TaxTMI 
TaxTMI 
1970 (9) TMI 103
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....ion that the general revision of the rental values of the houses and buildings effected by the Guntur Municipality in the year 1960 for the purpose of assessment of tax was ultra vires ,and illegal and for a consequential relief of a permanent injunction restraining the municipality from acting on the special notices issued to the tax payers. Section 81 of the Madras District Municipalites Act 1920, hereinafter called the "Municipalities Act" gives the description and classes of property tax and other taxes leviable by the municipality. Section 82 gives the method of assessment. It is provided by sub-s. (2) of that section that the annual value of lands and buildings shall be deemed to be the gross annual rent at which they may r....
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....960 hereafter called the "Act" Now S. 82(2) of the Municipalites Act, as stated before, makes Provision for the fixation- of annual value according to the rent' at which lands and buildings may reasonably be expected to be let from month to month or from year to year less the specified deduction. The test essentially is what rent the premises can law,fully fetch if let out to a hypothetical tenant. The municipality is thus not free to assess any arbitrary annual value and has to look to, and is bound by the fair or the standard rent which. would be payable for a particular premises under the Rent Act in force during the year of assessment. In The Corporation of ,,Calcutta v. Sm. Padma Debi & Ors. ([1962] 3 S. C. R. 49.) it was....
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....rent has been fixed. It is perfectly clear that the landlord cannot lawfully expect to get more rent than the fair rent which is payable in accordance with the principles laid down in the Act. The assessment of valuation must take into account the measure of fair rent as determinable under the Act. It may be that where the Controller has not fixed the fair rent the municipal authorities will have to arrive at their own figure of fair rent but that can be done without any difficulty by keeping in view the principles laid down in s. 4 of the Act for determination of fair rent. This would of course be with regard to the assessment of valuation for the period subsequent to the coming into force of the Act. For the prior period it would be the R....