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2016 (9) TMI 1048 - RAJASTHAN HIGH COURT

2016 (9) TMI 1048 - RAJASTHAN HIGH COURT - TMI - Exemption from taxation - use of property - control of the premises - titles to the property - Held that:- It is clear that the property which is constructed is in the ownership of the Government of India but land and the possession is with the Food Corporation of India and they are enjoying the property, no sovereign function is done on the land in question. The land which is allotted to the Food Corporation of India is on creation of the statuto .....

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ranted exemption of taxation.The contention raised by the petitioner is misconceived and is liable to be rejected. - D.B. Civil Writ Petition No. 1049/1999 - Dated:- 15-9-2016 - K. S. Jhaveri And Banwari Lal Sharma, JJ. For the Petitioner : S. C. Mittal 1. By way of this petition, the Food Corporation of India has approached this Court praying for the following relief(s):- "(i) declaring the provisions of Rule 3 of the Rules of 1969 as amended in 1991 thereby providing two pay scales for th .....

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der dated 21.7.1997 (Annex.6) to be illegal and unconstitutional and setting-aside the same; 2. The petitioner is a corporate body established under the Food Corporation Act, 1964. It is an agency created for the purpose of procurement, storage and distribution of food grains and fertilizers. It owns godowns at various places in the State of Rajasthan. The physical possession of the godowns formerly blongs to the Ministry of Agriculture and Irrigation of the Government of India was also transfer .....

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, which reads as under:- "I am directed to refer to Shri L.M. Chavan's D.O. Letter M. E.9(15)/75- Stg.V (M.P.) dated the 24th November, 1976 on the above subject and to say that the ownership of Central Storage godowns, the physical possession of which has been transferred to FCI in respect of the godowns listed in your above letter, still vest in the President of India. As such, no property taxes are payable for these properties in accordance with Article 285 of the Constitution under .....

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la 241 where in para 13, 15, 27 & 32, the Court has observed as under:- "13 In Dum Dum Municipality's case (1995) 5 SCC 251 supra, an argument appears to have been raised that only those properties which are vested by the Central Government in the Authority on the date of its constitution alone will continue to be the properties of the Union. While dealing with this contention the Supreme Court observed:- "But so far as the properties which have been acquired or constructed aft .....

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ar 1988-1989 which in unmistakable terms points out that the Authority claims to the owner of all the properties without making any distinction between those were vested in it at its inception and those which have been acquired and/or constructed later. This distinction sufficiently supports our view that there are two sets of properties and buildings in the occupation of the FCI. Thus the properties, buildings and other assets owned by the Union of India, in the occupation of the FCI, after its .....

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ion of India, which were transferred to the FCI for its occupation are immune from taxation by the State or by any authority within the State as provided in Article 285(1) of the Constitution and hence those properties are liable for exemption from payment of property tax leviable by the 'Municipal Corporation'. At the same time, the properties and buildings acquired and constructed by the FCI after its constitution are its own properties and hence no immunity from taxation is available .....

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case not upon the property of Union of India (Central Government being the owner of the property) but, upon the interest of the lessee under the Central Government. As per the definition of the word 'owner' under Section 2(j) of the A.P. Non-Agricultural Land Assessment Act 1963, lessee under the Central Government is deemed to be the owner for the purpose of assessment of tax. Art. 285 is therefore not attracted such a case. The State Government can levy and collect the tax from the pe .....

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sment Act, 1963, lessee under the Central Government is deemed to be the 'owner' for the purpose of the assessment of tax. But the definition of the word 'owner' contained in Section 2(26) of the Kerala Municipal Corporation Act, 1961, is as follows:- "(a) person who for the time being is receiving or is entitled to receive, the rent of any land or building whether on his own account or on account of himself and others or as an urgent, trustee, guardian or receiver for any o .....

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(I) of Section 2 of the Andhra Pradesh Non-agricultural Lands Assessment Act, 1963 includes a lessee if the land has been leased out by the Government for any commercial, industrial or other non-agricultural purpose. That being the position, the decisions referred to above will not render any assistance to the Municipal Corporation to levy property tax or service charge in respect of the building occupied by the FCI. 27. The discussion herein above brings forth the following conclusions : (1) T .....

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and P3 in O.P. No. 6588 of 1992) containing the decisions of the Government of India regarding the payment of service charges to the Municipal Corporations in respect of the Union properties have the force of law. (4) The service charges payable under the aforesaid Circulars is a 'compensation' payable in quasi- contract under Section 70 of the Indian-Contract Act. (5)Section 70 of the Indian Contract Act will come within the ambit of any other law contemplated under Section 413 of the .....

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dia. 32. Property of the Union and revenue therefrom, but as regards property situated by a State subject to legislation by the State, save in so far as Parliament by law otherwise provides. Articles 285 itself refers to a law by the Parliament in so far as the exemption of property of the Union from State taxation. The Parliament has no so far framed any law in so far as the taxation of the property of the Union as contemplated under Article 285. Ext. P2 Circular referred to above, inter alia, .....

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