IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON FRIDAY, THE 6TH AUGUST 2010 / 15TH SRAVANA 1932 WP(C).No. 24320 of 2010(L) -------------------------- PETITIONER: --------------- THE ARYA VAIDYA PHARMACY (COIMBATORE) LTD. OPP. RAILWAY STATION, KANJIKKODE WEST PALAKKAD REPRESENTED BY ITS GENERAL MANAGER. BY ADV. SRI.U.BALAGANGADHARAN RESPONDENTS: --------------- 1. STATE OF KERALA, REPRESENTED BY THE SECRETARY, SECRETARY, REVENUE DEPARTMENT THIRUVANANTHAPURAM. 2. THE TAHSILDAR, PALAKKAD. 3. THE SECRETARY TO GOVERNMENT FINANCE DEPARTMENT, THIRUVANANTHAPURAM. BY GOVERNMENT PLEADER ADV. MR. BIJOY CHANDRAN. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06/08/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: P.R. RAMACHANDRA MENON, J. .............................................................................. W.P.(C) No. 24320 OF 2010 ......................................................................... Dated this the 6th August , 2010 J U D G M E N T The petitioner is before this Court challenging the assessment order passed by the second respondent under the relevant provisions of the Kerala Building Tax Act without considering the claim for exemption as available under Section 3 (1) (b) of the said Act. 2. The learned Counsel for the petitioner narrates the sequence of events stating that the petitioner is a renowned institution in the field of manufacture ands sale of traditional ayurvedic medicines and with intent to renovate the unit, a new factory building was constructed after obtaining the requisite sanction from the local authority and all others concerned, including Director of Factories and Boilers, Grama Panchayat, Fire and Rescue Divisional Office, Kerala State Pollution Control Board etc; as borne by various certificates produced before this Court along with the Writ Petition ( Exts.P1 to P4 and P4(a) to P4(d) ) . It is the case of the petitioner that the petitioner has already filed Ext.P5 application dated W.P.(C) No. 24320 OF 2010 2 07.04.2009 before the second respondent, stating that it is a 'factory building' and that the petitioner is entitled to have exemption from the purview of building tax. However, without any regard to the claim put forth by the petitioner, the assessment was finalised by the second respondent, who issued Ext. P7 assessment order dated 30.06.2010 fixing the total liability at Rs.9,16,200/-, requiring the petitioner to satisfy the same by way of four equal quarterly installments commencing from 30.07.2010 followed by Ext. P7(a) demand notice, which are under challenge in this Writ petition. 3. The learned Counsel for the petitioner submits that the petitioner having raised the claim for exemption, it was no more open to the second respondent /assessing authority to have proceeded with assessment leading to issuance of Ext.P7 and P7(a) 4. Heard the learned Government Pleader as well, who made available a copy of the return stated as preferred by the petitioner and also a copy of the representation dated 19.06.2010. As per the return, it is stated against Column No.15 that the petitioner proposed to clear the liability by way of W.P.(C) No. 24320 OF 2010 3 'installments'. As per the letter dated 19.06.2010, the petitioner conveyed that it is a 'factory' building and the second respondent to extend all possible concessions, also stating that the petitioner is not a profit making industry and that they cannot bear huge burden towards tax . 5. Going by the contents of the return stated as filed by the petitioner, it is revealed that, though it does not bear the date, it can only be 'after 01.06.2009', as the commencement of production or use of the building has been stated as w.e.f.. 01.06.2009, pointing out that it is a new building. However, the said return has been submitted in the 'old form' which was printed in the Government Press in the year 2002 as discernible from the left bottom of the return. After the introduction of 'new plinth area rules', the return has to be submitted in the 'new form' which specifically contains a clause as to whether any 'exemption' is sought for. In the 'old form', there is no provision for such an entry. This being the position, no answer has been given by the petitioner, as to the eligibility for exemption though liability was sought to be cleared by way of 'installments' in answer to the question whether it was intended W.P.(C) No. 24320 OF 2010 4 to be remitted in the single lot or by way of installments. 6. Going by the contents of the representation dated 19.06,.2010, which is admittedly in the files of the second respondent, it was brought to the notice of the said respondent that the building was a 'factory' seeking for maximum possible concessions. If it is a 'factory', the statute contemplates that such building is eligible for exemption as provided under Section 3(1)(b) of the Act. Once a claim is raised with regard to eligibility for exemption, it is settled law, that the matter has to be referred to the Government for decision, as provided under Section 3(2) of the Act. 7. As evident from the materials on record, this Court finds that the petitioner's establishment has been set up on the strength of various certificates including the permit/sanction issued by the authorities under the Factories Act/Rules. So the matter has to be examined by the Government as to whether the petitioner's building is a 'factory' or not and if it is a factory, it is very much eligible to have exemption as provided under the statute. 8. In the above circumstance, this Court sets aside W.P.(C) No. 24320 OF 2010 5 Ext.P7 assessment and the consequential demand as borne by Ext.P7(a). The second respondent is directed to refer the matter for decision of the Government as provided under Section 3(2), which shall be done as expeditiously as possible, at any rate, within 'two weeks' from the date of receipt of a copy of the judgment. On receipt of such reference, the first respondent / Government shall consider the matter and final orders shall be passed, after giving an opportunity of hearing to the petitioner, as expeditiously as possible at any rate within three months thereafter. The liability of the petitioner to satisfy the building tax will be subject to the outcome of the decision to be rendered by the first respondent/Government . The Writ Petition is disposed of. P.R. RAMACHANDRA MENON, JUDGE. lk