Bobay HC – Change of Ownership Justifies Reassessment of Property Tax & Ratable Value
The property at Yerawada is admeasuring 3825.25 sq.mts with constructed area of 540.4 sq.meters. In 1989, the rate value was Rs.6,000/-. On 14.5.1993, the respondent company acquired the property from the said society.
On 14.8.1995, the respondent applied to PMC for mutation and transfer of title in its records. The Corporation issued special notice dated 23.2.1996 and revised ratable value to Rs.5,80,550/- for the constructed portion and Rs.5,84,550/- for the open land. However, the Collector of Taxes confirmed revised annual ratable value and withdrew 40% concession for self-occupation by the owner.
This was challenged in appeal in the Small Causes Court. The trial Court allowed the appeal vide judgment and order dated 15.3.1997.
The power to assess property tax is not static. It is an annual exercise. Every year, the Municipal Commissioner is required to publish a public notice and invite objections. The statute itself contemplates that the assessment must be revisited year after year.
Once the law mandates an annual revision, it follows that the assessment for each year stands on its own footing. A change in ownership may bring to light relevant factors such as change in user, change in occupation, cessation of self-occupation concession, or other material circumstances. The Corporation is not bound to mechanically continue the earlier ratable value without examining whether it reflects the true position for the relevant year. The liability to pay property tax arises from the statute. It does not depend on whether the previous owner objected or remained silent.
Judgment dated 12.2.2026 of the High Court of Bombay in Writ Petition No.5920 of 2006 of Pune Municipal Corporation Vs. The Indian Seamless Metal Tube Ltd.
