SC Clarifies Property Tax Exemption on MIDC Industrial Units
Property Tax on Industrial Units of MIDC in Navi Mumbai Municipal Corporation
The provisions of the MIDC Act and the MMC Act show that the MIDC is empowered to levy fee or service charges for maintenance of road, drainage, water supply, other services and amenities. However, it has no power to impose or collect property tax. The power to impose and collect property tax vests only with the Municipal Corporation under Sections 127 and 128A of the MMC Act.
Para 71 – However, section 63 of the MMC Act provides for provisions of the collection, removal, treatment and disposal of sewage, offensive matter.
NMMC is duly authorized to levy and collect property tax from the units/ plot holders within its area including the industrial area of TTC MIDC, even though the appellants or its members may be paying fee or service charges to the MIDC for providing necessary infrastructure, facilities and amenities and the fee or service charges paid by them to MIDC are not in the nature of any tax.
However, Clause 7 (1) of the First Schedule of the MRTP Act provides for exemption.
However, the entire land within the jurisdiction of the TTC MIDC Vests with the MIDC and does not belong to individual unit / plot holder. They are the lessees using the said land but ownership vests with the MIDC. Therefore, any building constructed on such land stands exempted from taxation, irrespective of the fact that the constructions have been raised by the individual unit / plot holders.
as the MIDC was providing the infrastructure facilities and amenities and was realizing fee/ service charges, the MIDC including all its unit/ plot holders were exempt from payment of tax under Clause 7(1) of First Schedule of MRTP Act, till the time those facilities were handed over to the NMMC whereupon it is within the sole domain of the NMMC to realise property tax without any exemption.
Judgment dated 27.5.2026 of the Supreme Court in Civil Appeal No.7318 of 2010 of Small Scale Entrepreneurs Association and others Vs. State of Maharashtra and others with connected matters.
