IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE T.R.RAMACHANDRAN NAIR THURSDAY, THE 3RD JANUARY 2008 / 13TH POUSHA 1929 OP.No. 17436 of 2001(A) ----------------------- PETITIONER: ------------------- E.K.SIVADAS, ADVOCATE, H.NO.1/3913-A, “RHYTHM”, PRASANTHAM COLONY, CALICUT – 673 005. BY ADV. SRI.P.RAVINDRAN SRI.ANIL SIVARAMAN RESPONDENTS: ---------------------- 1. THE UNION OF INDIA, REP: BY ITS SECRETARY, MINISTRY OF LABOUR, NEW DELHI. 2. THE STATE OF KERALA, REP: BY ITS SECRETARY FOR LABOUR, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM. 3. THE ASSISTANT LABOUR OFFICER GR.I, (ASSESSING AUTHORITY UNDER THE BUILDING & OTHER CONSTRUCTION WORKERS' WELFARE CESS ACT, 1996), KOZHIKODE. 4. THE SECRETARY, BUILDINGS & OTHER CONSTRUCTION WORKERS WELFARE BOARD, P.O. POOJAPPURA, THIRUVANANTHAPURAM. BY ADV. SRI.MOHAN IDICULLA ABRAHAM, ADDL.CGSC SRI.C.R.SYAMKUMAR, SC, KCWWF BOARD R2 & 3 BY GOVERNMENT PLEADER SMT.SMITHA BABU. THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 03/01/2008, HE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: APPENDIX PETITIONER'S EXHIBITS;- P1: COPY OF THE APPROVED SITE PLAN. P2: COPY OF THE ESTIMATE OF COST. P3: COPY OF THE DEVELOPMENT PERMIT NO.E1/66650/94 DTD.4/5/1995. P4: COPY OF THE RECEIPT FOR PAYMENT OF PROPERTY TAX. P5: COPY OF NOTICE DTD.14.5.2001 ISSUED BY 3RD RESPONDENT. P6: COPY OF OBJECTIONS OF PETITIONER BEFORE 3RD RESPONDENT DTD.21.5.2001. P7: COPY OF ORDER DATED 24.5.2001 ISSUED BY 3RD RESPONDENT. RESPONDENTS' EXHIBITS:- Nil. ( true copy ) P.A. TO JUDGE. kvs/- T.R.RAMACHANDRAN NAIR, J. = = = = = = = = = = = = = = = O.P.No.17436 OF 2001-A. = = = = = = = = = = = = = = = Dated this the 3rd day of January, 2008. J U D G M E N T The petitioner is aggrieved by the order Ext.P7 passed by the Assessment Officer under the Building and other Construction Workers' Welfare Cess Act, 1996. The petitioner is the owner in possession of an extent of 8.5 cents of land in Prasantham Colony, East Hill Road, Kozhikode, which is lying in R.S.No.1170 and 1176 of Block No.31 of Calicut Corporation. As per Exts.P1 and P3 building permit and development permit the petitioner constructed a residential building in the property. Ext.P2 is the agreement executed with the contractor for the construction of the said building. According to the petitioner, the building was completed in the year 1994 itself and thereafter the building was numbered by the authorities of the Calicut Corporation. Ext.P4 is the receipt for payment of property tax from 1.4.1997. 2. He was served with a notice by the 3rd respondent dated O.P.No.17436 OF 2001-A. 2 20.12.2000 requiring him to submit his return as required under the Building and other Construction Workers' Welfare Cess Act, 1996. It appears that he had personally met the assessing officer and raised objections as regards the applicability of the Act to the building in question since according to the petitioner, the construction of the building was completed before the coming into force of the Act namely, 3.11.1995. He had raised other objections also. Thereafter by notice dated 14.5.2001 described as assessment notice, the petitioner was informed that an amount of Rs.10,721/- towards cess due at the rate of 1% of an assumed cost of construction of Rs.10,72,066/- has been assessed which has to be paid within 15 days from the date of the notice. 3. On receipt of the same the petitioner filed a detailed objection Ext.P6. Apparently the contentions relate to the non- applicability of the Act to the building in question, and that the workers employed by the petitioner are only casual labourers who were less than ten in numbers and therefore the said Act is not applicable to him. It is contended that the said labourers were not registered as beneficiaries under the Building and Other Construction Workers Act and therefore they are not entitled to the benefit of the Act. It is also O.P.No.17436 OF 2001-A. 3 contended that the estimated cost of construction is only an imaginary one and the cost of construction was also disputed by the petitioner. Finally he was served with Ext.P7 which is the assessment order. Ext.P7 shows that his objections have been rejected stating that the same is not satisfactory. 4. The learned counsel for the petitioner contended that as the Act is not having retrospective operation the authorities lack the jurisdiction and the entire action is without any authority of law. It is further contended by referring to the provisions of the Act that the labourers employed by him are casual labourers ten in number and hence the said Act is not applicable to him. It is also pointed out that they were not registered under the Building and Other Construction Workers Act, 1996 and therefore no benefits are allowable to them. The learned counsel pointed out that in Ext.P5 the cost of construction is mentioned at Rs.10,72,066/- and the petitioner has not been given the details about the finalisation of the cost of construction and that the same has been arrived at without following any procedure. 5. The 2nd respondent has filed a counter-affidavit. 6. A reading of Ext.P6 would show that the petitioner has O.P.No.17436 OF 2001-A. 4 raised very valid contentions as to the jurisdiction of the assessment officer and as to whether the Act itself is applicable since the construction of the petitioner's building was in 1994. Therefore that is a crucial issue to be decided. The other contentions also deserve detailed consideration. I find from Ext.P7 that none of the contentions on their merits have been dealt with and the authority has not applied its mind to any of these aspects. The rejection of the objection by simply stating that “it is not satisfactory” is not a proper method of exercise of statutory power. It cannot be disputed that only if the Act is applicable to him then only the respondent will be justified in imposing the liability, but that can be done only after following a fair and reasonable procedure. In other words, the authority is bound to act in accordance with the principles of natural justice. A reasoned order is a requirement of the principles of natural justice. A person who has filed an objection for the proposal to the assessment is entitled to know the reasons by which his objections were considered and rejected. Nothing is discernible in Ext.P7 as to the reasons for non-acceptance of the objections. Therefore the justification sought for passing the order in the counter-affidavit cannot be accepted at all. O.P.No.17436 OF 2001-A. 5 7. Therefore, I quash Ext.P7. The 3rd respondent is directed to reconsider the matter after notice to the petitioner and after allowing him an opportunity to adduce evidence in support of objection to Ext.P6. The 3rd respondent while considering the matter will refer to the specific objection raised by the petitioner in Ext.P6 as to the applicability of the provisions of the Act. A reasoned order will have to be passed by the 3rd respondent after referring to the objections raised by the petitioner in Ext.P6 and to the other objections he may raise at the time of personal hearing. The needful will be done in the matter within four months from the date of receipt of a copy of this judgment. The original petition is allowed as above. No costs. T.R.RAMACHANDRAN NAIR, JUDGE. kvs/