The Supreme Court has ruled that a lawyer doing his practice from a residential building was not liable to pay property tax under the Delhi Municipal Corporation Act.
The Bench of Justice BV Nagarathna and Justice Augustine George Masih, while refusing to interfere with the Delhi High Court order, noted that the ‘professional’ activity of an advocate did not fall within the category of ‘business’ activity and hence, he was not liable to pay property tax for a commercial establishment.
Dismissing the Special Leave Petition filed by the South Delhi Municipal Corporation, the Bench said it was not inclined to interfere with the High Court order.
The Municipal Corporation of India (MCD) had contended before the High Court that a lawyer’s services fell within the sphere of professional activity, and a part of a building used for professional activity would fall within the definition of a ‘business building.’
The respondent had submitted that the ‘power’ to tax must be expressed; otherwise, there was no power to tax. Under the Delhi Municipal Corporation Act, 1957 (DMC Act), there was no power to tax professional activities carried out in residential buildings, it added.