Municipalities cannot enforce retrospective property tax enhancement without prior notice and a reasoned decision.

The petitioner challenged the enhancement of property tax from ₹404 to ₹2266.40, applied retrospectively from the first quarter of 2015-16

Initially, the petitioner approached the High Court in 2019 (WPA 8524 of 2019), which directed the Kalyani Municipality to consider her representations

The Municipality contended that the representations could not be disposed of because the petitioner failed to submit required documents, including the lease hold indenture, mutation certificate, and sanctioned building plan

Despite the 2019 order, the Municipality continued to demand the enhanced rate and failed to pass a final order on the valuation

1. Whether the Municipality can demand enhanced property tax without first disposing of the petitioner's pending representations as per a previous court mandate

2. Whether the Municipality’s initial determination of enhanced tax was valid given the lack of notice to the petitioner and the absence of clear documentation

The core legal rule dictates that whenever a statutory body enhances a tax liability—especially with retrospective effect—it must provide the assessee with notice and a fair hearing

An administrative body must take an "informed decision" based on relevant documents and cannot leave a court-mandated representation unresolved indefinitely while enforcing the contested demand

The Court observed a contradiction in the Municipality’s position: the Municipality claimed it could not determine the tax because the petitioner failed to disclose documents, yet it had already issued bills at an enhanced rate

The Court noted that the enhancement from ₹404 to ₹2266.40 was done without any prior notice to the petitioner

While the petitioner was found to be partially at fault for not paying even the admitted "old rate" during the dispute, the Court held that the Municipality's failure to comply with the 2019 direction necessitated a fresh, time-bound determination

The petitioner was ordered to submit all required documents and pay arrears calculated at the old rate within two weeks

The Court held that the decision to enhance property tax shall only be effective from the 1st quarter of 2015-16 upon a "fresh decision" following a hearing

Crucially, the Court ordered that the Municipality shall not be entitled to levy any penalty charges, late fees, or interest on the arrear amounts during this period