Property tax relief for owners
Mar 11, 2014
Source : The Times of India


MUMBAI: The Bombay high court has granted relief to all property owners who have to pay steep property tax on the basis of a new system introduced in 2010. They can now pay property taxes under the old un-amended rates with 50% differential between the old and new rates, the HC directed recently.

The HC bench of Chief Justice Mohit Shah and Justice M S Sanklecha passed the order while hearing a bunch of 47 petitions by the Property Owners' Association, societies and individual property owners, among others. The petitioners had challenged the new property tax regime based on capital value of the property as "arbitrary and unconstitutional". Several private charitable trusts like Bombay hospital and others had also challenged the new regime since it took away exemptions granted to them earlier. The new system took the capital value of the property to calculate the amount of property tax instead of the "reasonable rent" premises would fetch as a base value under the old law. The POA represented by advocate H N Vakil and others said the new taxes as result were exorbitant and discriminatory.

The HC had granted relief to several property owners earlier. On February 24 it extended the relief to others. After it was pointed out that other property owners similarly affected but not before the court would suffer, the HC said its order would be applicable to all property owners even those who were not before the court till further orders.

The tax would be accepted by the BMC without prejudice to rights of all parties.

The matters were argued at length by a number of counsel appearing for various petitioners. Counsel Snehal Paranjpe appearing on behalf of the Bombay Hospital Trust, instructed by Kanga and Company, argued that being a charitable trust the hospital was entitled to certain exemptions allowed earlier.

The HC de-tagged the petition filed by Bombay Hospital from the group of petitions filed by POA and others. It said it would hear the petitions filed by charitable trusts, such as Bombay Hospital and others, separately. But to put an end to petitions being filed on a regular basis by aggrieved owners the HC said the interim order would be applicable to all property owners within BMC limits and adjourned the matters to March 11, 2014.

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