The Supreme Court issued an order on Wednesday declaring that the Navi Mumbai Municipal Corporation (NMMC) holds the authority to collect property tax in the Thane Trans Creek-MIDC region, which is recognized as the Thane-Belapur industrial corridor.
This ruling, resulting from a case brought forth by the Small Scale Entrepreneurs Association (SSEA) concerning the Thane Trans Creek-MIDC area, facilitates the NMMC’s collection of property tax from more than 3,000 industries situated along the corridor.
In 2001, the SSEA submitted a petition to the Bombay High Court contesting NMMC’s property tax collection directive, citing a jurisdictional conflict due to the MIDC also imposing service charges in the region.
The High Court ruled in favor of NMMC, prompting the SSEA to appeal the decision to the Supreme Court in 2010. Regarding the jurisdiction of the TTC-MIDC area under NMMC, the Supreme Court affirmed that the entire region falls within NMMC’s jurisdiction according to the provisions of the Maharashtra Municipal Corporation Act (MMC), the Maharashtra Industrial Development Act, 1961 (MIDC), and the Maharashtra Regional Town Planning Act, 1966 (MRTP).
The Supreme Court clarified that taxes and fees are distinct entities, asserting that the authority to impose taxes resides with the municipal corporation as a local self-governing body. Fees are charged as a surcharge or compensation for services rendered and are not classified as taxes, as stated by the court.
Furthermore, the Supreme Court indicated that the MIDC is permitted to impose fees but not taxes, and it confirmed that NMMC possesses the authority to levy taxes under Sections 127 and 128A of the MMC Act. Officials noted, “The assertion of double taxation has been demonstrated to be incorrect, as the apex court elucidated the distinction between tax and duty while establishing NMMC’s tax-levying authority for this area.”
Municipal Commissioner Kailas Shinde informed that this ruling has resolved the long-standing issue of property tax collection in the TTC-MIDC area, which has been pending in court for several years, thereby clearing the way for the municipal corporation to proceed with tax collection.
He additionally stated that the urban development initiatives are being funded through the tax revenue collected by the municipal authority, and this revenue will provide a fresh impetus for the advancement of the city. He urged all small business owners to support the city’s growth by fulfilling their property tax obligations in accordance with the Supreme Court’s ruling.
The outstanding property tax liabilities exceed Rs 800 crore. K R Gopi, former president of SSEA and current president of the TTC-MIDC Industries Association, remarked, “We will contest the court’s ruling by submitting a review petition. We will reiterate our argument. We are opposing the issue of dual taxation imposed by both MIDC and NMMC.
