New Delhi: The Supreme Court has ruled that tenants in Bengal can be evicted by landlords if they refuse to pay municipal taxes levied under the Calcutta Municipal Corporation Act 1980 and the West Bengal Municipal Act 1993.

The bench comprising Justices Ranjan Gogoi, R. Banumathi and Navin Sinha passed the order on Friday while setting aside the contrary and concurrent view taken by Calcutta High Court and a trial court, both of which had held that tenants could not be evicted for not paying municipal taxes.

The apex court allowed an appeal filed by M/s Popat & Kotecha Properties, challenging the refusal of the two courts to entertain its plea to evict tenant Ashim Kumar Dey, who had failed to pay municipal taxes along with the rent.

Justice Gogoi said that with the amendment of the relevant municipal act with effect from July 19, 2001, and after incorporation of sub-section (8) of Section 5, the obligation to pay municipal taxaxes was specifically on the tenant in his/her capacity as an occupier.

According to a civic official, a property tax bill is always drawn in the name of the owner. "The corporation always issues the tax bill to the owner. The owner has to deposit the tax. Whether the owner recovers it from the tenants is his/her discretion. The corporation never collects tax from tenants," he said.

The official also pointed out that if tenants want to know what their share of civic dues will be, a property owner can approach the corporation for a break-up of the taxes. "The owner can apply and get a break-up of tax liabilities against a fee of Rs 200, but cannot decide the break-up of taxes between tenants."

While municipal rules allow property owners to seek action against tenants for failure to pay their share of taxes, what measures can be initiated is governed by the West Bengal Premises Tenancy Act 1997.

The official said the rent agreement must specify whether the rent includes tax and whether the tenant needs to pay taxes separately. "If nothing is mentioned, the landlord can ask the tenant to pay the municipal taxes," he said.

All these rules come into play only if properties occupied by tenants are recorded with the civic body's assessment department.

Multiple properties have residential and commercial tenancies that have not been reported to the civic authorities and hence generate less tax. "In such cases, tax is to be collected only from the owner. The civic body loses out on tax pertaining to the tenanted portions," the official said.

Additional reporting by Our Bureau