Chapter – XX) Local Government Taxes, Fees, Rates and Tolls

Chapter – XX) Local Government Taxes, Fees, Rates and Tolls #

99.       Authority of a local government to levy taxes etc.– #

(1) A local government may, through a notification published in the official Gazette, levy all or any of the taxes, fees, rates, tolls, rent and other charges given in the Fifth Schedule.

(2)       Every resident shall, where applicable, pay toll, tax, fee, rates or other charges imposed by the local government, allow officers and servants of the local government reasonable access to his property in relation to the performance of their duties, and comply with bye-laws and instructions of the local government applicable to him.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
115	156	99	108	99

RELEVANT INSTRUCTIONS / ADVICE
1.	Letter No. SOTAX (LG) 2-46/2008(PI), Govt. of the Punjab, LG&CD Department dated 20.02.2011 regarding “Collection of Tax on Transfer of Immovable Property Tax by TMAs”.

100.     Procedure for imposition, revision or abolishment of a local tax, fee, etc.– #

(1) A Head may make proposal with respect to:

(a)        levy of a new tax, fee, rate, rent, toll or other charges under the Act; or

(b)       increase or reduction in the incidence of a tax, fee, rate, rent, toll or other charge or otherwise revision of a tax, fee, toll or other charges which is for the time being in force under the Act; or

(c)        suspension or abolishment of a tax, fee, rate, rent, toll or other charges which is for the time being in force under the Act; or

(d)       exemption of any person or class of persons, or property or goods or class of property or goods, or services or other things from the levy of a tax, fee, rate, rent, toll or other charges which is for the time being in force under the Act.

(2)       Every proposal for levy of a tax, fee, rate, rent, toll or other charges under subsection (1) shall, amongst others, mention:

(a)        the class of persons, or description of property or goods, or services or other things on which the proposed tax, fee, rate, rent, toll or other charges shall apply;

(b)       the method of assessment of the proposed tax, fee, rate, rent, toll or other charges; and

(c)        the incidence at which the tax, fee, rate, rent, toll or other charge is to be levied.

(3)       As soon as may be after making of a proposal under subsection (1), the Head shall, through a public notice, invite suggestions and objections on the proposal mentioning therein, amongst others, the date and time by which the suggestions and objections shall be submitted.

(4)       The last date of submission of objections under subsection (3) shall be fixed in such manner as to allow not less than thirty days commencing from the date of publication of the notice.

(5)       Any resident of the relevant local area or a person affected by the proposal referred to in subsection (1), may submit his suggestions or objections or both in writing to the Chief Officer by the date and time appointed under subsection (3).

(6)       After having considered all suggestions and, as the case may be, objections received under subsection (5), the Head may:

(a)        accept suggestions and objections inasmuch as he deems appropriate and present a revised proposal before the Council in a public meeting; or

(b)       reject the suggestions and objections and present his original proposal before the Council in a public meeting.

(7)       The Council may with a simple majority of votes of existing members, approve the proposal with or without revision.

(8)        The local government shall, through notification in the official Gazette, publish approved tax, fee, rate, rent, toll or other charge, or the suspension or abolishment or increase or decrease of the incidence or any other revision of such tax, fee, rate, rent, toll or other charge.

(9)        Notwithstanding anything contained in the previous local government laws, any tax, cess, fee, rate, rent, toll, charge or surcharge, levied and recovered without fulfilling the requisite procedure or authority, up to the coming into force of the Act, shall be deemed to have been validly levied and recovered under the Act; provided that the tax, cess, fee, rate, rent, toll, charge or surcharge is levied prior to coming into force of the Act.

(10)      Subsection (9) shall apply retrospectively to all legal proceeding before any legal forum.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
115	157	100	109	100

RELEVANT RULES
1.	The Punjab Local Governments (Taxation) Rules, 2016.
2.	The Punjab Local Government (Taxation) Rules, 2001.
3.	The Punjab Local Governments (Tax on Transfer of Immovable Properties) Rules, 2016.
4.	The Punjab Local Government (Tax on Transfer of Immovable Property) Rules, 2001.
5.	The Punjab Local Rate (Assessment and Collection) Rules, 2001.
RELEVANT INSTRUCTIONS / ADVICE
1.	Letter No. SOTAX (LG) 1-1/17(MCL), Govt. of the Punjab, LG&CD Department dated 01.07.2021 regarding “Approval / Gazette Notification of Taxation Proposals of all Local Governments in the Punjab”.
2.	Letter No. SOTAX (LG) 2-1/2017, Govt. of the Punjab, LG&CD Department dated 15.01.2018 regarding “Waiver of Taxes on Establishment of Facilitation and Booths by Telenor Pakistan”
3.	Letter No. SOTAX (LG) 2-61/97-D, Govt. of the Punjab, LG&CD Department dated 09.03.2015 regarding “Exemption of Tax against Van/Kiosk Activity”.
4.	Letter No. SOTAX (LG) 2-42/2008, Govt. of the Punjab, LG&CD Department dated 11.05.2009 regarding “Exemption of Municipal, Taxes on ‘Rickshaw Tongas and Carts’”.
5.	Letter No. SOTAX (LG) 2-45/2008, Govt. of the Punjab, LG&CD Department dated 19.09.2008 regarding “Abolition of Tehbazari Fee”.

101.     Date on which local taxes, fee, etc. become effective.– #

Tax, fee, rate, rent, toll or other charge approved or the suspension or abolishment or increase or decrease of the incidence or any other revision of such tax, fee, rate, rent, toll or other charge under the Act, shall become effective from the commencement of next financial year.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	158	101	110	101

Comments

Sections 99 of the Act is a charging section allowing the local government to levy by publication in the official gazette all or any of the taxes, etc. given in the Fifth Schedule. Payment of tax, etc., where applicable, is mandatory on every resident who is also bound to give to officer and servants of the local government reasonable access to his property in relation to the performance of their duties, and comply with bye-laws and instructions of the local government applicable to him. Previously, the Punjab Local Governments (Taxation) Rules, 2016 were notified under the Punjab Local Government Act, 2013 which provide procedure for levy of the tax, etc., and the same is saved under section 204 of the Act to the extent of consistency. Under the Act, unlike the previous Punjab Local Government Ordinance, 2001 and the Punjab Local Government Act, 2013, a procedure for levy of taxes, etc. has been provided in section 100. Hence, the applicability of the Punjab Local Governments (Taxation) Rules, 2016 is only to the extent of the procedure not provided in section 100.  It is important to note that previously the Punjab Local Government Ordinance, 2001 and the Punjab Local Government Act, 2013 in their respective charging sections 116 and 115 enables Government to vet the taxation proposals prior to the approval of the tax by the local government in order to ensure that the proposal is reasonable and in accordance with law. No such provision of vetting of taxation proposals of the local governments by the Government exists in the Act.

Another important provision provided in sub-section (9) of section 100 is a validity clause also called as grundnorm clause, declaring any tax, cess, fee, rate, rent, toll, charge or surcharge, levied and recovered without fulfilling the requisite procedure or authority under the previous local government laws up to the coming into force of the Act, as validly levied and recovered under the Act. By virtue of sub-section (10) of section 100, Subsection (9) shall apply retrospectively to all legal proceeding before any legal forum. Hence, where any tax, etc. was levied without fulfilling the requisite procedure or authority (not by the elected government) and the same is under judicial review of the court of jurisdiction, provisions of subsection (9) and (10) may be relied upon to defend the litigation.

It is also a settled principle of law that a tax can be levied from the date of official gazette. In the judgment of the Lahore High Court Lahore reported as 2004 MLD 1927 in the case titled “Bata Pakistan Limited v. Government of the Punjab, etc.” it was held that “As to the requirement in section 116(1) that the tax be notified in the official Gazette, learned counsel for the CDG, had no answer. For this reason also, the levy and demand of the impugned amount from the petitioner on account of property tax, is legally not sustainable.”

Section 101 of the Act further provides that the tax once levied shall become effective from the commencement of next financial year. Since some of the taxes are collected on monthly basis and other are collected on yearly basis and most of the them are collected through the contractors by way of award of contract for the next or current financial year under the Punjab Local Governments (Auctioning of Collection Rights) Rules, 2016 (except to collect income from  (a) water rate, building fee, tax on transfer of immovable property, conversion of land use fee, sanitation fee, licence fee and lighting rate; or (b) the income from the demand raised against a specific person and the arrears of which are carried forward), the provision of section 101 has been inserted to ensure that the quantum of the tax remains the same during the financial year.

The Hon’ble Court through judgment reported as PLD 2021 Lahore 108 titled “The Bank of Khyber v. Municipal Corporation, Gujrat” held that any fee that is charged by a local government will be cognizant of the federal statute regarding banks and corporate entities to install their signboards outside their premises as per the Companies Act and the SBP policy. Local governments are authorized to levy taxes and fees provided they are duly notified in the official gazette. Banks and corporate entities are entitled to install signboards/signage without charge of fee subject to any rules or regulations on size, shape provided it does not contain any advertisement material. 

The Hon’ble Lahore High Court Lahore through judgment reported as 2017 CLC Note 140 in the case titled “Abdullah Advertiser v. District Coordination Officer, District Khushab” observed that mere non-framing of rules or bye-laws is not sufficient to invalidate the auction proceedings, Relevant paragraph 6 of the judgment is reproduced below:

“Now while adverting to the merits of the case, it is observed that the petitioners have challenged the auction proceedings mainly on the ground that the respondents since have not framed any rules to this effect in pursuance to the powers vested under The Punjab Local Government Ordinance, 2001, so they are not vested with the authority to conduct auction proceedings. In this regard suffice to observe that when such powers are available in the statute itself, mere non-framing of rules or bye-laws to this effect is not sufficient to invalidate the auction proceedings. Section 116 empowers a Council to levy taxes, cesses, fees rates, rents, tolls, charges, surcharge and levies specified in the Second Schedule and as per Second Schedule Part-III, every Tehsil Council is vested with the authority to levy fee on advertisement. Furthermore section 191 of the Ordinance ibid authorizes the Government to make rules for carrying out the purposes of the Ordinance by way of notification in the official Gazette whereas section 192 ordains that a Zila Council, Tehsil Council, Town Council and Union Council in their ambit of responsibilities, can make bye-laws to carry out the purposes of the Ordinance. It is thus evident that power to levy the fee on advertisement as well as to regulate such activity is available in the basic statute. The failure or omission on the part of Government or Authority concerned to frame necessary rules or bye-laws to that effect cannot be construed as having the effect of rendering the statute nugatory or unworkable. The relevant provisions would remain in field with full force and rigours. Guidance in this regard can be sought from “M.U.A. Khan v. Rana M. Sultan and another” (PLD 1974 Supreme Court 228) wherein Hon’ble Supreme Court of Pakistan held as under:-

“It is universally recognized that as regulatory statutes have to deal with a variety of situations and subjects, it is not possible for the Legislature itself to make detailed regulations concerning them, and, therefore, the Legislature delegates its power to specified or designated authorities to make such detailed regulations, consistent with the statute, for carrying out the purposes of the parent legislation. The power so conferred is generally in the nature of an enabling provision, intended to further the object of the statute, and not to obstruct and stultify the same. As a consequence, the failure or omission of the designated authority to frame the necessary rules and regulations, in exercise of the power conferred on it by the Legislature, cannot be construed as having the effect of rendering the statute nugatory and unworkable. Such an eventuality could arise only if the Legislature indicates an intention to this effect in clear and unmistakable terms.”

The Hon’ble Court in the judgment reported as 2014 CLC 1135 Lahore in the case titled as “Coca Cola Beverages Pakistan Limited v. City District Government, Rawalpindi” , defined the terms “tax” and “fee” in the term that “Tax is a compulsory exaction of money by public authority for public purposes enforceable by law and is not payment for services rendered whereas fee may be generally defined to be a charge for a special service rendered to individuals by some governmental agency or a Local Council under the principle of quid-pro-quo.”

In the judgment reported as PLD 2016 Lahore 355 in the case titled “D.S Textile Mills Limited v. Government of Pakistan”, the Hon’ble Court while defining the term “tax” also draw a distinction between the fee against specific services and a regulatory fee in the following terms:

“15. Our jurisprudence evolved over the years has examined “fee” in the context of services rendered in return i.e., quid pro quo. The recent judgment of the Supreme Court of Pakistan in Durrani Ceramics eloquently summarizes the consistent view of our Courts on the subject in the following manner:

Whereas ‘tax’ is a common burden for raising revenue and upon collection becomes part of public revenue of the State, ‘fee’ is exacted for a specific purpose and for  rendering services or providing privilege to particular individuals or a class or a  community or a specific area. However, the benefit so accrued may not be measurable in exactitude. So long as the levy is to the advantage of the payers, consequential benefit to the community at large would not render the levy a ‘tax.’ (Emphasis supplied).”

20. Examining the constitutional provisions and the jurisprudence developed in and out of Pakistan, it transpires that fee simpliciter or user fee requires a corresponding service to be rendered in return i.e., a quid pro quo. License fee, on the other hand, is architecturally different. It is a fee charged to permit or allow a person to operate within a regulatory scheme. A scheme designed to protect and improve public welfare. While fee has a micro objective of extending services to an identified person; license fee has a more macro objective and is charged to meet the administrative costs of maintaining a regulatory scheme for the benefit of the community, a particular sector or public at large. This distinction is constitutionally recognized under Article 73(3)(a). Fee and license fee are, therefore two distinct sub-species of charges, having their peculiar characteristics, as discussed above. The argument of the petitioners that in the absence of a service in return, license fee amounts to a tax is not sustainable and is opposed to the clear provision of the Constitution. License fee, in essence, is a regulatory fee and not a user fee and does not require a service rendered in return. Hence, the impugned License Fee is constitutionally permissible and legally valid.

21. The determination of rate or quantum of license fee is a matter of concern for the Court. Neither the Ordinance, nor the Rules lay down parameters or formula or guidelines for determination of the rate of license fee. This dimension of the case has not been challenged or argued before the Court. Rule 4 of the Punjab Local Governments (Fees for Licensing and Permits and Licensing of Professions and Vocations) Rules, 2002 provides a methodology for determining license fee, which is the same as under Local Government (Taxation) Rules, 2001. Learned Law Officer has assured the Court that the procedure under the Local Government (Taxation) Rules, 2001 has been followed before determining the quantum of license fee. I therefore, leave this question to be determined in some other case.

22. For the above reasons it is declared that the license fee is in effect a regulatory fee charged to meet and defray the administrative costs of maintaining regulation in the area and is neither a fee (or user fee) which requires services to be rendered in return or a tax to raise revenue for the State. Therefore, the charge of license fee is constitutional and lawful. Petitioners are, therefore, liable to pay the license fee. This petition is, therefore, dismissed.”

The Hon’ble Lahore High Court Lahore in the judgment reported as 2010 YLR 179 titled “Israr Ahmad Khan v. Secretary Local Government” held that The imposition of collection of tax outside the Bus Stand is without lawful authority, for the reasons that, adda fee and parking fee are to be charged from the vehicles, parked in the Adda and which utilized the services of Adda and not from the vehicle plying on the road.

102.     Rating areas and property tax.– #

(1) On commencement of this Act, a rating area in which tax has been imposed or saved under the Punjab Local Government Act, 2019 (XIII of 2019) shall continue to be the rating area within the meaning of the Punjab Immovable Property Tax Act, 1958 (V of 1958) and under this Act until revised.

(2)       Notwithstanding anything contained in Act V of 1958, a local government to which urban immovable property tax relates to, may determine the rate of this tax in accordance with section 100 of this Act.

(3)       If no determination under subsection (2) is made, the rate of urban immovable property tax shall be determined under Act V of 1958.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
116	159	102	111	102

Comments

Provisions relating to levy of property tax and determination of rate of property tax was for the first time inserted in section 117 of the Punjab Local Government Ordinance, 2001 which declared that local areas falling under the defunct Tehsil / Town Municipal Administrations were declared as rating areas within the meaning of the Punjab Urban Immovable Property Tax Act, 1958. The term “rating area” has been defined in Section 2(g) of the Act-1958 as “means urban area where tax is levied under the provisions of this Act.” Accordingly, the Tehsil/Town Municipal Administration was competent to determine the rate of property tax and levy property tax within its local area. Since all tehsils/towns in the Districts/City Districts had become rating areas by virtue of the above provisions of law, issuance of notification of “urban area” under section 3 Punjab Urban Immovable Property Tax Act, 1958 was not required. This legal position has been upheld by the Division Bench of this Hon’ble Court vide judgment dated 19.10.2009 passed in writ petition No.6352/2008. Operative paragraph thereof is reproduced below:

“3. On account of section 117 of the Ordinance 2001 ibid notwithstanding any notification issued under section 3 of the Act 1958 per force of law, all Tehsils in the District are formed part of the rating area and resultantly the tax can be levied thereupon.”

Under Section 31 read with section 191 of the Punjab Local Government Ordinance, 2001, the Government notified District Government Rules of Business, 2001 (“Rules-2001”) for smooth and efficient disposal of work by City/District Government. The Excise and Taxation Department, Government of the Punjab was authorized to assess and collect the property tax by virtue of rules 3(2) read with entry No. (ii)(a)(3) at serial No. 10 under the Head of Revenue of Schedule-II of Rules-2001. The Punjab Local Government Ordinance, 2001 was repealed by the Punjab Local Government Act 2013 which through section 116 saved the previously declared rating areas in which the tax was imposed under the repealed Punjab Local Government Ordinance, 2001. In addition, the Metropolitan Corporation Lahore, Municipal Corporations, Municipal Committees and rural Union Councils having urban characteristics were given exclusive powers to determine higher rate of property tax within their areas in accordance with the provisions of Section 115, after following the procedure prescribed in the Punjab Local Government (Taxation) Rules, 2016 which are still in force by virtue of section 204 of the Act. Rule 2(1)(k) of the said Rules, defines rating area as “rating area as defined in the Punjab Urban Immovable Property Tax Act, 1958 (V of 1958).” Accordingly to rule 2(1)(b) of Rules-2016, the “Assessing Authority” is the Authority defined under the Punjab Urban Immovable Property Tax Act, 1958; and the tax is also to be collected and distributed to the Local Governments as per their respective shares under Section 3-A of the said Act. Rule 6(2) of Rules-2016 provides that for the purpose of expansion of rating areas, Mayor or Chairman shall request the Assessing Authority to carry out survey of an area for levy of property tax. Rule 6(3) of said Rules lays down the criteria to be followed by the Assessing Authority for carrying out the survey of the area. Thereafter, the Mayor or Chairman shall notify an area under said rule 6(3) after satisfaction that the area fulfills all the requirements for levy of property tax. Moreover, as envisaged in transitional provisions under section 153(1) of Punjab Local Government Act, 2013, all taxes, cesses, fees, rates, rents, tolls or charges which were being charged, levied and collected by any office of a local government under the repealed Punjab Local Government Ordinance, 2001 shall continue to be charged, levied and collected under the former Act by the successor local government and every person liable to pay such a tax, cess, fee, rate, rent, toll, charge or any arrear of the tax, cess, fee, rate, rent, toll or charge shall continue to make the payment until such tax, cess, fee, rate, rent, toll or charge is revised, withdrawn or varied. The Punjab Local Government Act, 2013 was repealed by the Punjab Local Government Act, 2019 and according to its section 159 provided that rating area in which tax had been imposed under the Punjab Local Government Act, 2013 shall continue to be declared under the Punjab Local Government Act, 2019. Section 102 of the Act also talks about continuity of the rating area declared under previous enactments for the purpose of property tax. It is worth mentioning here that section 100(9) of the PLGA-2022 contains a grundnorm clause validating the tax, etc. levied and recovered without fulfilling the procedure or authority.

RELEVANT RULES
1.	The Punjab Local Governments (Tax on Transfer of Immovable Properties) Rules, 2016.
2.	The Punjab Local Government (Tax on Transfer of Immovable Property) Rules, 2001.
RELEVANT INSTRUCTIONS / ADVICE
1.	Letter No. SOTAX (LG) 2-22/07, Govt. of the Punjab, LG&CD Department dated 17.08.2017 regarding “Declaration of Rating Areas”.
2.	Letter No. SOTAX (LG) 2-22/07 (P-I), Govt. of the Punjab, LG&CD Department dated 17.08.2017 regarding “Declaration of Rating Areas”
2.	Letter No. SOTAX (LG) 2-22/2007(P), Govt. of the Punjab, LG&CD Department dated 30.11.2011 regarding “Expanding Base of Property Tax”.

103.     Unfair local taxes etc.– #

(1) If at any time, on a representation by the resident of that local area made to it for this purpose or otherwise, it appears to the  Secretary that the incidence of a tax, fee, rate, rent, toll or other charge imposed under the Act is unfair or excessive, the  Secretary may, after affording opportunity of hearing, through an order require the concerned local government to take, within a specified period, measures to remove the objection.

(2)       If a local government fails to comply with the order of the Secretary under subsection (1) to their satisfaction within the specified period, the Secretary, may suspend the levy of the objectionable tax, fee, rate, rent, toll or other charge or of such part thereof until the objection is removed by the concerned local government.

(3)       Any resident of the relevant local area or a person or entity affected by the imposition or levy of a tax, fee, rate, rent, toll or other charges may make a representation to the Secretary under subsection (1).

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	160	103	112	103

Comments

This section provides a legal remedy to resident of local area of a local government to file representation before the Secretary against incident of tax on the ground of being unfair and excessive. The Secretary may if it appears to him after hearing the matter that the tax imposed under the Act is unfair and excessive, he may require the local government concerned to take measures to remove the objection and in case of failure of the local government to remove the objection, suspend the levy until the objection is removed.

RELEVANT INSTRUCTIONS / ADVICE
1.	Letter No. SO.TAX (LG) 1-18/01-T.T.Singh, Govt. of the Punjab, LG&RD Department dated 13.11.2004 regarding “Levy of Illegal Tax in the Name of Road Service Charges by TMAs”.

104.     Duty to furnish information on liability to local tax, fee etc.– #

 
Every resident of the respective local area and every other person subject to any tax, fee, rate, rent, toll or other charges imposed under this Act, shall on demand of the Chief Officer or an officer authorized by him in this behalf, furnish such information, produce such record or accounts, or present such goods, vehicles, animals or other things which are liable to the tax, fee, rate, rent, toll, or other charges, as may be necessary for the purpose of determining their liability to pay the tax, fee, rate, rent, toll, or other charges as the case may be or the assessment thereof.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	161	104	113	104

105.     Power of entry for valuation of local taxes etc.– #

 The Chief Officer or an officer authorized by him in this behalf, may after giving due notice to the occupier, or, if there is no occupier, to the owner of a building or premises, at any time between sunrise and sunset, enter upon any building or premises to assess the liability of that building or premises to any tax or inspecting any goods, vehicles, animals or other things therein liable to any tax, fee, rate, rent, toll or other charges under this Act.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	162	105	114	105

106.     Presentation of bill for local taxes and rates etc.– #

(1) When any sums become due for payment on account of any tax, fee, rate, rent, toll or other charges under this Act, the Chief Officer or any other officer authorized by him shall cause to be presented to any person liable for payment thereof a bill for the sum claimed as due.

(2)       Every such bill shall specify the period for which and the property, occupation, services or things in respect of which the sum is claimed and shall also give notice of the time by which the sums shall be paid and liability incurred in default of payment and the time within which an objection may be preferred against such claim under this Act.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	163	106	115	106

107.     Notice of demand to be issued on non-payment of bill.– #

(1) If the sum for which a bill has been presented under section 106 of this Act is not paid within the time specified therein, the Chief Officer or any other officer authorized by him may cause to be served upon the person to whom such bill has been presented a notice of demand in the specified form.

(2)       For every such notice of demand, a fee of such amount not exceeding fifteen per centum of the sums due shall be payable by the said person, and the said amount shall be included in the cost of recovery.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	164	107	116	107

108.     Payment of local tax etc. and consequences of default.– #

(1) A person upon whom a bill or notice of demand has been served under section 106 or 107 of this Act, may:

(a)        pay the sum demanded in the bill or notice of demand to the local government concerned as directed in the bill or notice; or

(b)       within fifteen days from the service of such bill or notice of demand make an objection in writing to the Chief Officer and show cause to his satisfaction as to why he should not pay the sum indicated in the notice; or

(c)        prefer an appeal in accordance with the provisions of section 110 of this Act against the determination of a Chief Officer under clause (b) above.

(2)       Where such person does not pay the sum demanded, or show cause or prefer an appeal under subsection (1), the Chief Officer may refer a case for the recovery of such sums as an arrear of land revenue to the respective Collector.

(3)        Every person liable to pay tax, fee, rates, rents or other charges imposed by the local government shall be personally liable to pay such tax and fee etc. directly to the local government or its authorized person as per the determined amount.
Provided that any person liable to pay tax, fee etc. shall not enter into a contract with a third party for any lesser fixed fee arrangement, which shall be strictly prohibited and any contravention thereof shall be an offence under this Act. 

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	165	108	117	108

109.     Investigation of objections by Chief Officer.– #

(1) The Chief Officer shall cause all objections made before him under section 108 of this Act to be entered in a register to be maintained for this purpose and shall give a notice in writing to the objector of a time and place at which his objection shall be investigated.

(2)       At the time and place fixed under subsection (1), the Chief Officer or any other officer authorized by him for this purpose, shall hear the objection, in the presence of the objector or his authorized agent if he appears or may, for reasonable cause, adjourn the investigation.

(3)       When the objection has been determined, the order passed on such objection shall be recorded in the register mentioned in subsection (1) and if necessary, the bill or demand notice shall be amended or withdrawn in accordance with the result of investigation.

(4)       The Chief Officer shall cause to be immediately delivered to the objector, free of any charge, a certified copy of the order made by him under subsection (3).

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	166	109	118	109

110.     Appeal against the order of Chief Officer.– #

(1) A person aggrieved from the order of a Chief Officer passed under section 109 of the Act, may, within thirty days of the receipt of such order, file an appeal before Head of the local government which shall be decided within thirty days.

(2)       No appeal shall be entertained by Head of the local government unless it is made in writing and is accompanied by an order of the Chief Officer appealed against.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	167	110	119	110

111.     Liability for local tax etc. to be called in question only under this Act.– #

No assessment of a tax, fee, rate, rent, toll or other charges under this Act or the liability of a person for such tax, fee, rate, rent or toll shall be called in question except in accordance with the provisions of this Act.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	168	111	120	111

112.     Payments to be made in authorized banks against receipts.– #

(1) All sums on account of a tax, fee, rate, rent and any other charges under this Act shall be paid to the local government through an authorized bank either manually or electronically unless permission for any other method of payment is obtained from the Government.

(2)       For all sums paid to a local government on account of any tax, fee, rate, rent, toll or other charge under this Act, a receipt, stating among other things the amount and the tax, fee, rate, toll or other charges on account of which it has been paid, shall be tendered by the person receiving such payment on behalf of the local government.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	169	112	121	112

113.     Writing off of irrecoverable taxes etc.– #

(1) At the close of each financial year, every Chief Officer shall prepare a statement of all such sums due to the respective local government on account of any tax, fee, rate, toll or other charges which, in his opinion, are irrecoverable.

(2)       The Chief Officer shall present the statement prepared under subsection (1) to the Council and after due consideration, the Council may order that such sums or any part thereof shall be struck off the relevant books kept under section 115 of this Act.

(3)       The Chief Officer shall cause an authenticated copy of the statement prepared under subsection (1) along with an authenticated copy of the statement of struck off dues to be displayed at a conspicuous place in the office of the local government for public inspection and shall, on application of any person, also cause to be furnished to him a copy thereof or any extract thereof on payment of such reasonable fee as may, from time to time, be fixed by the Council.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	170	113	122	113

114.     Tax, fee etc. not to become invalid for a defect in form.– #

(1) No assessment of value, or charge or demand of any tax, fee, rate, rent, toll or other levy made under this Act, shall be called in question or in any way be effected by reason of:-

(a)        any mistake in the name, residence, place of business or occupation of any person liable to pay such tax, fee, rate, rent, toll or other charges; or

(b)       any mistake in the description of any property, service or thing liable to such tax, fee, rate, toll or other charges; or

(c)        any mistake in the amount of assessment of such tax, fee, rate, rent, toll or other charges; or

(d)       any clerical error; or

(e)        any other defect of form.

(2)       It shall suffice for any assessment of value, or levy or demand of a tax, fee, rate, rent, toll or other charges that the person, property, service or any other thing subject thereof is so described as to be sufficiently identifiable.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	171	114	123	114

115.     Records pertaining to valuation, assessment and collection of local tax, fee etc.– #

(1) Every Chief Officer shall prepare and maintain records pertaining to valuation, assessment and collection of all taxes, fees, rates, rents, tolls and other charges levied by the local government in the prescribed manner.

(2)       All records prepared and maintained by the Chief Officer under subsection (1) above shall be authenticated by the respective Head of the local government.

(3)       The Chief Officer shall cause to be displayed at a conspicuous place in the office of the local government a copy of all records authenticated under subsection (2) above for public inspection and shall, on an application by any person, also cause to be furnished to him a copy thereof or any extract thereof on payment of such reasonable fee as may, from time to time, be fixed by the Council.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	172	115	124	115

116.  Appointment of an agency or officer for collection of local tax, fee etc.– #

(1) In the interest of economy, efficiency and effectiveness, the Chief Minister may by a notification in the official Gazette, direct that an agency or an officer of the Government engaged in collection of its tax, fee, rate, rent, toll, or other charges shall also collect one or more taxes, fees, rates, tolls, rents or other charges on the behalf of one or more local governments or constitute a separate agency for this purpose and provisions relating to the authority of the Chief Officer in relation to collection of local tax, fee, rate, rent, toll or other charges under this Act shall mutatis mutandis apply on that agency or officer.

(2)       The Agency or officer referred to in subsection (1) shall, to the extent of collection of a local tax, fee, rate, rent, toll or other charge be responsible to the respective local government.

NOTES:
PARI MATERIA PROVISIONS
PLGA 2013	PLGA 2019	PLGO 2021	PLGA 2022 (Act No. XIII of 2022)	PLGA 2022 (Act No. XXXIII of 2022)
s.	s.	s.	s.	s.
–	173	116	125	116

Comments

Efficiency is the ability to produce an intended result in the way that results in the least waste of time, effort, and resources. Effectiveness is the ability to produce a better result, one that delivers more value or achieves a better. The phrase “in the interest of economy, efficiency and effectiveness” means to get the right input at the lowest cost, by producing an intended better result that delivers more value without wastage of time, effort and resources. The intent and purpose of this section is to aid the local government in collection of its tax, etc. through an agency or an officer of the Government engaged in collection of taxes, etc. of the latter, or through a separately constituted agency. This will of course, enhance the revenue collection ability of the local government as well as increase the quantum of revenue. Presently, the Board of Revenue (BOR) and Punjab Land Record Authority (PLRA) are collecting TTIP tax on behalf of local governments pursuant to notification No.SO.Tax(LG)2-19/2018 dated 06.06.2022 and transfer the collected amount to the respective local governments after charging service fee @ Rs.100 pee transactions.

RELEVANT INSTRUCTIONS / ADVICE
1.	Letter No. SOTAX (LG) 2-19/2018(Vol-I), Govt. of the Punjab, LG&CD Department dated 17.08.2023 regarding “Appointment of Board of Revenue (Bor) and Punjab Land Records Authority (PLRA) as Agencies for Collection of Tax on Transfer of Immovable Property (TTIP) on Behalf of Local Governments of the Punjab”.
2.	Letter No. SOTAX (LG) 2-19/2018, Govt. of the Punjab, LG&CD Department dated 21.07.2023 regarding “Appointment of Board of Revenue (BOR) and Punjab Land Records Authority (PLRA) as Agencies for Collection of Tax on Transfer of Immovable Property (TTIP) on Behalf of Local Governments of the Punjab”