1. The admitted facts are as follows :
The petitioners completed the construction of their chain of nine godowns within the Municipal limits of Ferozepur City on 6th Oct., 1979. These were leased out of the tenant, Food Corporation of India, on 19th Oct., 1979. In fact, these had been constructed in accordance with a scheme formulated by the Corporation whereby the private parties were encouraged to build godowns at their cost--raising of loans from the Nationalised Banks for this purpose was also facilitated by the Corporation--ultimately to be leased out to the Corporation at scheduled rates of rent. Respondent No.2, Municipal Committee, Ferozepure, sent a notice under Sections 65/67/68 of the Punjab Municipal Act, 1911(for short, the Act) calling upon the petitioners to file objections regarding the proposed house-tax assessment of these godowns at an annual value of Rs. 1,72,800/- . Since the petitioner did not choose to file any objections, the said assessment was finalised and in pursuance thereof demand notices issued to the assessees that they made the due payments. Copy of one such notice for the period Jan., 1980 to Dec., 1980 is Annexure P-1. Again, another notice Annexure P-2 was issued to some of the petitioners (Concededly, similar notices were issued to others also) under the same sections for the period 1st Jan., 1980 to 31st March, 1981, for the assessment of the house-tax on the proposed annual value of Rupees 5,58,576/- and the petitioners were called upon to file objections within a period of one month. The petitioners did choose to contest the assessment this time but ultimately their objections were rejected by the Tax Sub-Committee vide its order dated 30th Dec., 1980(Annexure P3). The petitioners preferred an appeal to the Deputy Commissioner, Ferozepore, but there too they failed vide order dated 3rd July, 1981(Annexure P-5). This assessment was contested, inter alia, on the grounds, (I) that the house-tax was determinable on the basis of the fair rent that could possibly be fixed under the East Punjab Urban Rent Restriction Act, 1949, which Act was admittedly operative in the area concerned and not on the basis of the actual or contractual rent, and (ii) that no tax was at all leviable in view of the exemption granted vide notification dated 20th July, 1967(Annexure P-6). It is again on the basis of these very grounds that the orders Annexure P-3 and P-5 are presently impugned.
2. The precise defence of respondent Nos. 2 and 3 is that they were well-justified in assessing the house-tax on the basis of the actual rental or annual value as no fair rent of the building in question could possibly be determined under S. 4 of the East Punjab Rent Restriction Act as the godowns were not even in existence prior to Oct., 1979. No exemption under the notification Annexure P-6 is available to the petitioners as the godowns in question are commercial buildings. Having heard the learned counsel for the parties I find that the stand of the respondent-authorities is not devoid of merit.
3. It is, no doubt, true that in the light of the observation of their Lordships of the Supreme Court in Devan Daulat Rai Kapur v. New Delhi Municipal Committee AIR 1980 SC 541 and Mrs. Shiela Kaushik v. Commr. of Income-tax, Delhi, AIR 1981 SC 1729, the annual value of a building under S. 3(1)(b) of the Act has to be determined in the light of the provisions of the Rent Control legislation applicable to the building on the basis of what a landlord might reasonably except to get as rent from a hypothetical tenant if the building were let out from year to year and not on the basis of the rent being realised by the landlord. To this extent the stand of the respondent-authorities obviously has to be negatived. But they appear to be well justified in asserting that in the instant case the actual rent being received by the petitioners has to be taken as the fair rent for the reasons; firstly, no fair rent can be determined for the buildings in question under the provisions of S. 4 of the East Punjab Rent Restriction Act, and, secondly, these godowns as also their godowns have been taken on lease by the Food Corporation of India on the basis of a particular scheme referred to above on the scheduled rates of rent which obviously would mean that in the absence of the criterion applicable to the fixation of fair rent under S. 4 of the East Punjab Urban Rent Restriction Act the said rent would be the fair rent.
4. It has been settled by a Division Bench of this Court in Civil Revn. No. 1324 of 1976(Smt. Ram Piari v. Jagan Nath) decided on 30th October, 1981, that in the absence of a definition of the expression 'fair rent', the same has to be determined in accordance with the prescribed method in S. 4 of the Rent Restriction Act. As per sub-section (2) of this section, the Rent Controller firstly has to fix the basic rent. It is only then that he can determine the fair rent after allowing specified increase mentioned in sub-ss. (3) to (5). From the phraseology of this section, it is clear that 'fair rent' is the 'basic rent' increased by certain percentage according to the quantum of basic rent as well as the purpose for which the premises are used and the period of their construction. It has further been held in this judgment that where the parties fail to prove by evidence produced the basic rent as required by S. 4(2)(a)(b), the only course, open to the authorities under the Act is to fix the agreed rent as the fair rent of the premises. 'The conclusion of the Division Bench further is that while fixing the basic rent under sub-section (2) of S. 4 of the Act, the Rent Controller cannot determine the same on the basis of evidence which is not strictly in consonance with the type of evidence specified in cls. (a) and (b) of this sub-section. In the light of this authoritative pronouncement, the petitioners (respondents) appear to be wholly right in submitting that in this case no basic rent could be fixed under the East Punjab Urban Rent Restriction Act in terms of S. 4 of the same as the buildings in question were not even in existence prior to 1979.
5. It is not in dispute and in rather conceded that similar godowns constructed by different individuals or parties under the scheme under which the petitioners have constructed theirs, have been taken on rent by the Corporation on specified rates. To my mind, the rent being paid by the Food Corporation of India to the petitioners has to be taken as the fair rent in the light of the rent being paid for the other godowns by the Corporation at similar rates. As already pointed out, in the absence of the applicability of the criteria laid down in Section 4 of the Rent Restriction Act for the fixation of the basic or the fair rent, agreed rent has to be taken as the fair rent particularly when for all such or similar building s the rent is being paid by the tenant-Corporation at the same rates.
6. So far as the second aspect of the matter as pleaded by the parties in the light of the notification Annexure P-6 is petitioners are not exempted from the levy of house-tax. As per the last line of this notification, though it was published on 20th July, 1967, yet it has to be taken to be in force with effect from 1st Aug., 1964. This notification exempts every building, construction whereof is completed after the date of its publication in the official gazette, from the payment of house-tax impossible by a Municipal Committee specified in the schedule for a period of five years from the date of the completion of the building. But this notification has not to apply to commercial buildings. Thus, to determine the applicability of this notification what needs to be determined is as to whether the godowns of the petitioners can be held to be commercial buildings or not. In the absence of any definition of 'commercial building' the ordinary dictionary meaning has obviously to be given to the same. As per Chamber's Twentieth Century Dictionary, 'commercial' means pertaining to commerce or trade. The stand of the petitioners, however, is that though the expressions 'trade' or 'business' are terms of a very wide import yet in order to correctly interpret the contends of this notification, commercial activity must have relation to the premises and must be carried on for profits as the ultimate object in the premises. Viewed in this light, the premises in question cannot be said to be falling within the definition of 'commercial building'. For this stand of theirs, the learned counsel for the petitioners firmly relies on a Full Bench judgment of this Court in Ram Chander Baru Ram v. State, AIR 1963 Punj 148. This judgment undoubtedly fully supports the stand of the learned counsel but all that has been and in this judgment has been said in the light of the definition of the expression 'commercial establishments' as provided for in the Punjab Shops and Commercial Establishments Act, 1959 and the Punjab Trade Employees Act, 1940. It is in the light of these definitions that the Full Bench has made the following meaningful observations:
'Indirectly, the godowns has connection with the trade or business. As I have already said, trade or businessman its larger sense has a very wide scope and will embrace particularly all types of human activity. But surely that is not what the definition is intended to cover.' In the instant case neither the abovenoted definition under the Shops Act can possibly be made applicable to the interpretation of the notification Annexure P-6 nor can the true and wide import of the expressions 'trade' or 'commerce' be restricted in the absence of the same. Besides this, the appellate authority-respondent No. 3 has concluded this aspect of the matter in the following words :-- 'Godowns cannot be considered as residential buildings. They are used for purposes intimately connected with the trade of foodgrains. The Food Corporation of India purchases foodgrains from the farmers through the prescribed procedure and eventually the foodgrains are sold out to other States and during the interim period and for the purposes of storage, they are kept in godowns. Food Corporation of India is a commercial organisation and its activities are regulated by such consideration within the framework of Government rules. The expenditure incurred in storage is further based on to the total cots analysis and the incidence has to be done, whether the Government through subsidy or by the consumer. Accordingly, one cannot take it that godowns are not commercial buildings. Apparently, I have neither any reasons nor any material to differ from the abovenoted finding of the appellate authority.
7. In the light of the above discussion I am of the considered view that the godowns in question are commercial buildings and are not exempted from the levy of house-tax by virtue of the notification Annexure P-6.
8. In all fairness to the learned counsel for the petitioners it may be mentioned here that he did seek to raise an argument that the tax is being imposed by the Municipal Committee retrospectively but since no such case has been pleaded in the petition, the said aspect of the matter was neither allowed to be raised nor is considered. Similarly, an objection raised on behalf of the respondents that the petitioners stand estopped from raising the abovenoted contentions in the light of their having paid the house-tax in pursuance of he notice Annexure P-1 by accepting the properties in question to be commercial buildings was disallowed for the short reasons that there cannot be any estoppel against law.
9. For the reasons recorded above, this petition fails and is dismissed but with no order as to costs.
10. Petition dismissed.