Mr. Singh, Clause 7(1) of the First Schedule of the MRTP Act exempts 'the relevant authority' from paying taxes. But if the relevant authority is exempt, can the municipal corporation collect the same tax from the occupier of the land? Would that not defeat the exemption?

My Lord, the exemption under Clause 7(1) is personal to the relevant authority. It is not a property-based exemption. The unit/plot holders are separate legal entities. They are not the relevant authority. They have constructed buildings on the land at their own cost and are carrying on commercial activities. They receive municipal services — roads, street lighting, drainage — from NMMC. There is no reason why they should not pay property tax. The fact that MIDC is exempt does not automatically exempt the occupiers. The MMC Act levies property tax on the 'owner' or 'occupier'. If MIDC is the owner but is exempt, the tax can still be levied on the occupier. The exemption does not attach to the property; it attaches to MIDC as a person.

The statement of objects of the MRTP Act says that Clause 7(1) was intended to exempt 'buildings or lands belonging to, or vesting in a relevant authority or buildings constructed on land belonging to such authority'. This suggests the exemption was meant to cover the entire industrial area. Why should we ignore the statement of objects?

My Lord, the statement of objects is not part of the statute. It can be referred to only to understand the legislative intent when the language of the provision is ambiguous. Here, the language of Clause 7(1) is unambiguous: it exempts 'the relevant authority'. It does not say that the exemption extends to any other person. When the language is clear, the statement of objects cannot override the plain meaning. Moreover, even if we refer to the statement of objects, it refers to buildings or lands belonging to or vesting in a relevant authority. The buildings in question do not belong to MIDC; they belong to the individual unit/plot holders who constructed them at their own cost. Therefore, even under the statement of objects, the exemption would not apply to these buildings.

The MoU dated 01.12.2005 handed over only maintenance of roads, street lights and drains. MIDC continues to provide water supply, electricity and sewerage. Under Clause 7(1), the exemption applies so long as the relevant authority provides 'all or any of the amenities' — not necessarily all. Does the exemption not continue for the amenities still provided by MIDC?

My Lord, the phrase 'all or any' in Clause 7(1) must be read in context. The clause provides that 'the relevant authority itself provides in the area within the jurisdiction of the local authority all or any of the amenities which the local authority provides'. The local authority provides a comprehensive set of amenities. If the relevant authority provides only some of them, is it exempt from all taxes? That would be an absurd interpretation. The legislative intent is that the exemption applies when the relevant authority provides the amenities that the local authority would otherwise provide, i.e., substantially all amenities. Once the local authority takes over maintenance of roads, street lights and drains — which are core municipal functions — the condition for exemption is no longer satisfied. Moreover, the MoU itself contemplated that NMMC would take over infrastructure development and maintenance. From that date, NMMC has been providing these services, and MIDC has stopped levying service charges for them. Therefore, the exemption has ceased.

The petitioners have been paying property tax to NMMC for years. Does this not create an estoppel? Can they now turn around and say the tax was not payable?

My Lord, there is a stronger principle at play: there can be no estoppel against the statute. If NMMC had no jurisdiction to levy the tax, the petitioners' payments under a mistaken belief cannot confer jurisdiction. However, in the present case, the petitioners are not claiming that they paid under a mistaken belief. They have been challenging the levy since 2001 through the writ petition. The payments made were under protest or to avoid coercive action such as attachment of bank accounts or auction of property. This Court has consistently held that payments made under protest or to avoid coercive recovery do not create estoppel. Moreover, the lease deed clause is generic. It does not constitute an admission that NMMC has jurisdiction; it merely allocates the burden of taxes that are legally payable.

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NMMC Has Jurisdiction to Levy Property Tax on MIDC Area — (2026) INSC 570

Small Scale Entrepreneurs Association & Ors. v. The State of Maharashtra & Ors. — (2026) INSC 570

Core Argument

The TTC MIDC Industrial Area falls within the territorial jurisdiction of NMMC as per the final notification dated 17.12.1991, and under Sections 127 and 128A of the MMC Act, NMMC alone has the power to levy property tax. Clause 7(1) of the First Schedule of the MRTP Act exempts only MIDC, not the unit/plot holders.

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