TaxTMI 
TaxTMI 
2022 (8) TMI 157
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....after referred to as the 'Act 1997'), the original plaintiff - landlord has preferred the present appeals. 2. The facts leading to the present appeals in a nutshell are as under: That by a Tenancy Agreement dated 6.5.1993, the appellant - original plaintiff - landlord inducted the respondent/defendant as tenant in respect of a showroom admeasuring 1700 sq. ft. on the ground floor of a prime location of Kolkata being the arcade of the Hotel Oberoi Grand at Premises No. 15/2, Jawaharlal Nehru Road, Kolkata. Under the Tenancy Agreement, the rent was fixed at Rs. 10,000/- per month. Under the Tenancy Agreement, the liability to pay the taxes including surcharge and water tax/fees was upon the respondent - tenant. 2.1 The appellant - original plaintiff - landlord terminated the tenancy by issuing notice under Section 106 of the Transfer of Property Act, 1882 (hereinafter referred to as the 'TP Act'). Upon expiry of the notice period, the appellant - original plaintiff - landlord filed a suit before the learned Single Judge (Original Side) of the Calcutta High Court being Civil Suit No. 354/2012, seeking eviction of the respondent - tenant from the tenanted premises. According to t....
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.... 1997 shall be applicable and therefore the suit under Section 106 of the TP Act would be impliedly barred, the original plaintiff - appellant - landlord has preferred the present appeals. 3. Shri Rana Mukherjee, learned Senior Advocate has appeared on behalf of the original plaintiff - landlord and Shri Siddharth Dave, learned Senior Advocate has appeared on behalf of the respondent - defendant - tenant. 3.1 Relying upon Sections 3, 5(8) of the Act 1997 r/w Section 230 & 231 of the Kolkata Municipal Corporation Act, 1980 (hereinafter referred to as the 'Act 1980') and relying upon the decisions of this Court in the case of Calcutta Gujarati Education Society v. Calcutta Municipal Corporation, (2003) 10 SCC 533 (para 45) and the subsequent decision in the case of Popat and Kotecha Property v. Ashim Kumar Dey, (2018) 9 SCC 149, it is vehemently submitted by Shri Rana Mukherjee, learned Senior Advocate appearing on behalf of the original plaintiff - landlord that both, the learned Single Judge as well as the Division Bench of the High Court have committed a serious error in observing and holding that the Act 1997 shall be applicable. 3.2 It is vehemently submitted that as pe....
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.... would include the taxes payable to the municipal corporation payable by the tenant. Relying upon the aforesaid decision, it is submitted that even the tax is a part of the rent and therefore if the same is included the rent payable would be more than Rs. 10,000/- and therefore Section 3(f)(i) of the Act 1997 would be applicable and hence the Act 1997 shall not be applicable. It is submitted that the said decision has been subsequently followed by this Court in the case of Popat and Kotecha Property (supra). It is submitted that in the case of Popat and Kotecha Property (supra), even this Court has observed and held that for non-payment of tax due and payable by the tenant under Section 230 of the Act 1980 r/w Section 5(8) of the Act 1997 and as the tax can be said to be rent and even the eviction decree can be passed for non-payment of tax. 3.5 Shri Rana Mukherjee, learned Senior Advocate has also relied upon another decision of this Court in the case of Abdul Kader v. G.D. Govindaraj (Dead) By Lrs., (2002) 5 SCC 51 and has submitted that as observed and held by this Court, after considering the decision of this Court in the case of Karnani Properties Limited v. Augustine (Miss....
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....the suit under Section 106 of the TP Act, but the question is with respect to protection which may be available to the tenant under the provisions of the Act 1997. It is urged that under the Act 1997, the landlord can recover the possession and evict the tenant on very limited grounds and the protection under the Act 1997 shall not be available to the tenant in a suit for eviction under Section 106 of the TP Act. 4.2 Now so far as the reliance placed upon the decision of this Court in the case of Popat and Kotecha Property (supra), relied upon by the learned counsel appearing on behalf of the landlord is concerned, it is submitted that in the said decision, para 46 of the judgment in the case of Calcutta Gujarati Education Society (supra) has not been noticed. Learned counsel has also taken us to the objects and reasons for amendment in Section 230 of the Act 1980 and insertion of Section 5(8) of the Act 1997, by which, the liability to pay the municipal tax payable to the Corporation (to the extent of 50% of the tax liability) now would be on the tenant and therefore the same is held to be recoverable as arrears of rent. It is submitted that being a private person, it was not p....
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.... distinct on the tenant. On a fair reading of Section 3(f) of the Act 1997, which provides that any premises let out for non-residential purpose, which carries more than ten thousand rupees as monthly rent, nothing contained in the West Bengal Premises Tenancy Act, 1997 shall apply. The word used is "monthly rent". As observed hereinabove, the term "rent" is not defined. 6. It is the case on behalf of the landlord that as under Section 5(8) of the Act 1997, every tenant is under an obligation to pay his share of municipal tax as an occupier of the premises in accordance with the provisions of the Kolkata Municipal Corporation Act, 1980 and as per Section 230 of the Act 1980, 50% of the municipal tax shall have to be paid by every tenant and as per Section 231 of the Act 1980 the same shall be recoverable as arrears of rent and as per the decision of this Court in the case of Calcutta Gujarati Education Society (supra) the arrears of municipal tax can be recovered as arrears of rent and therefore the share of municipal tax payable by the tenant will be part of the rent. Heavy reliance is placed on para 45 in the case of Calcutta Gujarati Education Society (supra) and the subseque....
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....remises in accordance with the provisions of the Kolkata Municipal Corporation Act, 1980 (West Bengal Act LIX of 1980) or the West Bengal Municipal Act, 1993 (West Bengal Act XXII of 1993). Explanation - For the purposes of this sub-section, the term 'occupier' means an occupier as defined in clause (6)) of section 2 of the Kolkata Municipal Corporation Act, 1980 or clause (43) of section 2 of the West Bengal Municipal Act, 1993." As per Section 230 of the Act 1980, a person primarily liable to pay the property tax (lessor) in respect of any land or building may recover half of the amount of the property tax from the occupier (lessee/tenant) of the property. Section 231 of the Act 1980 provides that the person primarily liable to pay any property tax is entitled to recover the consolidated rate including surcharge from the occupier of the property and for that purpose the person primarily liable shall have the same rights and remedies as if such sum were 'rent' payable to him by the person from whom he is entitled to recover such sum. Section 5(8) of the Act 1997 casts an obligation on the tenant to pay his share of municipal tax as an occupier of the premises in accord....
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....yable by the tenant or sub-tenant, the landlord has to be equipped with the power to get himself reimbursed by recovery of the portion of tax paid by him on behalf of the tenant. Section 231 of the Act, therefore, creates a fiction that the "tax" apportioned on the tenant would be treated as "rent" and would be recoverable as such. The word "rent" has not been defined in the tenancy law and this Court has taken note of this legal position in the case of Puspa Sen Gupta v. Susma Ghose [(1990) 2 SCC 651] which arose out of the provisions of the Tenancy Act applicable to West Bengal. Rent is a compendious expression which may include lease money with service charges for water, electricity and other taxes leviable on the tenanted premises." That thereafter, in paragraph 46, it is observed and held as under: "46. The provisions of the Tenancy Act merely enable the landlord to make a demand of arrears of rent and in default of the payment of the same, sue the tenant for recovery of rent or eviction on the ground of non-payment of rent despite demand. The tenant can get protection against eviction on the ground of arrears of rent only if he makes requisite deposit of the arrea....
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....f the premises which is tenanted. For that purpose, the terms and conditions mentioned in the tenancy agreement/lease agreement are required to be considered. For example, if in the tenancy agreement if it is provided that the tenant shall pay 'X' amount which shall include the taxes, the tax component can be said to be 'part of the rent'. However, if under the agreement and/or even under Section 230 of the Act 1980 r/w Section 5(8) of the Act 1997, the tenant is liable to pay tax separately or half of the amount of tax now statutorily liable to be paid, the same can be recovered as arrears of rent because such 'tax' is to be treated as 'rent' for the purpose of recovery. However, the same cannot be said to be 'part of the rent'. Therefore, reliance placed upon the decision of this Court in the case of Calcutta Gujarati Education Society (supra) by learned counsel appearing on behalf of the landlord is on a misreading of the said decision. As observed hereinabove, the said decision cannot be read to mean that the tax apportioned can be said to be part of the rent as sought to be contended by Shri Rana Mukherjee, learned Senior Advocate appearing on behalf of the landlord. 9. Now....