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No coercive action must be taken against JNPT: SC

delhi Updated: Jun 09, 2010 20:42 IST
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The Supreme Court has instructed the state authorities to refrain from taking any coercive action against the Jawaharlal Nehru Port Trust (JNPT) with regard to the payment of property tax to village panchayats surrounding its port establishments.

The state-owned JNPT had approached the Supreme Court, seeking relief from a Rs 129-crore village property tax demand by surrounding village panchayats for setting up port-related infrastructure in the area.

A vacation bench, comprising Justices Deepak Verma and K S Radhakrishnan, issued notices to 11 gram panchayats surrounding India’s busiest container port located near Mumbai. The court also said, "Until the next date of hearing, no coercive steps shall be taken" against the Board of Trustees of the JNPT, which runs the port.

The court also reassured the gram panchayats seeking payment of the tax by saying,"It (JNPT) is a government's undertaking and your amount (duty) is safe". The court's direction came over a petition filed by the JNPT, challenging a Bombay High Court order that refused to stay tax demands by the panchayats under the Bombay Village Panchayat Act.

The JNPT was directed to approach the standing committee formed by the state government for the relief. During the proceedings, senior advocate P S Patwalia --the counsel appearing for the port trust -- submitted that the panchayats were yet to determine the final amount.

"Earlier, it was Rs 54 crore. Then, in High Court, it (duty) became Rs 129 crore and before the standing committee, they have not even mentioned the amount," he submitted. JNPT's counsel further submitted that the port trust was ready to give a bank guarantee for the tax, but that would happen only if the standing committee fixes the amount. The panchayats are demanding property tax from the port from 1983, when the port was established, to 2009. They have also approached the Bombay High Court seeking payment of tax.