yearsAs1·es.nne11t list under ohf Act essment list every year and need prepare such Jist once in every 4 year~ an-.! can adopt an car1ier assessment list such an adopteJ li~a becomes th.: assessment list for that particular year as if it was a ne""· list and to which ss. 75 and 76 apply. [130E-JJIC] Accordingly. the Corporation ¥.'as entitled to adopt for the official years in question the late..;t list prepared under the old Act. and under s. 79 lilat li'it v.·ould hci.:0mc the a\iscssmcnt list for the sa!d years provided that the.: provision~ of s~. 75 and 76 arc fol101A~d. Even then the appellant Corporation "'·oukl ·nor be entitled to impose hous-; tax on the basis of the gross annual Jetting value as such impoo;ition \•.'oul! such particub•s are the valuation based on capital or annual letting value as the case may be on which the property is assessed. Sub-sec. 2 provides that in" 128 SUPREME COUllT REPORTS [1968) 2 S.C.R. assessing the tax on buildings or lands, where the valuation determined under clause (d) of sub-section I is the annual letting value, a sum equal to I 0% of such valuation shall be deducted therefrom in lieu of allowance for costs of repairs or on any account whatsoever. Sec. 7 5 provides for the publication of the asses.~ menr list and the right of the o" ner or occupier of properties included in the list to take inspection thereof and to make extracts therefrom. Sec. 76 provides for a public notice of time fixed for lodging objections to such assessment list and the hearing of such objections. Sub-sec. 4 of sec. 76 provides for the authentication of the list. Sub-section 6 lays down that subject to such alterations as may be made therein under sec. 77 and to the result of any appeal or revision made under sec. 190 in the case of City Municipality and under sec. 90 in the case of other municipalities. the entries in the assessment list so authenticated shall be accepted as conclusive evidence for the purposes of all municipal taxes of the valuation or annual letting value of buildings and lands to which such entries respectively refer and for the purposes of the tax for which such assessment list has been prepared of the amount of tax lcviable on such buildings or lands "in any official year in which such list is in force." Sec. 79(1) provides that it would not be necessary for a Municipality to prepare a ·new assessment list for every year. It further provides that subject to the , condition that such assessment list shall be completely revised not less than once in every 4 years the Municipality may adopt the valuation and assessment contained in the list fo~ any year with such alterations as may be necessary for the year immediately following. But sub-section 2 lays down that the provisions of s. 75 and s. 76 shall be applicable every year as if a new assessment list has been completed at the commencement of the official year. ' These provisions show that though by sec. 2 the new Act repealed the Indore City Municipal Act, 1909 along with other Acts, the legislature by sec. 2(c) saved certain things done under the repealed Acts, viz., rules bye-laws, orders, notifications and notices, taxes and rates made, framed, passed, or imposed or deemed to have been made. framed, passed or imposed under the repealed Acts and added a fiction that so far as they are not inconsistent with the new Act they shall be deemed as if they were made, framed, passed or imposed as the case may be under this Act. We are informed by Counsel that under the rules made under the repealed Indore City Municipal .Act, 1909 the Municipality had imposed the tax on houses at the rate of 7% of their gross annual letting value, that an assessment list on that basis was prepared for the year 1952-53 and that the Municipality has been levying tax at the said rate on the basis of lhe said assessment list for the two subsequent years. A B c D E F G H A B c D E F G H MUNICIPAL CORPORATION v. HlRALAL (She/at, J.) 129 Counsel for the appellant Corporation argued that the .Corporation was entitled to levy. the house tax at the rate of 7% of the gross annual letti!lg value and that it was not bound to deduct the 10% allowance provided by sec. 73(2) from such gross annual letting value. The argument· was, firstly, that the appellant Corporation could do so because the rules made under the Indore Act are saved by sec. 2(c) and therefore the rate of 7% of the gross annual letting value at which the tax was levied also has been saved and secondly, that under sec. 79(1) of the 1954 Act the Corporation need not prepare a fresh assessment list every year, that it has to prepare a fresh assessment list only once in every 4 years, that the Corporation therefore can and in fact has adopted the said list for the two years in question and that that being so, the list so adopted was in force during the years in question and has to be accepted under s. 76(6) as conclusive evidence of the annual letting value as also for the amount of tax leviable on the buildings or lands or both. He contended that that being the position the respondents were debarred from ob· jecting to the annual letting value nnd the quantum of tax based on it as entered against the respondents' properties in the said a5sessment list. We are not impressed with these contentions as in our .view t'.iey are not warranted on the true construction of the provisions o{ the Act. The Indore Municipal Act being no longer in force as from January 26, 1954, obviously no tax could be levied or imposed thereunder after that date. The rules made and the taxes imposed under the repealed Act are no doubt amongst other things saved and are deemed to have been made, framed, passed or imposed under the .new Act but cl. (c) cf sec. 2, it must nut be forgotten, lays down an important qualification that they are to be deemed to have been made, or imposed etc., under the new Act to the extent that they are consistent with the provisions of the Act. Sec. 73 read with sec. 69 provides that a tax on houses or buildings shall be levied on the annual letting value and that in assessing such tax a sum equal to 10% of such letting value shall be deducted therefrom. The tax levied under the old Act and the rules framed thereunder on the basis of the gross annual Jetting value is obviously inconsistent with the provisions of s. 73 of the Act. The saving and the deeming provisions in s. 2(c) can' only apply if the tax is assessed in the manner consistent with the provisions of s. 73, that is, if it is assessed on the net and not the gross annual letting value after deducting 10% statu· tory .allowance in lieu of the costs of repairs or .any other account whatsoever. If the construction of sec. 2(c) as suggested by Counsel were to.be accepted it would render sec. 73 (2) nugatory, for, the Municipal Corporation in that case can go on imposing the tax on the basis of the gross annual Jetting value for ever despite the express provision for levying tax on the basis of net annual . --- ---. 130 SUPREi\fE-GOJJRT REPORTS (I 9q8) 2 S.C.R. letting value, i.e., the value arrived at after deducting ·10% of the gross annual letting value. • The second .part of the contention is equally unacceptiibie because. if accepted, it will be contrary to the provisions of sections 75,76 and 79 of the Act. After JiOing through the procedure laid down in ss. 70, 71 anp 72 sec. 73'. enjoins upon· the Chief Executive Officer to have an assessment list made containing il\ter a/ia valuation or· annual letting value at which the property is assessed and !he amount of. tax assessed on the basis of suc!i V'jluati9n or ann'ual letting value. ,Under ss. 75 and 76 when the assessment list is J)fepared in accordance with the provisions of sec. 73 it has to be published and time has t~ b~ fixed for l,odging objections against the • entries thereil). After such objections are heard and disposed of the asseSsment list has to be {1uthei:ticated a~ provided by sec. 76(6),. ~~b-sec. ,6 of sec. 76 lays down that such ·assessment list when· authenticated becomes c9nclusive evidence for purposes of ail taxes, of the valuation or annual letting value and of the amo11nt of tax leviable on such buildings' or lands or both in any official year in which such list is in force. The Municipal tax is ai:! anm 11a!' tax leviable for a ·particular official year and the assessment list on the basis df which the tax is assessed is for each such official ·year. This is supported by the words "such assessment·'list" and \'of tlie amount of tax leviable .... in any official year in which such list is in force~ 'in sec. 76(6). ~~ ~ Ordiniuily therefore the Municipal Corporation has ·10 prepare a fresp assessment list every year. The legislature howevet has empowered by sec. 79, as qther State legislatu:·cs'.have similarly d,one in several Municipal Acts, to adopt the valuation and assessment contained in the assessment list prepared iri an ea-rlier year prpvided, hqwever, that it prepares a fresh hst once in every 4 years, But sub-sec. 2 of sec. 79 provides expressly th,a,t, when Sl!ch ;i previous list is adopted for a partii;:ular official year it can_ be done subject to the provisions of sections 75 and 7y. I I) '.other words, an asses~meTJt. list being for ~ particular official y~ar even when an assess1nent, list prepared in an •earlier y~ar is adopted i.t becomes the list fqr such subsequent year subject. t'l the procedure laid down in secs. 75 and 76. The list so adopt~· has therefore to be published, has ,to invi,te objections anq has f~ be authenticated in the ·manner prescribed by sec. 76 (6) aftei: disp9sing qf Jhe objections if .any and it is. the,n cin,ly t!J,at it pe-· comes_ ~onclusiy~ evidence of the ':'aluation and -!h~ t~x ~si~s~id, thereon for that particular official year .. If it were ·8th~i:; the annual lettini; value or the value estimqted on a parlieuTar ouilding or house would !le static for 4 yeap; during whicl} the Corporation can. go on adopting the :issessme'nt list prepared 'ID' an earlier year and the.owner_ or the o~upier Qf,thf) building would . ~ s • c D F ~I H '