CHENNAI: Justice N Sathish Kumar of the Madras High Court held that the Dharmapuri municipality cannot collect the excessive property tax for commercial buildings without proper assessment and prior notices as contemplated under the Act.
"When Municipality is sought to claim excessive tax without any notification, such action cannot be sustained in the eye of law. To make a demand, the tax ought to have been determined and notified which has not been done in this case. The impugned notice requires to be set aside and the respondent is directed to follow the procedure to determine the tax and take action as per law," the judge wrote.
The judge passed the orders on allowing a petition filed by V Kumaravelan and V Pankajavalli. The petitioners alleged that the municipality issued a demand notice by increasing the tax for their shops from Rs 803 to Rs 4240 for one petitioner and Rs 964 to Rs 4240.
Recording the submissions, the judge observed that the impugned demand notice has been issued only on the basis of the alleged audit report. "The demand notice has been made for the second half year for the years 1998-1999, there were no reasons whatsoever assigned by the respondent how such tax has been assessed," the court opined, adding, the move of the municipality was against Section 79, 80, 81, and 82 of The Tamil Nadu District Municipalities Act, 1920.
The court further quashed the notices.
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