Standard rent governs house-tax valuation for rent-controlled property, even where the building was never actually let out.

For house-tax assessment under the Punjab Municipal Corporation Act, 1976, property governed by rent control legislation must be valued by reference to the standard rent, because annual value cannot exceed the rent a hypothetical tenant could reasonably be expected to pay. The fact that the property was never actually let out does not change the valuation basis, since assessment depends on notional letting value rather than actual receipt of rent. The earlier contrary view was treated as no longer good law in light of later Supreme Court authority. The assessment order was set aside and the matter remitted for fresh reassessment in accordance with law.

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Issues: Whether, for the purpose of assessing house-tax under the Punjab Municipal Corporation Act, 1976, the annual rateable value of a property situated in an area governed by rent restriction law must be determined with reference to the standard rent, even if the property had never been let out.

Analysis: The applicable legal position is that where a building is governed by rent control legislation, the landlord cannot reasonably be expected to receive more than the standard rent from a hypothetical tenant, and the annual value cannot exceed that standard rent. The fact that the property had never been rented out does not alter the basis of valuation, because the assessment must proceed on what rent the property could fetch if let to a hypothetical tenant. The contrary view previously taken was treated as no longer good law in light of the later Supreme Court ruling.

Conclusion: The annual rateable value had to be fixed with reference to the standard rent under the rent restriction law, and the petitioner succeeded on this issue.

Final Conclusion: The assessment order was set aside and the matter was remitted for fresh reassessment of house-tax in accordance with law.

Ratio Decidendi: For property governed by rent control legislation, annual value for house-tax purposes cannot exceed the standard rent determinable on a hypothetical tenancy basis, regardless of whether the property has actually been let out.

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