In Brief
The Supreme Court held that a company operating a bus terminal under a Build-Operate-Transfer (BOT) concession agreement is not liable to pay house tax under the Punjab Municipal Corporation Act, 1976. The lease deed explicitly exempted the lessee from paying any tax except a nominal Re. 1 annual rent. Although Section 97(2) of the Act normally makes such a lessee liable for taxes, the Government's statutory power under Section 157(1) to grant exemptions applies here. Since the Government had historically paid the tax and included no clear clause shifting the burden to the concessionaire, the demand was without legal authority. The Company is entitled to a refund with 10% per annum interest from the deposit date.
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