LexMUNICIPAL CORPORATION OF DELHI versus NORTH DELHI POWER LTD. (NOW TATA POWER DELHI DISTRIBUTION LTD.) AND ANR.
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[2016] 9 S.C.R. 633 MUNICIPAL CORPORATION OF DELHI v. NORTH DELHI POWER LTD. (NOW TATA POWER DELHI DISTRIBUTION LTD.) AND ANR. (Civil Appeal No. 5653 of2014) AUGUST 10,2016 [ANIL R. DAVE AND L. NAGESWARA RAO, JJ.] Municipalities - Property tax - Delhi Mw1icipal Corporation Act, 1957 - s.119(1) and ss.114/120(l)(c)/169 - Exemption of government land from property tax - Lm1d in question initially stood transferred to the government then to the Distribution Company as licensee and then to the Holding Company - Ownership, if continued to vest in the government and thus exempted from property tax or in the Distribution Company/Holding Company making them liable to A B c pay tax - Held: Under the scheme contemplated by Delhi Electricity . D Reforms Act and Rules framed therein, assets (including land) of erstwhile Delhi Vidyut Board initially stood transferred and vested absolutely in the government and then undertakings were transferred to generation, transmission and distribution companies - Thereafter shares of these companies were allotted to E the Holding Company, Delhi Power Company Ltd., a wholly owned government company - Land and land rights were also transferred to the Holding Company - Hence, it is clear that transfer of all assets including land to the government was a transitory step as it was the Holding Company which was to be in total control - Thus, land belongs to the Holding Company and not the government and hence not exempted from tax uls.119(1) - High Court's order remanding matter back to the Deputy Assessor and Collector, MCD confirmed with direction to consider provisions of DMC Act, Delhi Electricity Reforms Act, Transfer Scheme Rules and the distribution licence issued u/s.20, Delhi Electricity Reforms Act to decide matter pertaining to incidence of tax - Delhi Electricity Reforms Act, 2000 - ss.14, 15 & 20 - Delhi Electricity Reforms (Transfer Scheme) Rules, 2001 - rr. 314/5(5)/9112(1). Delhi Electricity Reforms (Transfer Scheme) Rules, 2001 - Schedules 'F' and 'G' - Distribution undertakings as set out in 633 F G H 634 A B c .. D SUPREME COURT REPORTS (2016] 9 S.C.R. Schedule 'F' and Holding Company as set out in Schedule 'G' - If any conflict between the two as regards the ownership of land which stood transferred to the Holding Company - Held: No contradiction in Schedule 'F' and 'G' pertaining to ownership of land - Only the land which was exclusively and primarily used for purpose of business by transferee on date of transfer, as referred to in proviso to items I to III in Part I of Sch. 'F ', not forming part of assets transferred to Distribution Company, would be subject matter of a licence by the government in favour of transferee - All other lands would be part of land transferred to the Holding Company as contemplated in Sch. 'G '. Delhi Electricity Reforms (Transfer Scheme) Rules, 2001 - Ownership of land transferred - Determination on basis of cabinet decision - Held: Cabinet decision dated 6.1.2001 to the effect that the land belongs to the government was much prior to the statutory scheme and hence; cannot be taken into consideration to reach a different conclusion. Delhi Electricity Reforms (Transfer Scheme Rules), 2001 - r.12(1) - Adjudicatory powers of Government - Scope of - r. 12(1) provided that in case of any dispute, difference or issue with regard to transfer under the Rules, decision of the Govt. shall be final and E binding on all parties - Held: Stand of the Government that land continues to vest in it would not amount to a decision by Government in resolving a dispute between parties to the Transfer Scheme - r. 12(1) not applicable in the instant case as the adjudication of dispute involves interpretation of provisions of the statute and rules , F - Division Bench s findings that Government is not the owner of land, upheld. Delhi Municipal Corporation Act, 1957 - s. l 20(l)(c) - Incidence of property taxes - Held: s. 120(l)(c) contemplates t_hat a person having right to let out un-let land is liable to pay tax - Since, G the distribution license empowers the Distribution Company to let out land, notwithstanding the fact it is a licensee under Sch. 'F' of Transfer Scheme Rules, it would still be liable to pay tax - Matter remanded back to Deputy Assessor and Collector of MCD to decide incidence of tax. H MUNICIPAL CORPORATION OF DELHI v. NORTH DELHI POWER LTD. Disposing of the appeals
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