The Telegraph
Since 1st March, 1999
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Court jolt for hike in civic taxes on units

The recent Calcutta Municipal Corporation (CMC) decision to hike the rate of water and garbage taxes during collection of licence fees from city-based industrial units received a jolt on Monday, when Justice K.J. Sengupta of Calcutta High Court asked the civic body to hear out the petitioner company and to clarify the rule that empowered the civic body to raise the rate. The court order will be a precedent in a large number of similar cases.

According to legal circles, the rate of hike in the taxes was beyond the rules framed in the CMC Act. They observed that it would be impossible for the civic body to justify its stand.

Weathermaker Airconditioning Company, a unit in the Behala Industrial Area, filed a case in Calcutta High Court challenging the rate of enhancement of the taxes by the CMC.

“For the past three years, the company has been paying Rs 13,910 (including water tax and garbage tax) per annum for renewal of trade licences. This year, the company has been asked to pay Rs 15,250,” the petitioner’s lawyer Siraj Gooptu said.

He said the company had to pay rent to the Small Industries Corporation, which includes 18 per cent of municipal taxes. “Neither does the CMC supply water to the company, nor does it remove garbage. There is no provision in the CMC rule to enhance the taxes,” he said.

CMC counsel Aloke Ghosh told the court that the CMC had to enhance the rates of taxes to maintain its services to the people as well as to industrial units.

After hearing both the sides, the judge passed the directive.

Sources said Weathermaker is not the only company that has to cough up taxes at the enhanced rate without being provided any services in return by the civic authorities. “If the civic authorities lose this battle, many other companies will come forward to get justice,” the official said.

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