Urban News

The Hindu 04.12.2009

High Court ruling on property tax defaulters

Staff Reporter

MADURAI: Municipalities cannot institute criminal proceedings for non payment of property tax without taking any efforts to seize and sell movable properties of tax defaulters, the Madras High Court has ruled.

Dismissing three criminal appeals filed by the Commissioner of Rajapalayam Municipality in Virudhunagar district, Justice G.M. Akbar Ali said criminal prosecution could be launched only if the distraint of movable properties was unfeasible.

The judge pointed out that Rule 30(2) of the Tamil Nadu District Municipalities Rules states that the authorities concerned might prosecute tax defaulters if any distraint or sufficient distraint of the defaulters’ properties was impracticable.

A careful reading of the Section would make it clear that the officials cannot prosecute defaulters by merely recording their statement that distraint proceedings were not feasible without actually taking steps to bring the movable properties for sale, he added.

Bill must be served

To commence distraint proceedings, it was necessary that a bill under Rule 29 should be served on persons from whom the amount was due.

Such a bill should contain statements of the period of tax arrears and description of the property taxed.

A notice of liability incurred in default of payment of such due should also be served on the defaulters.

If the amount was not paid within 15 days from the service of such notice, it could be recovered under a warrant of distraint, the judge said.

These procedures were a condition precedent for launching criminal prosecution.

The criminal law could be set in motion only after the efforts of a Muncipality to recover the tax arrears go in vain, Mr. Justice Ali clarified.

Present appeals

The present appeals were filed by the Municipality Commissioner against the refusal of a Judicial Magistrate at Rajapalayam to initiate criminal action against two individuals and a textile mill for not paying tax arrears of Rs.5,94,677.

The Magistrate had initially taken the three complaints filed by the Municipality on file and also summoned the defaulters.

The cases were dismissed only after examining the defaulters under Section 313 of the Code of Criminal Procedure.

The Hindu 03.12.2009

Property tax arrears collected

Staff Reporter

CHENNAI: The Chennai Corporation on Wednesday collected Rs.18 lakh property tax arrears from the occupants of properties belonging to the Pachaiyappa’s Trust on NSC Bose Road. This was done after the civic body made an attempt to seize movable goods from the shops.

A senior official of the civic body said that if the landlord of the property failed to pay the tax, the occupant had to pay it and deduct it from the rent payable to the owner. “We had issued notices to the occupants but they also failed to respond positively, following which we initiated this action. However, as we received cheque towards our dues, we did not seize any property,” he said.

Over 200 property owners across the city owe over Rs.15 lakh each to the civic body in property tax dues and notices have been issued to such defaulters.

Water purifying plant

Mayor M. Subramanian on Wednesday inaugurated a water purifying plant at Corporation School on Choolaimedu High Road. The plant has been installed by Lions Club. Earlier, he inspected various works in CIT Nagar area and instructed the Chennai Corporation officials to renovate a park there. He asked officials to construct a dining hall above a kitchen centre inside a school.