Order 18

Order Details: COPY OF ORDER
Pdf Text: IN THE COURT OF DR. PANKAJ SHARMA:
DISTRICT JUDGE-02 & WAQF TRIBUNAL :
PATIALA HOUSE COURTS : NEW DELHI
HTA No. 43/2024
IN THE MATTER OF :
M/s. Hotel Hans Private Ltd. ….Appellant
VERSUS
New Delhi Municipal Council …..Respondent
28.04.2026
ORDER
1. Vide this order, I shall dispose of the application filed by the
appellant under Section 101 and 102 of NDMC Act, 1994 and Section 151 of the
Code of Civil Procedure, 1908 seeking refund of amount of Rs.97,81,550/-
illegally attached vide warrant dated 11.03.2025.
2. The brief facts set out in the application under Section 101 & 102
of NDMC Act are that:-
The appellant has filed two House Tax Appeals(HTA), one is present
one i.e. HTA No.43/2024 and second is HTA No. 42/2024. The HTA bearing
no.43/2024 pertains to Assessment years 2003-04 to 2008-09 and HTA No.
42/2024 pertains to Assessment years 2009-10 to 2024-25. It is submitted that
vide order dated 20.12.2024, it was directed to the appellant to deposit of
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disputed tax for the base year i.e. Assessment year 2003-04 with direction to
deposit the same within 02 weeks and in compliance of the same, remaining tax
amount for the base year of Rs.62,89,855/- was deposited on 01.01.2025 and the
matter was adjourned for notice to the respondent for 01.04.2025. The summons
were accordingly issued to the respondent. Thereafter, the officials of the
respondent illegally issued a warrant dated 11.03.2025 under Section 102(1) of
the NDMC Act thereby directing the IndusInd Bank, Barakhamba Road, New
Delhi to attach an amount equal to the sum of Rs.7.03 crores and remit the same
to NDMC through pay order. The IndusInd Bank, Barakhamba Road, New Delhi
attached an amount of Rs.97,81,550/- from the account of the appellant and
provided the information to the appellant vide order dated 15.03.2025 and
remitted the amount to NDMC through demand draft and marked the lien for the
balance amount of Rs.6,05,23,430/- and directed the appellant to maintain the
sufficient balance for payment of balance lien amount.
2.1 It is submitted that since the respondent was threatening to attach
and seal the property in question for illegal recovery of balance amount, the
plaintiff filed the writ petition bearing Writ Petition (C) No 3578/2025 on
21.03.2025 and in the said writ petition prayed for not to attach and seal the
property in question and quashing warrant dated 11.03.2025 and for refund of
amount of Rs.97,81,550/- alongwith interest @ 12% per annum. Hon’ble High
Court of Delhi vide order dated 24.03.2025 restrained the respondent from
attaching and sealing the property in question till next date of hearing.
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2.2 It is submitted that while the matter was listed before this Court on
01.04.2025, the counsel for the Appellant brought this fact to the knowledge of
the Court that the Respondent has during the pendency of the Appeal illegally
attached the money lying in the account of the Appellant with bank on the basis
of illegally issued Warrant dated 11.03.2025 and requested the Court through oral
submission to take cognizance of the said matter. The Court was graciously
pleased to direct the counsel for the Respondent to disclose as to on what basis
the Warrants were issued and attachment of the proceeds lying in the bank
account of the Appellant were attached and listed the matter for 03.04.2025.
2.3 It is submitted that the counsel for the Respondent informed the
Court on 03.04.2025 that since the tax amount of more than Rs.7 crore was not
paid, accordingly Warrants were issued. Time was sought by the Respondent to
file reply to the appeal. The Court directed the Respondent vide order dated
03.04.2025 to file the reply within one week and fixed the matter for 17.04.2025
for hearing arguments on the Appeal.
2.4 Ld. Counsel has drawn the attention towards Section 101 of the
NDMC Act and pleaded that the tax payer is deemed to be in default only if the
person liable for the payment of any tax does not, within 30 days of the service
of the Notice of Demand under Section 100 pay the sum due and no appeal is
preferred against such tax. It is submitted by Ld. Counsel that petitioner has filed
a House Tax Appeal challenging the Rateable Value and the Court in the said
appeals directed to deposit the tax for the base year as such the appellant can not
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be termed as a person in default under Section 101 of the NDMC Act. It is urged
that in such situation, no action could have been initiated for recovery of tax
through forcibly means by issuing Warrants of attachment for attaching the
proceeds lying in the bank account of the appellant. Also it is pointed out that as
per Section 102 of NDMC Act, if the tax amount alongwith the penalty if any
imposed under Section 101 of the Act is not paid within 30 days from the service
of notice of demand, the same can be recovered under Section 102 of the Act
under a Warrant issued in the form set forth in the Seventh Schedule by distress
and sale of the movable property or the attachment or sale of the immovable
property of the defaulter. The Petitioner cannot be termed as defaulter in any
manner under Section 102 of the Act inasmuch as the Petitioner preferred House
Tax Appeals and has therefore duly complied with Section 101 of the NDMC
Act, 1994. Under such circumstances, no Warrant of attachment could have been
issued under Section 102 of the Act. It is therefore prayed that the Warrant
bearing No. 955/AO(T) 2025 dated 11.03.2025 issued by NDMC be quashed and
also to quash the directions given by IndusInd Bank Limited, Barakhamba Road
Branch, New Delhi vide letter dated 15.03.2025 whereby lien has been marked
illegally on the account of the appellant and refund of the already recovered
amount of Rs.97,81,550/- alongwith interest @ 12% per annum.
3. Oral arguments have been addressed by Ld. Counsel for NDMC.
In a nutshell, it is submitted that the appellant is a defaulter in making payment
of the Assessment year 2012-13, 2014-15, 2017-18, 2018-19, 2019-20, 2020-21
and 2022-23. It is submitted that Section 101 of NDMC envisaged that if the
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person liable for the payment of any tax does not, within 30 days of the service
of the Notice of Demand under Section 100 pay the sum due and if no appeal is
preferred against such tax, he shall be deemed to be in default. The limitation
period for filing the appeal regarding the demand is 30 days from the service of
the notice of demand. Ld. Counsel has submitted that the present appeal has been
filed after a delay of more than 20 years of the initial demand i.e. 2001-02. It is
also submitted that the appellant has failed to qualify the test as laid down in
Section 116 of NDMC Act.
4. In rebuttal, Ld. Counsel has submitted that there is no delay in
filing the present appeal and if at all there is delay, there is delay of 146 days
there and his application for condonation of delay is already on record wherein
the delay has been duly substantiated.
5. I have heard both the counsels and have gone through the record
carefully.
6. Before adverting to the issue raised in the application, it would be
apposite to have a glance on the legal position:-
100. Notice of demand and notice fee. (1) If the amount of the
tax for which a bill has been presented under section 99 is not paid
within fifteen days from the presentation thereof, or if the tax on
vehicles and animals or the theatre-tax or the tax on advertisements is
not paid after it has become due, the Chairperson may cause to be
served upon the person liable for the payment of the same a notice of
demand in the form set forth in the Sixth Schedule.
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(2) For every notice of demand which the Chairperson causes
to be served on any person under this section, a fee of such amount
not exceeding five rupees as may be determined by bye-laws made in
this behalf, shall be payable by the said person and shall be included
in the cost of recovery.
101. Penalty in case of default of payment of taxes.
(1) If the person liable for the payment of any tax does not,
within thirty days of the service of the notice of demand under section
100 pay the sum due and if no appeal is preferred against such tax, he
shall be deemed to be in default.
(2) When the person liable for the payment of any tax is
deemed to be in default under sub-section (1), such sum not
exceeding twenty per cent. of the amount of the tax as may be
determined by the Chairperson, may be recovered from him by way
of penalty, in addition to the amount of the tax and the notice fee,
payable under sub-section (2) of section 100.
(3) The amount due as penalty under sub-section (2) shall be
recoverable as an arrear of tax under this Act.
102. Recovery of tax. (1) If the person liable for the payment
of the tax does not, within thirty days from the service of the notice
of demand, pay the amount due, such sum together with all costs and
the penalty provided for in section 101 may be recovered under a
warrant, issued in the form set forth in the Seventh Schedule, by
distress and sale of the movable property or the attachment and sale
of the immovable property of the defaulter:
Provided that the Chairperson shall not recover any sum the
liability for which has been remitted on appeal under the provisions
of this Act.
(2) Every warrant issued under this section shall be signed by
the Chairperson.
6.1 Admittedly, the appeal has been filed beyond the stipulated period
of 30 days of service of notice of demand by the appellant. The aspect of
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condonation of delay of appellant in filing the appeal shall be dealt separately. A
plain reading of Section 101 of the NDMC Act would show that upon service of
notice of demand under Section 100, the appeal is required to be preferred within
30 days and failure to do so by deeming fiction makes the noticee defaulter.
Appeal filed after the stipulated period would not be considered as a strict
compliance of the said provision. Therefore, the contention of the appellant that
the act of the Department in considering them as a defaulter is illegal can not be
sustained. Accordingly, the act of the Department regarding issuance of warrant
of attachment for recovery can not be faulted upon. The application is
accordingly disposed of.
Announced in open Court
today i.e. 28.04.2026.
(Dr. Pankaj Sharma)
DJ-02 & Waqf Tribunal
New Delhi District,
Patiala House Courts,
New Delhi.
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