Bharat Sanchar Nigam Ltd. v. State of Kerala and Thrissur Corporation

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN** **& THE HONOURABLE MR. JUSTICE ASHOK MENON** **TUESDAY, THE 5TH DAY OF JUNE 2018 / 15TH JYAISHTA, 1940** **RP.No. 411 of 2018 IN WA. 2620/2017 -----------------------------------** **AGAINST THE ORDER/JUDGMENT IN WA 2620/2017 of HIGH COURT OF KERALA** ## **REVIEW PETITIONER(S)/PETITIONER:** **-------------------------------** **THE BHARAT SANCHAR NIGAM LTD., REPRESENTED BY ITS ASST.GENERAL MANAGER PLANNING, THRISSUR.** **BY ADV.SRI.P.J.PHILIP, SC, BSNL** ## **RESPONDENT(S)/RESPONDENTS:** **-------------------------** **1. STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, LOCAL SELF GOVERNMENT, GOVERNMENT OF KERALA, THIRUVANANTHAPURAM-695001.** **2. THE SECRETARY, THRISSUR CORPORATION,THRISSUR-680001.** **R1 BY SR.GOVERNMENT PLEADER MOHAMMED RAFIQ R2 BY SRI. SANTHOSH P.PODUVAL, SC, THRISSUR CORPORATION** **THIS REVIEW PETITION HAVING BEEN FINALLY HEARD ON 05-06-2018, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **RP.No. 411 of 2018** **------------------** ## **APPENDIX** ## **REVIEW PETITIONER(S)' ANNEXURES:** **-------------------------------** **ANNEXURE A: COPY OF LETTER NO.28321/L2/06/SELF-GOV AT THIRUVANANTHAPURAM DATED 17-08-2006 ADDRESSED TO SECRETARY, PANCHAYAT DIRECTOR, THIRUVANANTHAPURAM.** **ANNEXURE B: COPY OF CIRCULAR NO.39457/RC2/2010/LSGD DATED 19-09-2011 ISSUED BY STATE GOVERNMENT THROUGH ITS PRINCIPAL SECRETARY** **ANNEXURE C: COPY OF CIRCULAR NO.43657/B4/04 DATED 09-12-2004, GOVERNMENT OF KERALA, LOCAL SELF GOVERNMENT INSTITUTIONS.** **RESPONDENT(S)' ANNEXURES:** **------------------------** ## **NIL** **/TRUE COPY/** **PA TO JUDGE** _**dkr**_ ## K.VINOD CHANDRAN & ASHOK MENON, JJ. ------------------------------------------Review Petition No. 411 of 2018 in W.A.No. 2620 of 2017 ------------------------------------------Dated this the 5[th] day of June, 2018 ## O R D E R ## Ashok Menon, J. The review petitioner is the original writ petitioner as well as the appellant. Consequent to the dismissal of W.P.(C) No.10972/2017 by the learned Single Judge, the matter came up on appeal before us and vide judgment dated 13-04-2018 the appeal was dismissed. The appellant has now come up before us with a review petition. 2. The Bharath Sanchar Nigam Limited (for short 'BSNL'), the petitioner, is a company incorporated under the Companies Act, 1956 and solely owned by the Government of India. The Secretary, Thrissur Corporation, issued two demand notices (Exts.P1 and P2) demanding a sum of Rs.3,86,268/- and Rs.9,03,174/- respectively for the period from 2000-2001 to 2006-2007 as property tax in respect of buildings of the telephone exchange as well as the staff quarters. The defence taken up by the review petitioner was that they are exempted from payment of tax by virtue of Article 285 of _RP 411/2018_ 2 the Constitution of India and hence a writ of certiorari was sought to quash Exts.P1 and P2 demand notices. After hearing the petitioner as well as the respondents, the learned Single Judge dismissed the Writ Petition. In appeal, we held that the petitioner was not entitled to exemption under Article 285 of the Constitution in as much as a Government company cannot claim exemption of tax imposed under a Statute. The argument of the petitioner that the property has not been transferred to the Company by the P&T Department was also not found acceptable. 3. Aggrieved by the dismissal of the appeal, the writ petitioner has filed this Review Petition, wherein the main ground for review is that the transfer of property to BSNL has to be compulsorily registered and only thereafter the property tax will become due from BSNL and it is settled that the ownership is conveyed only by a registered deed. It is also stated that the State of Kerala, Local Self Government Department has issued Letter No.28321/12/06/Self-Gov. dated 17-08-2006 addressed to the Secretary, Panchayat Director, Thiruvananthapuram, with respect to exemption of BSNL buildings situated in Payyannur Grama _RP 411/2018_ 3 Panchayat. It was directed that, as of now the BSNL buildings are in the name of the President and since they are not transferred to the company till now, they should be exempted from property tax by considering them as Central Government buildings. Copy of that letter is Annexure A. Thereafter, the State Government, through its Principal Secretary, issued Circular No.39457/RC2/2010/LSGD dated 19-09-2011 directing thus; “All Local Self Government Institutions are instructed that the BSNL buildings which are still in the name of HE the President of India shall be exempted from property tax under Article 285(1) of the Constitution of India, whereas property tax can be levied on those buildings owned by BSNL, but which are not in the name of HE the President of India now.” Copy of the above-said circular is Annexure B. It is pointed out that Annexures A and B were not brought to the notice of the Court due to an omission and those may be considered, because of these circulars superseding Circular No.43657/D4/04/LSGD dated 09-12-2014 (Annexure C herein), which formed the basis of Exts.P1 and P2. It is further submitted that the mandatory procedures provided in Section 203(3) to (13) of the Kerala Panchayat Raj Act, _RP 411/2018_ 4 1994 has not been followed prior to the demand of tax from the BSNL. The mandatory procedures, which ought to have been followed, is also detailed in the petition. Further, it is submitted that for buildings and property in a Panchayat to be taxed, a resolution has to be passed by each Panchayat determining the levy of tax and followed by publication of the new tax as provided under Rules 3, 4 and 6 of Kerala Panchayat Raj Act (Taxation, Levy and Appeal) Rules, 1996. As such, the demand of property tax from the BSNL is without jurisdiction in the Panchayats concerned, where Kerala Panchayat Raj Act is applicable. It is also pointed out by the petitioner that Section 233(3) of the Kerala Municipality Act, 1994, provides for certain procedure, which has not been followed. The Rules under the Kerala Municipality (Property Tax, Service Tax and Surcharge) Rules, 2011 has also not been followed. The details of the violation of Rules has also been given in the petition. It is stated that the Municipality or the Panchayat will not get jurisdiction to demand property tax from BSNL without following the abovementioned mandatory provisions in the respective Kerala Panchayat Raj Act and the Kerala Municipality Act and the Rules prescribed _RP 411/2018_ 5 therein. It is further submitted that a composite notice for tax from 2000-2001 to 2006-2007 issued is arbitrary and illegal and that there is a period of limitation of three years for demanding tax under Section 243 of the Panchayat Raj Act as well as Section 282 of the Kerala Municipality Act and four years to demand escaped tax. It is only fair and just that the judgment sought to be reviewed is recalled and the Writ Appeal heard on merits after considering the above-mentioned legal issues. It is also submitted that huge amounts are demanded from the BSNL by the Panchayats/ Municipalities spread over Kerala, without following the mandatory procedures provided in the Acts and the Rules. 4. We heard Senior Advocate Sri.V.Ramkumar, Counsel appearing for the review petitioner in detail. 5. At the outset, we have to notice that the writ petition was filed against the demand of property tax, by one local authority, the Thrissur Corporation. None of the averments raised with respect to the provisions in the Kerala Panchayat Raj Act or the Kerala Municipality Act were raised in the Writ Petition. The attempt of BSNL in the Review Petition is to get a blanket declaration against all _RP 411/2018_ 6 the local authorities in the State, which exceeds and travels far beyond the scope of the Writ Petition itself. We would also notice that the ground of a formal conveyance having not been effected was already considered and negatived by us; which we would not dwell upon further, in review. 6. Power of a civil court to review its judgment/decision is traceable under Section 114 of Code of Civil Procedure. The grounds on which the review can be sought are enumerated in Order 47, Rule 1, C.P.C., which reads thus:- “1. Application for review of judgment.- (1) Any person considering himself aggrieved - (a) by a decree or order from which an appeal is allowed, but from which no appeal has been preferred, (b) by a decree or order from which no appeal is allowed, or (c) by a decision on a reference from a Court of Small Causes, and who, from the discovery of new and important matter or evidence which, after the exercise of due diligence was not within his knowledge or could not be produced by him at the time when the decree was passed or could not be produced by him at the time when the decree was passed or order made, or on account of some mistake or error apparent on the fact of the record, or for any other sufficient reason, desires to obtain a review of the decree passed or order made against him, may apply for a review of judgment to the court which passed the decree or made the order.” _RP 411/2018_ 7 7. The provisions for review of a judgment is provided in law, on the principle that the action of the court shall not harm anyone (Actus curiae neminem gravabit) and that the judgments of courts are not infallible, and any mistake which has been committed by the court, is to be corrected under the provisions of review. A reading of the provisions would make it very clear that what is intended to be a mistake is “a mistake or error apparent” which by its very connotation indicates the error which is evident per se from the record of the case and does not require detailed examination, scrutiny and elucidation either of the facts or the legal position. Hence, it is settled law that if an error is not selfevident and detection thereof requires long debate and process of reasoning, it cannot be treated as an error apparent on the face of the record for the purpose of Order 47, Rule 1, C.P.C. There are catena of decisions rendered by the Apex Court on this point. In the decision State of W.B. v. Kamal Sengupta, (2008) 8 SCC 612, the Honourable Supreme Court has discussed all the important decisions on the subject, and culled out points for consideration from those judgments. Para 35 of the judgment _RP 411/2018_ 8 ## reads thus:- “35. The principles which can be culled out from the above-noted judgments are:- (i) The power of the Tribunal to review its order/decision under Section 22(3)(f) of the Act is akin/analogous to the power of a civil court under Section 114 read with Order 47 Rule 1 CPC. (ii) The Tribunal can review its decision on either of the grounds enumerated in Order 47 Rule 1 and not otherwise. (iii) The expression “any other sufficient reason” appearing in Order 47 Rule 1 has to be interpreted in the light of other specified grounds. (iv) An error which is not self-evident and which can be discovered by a long process of reasoning, cannot be treated as an error apparent on the face of record justifying exercise of power under Section 22(3)(f). (v) An erroneous order/decision cannot be corrected in the guise of exercise of power of review. (vi) A decision/order cannot be reviewed under Section 22(3)(f) on the basis of subsequent decision/judgment of a coordinate or larger Bench of the tribunal or of a superior court. (vii) While considering an application for review, the tribunal must confine its adjudication with reference to material which was available at the time of initial decision. The happening of some subsequent event or development cannot be taken note of for declaring the initial order/decision as vitiated by an error apparent. (viii) Mere discovery of new or important matter or evidence is not sufficient ground for review. The party seeking review has also to show that such matter or evidence was not within its knowledge and even after the exercise of due diligence, the same could not be produced before the court/tribunal earlier.” _RP 411/2018_ 9 8. In the light of the above points, which has been culled out from various judgments, it has to be examined whether the review application filed by the petitioner in the case in hand, can be allowed or not. It is pointed out that the judgment relies upon Circular No.43657/D4/2004 dated 09-12-2004 at Annexure C. This is apparently not true because what is referred to in the judgment is only that the Local Self Government Institutions were directed to levy property tax on the basis of the said Circular and pursuant to that the Secretary of Thrissur Corporation issued Exts.P1 and P2 demand notices. The circular is not the basis of the judgment under review. The review petitioner has now produced Annexures A and B letter and circular in support of the contention that the levy of property tax has been stalled and the Panchayat were given direction not to levy tax since there is no transfer of property effected. The petitioner admits that it is an error on their part for not having produced the circulars prior to argument. But there is no explanation as to why they were not produced. From the above cited decision, it is adequately clear that the court should confine its adjudication with materials which were available at the _RP 411/2018_ 10 time of initial decision. The court reviewing its judgment cannot sit on appeal reconsidering its decision on materials that may be placed subsequently. The review petition should not amount to an appeal in disguise. 9. The review petitioner has pointed out several infirmities in imposing tax under the Kerala Panchayat Raj Act and the Kerala Municipality Act, which is pointed as Grounds G to S in the review petition. But it has to be borne in mind that these infirmities pertaining to imposition of tax were never pleaded in the review petition and re-hearing on the grounds, which were not originally taken, is not permissible under Order 47, Rule 1, C.P.C. as is observed in Parison Devi v. Sumitri Devi, (1997) 8 SCC 715 . In exercise of the jurisdiction under Order 47, Rule 1, C.P.C. it is not permissible for an erroneous decision to be “re-heard and corrected”. There is clear distinction between the erroneous decision and error apparent on the face of the record. While the first can be corrected by a higher forum, the latter alone can be corrected by exercise of the review jurisdiction. A review petition has a limited purpose and cannot be allowed to be 'an appeal in disguise'. _RP 411/2018_ 11 10. The letter and circular at Annexures A and B now relied upon by the petitioner, would according to them, override the Annexure C circular. In any event, the circulars of Government are inconsequential. Section 233 of Kerala Municipality Act and Section 203 of Kerala Panchayat Raj Act confer power to impose tax on the Council of Municipalities and Grama Panchayats respectively. The Government's role is to fix the maximum and minimum limits under Section 233(2) and 203(2) and make Rules for the matters enumerated under Sections 233(1) and Section 203(19) of the respective enactments. It is also apparent that any remission or exemption has to be by a notification as seen from Section 233(19) (ix) of the Kerala Municipality Act and Section 203(19)(ix) of the Kerala Panchayat Raj Act and not by a letter or Circular as seen from Annexures A and B. 11. There is yet another ground raised of limitation. We cannot, but notice Section 539 of the Kerala Municipality Act, which restrains the local authority from proceeding after the expiration of a period of three years, from the date on which a distraint, suit or prosecution might first have been made, instituted or launched. _RP 411/2018_ 12 Hence the respondent-Corporation cannot proceed to recover any dues subsisting three years prior to the demand impugned in the Writ Petition. We also reserve the right of the writ petitioner to move the appellate authority, the time for which will commence from the date of receipt of the certified copy of this judgment; the limitation then being the period as stipulated in the Kerala Municipality Act. Considering the entire grounds taken by the petitioner and on hearing the learned Counsel appearing for the review petitioner, we are of the considered view that there is absolutely no reason for us to review the judgment on any other aspect. Accordingly, with the limited reservation of appellate remedy and the declaration on limitation, the Review Petition is rejected on other grounds. Sd/K. VINOD CHANDRAN Judge Sd/ASHOK MENON Judge dkr