{"id":310538,"date":"2024-01-02T16:00:10","date_gmt":"2024-01-02T10:30:10","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=310538"},"modified":"2024-01-12T12:45:44","modified_gmt":"2024-01-12T07:15:44","slug":"calcutta-high-court-upholds-kmcs-authority-to-levy-stallage-charges-and-penalties-scc-blog","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2024\/01\/02\/calcutta-high-court-upholds-kmcs-authority-to-levy-stallage-charges-and-penalties-scc-blog\/","title":{"rendered":"Calcutta High Court upholds Kolkata Municipal Corporation\u2019s authority to levy Stallage and related charges and penalties"},"content":{"rendered":"
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Calcutta High Court:<\/span> On a writ petition revolving around the legality of the charges imposed by Kolkata Municipal Corporation (KMC) under the authority conferred upon them by the Kolkata Municipal Corporation Act, 1980<\/a> (the Act), a single-judge bench comprising of Saugata Bhattacharyya,* J.<\/span>, upheld the validity of the demand notice, stating that KMC has the authority to levy stallage and related charges. The Court opined that the penalty for transfer of interest without prior approval was waived due to post facto approval. The Court directed the petitioners to pay the outstanding dues, with the interim deposit adjusted.<\/p>\n

Brief Facts<\/p>\n

In the instant matter, the present writ petition challenges two demand notices issued by the Superintendent, S.S. Hogg Market, Kolkata, dated 14-01-2011 and 21-11-2011, demanding payments of Rs.2,79,02,453 and Rs.2,10,56,342, respectively, from the petitioner. he notices demanded varying amounts, ultimately settled at Rs.2,05,81,725\/-. The Municipal Commissioner’s decision, following a co-ordinate Bench’s order, is also contested. The primary contention is that the charges imposed, including stallage and amalgamation fees, are without legal authority.<\/p>\n

Writ Petitioners’ Contentions<\/p>\n

The petitioner contended that the stall operators are licensees, not tenants, and the charges imposed by KMC are without authority. It w3as contended that the demand is arbitrary and inadmissible under the Kolkata Municipal Corporation Act, 1980<\/a> and Article 265<\/a> of the Constitution of India<\/a>. It was contended that the transfer of stalls from Sk. Nizam to Irshad Alam and then to the petitioner cannot be charged, and stallage charges with multipliers are impermissible under relevant provisions. It was contended that the authority of KMC to impose charges is limited by Section 430 of the Act and any new head must be introduced in the budget under Section 131. It was further contended that the demand for utilization of sub-floor area is unreasonable and lacks statutory backing.<\/p>\n

Respondents’ (KMC) Contentions<\/p>\n

The respondent contended that the excess area was utilized without formal permission, and charges are legitimate for amalgamation and mutation. It was contended that the license granted to Sk. Nizam is not transferable, and the formation of M\/s. Nizam’s Restaurant Private Limited is unauthorized. It was contended that the demand notices are valid, and the charges are license fees, not taxes or rent. It was further contended that Section 573 has no application to stallage, and specific provisions in the Act empower KMC to realize stallage without time limitations.<\/p>\n

Legal Provisions Invoked:<\/p>\n