9911796707
TMI Blog1998 (11) TMI 687X X X X Extracts X X X X X X X X Extracts X X X X ..... levied Under Section 128, Sub-section (l)(x) of the Act. The case of the appellant was that the respondent company had erected a factory with a large number of ancillary buildings and residential houses occupied by its officers and staff within the municipal limits of the appellant Board and that the entire complex of buildings owned by the respondent company was surrounded by a high wall for security reasons. The appellant Board raised the bills of water-tax on 13th Aug., 1959 calling upon the respondent to note that as a result of a public water stand pipe, the company's property bearing all factory buildings situated on Cigarette Factory Khalasi Line, being within a radius of 600 feet from the said pipe had come within the taxable area with effect from the month of May, 1959 for the purpose of imposition of water- tax. The respondent-company, by its communication dated 19th December, 1959 objected to the said imposition of water-tax and submitted that the company was not liable to pay water-tax bills for the period from 1.10.1959 to 31.3.1960, as according to the respondent company, the bills were incorrectly made out in that they included all residential and factory buildi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant before the High Court of Judicature at Allahabad. The learned single Judge of the High Court, who heard the writ petition, after hearing the contesting parties, came to the conclusion that all the buildings belonging to the respondent-company were standing in a "common compound" (even though that the company might be subdivided into different sections), because the entire complex was surrounded by a common wall. Relying on the map which was supplied by the respondent-company, it was held that the said map clinched the arguments of the appellant which showed that inside the residential area there was one road which was undeniably appurtenant to the factory, since it led from the main municipal road to the gate of the factory proper, and there was another road which provided access to the various residential houses and was, therefore, a common appurtenance of all those houses. The first of these roads consequently had to be treated as the "compound" of the factory, as defined in Section 2(5) of the Act; and similarly the second road was the compound of the residences. Both these roads started from a point quite close to the municipal stand pipe; and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had exercised in substance jurisdiction under Article 227 of the Constitution of India against the appellate order of the District Magistrate passed Under Section 160 of the Act. On merits, it was submitted that the Division Bench had patently erred in law in applying the provisions of Section 2 Sub-section (5) defining "compound" while interpreting Explanation (a) to Section 129 of the Act. He submitted that the term "building" for the purpose of the said section will have to be understood in the light of Explanation (a) to Section 129 and hence could include not only the structure or structures along with their compounds which may be appurtenant to them but the said term would also include in its meaning several buildings which are situated in a common compound, as in the present case, and consequently, all such buildings in the "common compound" together will be treated as "buildings" for the purpose of finding out 600 feet distance from the nearest stand pipe to such buildings as required Under Section 129(iii) of the Act. Shri Garg further submitted that neither the District Magistrate nor the learned single Judge and also not even the D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther non-residential buildings of the respondent company were ex facie unauthorised leaving aside any other questions. 8. On merits, it was submitted by Shri R.F. Nariman that on a correct interpretation of Section 128(l)(x) and Section 129 Explanation (a), the term "common compound" has to be construed as a place where the common compound land was having appurtenance to the buildings situated therein and in the land in that compound, the residents of the buildings should have a right of common use or enjoyment and that would make the said surrounding land a "common compound". Therefore, according to the learned senior counsel for the respondent, the concept of "appurtenance" of the compound land to the buildings in question was a relevant question and could not be said to be contradicted , as in his view Section 2 Sub-section (5) which defines "compound" would squarely get attracted even in such a case. In support of his contention, he invited our attention to the word "common" as found in P. Ramanatha Aiyar's "The Law Lexicon", Reprint Edition 1987 at page 216-r. He also submitted that under Articles 226 and 227 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co. Ltd. The Empress Mills, Nagpur v. The Municipal Committee, Wardha, [1958]1SCR1102 ; Commissioner of Income-Tax, Punjab v. Kulu Valley Transport Co. (P) Ltd, [1970]77ITR518(SC) ; Collector of Estate Duty v. R. Kanakasabai and Ors., [1973]89ITR251(SC) and Polestar Electronic (P) Ltd. v. Addl. Commissioner, Sales Tax, Delhi, [1978]3SCR98. 9. It was also submitted by Shri Nariman that as the learned single Judge had exercised powers under Article 226 of the Constitution of India, the Special Appeal was maintainable and that as this objection was not raised by the appellant before the Division Bench, it should not be permitted to be raised at this late stage. In any case, he is entitled to challenge the decision of the learned single Judge in the present proceedings. 10. In rejoinder, Shri Garg, learned counsel for the appellant, submitted that the District Magistrate had patently erred in law in relying upon the definition of the term "Compound" as found in Section 2, Sub-section (5) of the Act, while interpreting Explanation (a) to Section 129 and in fact the appellate authority completely by-passed the said provision and wrongly relied upon the aforesaid definition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench of the High Court; 5. Whether the factory premises of the respondent company can be brought within the tax net of water-tax Under Section 129 of the Act read with Section 128(1)(x) in the light of the Govt. Notification dated 18th September, 1958 which, it is alleged, covered only residential buildings; and 6. What final Order? We will deal with these points seriatim. Points Nos.(1) and (2): 12. These two points raise common questions of law and fact and therefore, they are being dealt with together. The water-tax which is in dispute between the parties could be imposed by the appellant as per the provisions Under Section 128(1)(x) of the Act which reads as under : 128. Taxes which may be imposed - (1) Subject to any general rules or special orders of the State Government in this behalf, the taxes which a municipality may impose in the whole or any part of a municipality are - x x x (x) a water-tax on the annual value of buildings or lands or of both; 13. Restriction in the imposition of water-tax is found in Section 129 of the Act. The said provision, as it stood at the relevant time, reads as under : 129. [Restriction in the imposition of water-tax] -The i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... buildings, meaning thereby that, if a building has got adjoining land may be as side compound or front compound A or backyard which is exclusively attached to the building and which would be in the exclusive use of the occupier of the building, such land could be said to be its compound land. Similarly, if a cluster of buildings situated so close to each other and well knit had common land attached only to such composite cluster of buildings for use and occupation of owners of such a cluster of buildings, then these buildings could be said to have a compound of their own attached as appurtenance to all of them. It is obvious that such compound land would be available for exclusive use of the occupiers of these buildings so closely situated to one another that their occupants could use this adjoining compound land being an appendage to their building. However, so far as the term "common compound" is concerned, it is not defined by the Act. When we turn to Section 128, we find that the Municipalities have been authorised subject to general rules or special rules of the State Government to impose water-tax on the annual value of buildings or lands or of both. Consequently, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e a part and parcel of that building. But the said phrase also gets covered by the definition of the term "building" as found in Section 2(2) of the Act which covers even boundary walls of such compound land appurtenant to such a building. Such compound land gets in its turn covered by the definition of the term "compound" as found in Section 2(5) of the Act. Thus the first part of Explanation (a) to Section 129 which defines "building" can have a nexus with the definition of the terms "building" as found in Section 2(2) and "compound" as found in Section 2(5). 15. But when we turn to the second part of this Explanation, we find that it deals entirely with a different situation wherein none of the buildings are said to be situated in a "common compound". Thus entirely a different legislative scheme is envisaged by the said second part which provides that where there are several buildings situated in a common compound all such buildings in the common compound together will be treated to be forming one building for the purpose of finding out the permissible 600 feet radius from the nearest water stand pipe, as mentioned in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipe. Then the entire complex of the buildings situated in such common land would be covered by the taxing net of Section 129 read with Section 128(1)(x) and the restriction would stand lifted qua such entire complex. It is difficult to appreciate how the learned single Judge arrived at the conclusion that "common compound" was appurtenant to such buildings. In fact as seen earlier, the concept of appurtenance of compound land to buildings is not at all germane to second part of Explanation (a) to Section 129. It is relevant for the first part thereof only. The term "common" is defined in "Law Lexicon" by P. Ramanatha Aiyar, Reprint Edition 1987, at page 216-r as an adjective to mean amongst others "shared among several". The aforesaid meaning of the term "common" read in the light of the term "compound" as an adjective makes it very clear that if the compound land is shared in common by occupants of number of buildings situated therein it would be a common compound for them. It has nothing to do with the question of being appurtenant to any one of those buildings. The phrase "appurtenant to the building" gets rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent company were situated in common compound land belonging to the respondent company and in the said common land different residential bungalows were situated but even that apart there were other structures like swimming pool, nursery, canteen, kitchen, children's Park etc. All these structures and buildings including the factory were situated in common land which was available for use of all the occupants of the various buildings and structures situated therein. It is not in dispute that the entire common land formed a building complex which belongs to the respondent company. Therefore, this entire area styled as Bungalow park Area or for that matter, the factory area could be said to be comprising of buildings situated in a "common compound" so as to fall within the sweep of Section 129 read with Explanation (a). Once we reach the aforesaid factual conclusion on the scheme of the relevant provisions of the Act, the question whether the "common compound" land was appurtenant to any of the structures becomes irrelevant. Hence, we do not think it fit to burden this judgment by consideration of various decisions of this Court noted earlier for deciding the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of its jurisdiction, But on the facts of the present case, the jurisdiction of the High Court squarely got attracted as we will presently see. The writ petition before the learned single Judge of the High Court was against the decision rendered by the appellate authority Under Section 160 of the Act. While dealing with the question of imposing of water-tax and the restrictions regarding the same as envisaged by Section 129(a) of the Act, the appellate authority in its judgment considered the definition of the term "building" as found in the Explanation to Section 129 and observed as under : "Compound means land, whether enclosed or not, which is appurtenance of a building or the common appurtenance of several buildings". It was further observed that : "if the factory premises are treated as a common compound the question arises as to of which building or building it is an appurtenance. I, therefore, do not recognise the whole plot of land containing a number of factory buildings and residential buildings as one Unit for purpose of water-tax..." A mere look at the reasoning of the appellate authority shows that it suffered from a patent error of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t fit to consider this point. We are inclined to take this view for a more substantial and practical reason, namely, that this appeal is pending since 1976 in this Court on the Certificate of fitness granted by the High Court. Even assuming that the learned counsel for the appellant is right that the special appeal was not maintainable under the Letters Patent applicable to the High Court of Judicature at Allahabad, respondent would be entitled to urge before us that they may be permitted to challenge the order of the learned single Judge directly before us under Article 136 of the Constitution since the entire period spent by them in the High Court and this Court up till now will get excluded Under Section 14 of the Limitation Act Consequently, at this late stage, we do not deem it fit to allow the appellant to take up this contention for voiding the decision of the Division Bench. Point No. 4 is, therefore, disposed of as not entertained and, therefore, not answered. Point No. 5: 18. So far as this point is concerned, the learned counsel for the appellant was right when he submitted that such a contention raising mixed question of law and fact was never taken by the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere subsequently got sanctioned by the Govt. Order dated 12.09.1958. The said rules recited that in continuation of the Government notification dated 24.07.1956 the Governor in exercise of the powers conferred Under Section 296 of the U.P. Municipalities Act, 1916, has made the Rules for the assessment and collection of water-tax of Saharanpur Municipality. Amongst others, Rule 8 read as under : "With reference to Section 129(a) of the Act, the radius governing the imposition of the water-tax shall be 600 ft." Along with the said affidavit was also produced an extract of U.P. Municipalities Act, 1916. In the said extract published in 1957 Section 129 of the U.P. Municipalities Act as it then stood read as under : "129. Restrictions on the imposition of water-tax - The imposition of a tax under Clause (x) of Sub-section (1) of Section 128 shall be subject to the following restrictions namely,- (a) that the tax shall not be imposed on land exclusively used for agricultural purposes, or, where the unit of assessment is a plot of land or a building as hereinafter defined on any such plot or building of which no part is within a radius, to be fixed by rule in this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Zaman aforesaid is seen along with the relevant rules no doubt is left in our mind that the said notification entitled the appellant Municipality to impose water-tax on lands and buildings of all types situated within the municipal limits and which were in the radius of 600 ft. front the nearest water stand pipe. Shri A Nariman, learned senior counsel for the respondent submitted that when the High Court has referred to notification dated 12.09.1958 the copy of the notification relied upon in this additional affidavit may refer to some other notification. The aforesaid contention cannot be sustained for the simple reason that a close look at the said notification shows that the sanction for imposition of water-tax is pursuant to the Government Order dated 12.09.1958 but the draft rules appeared to have been framed on 12. 09.1956. The High Court and the District Magistrate seem to have referred to 12.09.1958, as the date on which the relevant rules came into force. As the disputed assessment is for a period after 12.0.1958, the objection raised by Shri Nariman about any inconsistency regarding date of the rules pales into insignificance. Shri Nariman, learned senior counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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