Delhi Municipal Corporation Act, 1957: Maintainability of civil suits in disputes pertaining to payment of tax under the Act – Held: Wherever a right or liability, not pre-existing in common law is created by a statute and that statute itself provides a machinery for enforcement of such right or liability, both the right/liability and the remedy having been created uno flatu and a finality is intended to the result of the statutory proceedings, then, even in the absence of an exclusionary provision the jurisdiction of the civil court is impliedly barred – Delhi Municipal Corporation Act, 1957 creates a liability for payment of tax – There is no pre-existing liability of tax under Common Law – Further, a remedy by way of an appeal against an order of assessment, before an appropriate forum or authority, is also provided by the same statute – Necessarily, where a party aggrieved by the decision of the authorities has to resort to the remedy provided under the Statute, civil courts’ jurisdiction is barred – S.171 gives finality to the orders passed by Municipal Taxation Tribunal, which shows the intendment of the legislature to exclude jurisdiction of civil courts – Jurisdiction – Code of Civil Procedure, 1908 – S.9.
Delhi Municipal Corporation Act, 1957: Jurisdiction of civil courts, where exercisable – Held: The civil courts shall have jurisdiction to examine a matter in which there is an allegation of non-compliance of the provisions of the statute or any of the fundamental principles of judicial procedure – No jurisdictional error pleaded in the plaint.
Delhi Municipal Corporation Act, 1957: Onerous remedy provided in the Act – Remedy provided by a statute not being adequate or efficacious remedy, is not a ground for maintaining a civil suit – However, Writ Petition under Article 226 is maintainable. Allowing the appeals, the Court
HELD : 1. Section 9 of the Code of Civil Procedure, 1908 confers jurisdiction on the Civil Courts to try all suits, excepting those which are either expressly or impliedly barred. Chapter VIII of the Act deals with levy of taxes that can be imposed by the Corporation. Property tax is dealt with in Sections 114 to Section 135 of the Act. There is an inherent right to approach a civil court. The bar on a civil court’s jurisdiction is not to be readily or lightly inferred. The jurisdiction of civil courts can be excluded by an express provision of law or a clear intendment in such law. A perusal of the relevant provisions of the Act would show that there is no express bar on the jurisdiction of Courts. However, Section 169 of the Act provides for an appeal to the Municipal Taxation Tribunal. Section 171 of the Act provides that the order of the Municipal Taxation Tribunal in the appeal filed by the Assessee shall be final. According to the Corporation, these Sections, read together, create a bar on the jurisdiction of civil courts. [Paras 5, 6, 9] [712-C; 714-G; 717-C] Dhulabhai and Ors. v. The State of Madhya Pradesh and Anr. [1968] 3 SCR 662 – relied on.
Secretary of State v. Mask AIR 1940 PC 105 – referred to.
Wolverhampton New Waterworks Co. v. Hawkesford [1859] 6 C. B. (NS) 336 – referred to.
2. Any person having a grievance that he had been wronged or his right has been affected can approach a civil court on the principle of ‘ubi jus ibi remedium’ - where there is a right, there is a remedy. As no internal remedy had been provided in different statutes creating rights or liabilities, the ordinary civil courts had to examine the grievances in the light of those statutes. With the advent of a ‘Welfare State’, it was realised that enactments creating liabilities in respect of payment of taxes, obligations after vesting of estates and conferring rights on a class of citizens, should be complete codes by themselves. With that object in view, forums were created under the Acts themselves where grievances could be entertained on behalf of the persons aggrieved. [Para 10] [717-D-F]
3. As to various issues on the correctness of a return itself, or whether or not a return is correct; whether or not transactions which are not mentioned in the return, but about which the appropriate authority has knowledge, fall within the mischief of the charging section; what is the true or real extent of the transactions which are assessable; all these and other allied questions have to be determined by the appropriate authorities themselves. An assessment, based even on an erroneous finding about the character of the transaction, is an assessment made well within jurisdiction and cannot be said to be outside the purview of the Act. [Para 13] [718-B-C]
4. The Civil Court’s jurisdiction is impliedly barred for the following reasons: There is no pre-existing liability of tax under Common Law. The liability has been created by Delhi Municipal Corporation Act along with a remedy by way of an appeal to the Municipal Taxation Tribunal. Necessarily, where a party aggrieved by the decision of the authorities has to resort to the remedy provided under the Statute, civil courts’ jurisdiction is barred. Section 171 of the Act gives finality to orders passed by Municipal Taxation Tribunal, which shows the intendment of the legislature to exclude jurisdiction of civil courts. The remedy provided by Section 169 of the Act is an adequate and effective remedy. The High Court erred in holding that an appeal provided by the Statute against orders of assessments, containing an ‘onerous’ precondition of deposit of the entire amount in dispute, is not an effective remedy. [Para 14] [718-E-G; 719-A-B] Firm Seth Radha Kishan v. Administrator, Municipal Committee, Ludhiana AIR 1963 SC 1547 : [1964] SCR
273 ; Firm of Illury Subbayya and In Ram Swarup and Ors. v. Shikar Chand AIR 1966 SC 893 : [1966] SCR
553 ; Srikant K. Jituri v. Corporation of the City of Belgaum (1994) 6 SCC 572 : [1994] 4 Suppl. SCR 262 – relied on.
5. It is settled law that jurisdiction of the civil courts cannot be completely taken away in spite of either an express or implied bar. The civil courts shall have jurisdiction to examine a matter in which there is an allegation of non-compliance of the provisions of the statute or any of the fundamental principles of judicial procedure. A plain reading of the plaint would suggest that the order impugned in the suit is at the most an erroneous order. No jurisdictional error is pleaded in the plaint. Therefore, the question of maintainability of the suit does not arise. In the absence of any pleadings in the plaint, the High Court ought not to have remanded the matter back to the Single Judge. [Para 16] [719-F-H; 720-A]
NDMC v. Satish Chand (2003) 10 SCC 38 ; Secretary of State v. Mask AIR 1940 PC 105 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
This page is for informational and research purposes only and does not constitute legal advice. Consult a qualified advocate for advice specific to your situation.