NAVI MUMBAI: The Supreme Court ruled on Wednesday that the Navi Mumbai Municipal Corporation (NMMC) has the authority to collect property tax in the Thane Trans Creek-MIDC area, commonly referred to as the Thane-Belapur industrial corridor.
This decision, stemming from a case brought forth by the Small Scale Entrepreneurs Association (SSEA) regarding the Thane Trans Creek-MIDC area, allows NMMC to impose property taxes on more than 3,000 industries in the corridor.
In 2001, the SSEA petitioned the Bombay High Court against NMMC’s property tax orders, arguing a jurisdictional dispute since MIDC also charged service fees in the area. The High Court sided with NMMC, prompting the SSEA to contest the ruling in the Supreme Court in 2010.
The Supreme Court clarified that the entire TTC-MIDC area falls under NMMC’s jurisdiction, referencing the Maharashtra Municipal Corporation Act, the Maharashtra Industrial Development Act of 1961, and the Maharashtra Regional Planning and Town Planning Act of 1966.
The Court also emphasized that taxes and fees are distinct, affirming that the right to impose taxes lies solely with municipal corporations as local governing bodies. Fees are merely charges for specific services and don’t equate to taxes, as noted by the Court.
The SC confirmed that MIDC can only levy fees, not taxes, and clarified that NMMC’s tax authority derives from Sections 127 and 128A of the MMC Act. “Claims of double taxation have been dismissed as the Supreme Court clarified the difference between tax and fee in designating NMMC as the tax authority for the area,” officials asserted.
Municipal Commissioner Kailas Shinde expressed to TOI that this ruling resolves the long-standing dispute surrounding property tax in the TTC-MIDC area, clearing the path for tax collection by the municipal corporation.
He emphasized that the revenue generated from property taxes will aid in ongoing city development projects and urged small entrepreneurs to contribute towards the city’s progress by paying their property taxes, in light of the SC ruling. The outstanding property tax dues exceed Rs 800 crore.
K R Gopi, former president of SSEA and current president of the TTC-MIDC Industries Association, stated, “We plan to contest the court’s decision by filing a review petition. We will reiterate our argument against what we consider dual taxation by both MIDC and NMMC.”
