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Telangana HC Sets Aside Final Notice Adding Property Tax Penalty Without Prior SCN

Case Law Details

Case Name
Geetha Educational Society Vs State of Telangana (Telangana High Court)
Date of Judgement/Order
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Geetha Educational Society Vs State of Telangana (Telangana High Court)

The Telangana High Court considered a writ petition concerning proceedings issued by Chandur Municipality against Geetha Educational Society. A show cause notice dated 02.06.2026 alleged irregularities relating to the layout and building constructed on the subject property and required the petitioner to submit relevant documents within three days. The petitioner replied on 10.06.2026, stating that the building had been constructed as per the approved plan issued by the Gram Panchayat on 16.03.2012 and that property tax of Rs.40,573 for 01.04.2025 to 31.03.2026 had been paid.

The petitioner challenged a final notice dated 24.07.2026 alleging failure to produce approved building permission, avoidance of property tax on additional areas, and operation of a co-educational hostel in a residential area without permission. The notice threatened closure, removal of the hostel, revision and recovery of property tax with penalty, and other legal action.

The Court observed that the final notice did not discuss the petitioner’s reply dated 10.06.2026. It further noted that the original show cause notice contained no allegation regarding unauthorised construction or hostel use and made no reference to tax or revision. Holding that the impugned proceedings violated principles of natural justice, the Court set them aside without entering into the merits. The Municipality was directed to pass orders pursuant to the original show cause notice after considering the petitioner’s reply within four weeks.

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FULL TEXT OF THE JUDGMENT/ORDER OF TELANGANA HIGH COURT

1. Heard Mr. Praveen Kumar Veerjala, learned counsel for the petitioner; Mr. P. Krishna Reddy, learned Standing Counsel for Chandur Municipality – respondent No.2; and perused the material on record.

2. Show Cause Notice No.C/l 89/MCC/2026 dated 02.06.2026 was issued to the petitioner by respondent No.2 – Chandur Municipality stating that a complaint has been received regarding irregularities in respect of the layout developed and the building constructed in the subject property and the petitioner was directed to submit relevant documents / information within three (3) days there from.

3. The learned counsel for the petitioner submitted that in response to the show cause notice dated 02.06.2026, the petitioner submitted reply dated 10.06.2026 asserting that the subject building was constructed as per the approved plan issued by the Gram Panchayat vide Proceedings No.GP/12/2012 dated 16.03.2012. The subject property was mutated in the name of the petitioner Society viz., Geetha Educational Society and property tax of Rs.40,573/- (Rupees forty thousand five hundred and seventy three only) for the period 01.04.2025 to 31.03.2026 was paid vide on line tax receipt dated 30.04.2025.

4. Grievance of the petitioner is that without considering its reply dated 10.06.2026 submitted to the show cause notice dated 02.06.2026, Final Notice Lr.No.G1/01/MCC/2026 crated 24.07.2026 was issued by respondent No.2 stating that the petitioner failed to produce approved building permission, avoiding property tax for the additional areas and operating a co-educational hostel in the residential area without permission from the competent authority, and directed the petitioner to forthwith comply with the above directions, failing which, action will be initiated for closure of hostel and for removal of unauthorised hostel, revision and recovery of property tax with penalty and other legal action.

5. As seen from the impugned proceedings, no discussion is made regarding the reply dated 10.06.2026 submitted by the petitioner to the show cause notice. There is no allegation in the show cause notice dated 02.06.2026 that the petitioner has constructed the subject building unauthorisedly and is using the same for running a co-educational hostel; and further there is no mention regarding tax and revision.

6. Thus, as the impugned proceedings were issued in violation of the principles of natural justice, without entering into merits of the matter, the impugned notice is set aside. Respondent No.2 is directed to pass orders pursuant to the show cause notice dated 02.06.2026 by duly considering the reply dated 10.06.2026 submitted by the petitioner within a period of four (4) weeks from the date of receipt of a copy of this order. Accordingly, the writ petition is disposed of, at the admission stage itself. No order as to costs.

As a sequel thereto, miscellaneous applications. if any, pending in the writ petition stand closed.

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Author Info

CA Sandeep Kanoi
Qualification: CA in Job / Business
Company: Taxguru Consultancy
Location: Mumbai, Maharashtra
Articles Published: 18,194

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