Calcutta High Court: Issue Of Non-Service Of Bills Not Permissible If Raised At Appellate Stage

Calcutta High Court: Issue Of Non-Service Of Bills Not Permissible If Raised At Appellate Stage

Upholds the judgment of the single-judge bench

The Calcutta High Court has dismissed the appeal of the assessee while supporting the 50 percent waiver of interest on property tax.

The bench comprising Justice Joymalya Bagchi and Justice Gaurang Kanth observed that the matter of bills claiming enhanced property tax if not raised during the arrears period, was unfounded. The appellant could not be allowed to raise it at the appellate stage.

The appellant is one of the owners of the premises. In 1998, the property tax on the premises was fixed at Rs.165 per quarter. The appellant contended he was paying the amount regularly.

In 2004–2005, the tax was enhanced to Rs.1115 per quarter, which the appellant maintained, was regularly paid by him.

However, the demand notice for tax arrears for the years 2011–2012, 2012–2013, and 2013–2014 and the tax of up to the fourth quarter of 2014–2015 with surcharge and interest, were raised against him.

The appellant made representations before the municipal authorities to permit him to pay the arrears in instalments, but the offer was declined. This led him to approach the court.

The single-judge bench, while upholding the demand notice, waived 50 percent of interest, demanded from the appellant.

The Bally Municipal Corporation assailed the single-judge bench’s order to modify the demand notice towards payment of property tax arrears.

The appellant contended that no bills were raised for the years 2010–2011, 2011–2012, and 2013–2014, therefore, the interest could not be demanded on the arrears amount. He was willing to pay the outstanding amount in installments.

The municipal corporation contended that the appellant made a new case on appeal. Neither in the representation nor in the writ petition, he raised the issue of bills for the arrears period. The authorities stated they had no scheme to waive interest on property taxes. Hence, the order, to waive 50 percent interest should be set aside.

The court noted that the bills were raised more than a decade ago. At no stage, the appellant pleaded that the bills were served. As per the law, municipalities were required to maintain records for three years. Therefore, the relevant bills were not available.

The judges pointed out that the appellant raised the issue of non-service of bills belatedly, to avoid liability. But that won’t be permitted. In his representation before the municipality, the appellant requested paying the arrears in instalments due to financial constraints.

Thus, the bench dismissed the appeal of the appellant. It directed the municipal corporation to raise a demand notice on the appellant to pay the amount fixed by the single-judge bench within seven days from the date.

It added that the appellant must make the payment within a fortnight, failing which the amount would carry an interest of 10 percent until paid.