Airtel liable to pay Property Tax for Laying of Underground Cable: Chhattisgarh High Court [Read Judgment]

The Chhattisgarh High Court has held that the petitioner Bharati Airtel Limited is liable to pay property tax in respect of or otherwise relating to underground cable laid for the purpose of providing telephone services or other telecommunication facilities.

The petitioner has been granted a licence by the Government of India to establish, maintain and operate telephone services in the area described as M.P. Circle covering present Chhattisgarh also. In order to provide telephone services, the petitioner has laid telecommunication cable in different parts of the State of Chhattisgarh including within municipal limits of the city of Raipur and Bhilai.

For digging the soil in public streets and/or the land belonging to local authorities/municipal corporation, the petitioner has obtained permission under Section 12 of the Indian Telegraph Act, 1885 (hereinafter referred to as ‘the Act, 1885’). Under Section 19-B of the Act, 1885, a licensee is conferred power of telegraph authority whereas Section 10 of the Act, 1885 authorizes telegraph authority including licence to place and maintain telegraph lines and posts under, over along, or across and in or upon any immovable property subject to the conditions provided in the said section. However, Section 10 (c) provides that ‘except as hereinafter provided, the telegraph authority shall not exercise those powers in respect of any property vested in or under the control or management of any local authority, without the permission of that authority.’

While dismissing the petition, Justice Prashant Kumar Mishra observed that, “In the return filed by both the Municipal Corporations of Raipur and Bhilai, it has been stated on oath that the respective Municipal Corporation has passed a resolution to impose property tax for the use of land for laying underground cable on the basis of per running meter. Based on the resolution, assessments on the basis of records were carried and such data for laying underground cable has been used for the imposition of property tax against all the telephone/cellular companies like BSNL, Reliance, Airtel, etc. Thus it appears, the Corporation has followed the procedure prescribed under the Act, 1956 for carrying out an assessment before issuing demand notice and there is absolutely no violation of the provisions of the Act, 1956”.