In Brief
New Delhi Municipal Council challenged a Delhi High Court judgment striking down the 2009 Bye-laws that introduced Unit Area Method (UAM) for property tax assessment. The Bye-laws determined rateable value using fixed area values adjusted by factors for location, occupancy, age and use. The Supreme Court held the Bye-laws ultra vires Section 63 of the NDMC Act, 1994, which mandates rateable value be determined as 'annual rent at which property might reasonably be expected to let from year to year'—a rent-based methodology, not value-based. The UAM determines value of property, not rental value, and fundamentally differs from the statutory scheme. Although 95% of assessees accepted the Bye-laws and paid taxes voluntarily, the Court exercised powers under Article 142 to protect them from reassessment, while protecting writ petitioners' right to relief under the High Court's judgment.
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