Civil Appeal No. 10187 of 2010. Case: Tata Motors Ltd. Vs Talathi of Village Chikhali and Ors.. Supreme Court

Case Number:Civil Appeal No. 10187 of 2010
Party Name:Tata Motors Ltd. Vs Talathi of Village Chikhali and Ors.
Counsel:For Appellant: R.F. Nariman, Sr. Adv., Kavin Gulati, Nandini Gore, Debmalya Banerjee, Abhishek Ray and Manik Karanjawala, Advs. And For Respondents: Madhavi Divan, Sanjay Kharde, Asha Gopalan Nair and Shivaji M. Jadhav, Advs.
Judges:R.V. Raveendran, P. Sathasivam and A.K. Patnaik, JJ.
Issue:Maharashtra Regional and Town Planning Act, 1966 - Sections 113, 113A, 113(1), 113(2), 113(3A), 113(4), 114, 114(1), 116, 118, 118(1) and 159; Maharasthra Land Revenue Code, 1966 - Sections 2(11), 2(12), 2(19), 2(23), 2(40), 38, 39, 115, 168, 168(1), 168(2) and 174; Pimpri Chinchwad New Town Development Authority (Disposal of Land) Regulation, ...
Judgement Date:July 04, 2011
Court:Supreme Court


R.V. Raveendran, J.

1. Under Lease Deed dated 3.1.1995, Pimpri-Chinchwad New Town Development Authority (6th Respondent herein - for short 'the Development Authority') granted a lease of land measuring 164.5 acres in Sectors No. 15 and 15A in Village Chikhali, Taluka Haveli, District Pune, converted to industrial use, to the Appellant herein for a term of 99 years commencing from 21.11.1994. The consideration for the lease was a premium of Rs. 17,91,40,500/- (at the rate of Rs. 25/- per sq.ft.) paid by the Appellant apart from a yearly rent of rupee one. The Appellant utilized the said plot and adjoining plot obtained on lease from Maharashtra Industrial Development Corporation (for short 'MIDC') for construction of its factory. The Appellant commenced construction of its plant in or about the year 1997 and on completion, commenced actual use for industrial purpose, in the year 1999.

2. The Appellant was served with a demand notice dated 26.2.2002 by the Gar Kamgar Talathi, Chikhali, demanding payment of Rs. 45,25,538/- as non-agricultural cess and additional non-agriculture cess, for the period 1995-96 to 2001-02. As the said payment was not made, default notices dated 1.3.2002 and 5.3.2002 were issued under Section 174 of the Maharasthra Land Revenue Code, 1966 ('Code' for short) informing that if the amount demanded was not paid within seven days, the amount due will be recovered with 25% of the amount due as penalty. At that stage the Appellant filed a writ petition before the Bombay High Court for quashing the demand notice 26.2.2002, 1.3.2002 and 5.3.2002. The Appellant contended that it was a "government lessee". Alternatively, it was contended that it was the tenant of the Development Authority. It was submitted that neither a government lessee nor a tenant of the Development Authority was liable to pay the non-agricultural assessment under the provisions of the Code.

3. The High Court, by judgment dated 4.7.2007 rejected the contention that Appellant was a government lessee. It held that as lessee under the Development Authority, the Appellant was liable to pay the non-agricultural assessment. The High Court however held that having regard to Section 115 of the Code, non-agricultural assessment could be levied only with effect from the date on which the land was actually used for non-agricultural purpose, and as Appellant commenced actual non-agricultural use in the year 1999, the non-agricultural assessment was, due by it only from 1999-2000. As a consequence, the High Court allowed the writ petition in part, quashed the demand relating to the period 1995-96 to 1998-99 and upheld the claim for the non-agricultural assessment from the year 1999-2000 onwards. The said order is challenged in this appeal by special leave contending that it is not liable to pay the non-agricultural assessment as it is a government lessee. Alternatively it is contended that being the tenant of the 'occupant', it is liable to pay the land revenue, as only the 'occupant' is liable to pay the land revenue under Section 39 of the said Code. On the contentions raised, the following questions arise for consideration:

(i) Whether the Petitioner is a 'government lessee' and therefore not liable to pay the non-agricultural assessment?

(ii) Whether the Appellant being a tenant of the Development Authority, the demand for non-agricultural assessment could be made only on the Development Authority and not against the tenant?

The relevant statutory provisions

4. The answers to the aforesaid two questions would depend upon the provisions of the Maharashtra Land Revenue Code, 1966. Section 39 makes the occupant liable to pay the land revenue and the said section is extracted below:

39. Occupant to pay land revenue and Government lessee to pay rent fixed.

Every occupant shall pay as land revenue the assessment fixed under the provisions of this Code and rules made thereunder; and every Government lessee shall pay as land revenue lease money fixed under the terms of the lease.

(emphasis supplied)

The term "land revenue" and "occupant" referred in the said section are defined in Section 2(19) and Section 2(23) and the said definitions are extracted below:

(19) - "land revenue" means all sums and payments, in money received or legally claimable by or on behalf of the State Government from any person on account of any land or interest in or right exercisable over land held by or vested in him, under whatever designation such sum may be payable and any cess or rate authorised by the State Government under the provisions of any law for the time being in force; and includes premium, rent, lease money, quit rent, judi payable by a inamdar or any other payment provided under any Act, rule, contract or deed on account of any land;

(23) - "occupant" means a holder in actual possession of unalienated land, other than a tenant or Government lessee; provided that, where a holder in actual possession is a tenant, the land holder or the superior landlord, as the case may be, shall be deemed to be the occupant;

The expressions "to hold land" or "to be a land holder or holder of land" is defined in Section 2(12) and mean to be lawfully in possession of land, whether such possession is actual or not.

The term "tenant" and "government lessee" referred in the definition of "occupant" are defined in Section 2(40) and Section 2(11) and they are extracted below:

(40) "tenant" means a lessee, whether holding under an instrument, or under an oral agreement, and includes a mortgagee of a tenant's rights with possession; but does not include a lessee holding directly under the State Government;

(11) "Government lessee" means a person holding land from Government under a lease as provided by Section 38.

Section 38 referred in the definition of 'Government Lessee' is extracted below:

It shall be lawful for the Collector at any time to lease under grant or contract any unalienated unoccupied land to any person, for such period, for such purpose and on such conditions as he may, subject to rules made by the State Government in this behalf, determine...

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