According to Allahabad High Court, rent is not a tax and cannot be recovered as unpaid land revenue under Section 173-A of the UP Municipalities Act.
Title: Deepak Kumar Yadav v. Principal Commissioner of Income Tax and Anr.
Decided on: 25th May, 2023.
WRIT – C No. – 5284 of 2009
CORAM: Hon’ble Salil Kumar Rai,J. Hon’ble Arun Kumar Singh Deshwal,J.
Introduction.
According to the Allahabad High Court, Section 173-A of the U.P. Municipalities Act, 1916 does not permit any municipality to reclaim unpaid rent for a shop as unpaid land income.
Analysis.
Numerous writ petitions were filed in opposition to recovery certificates issued by the Executive Officer of the Nagar Palika Parishad of Bareilly to recoup allegedly overdue rent, as well as recovery citations issued by the Collector in accordance with Section 173-A (Recovery of taxes as overdue land revenue) of the Act.
The recovery certificates and recovery citations issued by the Collector were thrown out by the justices Salil Kumar Rai and Arun Kumar Singh Deshwal-led panel for lack of jurisdiction. It was decided that the U.P. Municipality Act of 1912 did not give the Municipality the authority to recover shop rent arrears as land revenue arrears. The defaulter has fifteen days to pay any outstanding debts. It was decided that additional Chapter VI of the Act actions may only be started if he failed to pay his debts within the allotted time.
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Written by- Varada Hawaldar