BMC to recover tax from 40 hospitals

Mumbai: The Brihanmumbai Municipal Corporation (BMC) will be issuing attachment notices to around 40 private hospitals in the city that have failed to pay property taxes since 2002. These hospitals, which are a part of the Association of Hospitals (AOH), have also failed to comply with the court order that states that they must deposit 50 per cent of the amount, according to the BMC. This has led to the court allowing the civic corporation to recover this amount running into crores of rupees from the hospitals, in accordance to the law.

In 2002, the hospitals had approached the HC against the BMC’s decision to not to grant them exemption from paying property tax. The HC had then ordered them to pay 50 per cent of the property taxes they were supposed to pay. But, they did not comply with the court’s orders.

According to the BMC counsel some of the major private hospitals in the city that are part of the AOH are likely to action for non-payment of taxes. A bench of Justice Rajesh Ketkar was hearing a notice of motion filed by the BMC in a writ petition that had been filed by the AOH in 2002, disposed and again revived in 2017.

The counsel for the BMC, advocate Suresh Pakale however reminded the court that a previous court, as interim relief, had directed the AOH to pay 50 per cent of the amount demanded by the BMC and also given BMC the liberty to recover the unpaid tax in accordance with law. But, the hospitals had still not paid the taxes. Hence the notice of motion was filed for dismissal of the petition and to recover the outstanding tax amount.

But, the counsel for AOH argued that a division bench had set the order of 2002 aside in 2006, which is why the hospitals had not paid the tax. The argument was however refuted by Pakale saying that as the writ had been revived it did not mean that interim orders were also revived. So, the hospitals were supposed to pay the taxes nonetheless.

TIMELINE OF TAX EXEMPTION CASE 

2002: AOH files a writ petition against BMC for not granting them exemption from paying property tax. The HC directed AOH to pay 50 per cent of the property tax.
2006: AOH challenged the 2002 decision and a division bench had set aside the 2002 order.
2011-2014: Individual hospitals like Kokilaben and Saifee filed separate writs but court asked them to go by 2002 order.
2017: Court asks AOH to pay 50 per cent of the tax and allows BMC liberty to recover unpaid taxes.