Allahabad High Court Upholds Ghaziabad Municipal Corporation's Property Tax Increase
The Allahabad High Court has delivered a significant verdict, refusing to interfere with the Ghaziabad Municipal Corporation's (GMC) decision to hike property tax. This ruling deals a blow to residents who have seen their tax bills surge by three to four times due to the revision. The court's decision underscores the legal validity of the corporation's approach, leaving many households grappling with substantially higher annual payments.
Court Dismisses Petition Filed by Former Councillors
On Wednesday, a division bench comprising Chief Justice Arun Bhansali and Justice Kshitij Shailendra dismissed a petition filed by three former GMC councillors. The bench held that the corporation's method of fixing the minimum monthly rent rates (MMRR) and revising property tax based on this framework was legally sound. In its order, the court stated, "We neither find any error in determination of ‘MMRR' nor any illegality in the impugned decision to revise/enhance the property taxes based upon ‘MMRR'." It further emphasized that the exercise was "fully in consonance with the statutory provisions" and required no judicial intervention, concluding, "The petition has no substance and the same is, therefore, dismissed."
Background of the Tax Revision and Public Outcry
The dispute traces back to April 1 last year, when GMC implemented a new property tax slab aligned with district magistrate circle rates. Under this revised structure, rates escalated from approximately Rs 0.7 to Rs 4 per square foot. Residents alleged that this change resulted in an additional annual tax burden of around Rs 5,000 for many households. The tax slab varied based on road width:
- Properties along roads under 12 metres: taxed from Rs 0.3 to Rs 1.6 per sq ft.
- Properties on 12-24 metre roads: taxed from Rs 0.5 to Rs 2 per sq ft.
- Properties on wider roads: taxed from Rs 0.65 to Rs 2.4 per sq ft.
This revision sparked widespread protests by Resident Welfare Associations (RWAs) and other stakeholders, leading the GMC board to initially repeal the hike. However, the corporation continued issuing notices to defaulters using the revised slab, keeping the controversy alive. In May last year, the former councillors approached the high court, arguing that municipal rules permit a property tax hike only once every two years. They highlighted that taxes had already increased by 10% in 2023-24 and were raised again in 2024-25.
Official Responses and Future Implications
A GMC official welcomed the ruling, stating it settles the issue around the new tax structure. The official explained, "GMC calculates property taxes on the annual rental value (ARV). At present, the civic body's consumers are over 6 lakh. With increased taxes, the corporation will generate additional revenue of over Rs 60 crore." This revenue boost is expected to aid in municipal development projects, though it comes at a cost to residents.
Co-petitioner and former councillor Rajendra Tyagi expressed disappointment, noting, "While the court's decision went in favour of GMC, we are mulling other legal options." This suggests potential further legal challenges, though the current verdict stands firm.
Mayor Sunita Dayal acknowledged public anger, pointing to temporary relief measures she implemented. She said, "The opposition by residents was very much understandable. So, I kept extending the rebate on property taxes for four months in a row. Now, after the court's decision, the matter stands closed." Her comments reflect an attempt to balance civic needs with resident concerns, though the tax hike remains in effect.
Conclusion: Legal and Financial Ramifications
The Allahabad High Court's dismissal of the petition solidifies GMC's authority to revise property taxes, setting a precedent for similar municipal actions. Residents must now contend with the financial impact, while the corporation gains a significant revenue stream. The case highlights the tension between urban governance and taxpayer rights, with legal avenues largely exhausted for now. As Ghaziabad moves forward, the focus shifts to how this additional revenue will be utilized for public welfare and infrastructure improvements.
