1. By this application, the applicant-landlord is challenging the valuation of her building made by the non-applicant for purposes of assessing the building to property tax.
2. Facts which are not in dispute In brief are: The applicant owns a house situated in the City of Nagpur within the jurisdiction of the Corporation of the City of Nagpur. That house is divided into six units bearing municipal Nos. 494, 494/1, 494/2, 494/3, 494/4 and 494/5. Unit No. 494 is in the occupation of the applicant herself while the other units are rented out to the tenants. The annual valuation of unit No. 494 fixed for purposes of assessment of the property tax is Rs. 130/, and the annual valuation of the other units is fixed on the basis of rents actually received by the applicant from her tenants after allowing deductions permissible under Section 119(b) of the City of Nagpur Corporation Act, 1948 (No. II of 1950). By notice, dated 24-9-1954, the applicant was intimated of the proposed annual valuation of these units and the tax based thereon. The applicant filed her objection thereto, which was rejected by the objection Officer by his order dated 10-8-1955. Feeling aggrieved by the order of the Objection Officer, the applicant preferred an appeal before the District Judge, Nagpur. This appeal also failed and hence this' revision.
3. It is urged on behalf of the applicant that it is not open to the Corporation to value the gross annual rent of the building on any other basis except those provided in the Bent Control Order pro-molugated under Act XI of 1946. At any rate, as no method is prescribed under the Act for valuing the gross annual rent, the method indicated in the aforesaid Order should be adopted. In the alternative, it is urged that there is no basis on which the gross annual rent of unit No. 494 is assessed and the same is arbitrary. Reliance is placed on behalf of the applicant on the decision reported in Municipal Corporation of Rangoon v. Surati Bara Bazar Co. AIR 1924 Rang 194, Corporation of the town of Calcutta v. Ashutosh De. : AIR1927Cal659 , Coimbatore Municipality v. G.S. Govindayyar and M.C. Arvi v. Hiralal, Civil Revision No. 180 of 1949 decided on 23-11-1949 (Nag) (D).
4. In any view, none of these contentions has any force on the facts and circumstances of the case. It is to be noted that no order has been passed by the Rent Controller fixing the fair rent to be charged for the units in possession of the tenants under the C. P. and Berar Letting of Houses and Rent Control Order, 1949.
5. Section 2 of Act XI of 1946 read thus: 'The State Government may, by general or special order which shall extend to such areas as the State Government may, by notification, direct, provide for regulating the letting and subletting of any accommodation or class of accommodation whether residential or non-residential, whether furnished or unfurnished and whether with or without board and in particular,
(a) for controlling the rents for such accommodation either generally or when let to specified persons or classes of persons or in specified circumstances.
(b) for preventing the eviction of tenants orsub-tenants from such accommodation in specified circumstances.
(c) for requiring such accommodation to be let either generally, or to specified persons or classes of persons or in specified circumstances, and
(d) for collecting any information or satistics with a view to regulating any of the aforesaid matters.'
Under this section, the State Government promulgated the C. P. and Berar Letting Of Houses and Rent Control Order, 1949, which came into force on 26-7-1049. It is nut in dispute that the said Order was made applicable to the area within the limits of the Corporation of the City of Nagpur. (6) Section 6 of Act XI of 1946 reads thus:
'Any order made or deemed to be made under Section 2 shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or in any instrument having effect by virtue of any enactment other than this Act.'
Depending on the aforesaid provision of Section 6 of Act XI of 1946, as already stated, it is contended that it is not open to the non-applicant to value the gross annual rent on any other basis except those indicated in the Order. In my view , this is not a correct contention. When the provisions of the Order are examined, it is clear that the Order by itself does not fix any fair rent. It only empowers the Rent Controller to fix a fair rent when moved either by the landlord or by the tenant. It is only when the Rent Controller is moved by either of them, he gets jurisdiction to fix a fair rent. It does not prevent the parties to amicably settle the rent between themselves, nor does this Order make it illegal to charge and realise the agreed rent which may be at variance with the method indicated in the Order for fixing a fair rent. It is only when such fair rent is fixed by the Rent Controller, the landlord is prohibited from claiming anything in excess of the rent fixed The relevant provision of Section 119 of the City of Nagpur Corporation Act for purposes of this case are as follows: '119. For the purpose of assessing land or buildings to the property tax:
X X X X X X (b) the annual value of any building shall be deem-ed to be the gross annual rent at which such building, together with its appurtenances and any furniture that may be let for use for enjoyment therewith, might reasonably at the time of assessment be expected to be let from year to year less an allowance of ten percent for the cost of repairs and for all other expenses necessary to maintain the building in a state to command such gross annual rent.'
Reading this section by itself, it would be seen that the powers of the non-applicant to assess the gross annual rent is in no way restricted by the provisions of the aforesaid Rent Control Order. Even assuming that Section 6 of Act XI of 1946 controls the powers of the Corporation to assess the gross annual rent, it cannot be said that these provisions come into play till the fair rent is actually determined by the Rent Controller on being moved by any one of the interested parties. As already stated, in the instant case, the Rent Controller has not fixed any fair rent, nor it was shown that the tenants had any intention to move the Rent Controller for fixing a fair rent. The landlord is actually receiving the rents from her tanants. In these circumstances, it cannot be said that the assessment of the gross annual rent of units Nos. 494/1 to 494/5, which is assessed on the basis of the rent actually received, is in any way vitiated.
6. It is urged by the learned counsel for the applicant that the tenants may apply for fixation of fair rent to the Rent Controller and the Rent Controller might reduce the rent. The landlord then will be getting rents at the lower rates but will have to pay taxes on the basis of higher rates. In my view, this contention has also no force. Section 134(1) of the City of Nagpur Corporation Act empowers the Chief Executive Officer to amend the assessment, and; as rightly pointed out by the learned counsel for the non-applicant, if any such contingency occurs, it will be open to the applicant to move the Chief Executive Officer to amend the assessment. It cannot be presumed that the Chief Executive Officer would not take into consideration the reduction in the rents consequent on such order of the Rent Controller, if any.
7. It is next necessary to consider the decisions on which reliance is placed on behalf of the applicant. Civil Revision No. 180 of 1949 (Nag) (D) has no bearing on the question that falls for consideration, it does not relate to the powers of the municipal committee regarding the assessment of the gross annual rent. It is distinguishable on facts. The facts in that case were: A lease was granted of a room in the market under bye law 3(b) By the Municipal Committee, Arvi, to one H for one year i.e. from 1-4-1946 to 31-3-1947. Under bye-law 7, the lessee was required to vacate on the expiry of the lease. An auction was held for the lease commencing from 1-4-1947 and one A was the highest bidder at the auction. H, however, did not vacate and claimed benefit of Clause 13(1) (b) of the House Rent Control Order. It was held that he was entitled to such benefit claimed. It is to be noted that under that clause it was not open to the landlord to terminate the tenancy without obtaining the permission of the Rent Controller for its termination. It will be seen that the action taken by the Municipal Committee was contrary to the prohibition contained in the Rent Control Order. As already shown, in the absence of any order fixing a fair rent, it was competent for the applicant to charge any rent which his tenant had agreed to pay.
8. Municipal Corporation of Rangoon v. Sarati Bara Bazar Co. (A) (supra) and Coimbatore Municipality v. G.S. Govindayyar (C) (supra) are also distinguishable on facts. In both these cases the rent was already fixed by the competent authorises under the Rent Control Acts or Orders prior td the date of assessment, and in these circumstances it was held that the assessment should have been based on the rents fixed.
9. The decision in Corporation of Calcutta v. Ashutosh De (B) (supra) turned on the interpretation of Section 26 of the Calcutta Rent Act of 1920. The said provisions read as follows:
'During the continuance of this Act the Corporation of Calcutta or any other local authority shall not raise its assessment of any premises above the standard rent on the ground of increase of value.'
The standard rent, according to the said Act, was the rent prevailing in the year 1918, and in view of the aforesaid provisions in the Calcutta Rent Act, it was held that it was not open to the Municipal Committee to raise the assessment. As already shown, there is no such provision restricting the powers of the Corporation to raise the assessment.
10. This brings us to the gross annual rent assessed on unit No. 494 which is in the occupation of the landlord. There is no substance in the contention of the applicant that there is no basis for fixation of this refit. Para 5 of the order of the objection Officer dated 10-8-1955 shows that the rent is fixed on the basis of the rents obtained by the landlord for the adjoining units. Nos. 494/1 to 494/5. This reason given by the Objection Officer has been accepted by the appeal Court. I see no reason to differ from it.
11. In the result, this application fails and is dismissed with costs.
12. Application dismissed.