Court deems assessment method arbitrary, violating law. Municipal Corporation non-compliance results in invalid assessment book. Inclusion of plant & machinery unconstitutional.

The Court found the assessment method based on a flat rate per 100 sq. ft. of floor area to be arbitrary and in violation of the law. The Municipal Corporation failed to comply with mandatory provisions of the Bombay Provincial Municipal Corporations Act, resulting in an invalid assessment book. Inclusion of plant and machinery in the rateable value was deemed beyond legislative competence and unconstitutional. The delegation of quasi-judicial powers was not addressed. The Court held that the assessment method and inclusion of plant and machinery violated fundamental rights under Article 14, leading to the petitions being allowed, with directions for fresh assessment lists and costs awarded to the petitioners.

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Issues Involved:
1. Validity of the assessment method based on flat rate per 100 sq. ft. of floor area.
2. Compliance with the Bombay Provincial Municipal Corporations Act, 1949, and its rules.
3. Inclusion of plant and machinery in the rateable value.
4. Delegation of quasi-judicial powers to the Deputy Municipal Commissioner.
5. Violation of fundamental rights under Articles 14, 19, and 31 of the Constitution.

Detailed Analysis:

1. Validity of the Assessment Method Based on Flat Rate per 100 sq. ft. of Floor Area:
The petitioners challenged the method adopted by the Municipal Corporation of Ahmedabad for determining the annual rental value of properties, arguing that it was based on a flat rate per 100 sq. ft. of floor area, irrespective of the locality, quality, age, and nature of the property. The Court found that this method was not a recognized method of valuation under the Law of Rating and was not permissible in law. The Court referenced the Lokmanya Mills v. The Barsi Borough Municipality case, which held that valuation based on floor area without considering actual or hypothetical rental value was arbitrary and not sanctioned by the Act. The Court concluded that the method adopted by the Municipal Corporation was arbitrary and violative of Article 14 of the Constitution.

2. Compliance with the Bombay Provincial Municipal Corporations Act, 1949, and Its Rules:
The Court examined the relevant provisions of the Bombay Provincial Municipal Corporations Act, 1949, and the rules made thereunder. It was found that the Municipal Corporation failed to comply with the mandatory provisions of the Act and the rules, particularly Rule 9(b), which required the determination of the rateable value of each building and land. The Court held that the assessment book for the years 1964-65, 1965-66, and 1966-67 was not prepared in accordance with the law and was therefore invalid.

3. Inclusion of Plant and Machinery in the Rateable Value:
The petitioners argued that the inclusion of plant and machinery in the rateable value was beyond the legislative competence of the State Legislature under Entry 49 of List II of the Seventh Schedule to the Constitution. The Court agreed, stating that plant and machinery could not be considered part of the land or building for the purpose of taxation. The Court also found that Rule 7(2) and (3) of the Taxation Rules, which allowed the inclusion of plant and machinery, were ultra vires the Constitution and involved excessive delegation of powers.

4. Delegation of Quasi-Judicial Powers to the Deputy Municipal Commissioner:
The petitioners contended that the delegation of quasi-judicial powers by the Municipal Commissioner to the Deputy Municipal Commissioner was invalid. The Court did not find it necessary to express an opinion on this issue, given its findings on the other issues.

5. Violation of Fundamental Rights under Articles 14, 19, and 31 of the Constitution:
The petitioners argued that the method of assessment and the inclusion of plant and machinery violated their fundamental rights under Articles 14, 19, and 31 of the Constitution. The Court found that the arbitrary method of assessment and the inclusion of plant and machinery without proper classification and guidelines were indeed violative of Article 14, which guarantees equality before the law.

Conclusion:
The petitions were allowed. The Court issued a writ of mandamus directing the Municipal Corporation to treat the relevant entries in the assessment book for the years 1964-65, 1965-66, and 1966-67 as invalid and canceled. The Municipal Corporation was directed to prepare fresh assessment lists for the said years relating to the textile mills and other properties dealt with in the special property section. The petitioners were entitled to costs of the applications.

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