IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON THURSDAY, THE 10TH JUNE 2010 / 20TH JYAISTHA 1932 WP(C).No. 15024 of 2007(L) ------------------------------------- PETITIONER(S): ------------------------ DHARMA SASTHA TRUST (REG.NO.474/IV/91), KODALY P.O., PADY, THRISSUR DISTRICT-680 699 REPRESENTED BY ITS JOINT SECRETARY V.RAMAN. BY ADV. SRI.C.ANIL KUMAR SMT.A.K.PREETHA RESPONDENT(S): -------------------------- 1. STATE OF KERALA, REPRESENTED BY PRINCIPAL SECRETARY, REVENUE DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM. 2. THE DISTRICT COLLECTOR, THRISSUR. 3. THE TAHSILDAR, MUKUNDAPURAM, THRISSUR DISTRICT. GOVERNMENT PLEADER SRI.MATHEW GEORGE VADAKKEL THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 10/06/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) NO.15024/2007 APPENDIX PETITIONER'S EXHIBITS P1:- COPY OF THE RESOLUTION PASSED BY THE MATTATHOOR GRAMA PANCHAYATH DTD. 2.2.07. P2:- COPY OF THE ORDER NO.G4-31605/2001 DTD. 19.5.2004 ISSUED BY THE 3RD RESPONDENT. P3:- COPY OF THE EXPLANATION SUBMITTED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DTD. 14.7.2004. P4:- COPY OF THE ORDER DTD. 15.12.2006 ISSUED BY THE IST RESPONDENT. P5:- COPY OF THE INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED ON 31.3.2006. P6:- COPY OF THE CERTIFICATE ISSUED BY THE MATTATHUR GRAMA PANCHAYATH DTD. 13.7.2004. TRUE COPY P.A. TO JUDGE tss P.R.RAMACHANDRA MENON, J --------------------------- W.P(C) No.15024 of 2007 ---------------------------- Dated this the 10th day of June, 2010. J U D G M E N T The petitioner, a Trust registered under the Indian Trusts Act, having got registration on 11.12.1991, is stated as engaged in the field of cultural, artistic and educational upliftment of the people at large, including the members of the Trust. 2. The petitioner constructed an Auditorium, which is being used by the members of the general public and also for holding public meeting and Governmental functions. It is pointed out that the auditorium is let out free of cost, for holding public meetings and Governmental functions as above and free classes are provided to the students, besides being used for conducting marriages, contending that no rent is being received in respect of such activities. 3. While so, the third respondent took steps for assessing liability under the Kerala Building Tax Act and Ext.P2 assessment order was passed on 19.5.2004, fixing the tax liability in respect of the auditorium as Rs.1,09,800/-, which was ordered to be paid by W.P(C) No.15024 of 2007 2 way of ‘four’ quarterly instalments as specified therein. The petitioner, after passing Ext.P2, filed Ext.P3 representation dated 14.7.2004 pointing out the activities of the petitioner and requested for the benefit of exemption. Taking note of the request as to the claim for exemption under Section 3(1) (b) of the Act, it appears that the proceedings were referred to the first respondent for decision under Section 3(2) of the Act. The first respondent heard the parties concerned and after considering the materials on record, Ext.P4 order was passed, turning down the request for exemption, holding that it was brought out that the auditorium was being let out for rent to the public and that the petitioner was not entitled to have the benefit of exemption under Section 3(1) (b), which in turn is under challenge in this Writ Petition. 4. The averments and allegations raised in the Writ Petition have been categorically rebutted by the respondents 2 and 3 in their counter affidavit, seeking to sustain Exts.P2 to P5. The learned counsel for the petitioner submits that the petitioner has clearly averred in the Writ Petition, that the auditorium is not being let out for rent and this being the position, the finding and reasoning given by the first respondent in Ext.P4 are not correct or proper and it is W.P(C) No.15024 of 2007 3 liable to be interfered by this Court. Reliance is also sought to be placed on Ext.P1 resolution passed by the Panchayat on 2.2.2007, whereby the Committee considered the fact that the Panchayat has imposed only very ‘nominal tax’ in respect of the building, taking note of the nature of activities being pursued by the petitioner and thus recommending to exempt the petitioner from the liability to pay building tax. Further reliance is placed on Ext.P5 ‘income and expenditure account’ for the year 31.3.2006 showing that, the year ended on 31.3.2006, the only two sources of income were; Rs.40/- by way of ‘interest’ on SB Account and Rs.47,000/- by way of ‘donations’. Placing reliance on such documents, the learned counsel submits that no rent has been collected by the petitioner and as such, the finding in Ext.P4 could not be true. 5. The learned Government Pleader appearing for the respondents submits that the nature of the building is much significant and the factum of letting it out to the public, rather stands conceded. The only question is whether any rent is collected in respect of such activity. It is clearly referred to in Ext.P4 that the party who was heard before passing Ext.P4 had conceded that the W.P(C) No.15024 of 2007 4 auditorium was being rented out, but claimed that only ‘nominal rent’ was being received for the purpose. This being the position, the factum of ‘letting out for rent ’ stands admitted; submits the learned Government Pleader. It is stated that the issue is squarely covered by the decision of a Division Bench of this Court in St.George Orthodox Church V. State of Kerala (2009(4) KLT 702). This Court finds that there is considerable force in the said submissions. The factum of letting out the auditorium for marriages and such other purposes is rather admitted from the part of the petitioner. Further, it was also conceded that the building was being let out for rent and the only contention was that the rent being was only ‘nominal’. There is a clear observation made by the Division Bench in the decision cited supra in the following words. “It is the settled position that building owned by the religious institutions when let out on rent is assessable for building tax asthe use is commercial purpose, no matter the income therefrom is used for religious or charitable purpose ”. 6. There is absolutely no case for the petitioner in the Writ Petition, that the observation made by the first respondent in Ext.P4 that, the petitioner had agreed that the building was being rented out (but for getting only a nominal rent) is wrong or perverse in any W.P(C) No.15024 of 2007 5 manner; though a new case has been raised in the Writ Petition. It is to substantiate this new pleading, reliance is sought to be placed on Ext.P5 ‘income and expenditure statement’. Admittedly, Ext.P5 income and expenditure statement is in respect of the year ended on 31.3.2006 ie. in respect of the period from 1.4.2005 to 31.3.2006. Ext.P2 order of assessment passed by the third respondent is dated 19.5.2004. In other words, reliance sought to be placed on Ext.P5 to contend that no rent was being collected by the petitioner is quite wrong and misconceived as the position in respect of the period prior to Ext.P2 assessment order can’t be inferred from Ext.P5. This Court finds it difficult to accept the version of the petitioner. The challenge raised against Exts.P2 and P4 is not successfully established. No interference is warranted. The Writ Petition fails and it is dismissed accordingly. Sd/- P.R.RAMACHANDRA MENON JUDGE //True Copy// P.A TO JUDGE ab