TMI Blog1987 (1) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... ression " vest " is capable of being used in this sense, depending on the context in which it is employed. We, therefore, allow this appeal - - - - - Dated:- 30-1-1987 - Judge(s) : B. C. RAY., M. P. THAKAR JUDGMENT The judgment of the court war, delivered by THAKAR J.--Is the Municipal Corporation of Hyderabad prohibited from levying municipal taxes from persons inducted by it in the property of its own ownership under the hire purchase agreement ? The validity of levy of municipal taxes -by the Municipal Corporation of Hyderabad from allottees to whom the Municipal Corporation had allotted buildings constructed under " Low Income Housing Scheme " launched by it was questioned by the allottees. The learned single judge upheld the validity but the Division Bench in appeal' took a contrary view. The Municipal Corporation has preferred the present appeal 2 and has contended that the learned single judge was right in upholding the levy and the Division Bench was wrong in holding it invalid. The facts giving rise to the writ petition instituted by the 72 allottees to whom the houses were allotted need to be stated briefly: The Hyderabad Municipal Corporation started a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is built on the argument that inasmuch as the houses under the hire purchase agreement have not yet vested unto the allottees, the property vests unto the Municipal Corporation and, under the circumstances, section 202(1) of the Hyderabad Municipal Corporation Act (Act) prohibits the levy of the general tax in respect of these houses. In order to deal with the plea of the allottees which was negatived by the learned single judge but sustained by the learned judges of the Division Bench, the relevant provisions of the Act require to be noticed. They are Sections 197(1)(i), 199(l), 202(l) and 204(l). " Section 197. (1)(i) For the purposes of this Act, the Corporation shall impose the following taxes namely: (a) taxes on lands and buildings;..." " 199. (1) The following taxes shall, subject to exceptions, limitations and conditions herein provided, be levied on buildings and lands in the City and shall hereinafter be referred to as property taxes, namely:-(a) general tax ; (b) a water tax; (c) a drainage tax; (d) a lighting tax; (e) conservancy tax; " " 202. (1) The general tax shall be levied in respect of all buildings and lands in the city except: (a) buildings and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lic purposes or for purposes of the community are exempted. For instance, by clause (a), buildings and lands which are used for purposes connected with the disposal of the dead are exempted inasmuch as the entire community is interested in such a user. The same principle is discernible in regard to clause (b) which provides for exemption in regard to lands or buildings solely occupied for public worship or for charitable or educational purposes. The same philosophy is discernible in the exemption accorded under clause (d) to properties belonging to the Central or State Government which are used solely for a public purpose. Be it realised that clause (d) makes it abundantly clear that the exemption will not be extended to properties belonging to the Central Government and State Government if the same are used for purposes of profit and not for a public purpose. The user for the purposes of the community is the rationale of the thread of principle which runs through all these three clauses (viz., clauses (a), (b) and (d) ) for granting exemption. So far as clause (c) which has given rise to the present controversy is concerned, a different principle is at the bottom: different but no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lies to a situation where the buildings or the premises are in the actual occupation of a person or body other than the Municipal Corporation itself. In such an event, the property taxes would be leviable primarily from the said occupier as if the said occupier holds the property from the Corporation itself. This leaves no room for doubt that the Corporation is entitled to impose taxes on the buildings which may be owned by itself but which may be in occupation of others. Otherwise, the provision contained in section 204(1) would be rendered aimless and otiose. Surely, the Legislature was enacting a purposeful provision and not a purposeless provision without aim or object. For the aforesaid reasons, we are of the opinion that the learned single judge was right in taking the view that the buildings and lands vesting unto the Corporation not only in title but also in possession (as polarized from those vesting in title only but not in possession) were exempted from the obligation imposed by the Legislature to levy property taxes. Buildings and lands which were merely owned by the Corporation but were in actual possession or under the actual use and occupation of someone else, tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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