LexINDIAN RED CROSS SOCIETY versus NEW DELHI MUNICIPAL COMMITTEE AND ORS.
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INDIAN RED CROSS SOCIETY A V. NEW DELHI MUNICIPAL COMMITTEE AND ORS. APRIL 28, 2003 [RUMA PAL AND B.N. SRIKRISHNA, JJ.] B New Delhi Municipal Council Act, 1994; Ss. 60, 61, 62 and 124: Exemption from payment of property tax/house tax-Building-Uses - Seif-occupied by the charitable organisation and a portion given on rent- C Committee Granted exemption from payment of property tax for the self occupied portion-Exemption was not allowed for the rented portion as not permissible under the provisions of the Act-Challenge to-Dismissed by the High Court-On appeal, Held: A charitable society could claim exemption from payment of property tax as a matter of right provided it fulfils the D stipulated conditions-Hence the exemption was rightly granted for the self occupied portion as used for charitable purposes-Statutory exemption under Section 62(1) of the Act not available for the rented portion of the building- The Society could apply to the Council under the provisions of&ction 124 of the Act to reconsider grant of exemption for rented portion of the building as well by invoking its special power granted under the Act-Punjab Municipal E Act, 191/;Ss. 70and71 . . Words and Phrases: 'charitable pw71ose '-Meaning of in the context of levy of property tax. The appellant-Society, a charitable organisation, owned a building in the area falling within the jurisdiction of the respondent-New Delhi Municipal Committee. A portion of the building was self-occupied by the F society for running its offices and remaining portion was let out on rent. Respondent levied and demanded property tax on the building. Appellant- G society made part payment. However, it filed a representation claiming exemption from payment of property tax on the ground of its use for charitable purposes since a portion of the building was self-occupied for running its various offices and earning of rent was used for charitable purposes. As no response was received from the respondent-Committee, 987 H 988 SUPREME COURT REPORTS (2003] 3 S.C.R. A the Appellant-society filed writ petitions. High Court stayed the demands and later disposed of the writ petitions directing the appellant to make a fresh representation before the respondent. Accordingly, the appellant- society made a representation afresh to the respondent-Committee. The concerned authority granted exemption from payment of property tax for B the self-occupied portion subject to fulfilment of certain conditions. However, it rejected the claim for exemption with respect to the rented portion of the building as not permissible under the law. Later the High Court allowed the application for reviving the writ petitions. Writ petitions were dismissed by the High Court. C Dismissing the appeal, the Court HELD: 1.1. It is clear from the provisions of law under Section 62(1) of the New Delhi Municipal Committee Act that if the appellant-society fulfils the stipulated conditions it is entitled as a matter of right to be exempted from payment of property tax. The concerned authority of D NDMC erred in treating the right to exemption in respect of the self- occupied portions of the appellant's building as a matter of discretion since it was provided as a matter of right on fulfilment of certain conditions laid down in Section 62(1) of the Act. 1994-G, HI E 1.2. The statutory exemption under Section 62(1) of the Act is not available to the society if the building is not self-occupied but is rented out.· The section does not make any allowance even if the rental income is used for charitable purposes. The phrase 'for a charitable purpose' only qualifies self occupation under Section 62(l)(a) of the Act. The appellant's claim for the benefit of such statutory exemption under Section 62 of the Act in F respect of the rented portion of the building is, .therefore, untenable and the concerned authority had rightly rejected it. 1995-B, Cl G Municipal Corporation of Delhi v. Children Book Trust and Anr., 119921 3 sec 390, held inapplicable. 1.3. With regard to the grant of exemption in respect of the tax lcviable on the rented portions, although the authority did not have any other option but to consider the appellant's claim for exemption in view of the direction of the High Court, no discretion is conferred under Section 62 of the Act on the authority for granting any exemption to the assessee H from any portion of the taxes leviable except to the e
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