Gujarat Agro Industries Corpn. Vs. Ahmedabad Municipal Corpn. - Court Judgment

Excerpt:
municipal tax - assessment - section 406 of bombay provincial municipal corporation act, 1949 - petitioner assessed for property tax under act - appeal under section 406 against gross rateable values and property tax but dismissed - in special leave application supreme court granted stay - petitioner failed to deposit amount of tax at 75% with corporation within stipulated period under supreme court's order - small causes court dismissed valuation appeals preferred by petitioner - appeal against small causes court's order - petitioner failed to comply with supreme court's order consequently stay could not be operative - small causes court failed to comprehend correct import of supreme court's order and dismissed valuation appeal - held, matter remanded back to small causes court for hearing and decide concerned valuation appeals. - - ' 3. the petitioner failed to deposit the amount of the tax at 75 per cent with the municipal corporation within two months from 12th december, 1980, i. failed to deposit the amount of 75 per cent within the period of 2 moths from 12-12-1980 as granted by the supreme court, the chief judge, small cause court proceeded to dismiss all the 8 municipal valuation appeals and orders dismissing these municipal valuation appeals nos. in this order, the supreme court had also ordered that -on such deposit being made, the appeals should be heard and disposed of'.therefore, even if the petitioners had failed to deposit the amount within the time of 2 months granted by the supreme court, all that could be said is that the petitioners could not take advantage of the stay order passed by the supreme court because they failed to comply with the condition imposed by the supreme court while granting the stay order, nevertheless, the fact remains that the appeals were to be heard and disposed of on the deposit being made. it appears that the small cause court proceeded to dispose of the appeals on 22-4-1981 merely because the petitioners failed to comply with the requirement of depositing 75 per cent of the amount, it was a condition precedent or a pre-requisite for the stay order, i. in our considered opinion, the chief judge of the small cause court failed to comprehend the correct import of the supreme court's order dated 12-12-1980 and dismissed the appeals on the ground that the petitioner failed to deposit the amount within time as directed by the supreme court. the only effect of the failure to deposit the amount could be that the stay granted by the supreme court could not beoperative, but it was never meant by the supreme court that the appeals pending before small cause court must be immediately dismissed on the said failure. 7. in the backdrop of the facts and circumstances as aforesaid, we find that the order dated 18-3-1983 whereby the petitioners' applications for restoration of the appeals were dismissed, was not justified and so also, the order dated 22-4-1981passed in each of the appeals dismissing the same on the ground of the failure to deposit the amount.order the gujarat agro industries (p) ltd. etc. etc. versus the municipal corporation of the city of ahmedabad and others (with appln. for ex parte stay). 12-12-1980. these matters were called on for hearing today. upon hearing counsel for the court special leave to appeal in all the matters and granted stay on condition that seventy five per cent of the tax is deposited with themunicipal commissioner, within 2 months from today. on such deposit being made by the appeals to be heard and disposed of. sd/- court master.' 3. the petitioner failed to deposit the amount of the tax at 75 per cent with the municipal corporation within two months from 12th december, 1980, i.e. within the time stipulated under the supreme court's order dated 12-12-1980 as a condition for stay. whereas the petitioner gujarat agro industries ltd. failed to deposit the amount of 75 per cent within the period of 2 moths from 12-12-1980 as granted by the supreme court, the chief judge, small cause court proceeded to dismiss all the 8 municipal valuation appeals and orders dismissing these municipal valuation appeals nos. 813/78, 814/78, 815/78, 1109/78, 1815/ 78, 1943/78, 772/80 and 1428/80 were passed on 22-4-1981. 4. the case of the petitioners is that when their counsel came to know about all these orders dated 22-4-1981, on 10-4-1982 he applied for the certified copy of the order dated 22-4-1981 on the same day, i.e. 10-4-1982 and such certified copy was delivered on 14-6-1982. thereupon the petitioner moved restoration applications on 13-7-1982 before chief judge of the small cause court at ahmedabad for restoration of the said municipal valuation appeals. these restoration applications were also dismissed by the small cause court on 18-3-1983. it has been further given out by mr. n.s. sheth that the 75 per cent amount had been deposited in each of the matters, of course, after the period granted by the supreme court and, therefore, at the most the gujarat agro industries corporation could be denied the benefit of stay order passed by supreme court but the appeals could not be dismissed by the small cause court on this ground alone. therefore, appeals should be restored and the same may be heard and decided on merits. 5. mr. sheth has raised the contention that at no stage the petitioner has received the audience on merits and the case has not been considered on merits at any stage and these special civil applications against the order dated 18-3-1983 read with the order dated 22-4-1981 as passed by the small cause court were filed in august, 1983before this court. it has been given out by mr. nagarkar appearing for respondent, that the special leave petitions which were filed before the supreme court as mentioned in para 2 of this order became civil appeals nos. 3012-20/80 on leave being granted by the supreme court and out of these civil appeals, civil appeals nos. 3018-19/80 were dismissed as withdrawn on 16-2-1999. 6. we have heard learned counsel for both the sides. we find that so far as the appeals before the supreme court are concerned, they were directed only against the validity of section 406(2)(e) of the b.p.m.c. act and the order which was passed by the supreme court on 12-12-1980 was not the final order. it was the order by which stay was granted on the condition of depositing 75 per cent of the tax within two months. in this order, the supreme court had also ordered that - 'on such deposit being made, the appeals should be heard and disposed of'. therefore, even if the petitioners had failed to deposit the amount within the time of 2 months granted by the supreme court, all that could be said is that the petitioners could not take advantage of the stay order passed by the supreme court because they failed to comply with the condition imposed by the supreme court while granting the stay order, nevertheless, the fact remains that the appeals were to be heard and disposed of on the deposit being made. it appears that the small cause court proceeded to dispose of the appeals on 22-4-1981 merely because the petitioners failed to comply with the requirement of depositing 75 per cent of the amount, it was a condition precedent or a pre-requisite for the stay order, i.e. stay against the recovery of the assessed amount of tax. in this regard, we have also gone through a detailed affidavit dated 12-7-1982 which has been filed by one shri kapinjal, m. desai, who was appearing on behalf of the petitioner before the small cause court. in our considered opinion, the chief judge of the small cause court failed to comprehend the correct import of the supreme court's order dated 12-12-1980 and dismissed the appeals on the ground that the petitioner failed to deposit the amount within time as directed by the supreme court. the only effect of the failure to deposit the amount could be that the stay granted by the supreme court could not beoperative, but it was never meant by the supreme court that the appeals pending before small cause court must be immediately dismissed on the said failure. be that as it may, the fact remains that the small cause court dismissed the appeals on this ground alone without considering the same on merits, while the gujarat agro industries corporation could still deposit the amount of 75 per cent by praying before it the permissible concession up to 25 per cent of the due amount of tax. it is settled that the small cause court while hearing the appeals under section 406 can entertain the appeals by granting the latitude up to 25 per cent so as to require the deposit of the tax to the extent of 75 per cent. in other words, if 75 per cent of the amount is permitted to be deposited, the appeal may be entertained by the small cause court and the proceedings may go ahead. in case the 75 per cent amount is permitted to be deposited, the appeals cannot be dismissed straightway and they have to be heard and decided on merits. it further appears that the civil appeals which were pending before the supreme court have been got dismissed as withdrawn either because the validity of section 406(2)(c) has been upheld or because these special civil applications have been filed before this court and the same are pending since 1983 and 75 per cent of the amount has been deposited in small cause court. we find that in such a fact situation, when the statement at bar is made by mr. n.s. sheth appearing on behalf of the gujarat agro industries corporation that 75 per cent of the amount was deposited, the petitioner could have been permitted to be heard on merits. it is very clear that at no stage, the petitioners have been heard on merits and now when there is no reason to disbelieve the fact with regard to the deposit of the 75 per cent of the amount and the same has not been disputed by mr. nagarkar for respondent -- it will be in consonance with the ends of justice to allow the petitioners to have a hearing on merits in the appeals preferred by it before the small cause court. 7. in the backdrop of the facts and circumstances as aforesaid, we find that the order dated 18-3-1983 whereby the petitioners' applications for restoration of the appeals were dismissed, was not justified and so also, the order dated 22-4-1981passed in each of the appeals dismissing the same on the ground of the failure to deposit the amount. accordingly, the common judgment and order dated 18-3-1983 in civil applications passed by the small cause court whereby the restoration applications were rejected and the orders dated 22-4-1981 passed in each of the eight municipal valuation appeals nos. 813/78, 814/78, 815/78, 1109/78, 1815/78, 1943/78, 772/ 80 and 1428/80 dismissing the appeals deserve to be quashed and set aside and the same are hereby quashed and set aside. the matters are remanded back to the concerned small cause court for hearing the same after verification of the actual deposit to the extent of 75 per cent in each case and if the amount has been deposited as stated, the concerned small cause court shall proceed to hear and decide the concerned municipal valuation appeals nos. 813/78, 814/78, 815/78, 1109/78, 1815/78, 1943/ 78, 772/80 and 1428/80 on merits in accordance with law after giving notice to both the sides with regard to the date of hearing. in case it is found by the concerned small cause court that the due amount of 75 per cent has not been deposited as stated above, the earlier orders dated 22-4-1981 and 18-3-1983 shall stand. it is expected that since the basic dispute relates to the assessment years 1978-79 and 1979-80 and the matters are taken up for hearing in the remanded proceedings concerned small cause court shall give priority to the hearing of these appeals and shall hear and decide the same on merits in accordance with law within the shortest possible period, but in no case later than a period of six months from the date the certified copy of this order is produced before the concerned small cause court by any of the parties. all these 8 special civil applications are allowed in the terms as aforesaid and rule is also made absolute accordingly. no order as to costs.

Judgment:
ORDER

The Gujarat Agro Industries (P) Ltd. etc. etc.

Versus

The Municipal Corporation of the City of Ahmedabad and others (with Appln. for Ex parte Stay).

12-12-1980. These matters were called on for hearing today.

Upon hearing counsel for the Court special leave to appeal in all the matters and granted stay on condition that seventy five per cent of the tax is deposited with theMunicipal Commissioner, within 2 months from today. On such deposit being made by the Appeals to be heard and disposed of.

Sd/-

Court Master.'

3. The petitioner failed to deposit the amount of the tax at 75 per cent with the Municipal Corporation within two months from 12th December, 1980, i.e. within the time stipulated under the Supreme Court's order dated 12-12-1980 as a condition for stay. Whereas the petitioner Gujarat Agro Industries Ltd. failed to deposit the amount of 75 per cent within the period of 2 moths from 12-12-1980 as granted by the Supreme Court, the Chief Judge, Small Cause Court proceeded to dismiss all the 8 Municipal Valuation Appeals and orders dismissing these Municipal Valuation Appeals Nos. 813/78, 814/78, 815/78, 1109/78, 1815/ 78, 1943/78, 772/80 and 1428/80 were passed on 22-4-1981.

4. The case of the petitioners is that when their counsel came to know about all these orders dated 22-4-1981, on 10-4-1982 he applied for the certified copy of the order dated 22-4-1981 on the same day, i.e. 10-4-1982 and such certified copy was delivered on 14-6-1982. Thereupon the petitioner moved restoration applications on 13-7-1982 before Chief Judge of the Small Cause Court at Ahmedabad for restoration of the said Municipal Valuation Appeals. These restoration applications were also dismissed by the Small Cause Court on 18-3-1983. It has been further given out by Mr. N.S. Sheth that the 75 per cent amount had been deposited in each of the matters, of course, after the period granted by the Supreme Court and, therefore, at the most the Gujarat Agro Industries Corporation could be denied the benefit of stay order passed by Supreme Court but the appeals could not be dismissed by the Small Cause Court on this ground alone. Therefore, appeals should be restored and the same may be heard and decided on merits.

5. Mr. Sheth has raised the contention that at no stage the petitioner has received the audience on merits and the case has not been considered on merits at any stage and these Special Civil Applications against the order dated 18-3-1983 read with the order dated 22-4-1981 as passed by the Small Cause Court were filed in August, 1983before this Court. It has been given out by Mr. Nagarkar appearing for respondent, that the Special Leave Petitions which were filed before the Supreme Court as mentioned in para 2 of this order became Civil Appeals Nos. 3012-20/80 on leave being granted by the Supreme Court and out of these Civil Appeals, Civil Appeals Nos. 3018-19/80 were dismissed as withdrawn on 16-2-1999.

6. We have heard learned counsel for both the sides. We find that so far as the appeals before the Supreme Court are concerned, they were directed only against the validity of Section 406(2)(e) of the B.P.M.C. Act and the order which was passed by the Supreme Court on 12-12-1980 was not the final order. It was the order by which stay was granted on the condition of depositing 75 per cent of the tax within two months. In this order, the Supreme Court had also ordered that -

'on such deposit being made, the appeals should be heard and disposed of'.

Therefore, even if the petitioners had failed to deposit the amount within the time of 2 months granted by the Supreme Court, all that could be said is that the petitioners could not take advantage of the stay order passed by the Supreme Court because they failed to comply with the condition imposed by the Supreme Court while granting the stay order, nevertheless, the fact remains that the appeals were to be heard and disposed of on the deposit being made. It appears that the Small Cause Court proceeded to dispose of the appeals on 22-4-1981 merely because the petitioners failed to comply with the requirement of depositing 75 per cent of the amount, it was a condition precedent or a pre-requisite for the stay order, i.e. stay against the recovery of the assessed amount of tax. In this regard, we have also gone through a detailed affidavit dated 12-7-1982 which has been filed by one Shri Kapinjal, M. Desai, who was appearing on behalf of the petitioner before the Small Cause Court. In our considered opinion, the Chief Judge of the Small Cause Court failed to comprehend the correct import of the Supreme Court's order dated 12-12-1980 and dismissed the appeals on the ground that the petitioner failed to deposit the amount within time as directed by the Supreme Court. The only effect of the failure to deposit the amount could be that the stay granted by the Supreme Court could not beoperative, but it was never meant by the Supreme Court that the appeals pending before Small Cause Court must be immediately dismissed on the said failure. Be that as it may, the fact remains that the Small Cause Court dismissed the appeals on this ground alone without considering the same on merits, while the Gujarat Agro Industries Corporation could still deposit the amount of 75 per cent by praying before it the permissible concession up to 25 per cent of the due amount of tax. It is settled that the Small Cause Court while hearing the appeals under Section 406 can entertain the appeals by granting the latitude up to 25 per cent so as to require the deposit of the tax to the extent of 75 per cent. In other words, if 75 per cent of the amount is permitted to be deposited, the appeal may be entertained by the Small Cause Court and the proceedings may go ahead. In case the 75 per cent amount is permitted to be deposited, the appeals cannot be dismissed straightway and they have to be heard and decided on merits. It further appears that the civil appeals which were pending before the Supreme Court have been got dismissed as withdrawn either because the validity of Section 406(2)(c) has been upheld or because these Special Civil Applications have been filed before this Court and the same are pending since 1983 and 75 per cent of the amount has been deposited in Small Cause Court. We find that in such a fact situation, when the statement at Bar is made by Mr. N.S. Sheth appearing on behalf of the Gujarat Agro Industries Corporation that 75 per cent of the amount was deposited, the petitioner could have been permitted to be heard on merits. It is very clear that at no stage, the petitioners have been heard on merits and now when there is no reason to disbelieve the fact with regard to the deposit of the 75 per cent of the amount and the same has not been disputed by Mr. Nagarkar for respondent -- it will be in consonance with the ends of justice to allow the petitioners to have a hearing on merits in the appeals preferred by it before the Small Cause Court.

7. In the backdrop of the facts and circumstances as aforesaid, we find that the order dated 18-3-1983 whereby the petitioners' applications for restoration of the appeals were dismissed, was not justified and so also, the order dated 22-4-1981passed in each of the appeals dismissing the same on the ground of the failure to deposit the amount. Accordingly, the common judgment and order dated 18-3-1983 in Civil Applications passed by the Small Cause Court whereby the restoration applications were rejected and the orders dated 22-4-1981 passed in each of the eight Municipal Valuation Appeals Nos. 813/78, 814/78, 815/78, 1109/78, 1815/78, 1943/78, 772/ 80 and 1428/80 dismissing the appeals deserve to be quashed and set aside and the same are hereby quashed and set aside. The matters are remanded back to the concerned Small Cause Court for hearing the same after verification of the actual deposit to the extent of 75 per cent in each case and if the amount has been deposited as stated, the concerned Small Cause Court shall proceed to hear and decide the concerned Municipal Valuation Appeals Nos. 813/78, 814/78, 815/78, 1109/78, 1815/78, 1943/ 78, 772/80 and 1428/80 on merits in accordance with law after giving notice to both the sides with regard to the date of hearing. In case it is found by the concerned Small Cause Court that the due amount of 75 per cent has not been deposited as stated above, the earlier orders dated 22-4-1981 and 18-3-1983 shall stand. It is expected that since the basic dispute relates to the assessment years 1978-79 and 1979-80 and the matters are taken up for hearing in the remanded proceedings concerned Small Cause Court shall give priority to the hearing of these appeals and shall hear and decide the same on merits in accordance with law within the shortest possible period, but in no case later than a period of six months from the date the certified copy of this order is produced before the concerned Small Cause Court by any of the parties. All these 8 Special Civil Applications are allowed in the terms as aforesaid and Rule is also made absolute accordingly. No order as to costs.