Supreme Court of India (Division Bench (DB)- Two Judge)

Appeal (Civil), 5653 of 2014, Judgment Date: Aug 10, 2016

                                                                  REPORTABLE

                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION


                        CIVIL APPEAL No. 5653 of 2014


MUNICIPAL CORPORATION OF DELHI
                                                           .... Appellant(s)
                                   Versus

NORTH DELHI POWER LTD. (NOW TATA POWER DELHI DISTRIBUTION LTD.) AND ANR.
                                                             … Respondent(s)

                                    WITH

                        CIVIL APPEAL No.5654 of 2014


TATA POWER DELHI DISTRIBUTION LTD. (FORMERLY  KNWON  AS  NORTH  DELHI  POWER
LTD.)
                                                           .....Appellant(s)

                                   Versus

MUNICIPAL CORPORATION OF DELHI (NOW KNOWN AS NORTH DELHI MUNICIPAL
CORPORATION)
                                                             … Respondent(s)

                                    WITH

                        CIVIL APPEAL No._7389_of 2016
                  (Arising out of SLP (C) No.17317 of 2015)

GOVERNMENT OF NCT OF DELHI
                                                           .... Appellant(s)

                                   Versus

NORTH DELHI POWER LTD. (NOW TATA POWER DELHI DISTRIBUTION LTD.) AND ANR.
                                                            .… Respondent(s)

                               J U D G M E N T
L. NAGESWARA RAO, J.
      Leave granted in Special Leave Petition (Civil) No.17317/2015.
      The issues in these  three  Civil  Appeals  are  the  exigibility  and
incidence of property tax over a plot of 8,080 square meters of land.
2.    On 26.03.2003, the Assessment and Collection Department of  the  Delhi
Municipal Corporation determined the rateable value  of  a  vacant  plot  of
8,080 sq. meters allotted to North Delhi  Power  Limited  at  Rs.58,53,960/-
with effect from 01.04.2002.  M/s North Delhi Power Limited filed an  appeal
under Section 169 of the Delhi Municipal Corporation Act,  1957  before  the
District Judge, Delhi challenging the order dated 26.03.2003. By a  judgment
dated 03.01.2004 in  H.T.A.  No.164/2003,  the  Additional  District  Judge,
Delhi held  that  the  land  in  dispute  stood  transferred  to  the  Delhi
Government and hence it was entitled for exemption from payment of  property
tax in view of Section 119 (1) of Delhi  Municipal  Corporation  Act,  1957.
It was also held that M/s North Delhi Power Limited was a  licensee  of  the
Government.  On the basis of the above findings, the District Judge  allowed
the appeal and quashed the assessment order dated 26.03.2003.  Aggrieved  by
the said judgment  dated  03.01.2004  of  the  District  Judge,  Delhi,  the
Municipal Corporation Delhi approached the High Court  of  Delhi  by  filing
Writ Petition No.3193/2004.  A Single Judge of the Delhi High Court  allowed
the writ petition holding that the North Delhi Power Limited  is  liable  to
pay the tax.  The Single Judge held that the provisions of Section  120  (1)
(c) of the Delhi Municipal Corporation Act, 1957  are  applicable  as  North
Delhi Power Limited was entitled to let out the properties  on  which  basis
it became liable to pay taxes.   With reference  to  the  Delhi  Electricity
Reforms (Transfer Scheme) Rules, 2001 which would be dealt in detail  later,
the Single Judge held that North Delhi Power Limited  is  an  effective  and
full successor in respect to all matters relating  to  all  liabilities  and
assets and further held that there is no  material  to  establish  that  the
Delhi Electricity Reforms (Transfer Scheme), 2001  ruled  out  liability  of
North Delhi  Power  Limited  from  municipal  taxation.  North  Delhi  Power
Limited filed L.P.A.No.2630/2005, challenging the judgment dated  25.07.2005
passed by the Single Judge in Writ Petition No.3913/2004.  A Division  Bench
of the High Court of Delhi held that Delhi Power Company Ltd. was the  owner
of land and land rights during the relevant assessment years i.e.  2002-2003
and 2003-2004, that the statutory  transfer  scheme  creates  a  licence  in
favour of the Delhi Power Company Ltd. and  that  the  distribution  licence
issued by Delhi Electricity Regulatory Commission under Section  20  of  the
Delhi Electricity Reforms Act, 2000 is distinct from the  licence  for  land
granted in its favour. As Delhi Power Company Ltd. was not a party with  the
proceedings before the Division Bench, the matter was remanded back  to  the
Deputy Assessor and Collector of  the  Respondent-Municipal  Corporation  of
Delhi for determination as to whether North Delhi  Power  Limited  or  Delhi
Power Company Ltd. is liable to pay property tax.   The Deputy Assessor  and
Collector of Municipal Corporation, Delhi was directed to give a hearing  to
both North Delhi Power Limited as  well  as  to  Delhi  Power  Company  Ltd.
before passing any final order.
3.     Aggrieved  by  the  said  judgment   dated   09.12.2013   in   L.P.A.
No.2630/2005, Tata Power Delhi Distribution Limited  (formerly  North  Delhi
Power Limited referred  to  as  ‘Distribution  Company’  hereinafter)  filed
Civil Appeal No.5654/2014.  The Municipal Corporation of Delhi  referred  to
as ‘Corporation’  hereinafter  for  convenience,  also  filed  Civil  Appeal
No.5653/2014, aggrieved by certain findings in favour  of  the  Distribution
Company. Civil Appeal No.______  of  2016  (arising  out  of  Special  Leave
Petition (C) No.17317 of 2015) was filed  by  Government  of  NCT  of  Delhi
(hereinafter  referred  to  as  ‘Government’),  challenging   the   findings
recorded by the Division Bench of the High Court that the vacant land  stood
transferred to Delhi Power Company Ltd. and the Government is not  owner  of
the vacant land.
4.    It would be useful to refer to the provisions, Statutes and the  Rules
for better appreciation of the dispute involved in this case.  Chapter  VIII
of the Delhi Municipal Corporation Act, 1957 deals with  taxation.   Section
114 provides  for  imposition  of  tax  on  land  and  buildings  in  Delhi.
Section 119 of  the  Delhi  Municipal  Corporation  Act  exempts  lands  and
buildings being properties of the Union from the property tax  specified  in
Section 114.  Section 120 of the Delhi Municipal Corporation Act deals  with
the incidence of property tax according to which the property tax  shall  be
primarily leviable on the lessor if the land or building is  let,  upon  the
superior lessor if the land or building  is  sub-let  and  if  the  land  or
building is un-let upon the person in whom the right  to  let-out  the  same
vests.   The  Delhi  Electricity  Reforms  Act,   2000   was   enacted   for
restructuring  the  electricity  industry,  to  increase  the  avenues   for
participation of private sector of the electricity  industry  and  generally
for taking measures conducive to the development and the management  of  the
electricity industry in an efficient, commercial, economic  and  competitive
manner in  the  National  Capital  Territory  of  Delhi.    The  process  of
unbundling of the Delhi Vidyut Board was dealt with in Sections  14  and  15
of the Act which are as follows:-
                                   PART V
                   “REORGANISATION OF ELECTRICITY INDUSTRY
14. Incorporation of companies for the purpose of  generation,  transmission
or distribution of electricity.
(1) The government may, as soon as may be after  the  commencement  of  this
Act, cause one or more companies to be incorporated and  set  up  under  the
provisions of the  Companies  Act,  1956  for  the  purpose  of  generation,
transmission or distribution of electricity, including companies engaged  in
more than one of the said activities, in the National Capital  Territory  of
Delhi and may transfer the existing generating stations or the  transmission
system or distribution system, or any part of  the  transmission  system  or
distribution system, to such company or companies.
(2) The Government may designate any company set up  under  sub-section  (1)
to be the principal company to undertake all planning  and  coordination  in
regard to generation  or  transmission  or  both;  and  such  company  shall
undertake works connected with generation or transmission and determine  the
requirements of the territory  in  consultation  with  the  other  companies
engaged in generation or transmission for the National Capital Territory  of
Delhi, the Commission,  the  Regional  Electricity  Board  and  the  Central
Electricity Authority and any other authority under any  law  in  force  for
the time being, or any other Government concerned.
(3) The companies incorporated  and  set  up  under  sub-section  (1)  shall
undertake the functions specified in this section and such  other  functions
as may be assigned to them by the Government.
(4) Subject to the provisions of this Act and of the  duties  and  functions
assigned to the companies incorporated and set  up  under  sub-section  (1),
other companies engaged  in  generation,  transmission  or  distribution  of
electricity, or more than one of the said activities,  may  be  incorporated
and set up in the National Capital Territory of Delhi.
(5) The Government may, in consultation with the Commission,  determine  the
lines that shall be treated as transmission or distribution  lines  for  the
purpose of division of responsibilities between the  companies  incorporated
and set up under this section, having regard to the voltage levels  of  such
lines and any other factor, which it may consider relevant.
(6) The Government may convert the companies set up under this Act to  joint
venture companies through a process of  disinvestment,  in  accordance  with
the transfer scheme prepared under the provisions of this Act.
(7) Upon the transfer of all functions of the Board  to  corporate  entities
in terms of this Part, the Government may appoint an administrator  for  the
purpose of finalisation of the accounts of the Board  for  all  the  pending
years till the date of such transfer  and  thereafter  for  winding  up  the
Board in such manner as the Government may direct.
15. Reorganization  of  Delhi  Vidyut  Board  and  transfer  of  properties,
functions and duties thereof.
(1) With effect from the date on which a transfer  scheme  prepared  by  the
Government to give effect to the  objects  and  purposes  of  this  Act,  is
published or such further  date  as  may  be  specified  by  the  Government
(hereinafter referred to as “the effective date”),  any  property,  interest
in property, rights and, liabilities which immediately before the  effective
date belonged to the Board shall vest in the Government.
(2) The Government may transfer such property, interest in property,  rights
and liabilities to any company or companies  established  under  section  14
for the purpose in accordance with the transfer scheme prepared therefore.
(3) Such of the rights and power to be exercised  by  the  Board  under  the
Electricity (Supply) Act, 1948 (54 of  1948),  as  the  Government  may,  by
notification in the official Gazette, specify, shall  be  exercisable  by  a
company or companies established as the case may be, under section  14,  for
the purpose of discharge of the  functions  and  duties  with  which  it  is
entrusted.
(4) Notwithstanding anything contained in this section  or  any  other  Act,
where:
(a) the transfer scheme involves the transfer of any property or  rights  to
any person or undertaking not wholly owned by  the  Government,  the  scheme
shall give effect to the transfer only after asset valuation;
(b) where any transaction of any description is effected in pursuance  of  a
transfer scheme,  it  shall  be  binding  on  all  persons  including  third
parties, even if such persons have not consented to it.
(5) The Government may require  any  transmitting  or  distributing  company
established  under  the  provisions  of  sub-section  (1)  of   section   14
(hereinafter referred to as "the transferor  licensee")  or  any  generating
company to draw up a transfer scheme  to  vest  in  a  further  licensee  or
licensees (the  "transferee  licensee  or  licensees"),  or  any  generating
company, any property, interest in property, rights  and  liabilities  which
have been vested in the transferor licensee or generating  company,  as  the
case may be, under this  section  and  publish  the  same  in  the  official
Gazette. The transfer scheme to be notified  under  this  sub-section  shall
have the same effect as a transfer scheme under sub-section (2).
(6)   A transfer scheme may-
(a) provide for the formation of subsidiaries, joint  venture  companies  or
other  schemes  of  division,  amalgamation,   merger,   reconstruction   or
arrangements;
(b) define the property, interest in property, rights and liabilities to  be
allocated-
(i) by specifying or describing the  property,  rights  and  liabilities  in
question,
(ii) by referring to all the property,  interest  in  property,  rights  and
liabilities comprised in a specified part of the transferor's  under-taking,
or
(iii) partly in one way and partly in the other :
Provided that the property, interest in  property,  rights  and  liabilities
shall be subject to such further transfer as the Government may specify;
(c) provide that any rights or liabilities specified  or  described  in  the
scheme shall be enforceable by or against the transferor or the  transferee;

(d) impose on  any  licensee  an  obligation  to  enter  into  such  written
agreements with, or execute such other instruments in favour  of  any  other
subsequent licensee as may be specified in the scheme;
(e) make such supplemental, incidental and consequential provisions  as  the
transferor licensee considers  appropriate  including  provision  specifying
the order in which any transfer or transaction is to be regarded  as  taking
effect;
(f)  provide  that  the  transfer  shall  be  provisional  subject  to   the
provisions of section 18.
(7) All debts and obligations incurred, all contracts entered into  and  all
matters and things done  by,  with  or  for  the  Board,  or  a  company  or
companies established as the case may be, under  section  14  or  generating
company or distribution  company  or  companies  before  a  transfer  scheme
becomes effective shall, to the extent specified in  the  relevant  transfer
scheme, be deemed to have been incurred, entered into or done  by,  with  or
for  the  Government  or  the  transferee  and  all  suits  or  other  legal
proceedings instituted by or against the Board or transferor,  as  the  case
may be, continued or instituted by or against the  Government  or  concerned
transferee, as the case may be.
(8)  In  the  event  a  licensee  is  required  to  vest  any  part  of  its
undertakings  in  another  licensee  pursuant  to   sub-section   (5),   the
Government shall amend the transferee licence in accordance with section  24
or revoke its licence in accordance with section 23.
(9) The Board shall cease to  exist  with  the  transfer  of  functions  and
duties specified and with the transfer of assets as on the effective date.
(10) The exercise by a licensee of any of Board’s rights and powers  may  be
made on such conditions  as  shall  be  specified  in  the  transfer  scheme
including a condition that such rights and powers shall be exercised by  the
licensee only with the approval of the Commission/Government”.

5.    The Delhi Electricity  Reforms  (Transfer  Scheme)  Rules,  2001  were
notified on 20.11.2001 and were given effect from 01.07.2002.  As  per  Rule
3 all the assets of the Delhi Vidyut Board stood transferred and  vested  in
the Government absolutely.  Rule 4 classified  the  undertakings.   In  this
case, we are concerned with the distribution  undertakings  as  set  out  in
Schedule ‘F’ thereof and the holding company as set  out  in  Schedule  ‘G’.
The assets set out in Schedule ‘F’ stood transferred and vested in  DISCOM-3
and the assets and liabilities set out in Schedule ‘G’ stood transferred  to
the Holding Company.   Sub-rule 5 of Rule 5 provides that  the  distribution
companies shall issue shares  and  instruments  in  favour  of  the  holding
company as specified in Schedules A to F, in consideration  of  the  vesting
of  the  undertakings.   Rule  9  postulates  that  the  classification  and
transfer of the undertakings, unless otherwise specified in any other  order
made by the Government shall be provisional and shall become final upon  the
expiry of three months from the date of transfer.    According  to  Rule  12
(1) if any doubt, dispute, difference or issue arises in regard to  transfer
under the said Rules, the decision of the  Government  shall  be  final  and
binding on all the parties.
6.    Schedule F of the Rules deals with  the  assets  and  liabilities  and
proceedings concerning distribution and their transfer.  There is a  proviso
to items I, II and III of part I of Schedule ‘F’ which is as follows:-
“PROVIDED THAT notwithstanding I, II and III above and  that  the  land  was
being used immediately before date of the transfer exclusively or  primarily
for the business of the transferee, no part of the land shall form  part  of
the assets transferred under these rules. The transferee shall  be  entitled
to use  such  land  as  a  licensee  of  the  government  on  payment  of  a
consolidated amount of one rupee  only  per  month  during  the  period  the
transferee has the sanction or licence or  authorization  to  undertake  the
transmission  business.  As  and  when   such   licence   or   sanction   or
authorization is revoked or cancelled or not renewed or the area  of  supply
where the land is situated is withdrawn from the transferee, the licence  to
the transferee in respect of such land shall cancelled’’.

Schedule ‘G’ gives details of the assets and liabilities transferred to  the
holding company which includes land and land rights.
7.    Mr. Dhruv Mehta, Senior Advocate, Ms. Madhu Tewatia  and  Ms.  Avanish
Ahlawat, Advocates appeared and made their  submissions  on  behalf  of  the
Distribution Company, the Corporation and the Government respectively.
8.    Mr. Dhruv Mehta, submitted that the Government  continues  to  be  the
owner of the land in question and hence there is an exemption  from  payment
of property tax as per Section 119 of the Delhi Municipal  Corporation  Act,
1957.  It is his further submission that, in  any  event,  the  Distribution
Company is a licensee under the Government  as  per  the  Delhi  Electricity
Reforms (Transfer Scheme) Rules, 2001 and hence it does not fall within  the
preview of Section 120 of the Delhi Municipal Corporation  Act,  1957.    He
also submitted that the Government of NCT of Delhi  has  taken  a  categoric
stand that the land belongs to the Government. He relied  upon  the  Cabinet
decision dated 06.01.2001 and other clarifications issued by the  Government
in this regard.  Mr. Mehta relied upon Rule 12 (1) of the Delhi  Electricity
Reforms (Transfer Scheme) Rules, 2001 to contend that  the  opinion  of  the
Government regarding the ownership of the land is final and  binding.    Mr.
Mehta  also  submitted  that  the  Division  Bench  committed  an  error  in
remanding the matter back to the Authority after recording the finding  that
Tata Power Delhi Distribution Ltd. is only a licensee.
9.    Ms. Madhu Tewatia, Advocate appearing for  the  Corporation  submitted
that the land belongs to Delhi Power  Company  Ltd.  which  is  the  holding
company in accordance with Schedule G of the  Transfer  Scheme  Rules.   She
further submitted that Rule 120 (1) (c) of the Delhi  Municipal  Corporation
Act, 1957 would be clearly applicable to the facts of the  instant  case  as
the Distribution Company has the right to  let  out  the  land  in  dispute.
This liability to pay  the  property  tax  under  Section  120  (1)  (c)  is
irrespective of the fact that the land belongs to the Government or  to  the
holding company i.e. Delhi Power Company Ltd.  Ms.  Tewatia  contended  that
the clarifications issued by the Government and the Cabinet decision  relied
upon by the Distribution Company would not fall within the preview  of  Rule
12(1) of the  Transfer  Scheme  Rules.   She  contended  that  the  findings
recorded by the Division Bench to the effect that the  Distribution  Company
is a licensee and that the  licence  relating  to  land  alone  would  be  a
decisive  factor  to  determine   ownership   without   reference   to   the
distribution licence are not correct.
 10.  Ms. Avanish Ahlawat, Advocate, appearing for the Government  submitted
that the Government is the owner of the land, there is no transfer  of  land
to the holding company and that the entry land and land rights as  found  in
Schedule G should not be given too much importance and has  to  be  read  in
conjunction with the other provisions of Schedule F and the other Rules.
11.   We have carefully considered the submissions  made  and  examined  the
material on record.  The first point that falls  for  our  consideration  is
exigibility of tax over the land of 8,080 sq. meters.  Section  119  of  the
Delhi Municipal Corporation Act exempts the properties  of  the  Union  from
taxation.  We entertained a doubt about the properties of Union  Territories
being treated as properties of  the  Union.   The  administration  of  Union
Territories is by the Central Government but that does not mean  that  Union
Territories become merged with the Central Government.  They  are  centrally
administered but retain their independent entity.  [See:  Satyadev  Bhushari
Vs. Padam Dev & Ors. (1955) 1 SCR 549; Government of NCT Delhi and ors.  Vs.
All India Central Civil Accounts, JAO’s Association and ors.  (2002)  1  SCC
344; Chandigarh Administration and Anr. Vs. Surinder Kumar and Ors (2004)  1
SCC 530].  But, we refrain from adjudicating this  issue  as  constitutional
questions are not decided unless they directly arise for consideration.
12.   Dismal performance of the Electricity Boards  led  to  a  decision  of
unbundling generation, transmission and distribution activities  which  were
separated  for  increasing  efficiency.   Private   participation   in   the
Electricity industry was also  envisaged.  Broadly  understood,  the  scheme
contemplated by the Delhi Electricity  Reforms  Act  and  the  Rules  framed
therein is that the assets of the erstwhile  Delhi  Vidyut  Board  initially
stood  transferred  and  vested   absolutely   in   the   Government.    The
undertakings were transferred to generation, transmission  and  distribution
companies.  The shares of these  companies  were  allotted  to  the  Holding
Company  which  is  Delhi  Power  Company  Ltd.  which  is  a  wholly  owned
Government company.  Land and land  rights  also  were  transferred  to  the
Holding Company. Thereafter the process  of  privatization  takes  place  by
divesting shares in the  distribution  companies.   It  is  clear  that  the
transfer of all the assets including land to the Government is a  transitory
step as the Holding Company is  to  be  in  total  control.   In  the  above
background, the question is whether the land belongs to the  Government  and
exempt from tax.  No doubt, all the  assets  of  Delhi  Vidyut  Board  stood
transferred and vested in  the  Government.   It  is  also  clear  that  the
distribution undertaking with assets mentioned in Items I, II & III of  Part
I of Schedule F were transferred to the Distribution Company.   The  proviso
to Items I, II & III of Part I of Schedule F to the  Transfer  Scheme  Rules
contemplates that land which was exclusively and primarily  being  used  for
business purpose by the transferee before the transfer does  not  form  part
of the assets transferred and the transferee would  be  a  licnesee  of  the
Government for the said land on payment of a nominal amount.   Schedule  ‘G’
deals with transfer in favour of the  Holding  Company  and  land  and  land
rights is one of the entities therein.  Mr. Mehta submits that the  transfer
of assets and liabilities are dealt with in Schedule F and it is clear  from
the said Schedule that  the  Distribution  Company  is  a  licensee  of  the
Government.  He further submitted that Government continues to be the  owner
of land and the entry land and land rights is vague and has  to  be  ignored
as it is  not  applicable  to  the  land  already  covered  by  Schedule  F.
Whereas, the case of the Corporation  is  that  there  is  no  ambiguity  in
Schedule G.  Land was transferred to the Holding Company and Section 119  of
the Delhi Municipal Corporation Act is not applicable.  The High Court  held
that the initial transfer and vesting of land is  in  the  Government,  then
Distribution Company  becomes  licensee  of  the  Government  qua  land  and
finally there is a transfer of land to the Holding Company.  In view of  the
fact that Government was not to hold any asset and the vesting  of  land  in
the Government was only transitory in nature, we uphold the findings of  the
High Court that Holding Company is the owner of land.
13.   We proceed to  deal  with  the  point  as  to  whether  there  is  any
contradiction in Schedule ‘F’ and ‘G’ pertaining to the ownership  of  land.
We see no conflict in the two Schedules.  The proviso to items I to  III  in
Part I of Schedule ‘F’ refers to land which was  exclusively  and  primarily
being used for the purpose of business by the  transferee  on  the  date  of
transfer  not  forming  part  of  the  assets  transferred  to  Distribution
Company.  Such land would be subject matter of a licensee by the  Government
in favour of the transferee. Only such land which  satisfies  the  condition
as stated above will be treated as licensed to transferee.  All other  lands
would be part of land transferred to the Holding Company as contemplated  in
Schedule ‘G’.  Hence, we see no conflict in the Schedules.
14.   Another issue connected to the ownership of the land is the  stand  of
the Government that the land continues  to  be  vested  in  the  Government.
Reference was made  to  the  Cabinet  decision  dated  06.01.2001.  M/s  SBI
Capital  Market  Limited  (referred  to  as  ‘SBI  Caps’  hereinafter)   was
appointed by Delhi Vidyut Board for restructuring of the  Board.   A  report
was submitted by the SBI Caps by which they recommended  that  the  land  in
possession of Delhi Vidyut Board which were earmarked  for  the  purpose  of
electricity generation, transmission and distribution  cannot  be  used  for
any other purpose without bringing  about  a  change  in  land  use  by  the
Competent Authority.  The SBI Caps further recommended  that  the  ownership
of the land should be retained by the State Government and  land  should  be
provided on licence to the successor entities. This recommendation  made  by
the Consultant i.e. SBI  Caps  was  approved  in  the  Cabinet  decision  on
06.01.2001.  Apart from the said Cabinet decision, we were also  shown  some
material which indicated that the Government was maintaining its stand  that
the land belongs to them.  As we have  interpreted  the  provisions  of  the
Act, Rules and the Transfer Scheme to conclude  that  the  land  transferred
and vested in the Holding Company, the  Cabinet  decision  dated  06.01.2001
which  was  much  prior  to  the  Statutory  Scheme  cannot  be  taken  into
consideration to reach a different conclusion.
 15.  Another issue that calls for consideration is relating  to  the  scope
of Rule 12 (1) of the Transfer Scheme Rules.  Rule 12(1) of the Rules  reads
as under:-
      “Decision of Government final:- (1) If any doubt, dispute,  difference
or issue shall arise in regard to the transfers under these  rules,  subject
to the provisions of the Act, the decision of the Government thereon,  shall
be final and binding on all parties.”

            The stand of the Government that the land continues to  vest  in
it would not amount to a decision by the Government in resolving  a  dispute
between the parties  to  the  Transfer  Scheme.   Rule  12(1)  will  not  be
applicable in the instant case as the interpretation of  the  provisions  of
the statute and the rules is involved in adjudication of the dispute.
16.   A similar provision  fell  for  consideration  before  this  Court  in
Municipal Commissioner of Dum Dum and Ors. Vs.  Indian  Tourism  Corporation
and ors., reported in (1995) 5  SCC   251.   The  issue  in  that  case  was
whether the properties vested in  the  International  Airport  Authority  of
India could be called as properties of the  Union,  within  the  meaning  of
Article 285 of the  Constitution  of  India  and  exempted  from  tax.   The
Government of India asserted that the properties of the  Authority  are  the
properties of the Union and reliance was placed on certain  letters  of  the
Government for the above  assertion.  Section  12(3)  of  the  International
Airport Authority of India Act, 1971 provided that decision of  the  Central
Government shall be final, if any dispute or doubt arises, as  to  which  of
the properties, rights or liabilities of the Central  Government  have  been
transferred to the Authority.  Interpreting the said provision,  this  Court
held that a dispute under Section 12(3)  should  be  between  the  Union  of
India and the Authority.  It was also held that the decision would not  bind
the Municipal Corporation.  In addition to the points mentioned  above,  Ms.
Madhu  Tewatia  submitted  that  there  was  no  opportunity  given  to  the
Municipal Corporation by the Government before taking such stand.   In  view
of the above discussion, we uphold the findings  recorded  by  the  Division
Bench in the impugned judgment that the Government is not the owner  of  the
land.
17.   Having answered the point about the  exigibility  of  tax,  the  point
which remains to be decided is the incidence of tax.  Section 120(1) of  the
Delhi Municipal Corporation Act reads as follows:-
“120. Incidence of property taxes
(1) The property taxes shall be primarily leviable as follows:—
 (a) if the land or building is let, upon the lessor;
(b) if the land or building is sub-let, upon the superior lessor;
(c) if the land or building is unlet, upon the person in whom the  right  to
let the same vests:
Provided that the property taxes in  respect  of  land  or  building,  being
property of the Union, possession of which has been delivered  in  pursuance
of section 20 of the Displaced  Persons  (Compensation  and  Rehabilitation)
Act, 1954 (44 of 1954), shall be primarily leviable upon the transferee.”

18.   The High Court remanded the matter back to  the  Deputy  Assessor  and
Collector of Municipal Corporation of Delhi for determination as to  whether
the Distribution Company or the Holding Company  i.e.  Delhi  Power  Company
Ltd. is liable to pay the property tax.   The  High  Court  also  said  that
Holding Company was not a party to the case and  in  view  of  the  findings
recorded in the judgment that the Holding Company is the owner of the  land,
the matter has to be decided by the  Assessing  Authority  after  giving  an
opportunity to the Holding Company.
19.   According to Section 120 (1) (c), the person who has a  right  to  let
would be liable to pay tax for un-let land.   Admittedly, this land  is  un-
let.  Incidence of tax has to be decided by the Authority after taking  into
consideration the provisions of the Act, rules and the  licences,  including
the distribution licence.  The High Court held that the  licence  pertaining
to land as per the Transfer Scheme would show that the Distribution  Company
is only a licensee and not a lessee. The High Court further  held  that  the
distribution licence under Section 20 of the Delhi Electricity Reforms  Act,
2000 is distinct and separate from the licence for  land.   It  was  further
held by the High Court that the distribution licence can neither govern  nor
be used as a tool to interpret the licence for land.   We do not agree  with
the said findings of the High Court. Section 120 (1) (c)  contemplates  that
a person who has the right to let out un-let land  is  liable  to  pay  tax.
His status as a lessor or  licensee  is  irrelevant.   If  the  distribution
licence  empowers  the  Distribution  Company   to   let   out   the   land,
notwithstanding the fact that the Distribution Company is a licensee as  per
Schedule ‘F’ of the Transfer Scheme Rules, it would still have  to  pay  the
tax.  For the reasons afore-stated, we confirm the order  of  remand  passed
by the High Court in the impugned judgment with a direction  to  the  Deputy
Assessor and Collector of Municipal Corporation of  Delhi  to  consider  the
provisions of Delhi Municipal Corporation  Act,  Delhi  Electricity  Reforms
Act, Transfer  Scheme  Rules  and  the  Distribution  licence  issued  under
Section 20 of the Delhi Electricity Reforms  Act  for  deciding  the  matter
pertaining to the incidence of tax.
      The appeals are disposed of in terms of the above directions.
                                        ................................J.
                                                         [ANIL R. DAVE]



                                        ................................J.
                                                     [L. NAGESWARA RAO]

New Delhi;
August 10, 2016