Urban News

The Hindu 17.08.2009

Corporation completes reassessment drive for tax collection

Aloysius Xavier Lopez

CHENNAI: A commercial property on Nungambakkam High Road with an earlier property tax assessment of Rs.9.52 lakh is paying Rs.15 lakh now, after the reassessment drive of the Chennai Corporation.

Similarly, many properties in the city had been found under-assessed and the civic body had issued notices to owners of 55,000 properties that had not declared the correct area.

“The loss of property tax revenue has been decreasing with initiatives such as computerisation of the process of tax collection, reassessment by officials and simplification of the tax system,” said Corporation Commissioner Rajesh Lakhoni.

The Revenue Department of the Corporation includes the area of thousands of buildings under deviation in the city for property tax assessment. However, the failure of residents to declare the exact area of the building has been one of the factors contributing to loss of revenue for the civic body, according to a Corporation official.

The reassessment process of the Corporation has been completed for all commercial and mixed residential properties in the city, said Mr. Lakhoni. The property tax collection this fiscal has been Rs.100 crore, of which arrears in the tax contributed Rs.63 crore. Online tax payment this fiscal has been Rs.77 lakh and the civic body is optimistic of improvement in the online payment in future.

“We are doing rigorous analysis of the computerised data on property tax for finding new ways of augmenting the property tax revenue,” said Mr. Lakhoni. The quick disposal of appeals on account of computerisation and the provision for instant checking by people has made it easier for collection of arrears by the civic body.

The categorisation of property tax payment and focussed intervention have made it easier for officials in reducing the loss of revenue. The Corporation has identified more than 8,000 properties with assessment of more than Rs.1 lakh. Around 300 properties in the city now have assessment of Rs.15 lakh and above. The civic body’s attention will be more on similar properties in future, according to officials.

The Hindu 15.08.2009

Metrowater’s tax demand notices set aside

K.T. Sangameswaran

CHENNAI: It is a settled proposition of law that when a statute prescribes to do a particular thing in a particular manner, the same should not be done in any other manner. The proposition is well recognised as held by the Supreme Court in a case, the Madras High Court has said.

Justice N. Paul Vasanthakumar was passing a common order on writ petitions filed by the Madras Sanskrit College and S.S.V. Patasala, Mylapore, seeking to quash the orders of the Chennai Metropolitan Water Supply and Sewerage Board of 2000 intimating arrears of water tax.

The petitioner’s case was that the CMWSSB was supplying water to the institution and it was paying water and sewerage tax regularly till March 3, 1994. After the City Municipal Corporation Act was amended, all educational institutions were exempted from property tax. Accordingly, the petitioner was also exempted. The demand for water and sewerage tax was made based upon the annual value as determined by the Chennai Corporation in respect of property tax. From April 1, 1994, no property tax was payable. The institution stopped paying Metrowater and sewerage tax. The CMWSSB Act clearly stated that the board should determine the annual value for each year for assessing the water and sewerage tax. However, insofar as the petitioner was concerned, no such assessment was made by the Board.

Mr. Justice Vasanthakumar set aside the impugned demand notices as no assessment as required under Section 34 of the CMWSSB Act had been made by the Board for all these years while making the impugned demand. When the statute mandated the Board to assess the water and sewerage tax in a particular manner, it was not open to the Board to assess the tax on the basis of property tax assessed earlier by the Chennai Corporation. Section 35 of the Act permitted reliance on property tax assessment which was a stop gap arrangement and the same could not be continued for years together.

The Judge directed the Board to assess the tax as required under law and demand the same from the petitioner. On such assessment, the amount already paid could be given credit to and the arrears, if any, could be demanded from the institution.