In Brief
The Supreme Court clarified the basis for assessing property tax on buildings under the New Delhi Municipal Council (NDMC) Act. The case involved two categories: self-occupied buildings and premises partly self-occupied with part sub-leased. The Court held that rateable value must be based on the annual rent that could reasonably be expected if the property were let, not on bye-laws under the repealed Punjab Municipal Act. For sub-leased premises where lessees pay 25% of gross rent to the Government of India, the rateable value must be calculated on 75% of the sub-lease rent. The impugned High Court judgments were set aside and the appeals allowed, with reassessment to be completed within three months.
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