IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE T.R.RAMACHANDRAN NAIR THURSDAY, THE 6TH MARCH 2008 / 16TH PHALGUNA 1929 OP.No. 30799 of 2001(N) ---------------------------------- PETITIONER: ------------------- BABY VARKEY, CHIRAKKAPPADICKAL HOUSE, ONAKKOOR. BY ADV. SRI.P.V.GEORGE, ADV. SRI.REJI GEORGE. RESPONDENTS: ----------------------- 1. THE TAHSILDAR, MUVATTUPUZHA. 2. THE REVENUE DIVISIONAL OFFICER, MUVATTUPUZHA. 3. STATE OF KERALA, REPRESENTED BY THE SPECIAL SECRETARY, REVENUE AND TAXES, TRIVANDRUM. BY GOVT. PLEADER SMT. N. SUDHA DEVI. THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 06/03/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: O.P. NO. 30799/2001-N: APPENDIX PETITIONER'S EXHIBITS : EXT.P.1: COPY OF THE CERTIFICATE OF REGISTRATION DTD. 31/08/1996 ISSUED BY THE MANAGER, DISTRICT INDUSTRIES CENTRE, ERNAKULAM. EXT.P.2: COPY OF THE ORDER NO. C5.7255/98 DTD. 04/05/1999 ISSUED BY THE R.1. EXT.P.3: COPY OF THE ORDER NO. K.DIS. 3561/99/A7 DTD. 27/08/2001 PASSED BY THE R.2. EXT.P.4: COPY OF THE DEMAND NOTICE NO. C5.7255/98 DTD. 05/10/2001 ISSUED BY THE R.1. EXT.P.5: COPY OF THE DEMAND NOTICE NO. C5.7255/98, DN.999/01DTD. 05/10/2001 ISSUED BY THE R.1. UNDER SECTION 7 OF THE KERALA REVENUE RECOVERY ACT. EXT.P.6: COPY OF THE REPLY TO THE PRE-ASSESSMENT NOTICE DTD. 18/11/1998 SENT BY THE PETITIONER. EXT.P.7: COPY OF THE LICENSE ISSUED BY THE DIRECTOR OF FACTORIES AND BOILERS DTD. 09/09/1996. RESPONDENT'S EXHIBITS: NIL. //TRUE COPY// prv. T.R. Ramachandran Nair, J. - - - - - - - - - - - - - - - - - - - - - - - - O.P.NO.30799 of 2001-N - - - - -- - - - - - - - - - - - - - - - - - - - - Dated this the 6th day of March, 2008. JUDGMENT The petitioner challenges Exts.P2 and P3 on the ground that the factory run by the petitioner is entitled for the benefit of the provisions of Section 3 of the Building Tax Act. Learned counsel for the petitioners points out that the petitioner has established a factory which is registered as a small scale industry with SSI registration No.22496 dated 31.8.1996 and the unit is categorised as a 'tiny enterprise' by the District Industries Centre, Ernakulam. It is stated that going by Section 3(1)(b) of the Act, the buildings used as factories, are exempted from the payment of building tax as per the said section. In Ext.P2, there is no consideration of the said issue. But in Ext.P3, it is stated that the petitioner had not produced evidence to show that a factory is being run in the building under assessment. 2. But herein, in the light of Section 3(2) of the Act, the assessing authority erred in straight away proceeding to make the assessment without referring the matter to the Government. Going by the stand taken by the petitioner, the question is whether the building is entitled for exemption under Section 3(1)(b) of the Act. Sub-section (2) of Section 3 provides that OP 30799/2001 -2- “if any question arises as to whether a building falls under sub-section (1) or under Section 3-A, it shall be referred to the Government and the Government shall decide the question after giving the interested parties an opportunity to present their case.” The position is well settled that the assessing authority cannot on its own proceed to make assessment by overruling the claim for exemption made by the assessee. Learned counsel for the petitioner placed reliance upon the decision reported in Mathew P. Mathai v. State of Kerala (1989 (2) KLT 678). 3. In the light of the above legal position, the orders of assessment and the appellate order cannot stand scrutiny. Therefore, Exts.P2 and P3 and the consequential demand notices are quashed. The first respondent is directed to refer the claim of the petitioner for exemption under Section 3(1) (b) of the Act, to the Government as enjoined under Section 3(2) of the Act. The Government shall hear the petitioner before taking any decision in the matter. The needful shall be done expeditiously. The Original Petition is allowed as above (T.R. Ramachandran Nair, Judge.) OP 30799/2001 -3- T.R. Ramachandran Nair, J. - - - - - - - - - - - - - - - - - - - - - - O.P. No.30799 of 2001-N - - - - - - - - - - - - - - - - - - - - - - JUDGMENT 6th March, 2008.