1. The above first appeal under Section 218-D of the Bombay Municipal Corporation Act, 1888 was filed bythe owner of the property against the dismissal of his appeal before the Chief Judge in the Court of Small Causes at Bombay, wherein he had challenged the rateable value of his property for the year 1968-69.
2. The appellant objected to the assessment of one room in the property, the monthly rent of which was estimated by the Municipal Officers at Rs. 5 for the purpose of assessment. The contention of the appellant was that that room has been unauthorisedly constructed by a trespasser and, therefore, he was not liable to pay the tax for that room. This contention was overruled by the learned Chief Judge on the ground that even though the premises were not let, under Section 146 (2) (c) of the Act, the owner of the land on which it was built was primarily liable as held in Ramji Keshavji v. Municipal Commr. of Greater Bombay : (1954)56BOMLR1132 .
3. A somewhat identical point arose in F. As. Nos. 169, 170, 171 and 571 of 1971 and relying on the decision of the House of Lords in London County Council v. Churchwardens and Overseers of the Poor of the Parish of Erith in the County of Kent 1893 AC 562, and the passage at page 422 of Ryde on Rating as to the effect of this decision, I confirmed the decision of the Chief Judge of the Small Cause Court in that case as consistent with the rating practice as established in England and here in view of the provisions contained in Section 146 (2) (c) and the definition of 'premises' contained in Section 3 (gg) of the Bombay Municipal Corporation Act as well as the aforesaid decision of this Court and a later decision of the Supreme Court in National and Grindlays Bank Ltd. v. Municipal Corporation for Greater Bombay : 3SCR565 .
4. Mr. Tipnis, who appears in person, has also fairly drawn my attention to a Division Bench decision of this Court, to which I was a party, in First Appeal No. 240 of 1968 (Bom) with other First Appeals, decided on June 28, 1976.
5. Mr. Tipnis, however, sought to distinguish all these cases on the ground that they were cases where the landlords could have had a right to let. In the present case, according to Mr. Tipnis, ha had no right to construct anything on the portion of the land in respect of which assessment is levied. He was forbidden by the Rules of the Municipality from constructing anything on the land)and merely because someone has constructed an unauthorised structure, he cannot be held liable on the footing that he had a right to let the premises.
6. This argument, in my opinion, ignores the definition of the word 'land' contained in Section 3 (r). Under that definition, 'land' includes land which is built upon or covered with water, benefits to arise out of land, things attached to the earth or permanently fastened to anything attached to the earth and rights created by legislative enactment over any street. There is nothing in this definition to indicate that what is built upon must be so built upon in accordance with the Rules of the Municipal Corporation or that it should be an authorised structure.
7. The word used in Section 146 (2) (c) is 'premises' which is defined in Section 3 (gg) as including messages, buildings and lands of any tenure, whether open or enclosed, whether built on or not and whether public or private. As the definition includes lands of any tenure, even though the owner may not be able to construct anything on it, as contended by Mr. Tipnis, it is included in the definition of 'land' for the purposes of the Bombay Municipal Corporation; and, in any event, it is included along with the building on it, whether constructed authorisedly or unauthorisedly, in the definition of 'premises'.
8. We are concerned with hypothetical right to let and not with the actual right to let when considering Section 146 (2) (c). It is necessary in this connection to quote the following passage at page 422 of Ryde on Rating, Thirteenth Edition, 1976, which runs as follows:--
'The effect of this decision The London County Council v. The Churchwardens and Overseers of the Poor of the Parish of Erith in the County of Kent of the House of Lords is that, even though it may be impossible in fact, and forbidden by law, that the actual occupier should be a yearly tenant of the hereditament to be rated, still for the purpose of valuing that hereditament it must be supposed that the actual occupier is among the possible yearly tenants; and unless the supposition be made, most absurd anomalies result.'
9. This view is also quoted with approval by Bean and Lockwood's Rating Valuation Practice, Sixth Edition, 1969. at page 19, and it is further observed by the learned authors:--.
'The nature of the tenancy envisaged is important, and in R. v. South Staffordshire Water Co, (1885) 16 QBD 359 it was held that 'a tenant from year to year is to be considered as a tenant capable of enjoying the property for an indefinite time, having a tenancy which it is expected will continue for more than a year but which is liable to be put to an end by notice'. It is thus apparent that a reasonable prospect of the tenancy continuing may be assumed and the decision in Humber Ltd. v. Jones and Rugby Rural Dist. Council (I960) 53 R & IT 293 has made it clear that the implied lack of security of tenure cannot be claimed as a factor which would adversely affect the rent to be expected.'
10. In Ramji Keshavji v. Municipal Commr. of Greater Bombay : (1954)56BOMLR1132 , the appellant who was the landlord let out an open plot of land to one Kanse for a period of one year from April 1, 1949 to March 31, 1950, on a monthly rent of Rs. 140 and the tenant constructed upon this plot a temporary asbestos shed. The Bombay Municipality treated the land and the shed as a single assessable unit and fixed the combined rateable value thereof at Rs. 5,500 for the assessment period from October 1, 1953 to March 31, 1954. When the bill was presented to the landlord, he contended that he was not primarily liable for the payment of the tax in respect of the shed constructed by the tenant,
11. After referring to Ss. 147, 154, 155 and 156 of the Bombay Municipal Corporation Act, Chagla, C.J. observed at page 1135:--
'Now, in our opinion, these sections must be read in the light of Section 146. The object of these sections is to fix rateable value and also to determine who is primarily liable. Therefore, if the primary liability under Sub-section (2) is upon the lessor where the premises are let, the information that would have to be gathered and the rateable value that will have to be fixed would be with regard to premises which would include both the land and the building, if a building was constructed upon the land. It would be untenable to suggest, that under Sections 154, 155 and 156 the Municipality should assess land separately from the building. If the Municipality were to do that, then it would be impossible to fix the primary liability as far as the building is concerned. It may also be pointedout that in the Bombay Municipal Corporation Act 'land' is defined as land which is being built upon or is built upon, and, therefore, when Sections 154, 155 and 156 refer to 'land.', it would include any structure put up on the land. Therefore in our opinion, the scheme of Section 146 and Sections 154, 155 and 156 clearly indicates that, when a land is let and the letting does not fall within the purview of Sub-section (3) of Section 146, and where the landlord is made primarily liable under Sub-section (2) of Section 146, the proper rateable unit is the land with the building standing thereon.'
12. It is clear that in that case, as the original lease was only for one year, so far as the year of assessment was concerned, it could not be said that the premises were let by the landlord to the tenant, But never the less this Court held, with respect, rightly that the building and the land must be assessed together and the landlord would be primarily liable under Section 146 (2),
13. It is true that Mr. Tipnis is right in his submission that so far as the case of National and Grindlays Bank Ltd. was concerned, the case fell within the ambit of Section 148 (2), (a) of the Act. Never the less, in that case the Supreme Court has laid down (at p. 1051 of AIR):--
'The scheme of Section 146 of the Act is that when land is let and the tenant has built upon that land, there should be a composite assessment of tax upon the land and building taken together.' It must, therefore, follow that even when it is unlet, the principle of hypothetical landlord and hypothetical tenant would apply and the land and the building together will constitute the composite unit for assessment,
14. Moreover, the view that I am taking in this case is not only identical with the view which I have taken in First Appeals Nos. 169, 170, 171 and 571 of 1971, decided on 13-6-1978 but is also consistent with the view of the Division Bench, to which I was a party, in First Appeal No. 240 of 1968 (Bom) with other First Appeals, decided on June 28, 1976,
15. In the result, the first appeal 13 dismissed. As no appearance is filed for the respondent, there will be no order as to coats.
16. Appeal dismissed.