# MUNICIPAL CORPORATION OF CITY OF HUBLI v. SUBHA RAO HANUMATHARAO PRAY AG & ORS

- **Citation:** [1976] 3 S.C.R. 883
- **Court:** Supreme Court of India
- **Decided:** 1976-03-24
- **Case number:** Civil Appeal No. 2406 of 1968
- **Bench:** H. R. Khanna, P. N. Bhagwati, A. C. Gupta
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/municipal-corporation-of-city-of-hubli-v-subha-rao-hanumatharao-pray-ag-ors-6845
- **Pages:** 10

## Headnote

Bonibay Municipal Borougl1s Act, \Born. 18 of 1925), Ss. 78 to 84-WheJhcr
1usessn1ent list should be authenticated before the expiry of the official year.
Stare Decisis-Principle when State High Courts have given a
particular
interpretation to State e11actn1ent.
interpretation of statutes-Statute 1nust be read as a
whole-Legislative
interpretation as u guide.
The scheme of ::-..:.. /8 to 84 of the Bombay Municipal Boroughs Act, 1925,
shows that tne official year is the unit o: time for the levy of rates on buildings
and lands.
Under these provisions the provisional assessment hst is prepared
for the official year, e.ther before the co111mencement or in the cour.~e of. the
official year, objections are invited, and amendments con,,,cqu n
1 npon tile
decisions on the ob1ections are carried out in the list.
The assessment list is
then authenticated. 1 he precess of as:.t.~S1nent and levy of tax .. hich begins
with the preparation of the provisional assessment list is thus completed when
the assessment list is authenticated.
The assessment list. when authenfcated.
becomes effective from the first dav of the official vear and gives rise to the
liability of the rate-payers to pay the tax levied. [8R8 G-889 Cj
For the assessment year 1951-52, the appell<1nt followed the rrocedure but
the authentication was on July 24, 1952, after the expirv of the otfi ial year
on March 31, 1952.
Since property tax in accordance with the revised rates
was sougnt to be levied, the respondents filed a suit for a declaration that the
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appel1ant was not entitled to recover ahy property tax at the rt:vised :a'es.
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The suit was decreed and the decree was affirmed by the High Court,
In appeal to this Court, it was contended that, ( 1) the authentication of the
assessment list in order to be valid and effective, need not be made befo~e the
expiry of the official year to which the assessment list relates; and (2) the suit
was barred under s. 206A of the Act.
Dismissing the appeal,
F
HELD : ( 1) The assessment list in order to be effective in_ levying the tax
must be authenticated b:fore the expiry of the officiat year· aild if it is not,
the assessn1ent list would be void and inoperative and would not 12ive rise to
any liability in the tate-i:;ayers to pay tax. (891 H]
(a) Once the view is taken that the process of levying the tax is complete
only when the assessment list is authenticated and it is only then that the tax
is levied on the rate-payers, it follows that the authentication must be made
within the official year. The tax being a tax for the official year
must
obviously be levied during the official vear and since the ie,-y of tax is complete only when the assessment list is authenticated it must follow a fortiori that
the authentication must take place in the official vear.
Otherwise.· the tax for
an official year would be leViable at any time, Without any time limit, even
years after the expiration of the official year, which could not have been the
intention of the legislature, since it is an annual tax intended to be levied for
each official year.
[889 D-FJ
' (b) Section 84 provides that it shall not be necessary to prepare a new
as.sessment list every year but subiect to the condition of revision once in everv
four years, the Chief Officer may adopt the as$essment l'st for any veaf,
with necessary alterations for the year immediately following. The provision
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SUPREME COURT REPORTS
[1976] 3 S.C.R.
A
postulates that there would be an assessment list, that is, the authenticated
assessn1ent list, for each official yea•r before the close of that official year so
that it can be adopted by the Ch.:ef Officer for the immedia.ely foliowine year.
Otherwise, he would have to prepare a new provisional assessment list every
lime wnen the AssessmenL List for the precec..ung year is not finalised and
au.lr.;;nticated, and this might lead to the sta• tling result of there befng mo.re
than one provisional assessment list in the process of final

## Text

MUNICIPAL CORPORATION OF CITY OF HUBLI
v.
SUBHA RAO HANUMATHARAO PRAY AG & ORS.
March 24, 1976
[H. R. KHANNA, P. N. BHAGWATI AND A. C. GUPTA, JJ.J
Bonibay Municipal Borougl1s Act, \Born. 18 of 1925), Ss. 78 to 84-WheJhcr
1usessn1ent list should be authenticated before the expiry of the official year.
Stare Decisis-Principle when State High Courts have given a
particular
interpretation to State e11actn1ent.
interpretation of statutes-Statute 1nust be read as a
whole-Legislative
interpretation as u guide.
The scheme of ::-..:.. /8 to 84 of the Bombay Municipal Boroughs Act, 1925,
shows that tne official year is the unit o: time for the levy of rates on buildings
and lands.
Under these provisions the provisional assessment hst is prepared
for the official year, e.ther before the co111mencement or in the cour.~e of. the
official year, objections are invited, and amendments con,,,cqu n
1 npon tile
decisions on the ob1ections are carried out in the list.
The assessment list is
then authenticated. 1 he precess of as:.t.~S1nent and levy of tax .. hich begins
with the preparation of the provisional assessment list is thus completed when
the assessment list is authenticated.
The assessment list. when authenfcated.
becomes effective from the first dav of the official vear and gives rise to the
liability of the rate-payers to pay the tax levied. [8R8 G-889 Cj
For the assessment year 1951-52, the appell<1nt followed the rrocedure but
the authentication was on July 24, 1952, after the expirv of the otfi ial year
on March 31, 1952.
Since property tax in accordance with the revised rates
was sougnt to be levied, the respondents filed a suit for a declaration that the
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appel1ant was not entitled to recover ahy property tax at the rt:vised :a'es.
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'
The suit was decreed and the decree was affirmed by the High Court,
In appeal to this Court, it was contended that, ( 1) the authentication of the
assessment list in order to be valid and effective, need not be made befo~e the
expiry of the official year to which the assessment list relates; and (2) the suit
was barred under s. 206A of the Act.
Dismissing the appeal,
F
HELD : ( 1) The assessment list in order to be effective in_ levying the tax
must be authenticated b:fore the expiry of the officiat year· aild if it is not,
the assessn1ent list would be void and inoperative and would not 12ive rise to
any liability in the tate-i:;ayers to pay tax. (891 H]
(a) Once the view is taken that the process of levying the tax is complete
only when the assessment list is authenticated and it is only then that the tax
is levied on the rate-payers, it follows that the authentication must be made
within the official year. The tax being a tax for the official year
must
obviously be levied during the official vear and since the ie,-y of tax is complete only when the assessment list is authenticated it must follow a fortiori that
the authentication must take place in the official vear.
Otherwise.· the tax for
an official year would be leViable at any time, Without any time limit, even
years after the expiration of the official year, which could not have been the
intention of the legislature, since it is an annual tax intended to be levied for
each official year.
[889 D-FJ
' (b) Section 84 provides that it shall not be necessary to prepare a new
as.sessment list every year but subiect to the condition of revision once in everv
four years, the Chief Officer may adopt the as$essment l'st for any veaf,
with necessary alterations for the year immediately following. The provision
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884
SUPREME COURT REPORTS
[1976] 3 S.C.R.
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postulates that there would be an assessment list, that is, the authenticated
assessn1ent list, for each official yea•r before the close of that official year so
that it can be adopted by the Ch.:ef Officer for the immedia.ely foliowine year.
Otherwise, he would have to prepare a new provisional assessment list every
lime wnen the AssessmenL List for the precec..ung year is not finalised and
au.lr.;;nticated, and this might lead to the sta• tling result of there befng mo.re
than one provisional assessment list in the process of finalisation at the same
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time. (889 G-890 CJ
(c) ln interpreting a provision of a statute the court is entitled and indeed
bcu.nd to consider any other parts of the Act which throw light on the intention of the legislature. The statu:e must, therefore, be read as a whole and
every provision in it must be construed with reference to the context and other
clauses so as, as far as possible, to make a consistent enactment of the whole
statute. Section 82 ( 1 ) provides for making of an amendment in the assessment list by insertion or alteration of an entry in certain events, after hearing
any objections to the amendment,
Section 82(3)
makes
the
amendment
effective from 'the earliest day in the current official year in which the circumstances justifying the entry or alteration existed.' The expression clearly signifies the earliest day in the official year which is current when the amendment
in the assessment list takes place, that is, the official year which is running at
the time when the amendment is made by insertion or alteration of an entry.
Therefore, a combined reading of s. 82(1) and (3) shows that an amendment,
in order to be effective in levying tax for an official year, must be made during
the currency of the official year. The Scheme of ss. 78 to 81 is identical with
s. 82 and in both cases what is contemplated first is a proposal to which
objections are invited and after the objections are investigated and disposed
of, the assessment Ust in orie case, and the altered entry ih the other, are
authenticated, giving rise to liability in the rate.payer. It must follow a fortiori,
that if an alteration in the assessment list in order to fasten liability on the
rate payer, is required to be made during the currency of the official year,
equa1ly, the assessment list, in order to give rise to liability in the rate payer,
must a1s·o be authenticated
before the expiry Of the official year. [890 C-.
891 BJ
Sholapur Municipality v. Governor Central, 49 Born. L.R. 752 and Sholapur
Municipal Corporation v. Ran1chandra 74 Born. L.R. 489 referred to.
(d) Three High Courts having jurisdiction o~r the territories in which the
Act is in force have all taken this view over a course of years and this Court
will not be justified in departing from it, merely on the ground that a different
view is possible. This Court is ordinarily loathe to interfere with the interpretation of a State statute which has prevailed in the State for a long number of
years and which the State Legislature has chosen not to disturb by legislative
amendment. (891 C-D]
( e) In the present case, the Bombay Legislature has accepted the interpretation of ss. 78 to 81 bv the three High Courts and given legislative recognition to it by introducing s. 84A by Bombay Act 53 Of 1954. This provision
makes it clear that the legislature not only did not amend the Act for the
purpose of removing the time limit of the official vear as interpreted bv the
High Courts or enlarging such time limit. but on the contrary, made the time
limit ·more stringent by oroviding that the authentication shall be made by
the Municipal Boroui!h not later than July 31, of the official year, and that·
if the authentication is not made within that time, the Stnte Government !llbaU
be entitled to appoint a person for the puroose of authenticating the asse:ii!!-
ment 1ist and that the authentication bv such oers0n shall not, in any event,'
be later than the Iast day of the official year. [891 D-H]
(2) Section 206A provides, inter alia, that no suit shall lie against a muhi~
cipality in resoect of any act done in pursuance of execution or
intended
execution of the Act unless it is commenced within 6 months next after the
accrual of the cause of action. It coud not, however, be contendf'd that the
cause of action for the suit in the present ca~e arose in favour of the respond~
ents and other rate payers on July 24, 1952, when the list was authenticated,
and that the suit, not having been filed within 6 month-; of that date is barred.
The assessment list in the present case was authenticated after the' expiry Of
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MUNJC. CORP. HUBL! v. SUBHA RAO (Bhagwati, J.)
8 85
the official year and was void and inoperative and the respondents and other
rate-payers were entitled to ignore it as a nullity.
Their cause of action arose ·
only when the appellant sought to recover the amount of tax from them on
the strength of that assessment list.
In the absence of material to show
'vhen the notices of demand requiring the re<;pondents ahd 01hcr rate-payers
to pay the amount of tax were issued, or which rate-payers paid and when
it is not possible to say whether the cause of action for filing'
l~e suit arose
to the respondents withih six months before the filing of the suit or earlier.
[892 A-E]
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2406 of 1968.
From the Judgment and Order dated 13-2-1968 of the High Court
of Mysore at Bangalore in R.S.A. No. 477 of 1962.
M. S. K_ Sastri and M. S. Narasimhan for the Appellant
A
B
B. D_ Bal, R. B. Datar and Rajan Yashpal for the respondents 1, 5,
C
6, 10, 11, 17, 19, 23, 25, 26, 27, 35, 36 and 50.
The Judgment of the Court was delivered by
BHAGWATI, J.
This appeal by special leave raises two questions
relating to the interpretation of certain provisions of th_c
Bombay
Municipal Boroughs Act, 1925.
The facts giving rise to the appeal
are few and may be briefly stated as follows :
D
The respondents are rate-payers liable to pay property tax in
respect of their lands and buildin~s situate within the limits of the
erstwhile Municipal Borough of Dharwar now converted into the
Hubli Dharwar Municipal Corporation.
The Municipal Borough
of Dharwar (hereinafter referred to as the Municipal Borough) was
at the material time governed by the provisions of the Bombay MuniE
pal Boroughs Act, 1925 (hereinafter referred to as the Act) .
fhe
Chief Officer of the Municipal Borough prepared an assessment list
for the official year 1951-52 containing revised valuation and assessment of the lands and buildings situated within the limits of the
Municipal Borough and published it on !st May, 1951 in accordance
with the provisions of the Act.
The respondents and several other
rate-payers filed their objections against the valuation and assessment
F
in the assessment list and consequent on the decisions on the objections, modifications were made in the assessment list and the assessment list so finalised was authenticated on 24th July, 1952_
Sinee
the authentication of the assessment list was made after the expiry of
the official year, the respondents and other rate-payers took the view
that the assessment list was void and inoperative and the Municioal
Borough was not entitled to recover property tax at the revised rates
G
which were higher than '.he rates charged in the previous official years_
It seems, however, that from a few persoru;, whose names do not appear in the record,. property tax in accordance with the revised rates
was collected by the Municipal Borough. There was consequently an
agitation amongst the rate-payers
and a body called the
Citizens
Welfare Association championing the causes of the rate-payers address·
ed a communication dated 30th November, 1952 to the Director of
H
Local Authorities requesting him to direct the Municipal Borough to
refund the excess amount of property tax collected from the ratepayers, because according to them the levy and collection of property
886
SUPREME COURT REPORTS
[1976) 3 s.c.R.
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tax at the revised rates was illegal in view of the fact that the assessment list was authenticated only on 24th July, 1952 beyond the
expiration of the official year for which the property tax was sought
to be levied.
The Director of Local Authorities by his reply dated
16th December, 1952 informed the Citizens Welfare Association that
the levy of pro.verty tax under the authenticated assessment list was,
according to hzm, perfectly valid.
The President of the Municipal
B
Borough thereaf,er issued a publ'c notice dated 10th November, 1954
calling upon the rate-payers to "pay immediately all the tax still due
from them aod extend their full cooperation to the Municipal Borough".
Since the Municipal Borough was determined to recover the amount
of proper'y tax from the rate-payers at the enhanced rates appearing
in the assessment list, the respondents, acting for and on behalf of
themselves and other rate-payers, filed a suit against the Municipal
C
Borough on 6th June, 1955. after giving notice dated ls!' April, 1955
on the hypothesis that such notice was required to be given under s.
206A of the Act.
The main reliefs claimed in the suit were, fin;tly,
a declaration that the Municipal Borough was. not entitled to recover
property tail: from the rate-payers at the revised rates since the assessment list was authenticated beyond the expiration of the official year
D
and secondly, an order directing the Municipal B"rou!!h to refund the
excess property tax recovered by i_t from the rate-payers.
The Municipal Borough in its written statement raised a preliminary
· objection that the suit was barred by limitation since it was not filed
within six months of the accrual of the cause of action as required
by s. 206A of the Act and it also disputed the claim of the rate-payers
on merits on the ground that there was nothing in the Act which
E
required that the assessment list should be authenticated before the
expiration of the official year and that even if the assessment list was
authenticated beyond the expiration of the official year, it did not have
the effect of invalidating the assessment list.·
The Trial Court negatived the plea of limitation based on s. 206A
of the Act and so far as the merits were concerned, held that since
F
the authentication of the assessment list was admittedly made beyond
the expiry of the official year, -the assessment list was void and inoperative and -the Municipal Borough was not entitled to levy and
_ _ co1lect property ·tax at the revised rates on the strength of such
assessment list.
The Municipal Borough, being
aggrieved by this
decision, filed an appeal to the District Court, but the appeal was
unsuccessful and a second appeal to the High Couit also failed.
G
Hence the present appeal by the Municipal Borough with special leave
obtained from this Court.
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The principal contention that was urged before us on behalf of the
Municipal Borough· was that on a true construction of the relevant
provisions of the Act, the authentication
of the assessment list, in
tient to impose liability to tax for the official year even if it is made
the official year to which the assessment list relates and it is sufficient to impose liability to tax for the official year even if it is made
at any time after the expiry of the official year and, therefore, in the
present case, though the authentication of the assessment list for the
official year 1951-52 was made on 24th July, 1952 after the expiry of
•
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. MUNIC. CORP. IIUDLI v. SUBllA RAO (Bhagwati, J.)
887
lhe official year, it was valid and effective
and operated to create
habJ.uy "" tn" ,ax payers rur payment of tax at the revised rates .. In
oruer lv appreciate lhls contenuon it is necessary to examine br1eily
the scheme of the Act in regard to assessment and levy of property
ta.A.
.. .uw .1.a::i1,;n .. u1us oi.
51,;;1,;1.~...,u aom / ts to 89 · aeals
with
assessment of and liability to rates of buildings and lands.
These sections
set out the procedure which must be followed for· levy of rates on
buildings and lands.
Secuon 78, sub-s. (1) reqtiues the Chief Officer
to cau>e an assessment list of all lands and buildings in the
Mun1c1pal Boruugn to be prepared -Cvu...atn111g
var1vu~ parL1culars
set out in the section.
When the preparation of the assessment list
is completed, the Chief Officer is required under s. 80 to give public
notice of the list and of the place where the list or a copy thereof
could be inspected.
Simultaneously the Chief Officer. has also to
give public notice under sub s. (1) of s. 81 of a date not less ·than
one month after such publication before which objections to the
valuation or assessment in such list shall be made.
Sub-s. (2) provides for the mode in which the objections must be made and sub-s.
(3) provides for the hearing and disposal of the objections by the
Standing Committee and the proviso to this sub-section permits the
powers and duties of the Standing Co=ittee to be transferred to anyother committee or to any officer of the government. This sub-section
provides that before the objections are investigated and disposed of, the
objector shall be given an opportunity of being heard in person or by an
agent and it is only after the hearing the objectors that the objections
can be disposed of. When the objections are thus considered and disposed of, the assessment list with the modifications which may have been
made consequent upon the decisions on the objections has to be authenticated in the manner set out in sub-s. (4). Suh-section (5) provides
that the list so authenticated shall be deposited in the Municipal office
and shall be open for inspection during office hours to all rate payers_
The completion of this procedure leads to certain important consequences and. they are set out in sub-s. ( 6) which reads as follows :
"(6)
Subject to such alterations as may be made therein
under the provisions of ·section 82 and to the result of any
·appeal or revision made under sec. 110, the entries in the
assessment-list so authenticated and deposited and the entries,
. if any, inserted in the said list under the provisions of sec.
82 shall be accepted as conclusive evidence-
.
(1)
(ii) for the purposes of the rate for which such assessment-list has been prepared, of the amount of the rate
liable on such buildings or lands or both buildings and
land in any official year in which such list is in force."
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section 82 then provides for amendment of assessment list in certain
cases.
This section is rather material and it may be reproduced in
full :
}[
"82. (1) The standing committee may at any time alter
the assessment-list by inserting or altering an entry in respect
of any property, such entry having been omitted from or
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SUPREME COURT REPORTS
. [1976) 3 S.C.R.
erroneously
niade in the
assessment-list through
fraud,
accident or mistake or in respect of any building constructed
altered, added to or reconstructed in whole or in part,
where such construction, alteration, addition or reconstructfon had been completed after the preparation of the assessment-list, after giving notice to any person interested in the
alteration of the list of a date, not less than one month ·
from the date of service of such notice, before which any
objection to the alteration should be made.
(2) An objection
made by any person interested in any
such alteration, before the time fixed in such notice, and in
the manner provided
by sub-section
(2) of section 81,
shall be dealt with in all respects as if it were an application
under the said section.
.(3)
An entry or alteration made under this section shall
subject to the provisions of section 110, chave the same effect
as if it had been made in the case of a building constr~cted ·
altered, added to or reconstructed on the day on which such
construction, alteration,
addition
or reconstruction
was
completed or on the day on which the ne\v construction,
alteration, addition or reconstruction
was first occupied, ·
whichever first occurs, or in' other cases, on the earliest_ day
in the current official year
on which the
circumstances
justifying the entry or alteration existed; ·and· the tax or
the enhaEced tax as the case may be shall be levied in suoh
year in the proportion which
the remainder of the year
after such day bears to the whole year."
t
The next important section is s. 84 which provides for the adoption
".:
of valuation and assessment contained in the assessment list of any
\
particular year for the year immediately following.
That section
is in the following terms :
"84. (1) It shall not be necessary. to prepare a new assess-.
· ment list every year. Subject to the condition that every
part of the assessment list shall be completely revised not
less than once in every four years, the Chief Officer may
adopt the valuation and assessment contained in the list for
any year, with such alterations as may be deemed necessary,
for the year immediately following.
(2) But the prmisions of sections 80, 81 and 82 shall be
applicable every year as if a new assessment list· had been
completed at the commencement of the officill;l year."
The other sections in this group are not material and it is not necessary_
to refer to them.
·
- It is clear ·from the scheme of these provisions that the official
year is the unit of time for the levy of the tax.
The provisional
assessment -list is prepared for the official year.
This may be done
before the commencement of the official year or: even ther;eafter in
the course of the official year.· ·Then objections are invited and when
made, they are disposed of andc amendments consequential upon the
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MUNIC. CORP. IIUBLI v. SUBIIA RAO (Bhagwati, J.)- -
889
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decisions on the objections are carried out in the assessment list. The
assessment list is then authenticated. The process of assessment and levy of the
tax which begins with the preparation of
the provisional assessment list is thus completed when the assessment
list is authenticated.
The assessment list, when aulhe1mcated, becomes effective from the first day of the official year and gives rise
to the liability to pay tax. It is on the authentication of the assessment list that the liability of the rate-payers to pay tax arises and the
tax is levied on the rate-payers.
This position would seem to be
clear as a matter of plain interpretation and in any event there is a
long line of decisions of the Bombay High Court commencing from
Sholapur. .f11unicipality v. Governor Gener111( 1). and
ending
has
Sholapur Municipal Corporation
v.
Ramchandra( 2 )
which
has
consistently accepted this position and the learned counsel appearing
on behalf of the Municipal Borough did not dispute the correctness
of these decisions.
The only contention raised by him was as to
within what time the assessment list must be authenticated, if it is to
be a valid and effective assessment list. It is to this contention that
we must now address ourselves.
/
B.
Now, once we take the view that the process of levying
the
tax is complete only when the assessment list is authenticated and it
is only then that the tax is levied on the rate-payers, it is ditlicuit to
resist the conclusion that the authentication must be made within the
official year.
The tax, being a
tax for the official year, must
obviously be levied during the official year and since the levy of the
tax is complete only when the assessment list is authenticated, it must
follow a fortiori that the authentication on the making of which alone
the levy of the tax is effected, must take place in the official year. Any
other view would result in an anomalom and rather absurd situation,
namely, that the tax for an official year would be leviable at any time,
even years after the expiration of the official year.
Th:it could not
possibly have been intended by the legislature.
That would indeed
be a strange consequence in case of a tax which is annual in its structure and organisation and which is intended to be levied for each
official year.
But, apart from this consideration, there is inherent evidence in ~
the sections themselves which shows that the authentication wa5 intended by the legislature to be a step which must be taken before the close
of the officbl year.
Section 84 provides that it shall 11ot be nece>-
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sary to prepare a new assessment Est every year but, subject to ~he __ G
conditions tha_t every part of the assessment list shall be completely
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revised not less than once in every four years, the Chief OrTiccr may
'
adopt the valuation and assessment contained in the list for any year,
with such alterations as may be deemed necessary, for the year immediately following.
This provision postulates that there would be an
assessment list for each official year at the close of that official year,
so that the valuation and assessment contained in it can he adopted by
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the Chief Officer for the immediately following year. Now clearly the
assessment list which can be adopted for the immediately following year -
(I) 49 Born. L. R. 752.
(2) 74 Born. L. R. 489. -
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SUPREME COURT REPORTS
[1976] 3 s.c.R.
is the authenticated assessment list and it would, therefore, seem that
the Jeg.slat1ve assumpt.on unue1Jymg LlliS provision is that in respect
or eaeh omc1al year, there woulu be an amhent1cated assessment list
before the cluse ot thar ornc.ai year, ~o inai. w~ ~ah.1.uuvl.l '1.Lau ......,,.,..,;').sment con.ameCI m ll can be aoopteCI by the Clue! Owc<r xor me . ·
immea1alt:Jy rollowmg year.
ULncrw~e, •l wuu1u not bt: pu~~101e tor
the Clltef Ullicer to aaopt the vamauon ana assessment 01 rne p1eccding v111l:.tal ycal auu uc woulu. navt: to prepare a new prov1s1onal
assessment Lst every tune when the asse~sment. J1st for Lile p1ct.:t:u.u.lg
year J!) uuL 11.ual1s~u a.nu
_aucuen~.cal .... u au.u
t.h1:,
m1gnt
lead to the
rather startling result of there
beillg several provmonal a»e>'mcnt
lists for d!lferent otticrnl years m the process ot hnal.tsatlon at me same.
time.
We shoulCI be slow to accept an interpretat10n which Dllght
lead to such a strange consequence.
Then again considerable Lght on this question is thrown by the
provis10n enacted m s. 82.
It IS a well setJed rule of 11i.crpreiat10n
that the Court is "enc.tied and inaeea bounu, when cunsau.ug the
· terlllS of any provision xound m a staiute, to consider any otl!er pru ts ·
of the Act wh1ch throw Lgnt on the liltenuon 01 the J~g1sl<J.LUte, and
which may serve to show that the parucular provision ought not to
be construed as it would be alone and ·apart trom the rest of the
Act."
The statute must be read as a whole and every prov1S1on in
the statute must be consrrued with reference to the contex1 and other
clauses in the staLUte so as, as far as poss.ble, to make a consistent
enactment of the whole statu<e.
Obv.ously, therefore, section 78
to 81 must be'so consrrued as to harmonise with s. 82.
'Ibey must
be read together so as to form part of a connec,ed whole.
~e~tion
82, sub-s. (1) provides for making of an amendment in the assessment llSC by insertion or alteration of an entry in certain events after
hearing objections which may b~ made by any person interested in
opposing the amendment.
Sub-section (3) of s. 82 makes the
amendment effective from "the
ear1est nay in the currcu. .,llic.al
year on which ihe circumstances ju,"1y.ng the entry or alteration
existed."
The expression 'current official year' in the context in
which it occurs in s. 82, sub-s. (3) clearly signifies the earliest day
in the official year which . is current when the amendment in the
assessment list takes place and that expression refers only to the
official year which is running at the time when the amendment is .
made by insertion or alteration of an entry under sub-s. (1) of s.
82.
It would, therefore, seem clear, on a combined reading of
sub-ss. (1) and ( 3) of s. 8 2, that an amendment, in order to be
effective in levying tax for an official year, must be made during the
currency of the official year.
That is now well settled as a result
of several decisions of the Bombay High Court cuJminatiug ·in the
Full Dench decision in Sholapur
Municipal
Corporar1011 v. Ramchandra (supra) and we do not see any reason to take a different
view.
Now the scheme of ss. 78 to 81 is identical with that of s.
82 and in both cases what is contemplated first is a proposal to which
objections are invited and after the objections
are iuvcstigated and
disp
0 sed of. the assessment F<• in the OPe rase and the altered entry in
the other are authenticated giving rise to liability in the rate-payer. It
must follow a forliori that if an alteration in the assessment list, in order
'
'
MUNC. CORP. HUBL! v. SUBHA RAO (Bhagwati, J.)
-- 891
to fasten liability on the rate-payer, is required to be made during the
A
currency of the official year, equally, on a parity cf reasoning, the asses~
f
,J
ment !1st, in order to give nse to hability rn the rate-payer, must also be
/
autncnt1cated betore tne expiry of the otticial year. Moreover, it is diffi!
cult to believe (hat the legislature did not intend that there should be
any time limit in regard to the levy of tax for an official year and that the
tax should be legally leviablc at any time after the close of the ollicial
year. There is, in our opinion, sufticient indication in the various proB
visions of the Act to show that the authentication of the assessment list,
in order to be valid and effective, must be made within the official year,
though the tax so levied may be collected and recovered even after the
expiry of thq _official year.
We may p"aint out that the Karnataka High Court_is not alone in taking this vic\V in the present case. This vie\V has ·been consistently taken
by the Bomoay High Court in a scncs ot decisions over the years and
it has also been followed by the Gujarat High Court._ When we find that
c
--;--
three High Courts having jurisdiction over the territories in which the
Act is in force have all taken this vie\V over a course of years, ;,ve do not
think we would be justified in departing from it, merely on lhe ground
f
that a different view is possible. This Court is ordinarily loathe to interfere Viith the interpretation of a State statute which has prevailed in
tho State for a long number of years and which the State Legislature has
chosen not to disturb by legislative amendment. As a matter of fact,
we find that, in the present case, the Bombay Legislature accepted this
interpretation of ss. 78 to 81 and gave legislative recognition to it by
introducing s. 84A by Bombay Act 53 of 1954. That section pwvidcs
that where in any year a new assessment list is prepared, or a list is revised, or the valuation and assessment contained in the list fer the year
immediately preceding is adopted v.rith er \Vithout ~11tera ir-n. "u"'li --,,v,
revised or adopted assessment list shall be authenticated in the manner
provided by section 81 at any time not later than the thirty-first day of
July of the official year to which the list relates, and if it is not so authenticated, then the State Government shall appoint such person or persons as it thinks fit to prepare, revise or adopt and authenticate the assessment list, and !hereupon such person or persons shall duly authenticate
such list at any time before the last.day Of the official year to wh'c s"'ch
list refates, and sections 78 to 81 or section 84 sliall,.as far as may be,
apply to the preparation, revision or adoption of the list, as the case may
be, by the person or persons appointed by the State Government. It is
D
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F
clear from this provision that the Legislature not only did not amend the
Act for the purpose of removing the time limit of the official ·year or enlarging such time limit, but on the contrary, made the time limit more -c
stringent by providing that the ai:thentication shall be made by the Muni- -
cipal Borough not later than 31st July of the official year and if the authentication is not made within that time, the State Government shall be
. entitled to oppoint a person fer the purpose of authenticating the assessment list and the authentication by such person shall not, in any event,
be later than the last day of the official yea.r. We are, therefore, of the
view that the assessment list;- in order to be effective in levying the tax,
must be authenVcated before the expiry of the official year and if it is
not, the assessment list '"ould be void and inoperative and not give rise
to liability in the rate-payers to pay t~.
H
A
B
c
D
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F
892
SUPREME COURT.REPORTS~· - [1976] 3 s.c.R.
That takes u3 to the second contention urged on behalf of the Municipal Borough based on s. 206A. That secuon provides inter alia that
Jlu swt snail lie against a municipality or against any officer or servant
of any municipality in respect of any act done in pursuance or execution '. •
or intended cxecuuon of tne Act, or in respect ot any alleged neglect or
C!efault in the execution of the Act, unless it is co=enced w1U11n six
montns next after the accrual of the cause of action. The argument of
the Municipal Borough was that the cause of action for the sull arose in
favour_ of the respondents and other rate-payers on 24th July, 1952 when
the assessment-list was authenticated and smce the suit was not Wed
within six months from that date, it was barred by limitation under s.
206A: This argument is plainly unsusta.nable.
The assessment lL't
being authenticated on 24th July, 1952, after the expLry of the official
year 1951-52, was void and inoperative and the respondents and other
rate-payers were entitled to ignore it as a nullity. It is only when the
Municipal Borough sought to recover the amount of tax from them en
the strength of the assessment list, that il became necessary for them t
to challenge the validity of the assessment Est with a view to resisting
.·
the demand of the Municipal Borough. Then and then only could a
cause of action be said to have accrued to them which they were required
to enforce within a period of six months. Now, in the present case,
there is no material to show as to when notices of demand requiring the
respondents and other rate-payers to pay the amount of tax w~re issued
by the Municipal Borough or which rate-payers paid the amount of t:ni:
and when. It is not possible to say, in the absence of such mater'c.l, as
to when the cause of action for filing the suit arose to the respondents
and other rate-payers and whether it arose within six months before the
filing of the snit or at a point of time earlier than that. The Municipal
Borough cannot, in the circumstances, be held to have established that
the suit was not commenced by the respondents and other rate-payers ,
within six months after the accrual of the cause of action and the plea of ~
limitation based on s. 206A must fail.
We are, therefore, of the view that there is no substance in th.e appeal
and it must be dismissed, but in the peculiar circumstances of the case,
we make no order as to costs.
V.P.S.
•
Appeal dismissed.