High Court of KeralaSingle Judge2014-12-08Parties to bear their own costs; Ext.P13 and Ex...

Westfort Ayurveda Hospital v. State of Kerala

Case / Petition Number:WP(C).No.7979 of 2009 (N)

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: A.K. Jayasankaran Nambiar
Judgment Date: 2014-12-08
Court Decision / Holding: I quash Ext.P13 assessment order, as also Ext.P16 revenue recovery notice, and direct the 3rd respondent Tahsildar to pass a fresh assessment order, assessing the additional construction effected by the petitioner in the year 1993 to building tax, after verifying whether the construction is in fact an additional construction to an erstwhile building or a new construction altogether. The 3rd respondent shall also keep in mind the Unity Hospital Full Bench decision to determine whether the petitioner is entitled to exemption in respect of the additional construction and shall pass fresh orders within three months from the date of receipt of a copy of this judgment, after hearing the petitioner. The order to be passed shall be reasoned and shall advert to the documents produced by the petitioner in support of its contentions.
Final Disposition: Parties to bear their own costs; Ext.P13 and Ext.P16 quashed; fresh assessment to be completed within three months after hearing the petitioner.

Parties to the Case

Appellants / Petitioners

M/S Westfort Ayurveda Hospital, Ayyanthole, Thrissur, represented by its Managing Partner

Respondents

State of Kerala
The Revenue Divisional Officer, Thrissur
The Tahsildar, Taluk Office, Thrissur
The Village Officer, Ayyanthole, Thrissur
Thrissur Corporation

Legal Representation & Advocates

Counsels for Petitioners

• Sri. Babu S. Nair
• Sri. Resmi G. Nair

Counsels for Respondents

• Sri. K.P. Vijayan
• Sri. V.M. Syam Kumar
• Sri. V.N. Haridas
• Sri. Kripa Elizabeth Mathews
• Sri. Lilly K.T

Case Synopsis & Summary

Westfort Ayurveda Hospital challenged a Building Tax assessment that taxed the entire building including a 1993 addition intended to house a Nursing School. The hospital had purchased the property in 1992 and, following construction in 1993, was assessed under the Kerala Building Tax Act; Ext.P13 (assessment) and Ext.P16 (recovery) taxed the entire structure, including the earlier building. The petitioner asserted that only the 1993 addition could be taxed, and that the Nursing School construction should qualify for exemption under Section 3 of the Kerala Building Tax Act. The respondents contended that the building in dispute differed in survey numbers and that the petitioner did not claim exemption prior to assessment. The High Court noted that the assessing authority ought to have resolved any dispute about the existence of an older building before issuing the assessment, and that the 1993 addition could be exempt if the Unity Hospital Full Bench ruling (2011) applied. The court quashed Ext.P13 and Ext.P16, and directed the Tahsildar to pass a fresh assessment order after verifying whether the construction is an addition to an existing building or a new construction, and whether the petitioner is entitled to exemption under the Unity Hospital ruling, within three months, with a reasoned order and consideration of the documents submitted by the petitioner.

Provisions of Law Cited

Kerala Building Tax Act, Section 3

Legal Doctrines & Maxims

Unity Hospital (P) Ltd. v. State of Kerala, (Full Bench) 2011 (1) KLT 236 — interpretation of exemption for additional construction under the Building Tax Act

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioner contended that the tax liability should cover only the 1993 addition to the building and that the Nursing School construction qualifies for exemption under Section 3 of the Kerala Building Tax Act. Ext.P13 (assessment) and Ext.P16 (recovery) were issued without considering the disputed existence of an older building and without applying the Unity Hospital exemption standard. The petitioner urged the Court to quash the assessment and direct a fresh assessment after evaluating whether the addition is indeed an extension to an old building or a new construction, and whether exemption is applicable.

Contentions of Respondents

The respondents argued that the construction represented a later, distinct building and that the survey numbers indicated a different property; they submitted that the petitioner did not claim exemption prior to assessment and that Ext.P13 was properly issued. They emphasized that the documents must reflect the correct building for tax purposes and that the authority should assess accordingly.

Cited Precedents (1)

Case Name	Citation	Treatment	Explanation
Unity Hospital (P) Ltd. v. State of Kerala	2011 (1) KLT 236	Positive	Full Bench ruling on exemption of additional construction under the Kerala Building Tax Act; the Court relies on this decision to assess eligibility for exemption.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR. JUSTICE A.K.JAYASANKARAN NAMBIAR** **MONDAY, THE 8TH DAY OF DECEMBER 2014/17TH AGRAHAYANA, 1936** **WP(C).NO. 7979 OF 2009 (N) ---------------------------** **PETITIONER(S):** **---------------** **M/S.WESTFORT AYURVEDA HOSPITAL AYYANTHOLE, THRISSUR, REPRESENTED BY ITS MANAGING PARTNER.** **BY ADVS.SRI.BABU S. NAIR SMT.RESMI G. NAIR** **RESPONDENT(S):** **---------------** **1. STATE OF KERALA REPRESENTED BY SECRETARY TO GOVERNMENT, REVENUE DEPARTMENT GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.** ## **2. THE REVENUE DIVISIONAL OFFICER, THRISSUR** ## **3. THE TAHSILDAR, TALUK OFFICE, THRISSUR.** ## **4. THE VILLAGE OFFICER, AYYANTHOLE,THRISSUR** **5. THRISSUR CORPORATION, REPRESENTED BY ITS SECRETARY, THRISSUR.** **R5 BY ADV. SRI.K.P.VIJAYAN R5 BY ADV. SRI.V.M.SYAM KUMAR R3 BY ADV. GOVERNMENT PLEADER SMT.LILLY K.T R5 BY ADV. SMT.KRIPA ELIZABETH MATHEWS R5 BY ADV. SRI.V.N.HARIDAS** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 08-12-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** ## **WP(C).NO. 7979 OF 2009 (N)** ## **APPENDIX** ## **PETITIONER'S EXHIBITS:** **EXT.P1: COPY OF THE SALE DEED NO.1305/92 DATED 16.3.92 IN RESPECT OF THE PETITIONERS PROPERTY** **EXT.P2: COPY OF THE SALE DEED NO.1306/92 DATED 16.3.92 IN RESPECT OF THE PETITIONERS PROPERTY** **EXT.P3: COPY OF THE SALE DEED NO.1307/92 DATED 16.3.92 IN RESPECT OF THE PETITIONERS PROPERTY** **EXT.P4: COPY OF THE SALE DEED NO.1308/92 DATED 16.3.92 IN RESPECT OF THE PETITIONERS PROPERTY** **EXT.P5: COPY OF THE SALE DEED NO.1309/92 DATED 16.3.92 IN RESPECT OF THE PETITIONERS PROPERTY** **EXT.P6: COPY OF THE SALE DEED NO.1466/92 DATED 16.3.92 IN RESPECT OF THE PETITIONERS PROPERTY** **EXT.P7: COPY OF THE SALE DEED NO.1675/92 DATED 16.3.92 IN RESPECT OF THE PETITIONERS PROPERTY** **EXT.P8: COPY OF THE SALE DEED NO.525/80 DATED 30.1.80 IN FAVOUR OF THE PREVIOUS OWNERS** **EXT.P9: COPY OF THE SALE DEED NO.547/80 DATED 2.2.80 IN FAVOUR OF THE PREVIOUS OWNERS** **EXT.P10:COPY OF THE SALE DEED NO.548/80 DATED 02.2.80 IN FAVOUR OF THE PREVIOUS OWNERS** **EXT.P11: COPY OF THE SALE DEED NO.549/80 DATED 02.2.80 IN FAVOUR OF THE PREVIOUS OWNERS** **EXT.P12: COPY OF THE NOTICE DATED 14.10.08 ISSUED BY THE 3RD RESPONDENT TO THE PETITIONER** **EXT.P13: COPY OF THE ORDER DATED 25.11.08 ISSUED BY THE 3RD RESPONDENT TO THE PETITIONER** **EXT.P14: COPY OF THE INFORMATION GIVEN BY THE 3RD RESPONDENT TO THE PETITIONER DATED 27.1.09 UNDER THE RI ACT** **EXT.P15: COPY OF THE ASSESSMENT REGISTER RELATING TO PROPERTY TAX FOR THE YEAR 1971-75** **EXT.P16: COPY OF THE DEMAND NOTICE DATED 02.02.09** ## **RESPONDENTS' EXHIBITS: NIL** **//TRUE COPY//** **P A TO JUDGE** ## **A.K.JAYASANKARAN NAMBIAR, J.** **.............................................................** W.P.(C).No.7979 of 2009 **.............................................................** Dated this the 8[th] day of December, 2014 ## **J U D G M E N T** The petitioner is an Ayurveda Hospital. It had purchased a property with a building thereon in 1992. It is the case of the petitioner that, on the said building, an additional floor was constructed in 1993, for the purposes of running a Nursing School. The petitioner was, however, issued with a notice proposing levy of building tax on the entire building, including the portion that was constructed prior to the coming into force of the Building Tax Act. Ext.P13 is the assessment order that was passed by reckoning the plinth area of the building as 2514.07 sq.metres. Ext.P16 is the revenue recovery notice served on the petitioner. In the writ petition, Exts.P13 and Ext.P16 are impugned, inter alia, on the ground that the respondents had authority to levy building tax only on the additional construction effected in 1993, and not the earlier portion which had come into existence prior to the coming into force of the Building Tax Act. It is also the case of the petitioner that, insofar as the additional construction was made to house a Nursing School, the said construction would also qualify for exemption in terms of Section 3 of the Kerala Building Tax Act. 2 W.P.(C).No.7979 of 2009 2. A counter affidavit has been filed on behalf of the respondents wherein it is pointed out that the documents produced by the petitioner, to suggest that the property that was acquired by them included a building therein, show the survey number of the property to be No. 890/02 of Ayyanthole village whereas the present construction is effected in Survey No.886/4. It is the case of the respondents, therefore, that the construction which is stated to be an old building, must necessarily be a building other than the one mentioned in the sale deeds produced by the petitioner in the writ petition. It is also pointed out that the petitioner had not made any claim for exemption prior to the assessment being done on them. 3. I have heard Smt.Lisha.M., the learned counsel for the petitioner and Smt.K.T.Lilly, the learned Government Pleader appearing on behalf of respondents. 4. On a consideration of the facts and circumstances of the case and submissions made across the Bar, I am of the view that, insofar as there is a dispute with regard to the existence of an earlier building, in the area where the additional construction was effected by the petitioner in the year 1993, it was incumbent upon the assessing authority to consider the said objection of the 3 W.P.(C).No.7979 of 2009 petitioner before passing orders of assessment in respect of the additional construction effected by the petitioner. It is also necessary to note that the petitioner had a definite case that the additional construction effected was for the purposes of conducting a Nursing School. If that be so, then in terms of the decision of the Full Bench of this Court in **Unity Hospital (P) Ltd. v. State of Kerala [2011 (1) KLT 236],** the assessing authority would have to ascertain whether the additional construction would qualify for exemption in terms of the said judgment of this Court. Insofar as Ext.P13 assessment order does not reflect a consideration of these aspects, I quash Ext.P13 assessment order, as also Ext.P16 revenue recovery notice, and direct the 3[rd] respondent Tahsildar to pass a fresh assessment order, assessing the additional construction effected by the petitioner in the year 1993 to building tax, after verifying whether the construction is in fact an additional construction to an erstwhile building or a new construction altogether. The 3[rd] respondent shall also keep in mind the aforementioned decision of the Full Bench of this Court so as to determine whether the petitioner is entitled to the exemption claimed in respect of the additional construction. The 3[rd] respondent shall pass fresh orders in the matter within a period of three months from the date of receipt of a copy of this judgment, after hearing the petitioner. The order to be passed by the 3[rd] 4 W.P.(C).No.7979 of 2009 respondent shall be a reasoned one and shall be advert to the documents produced by the petitioner in support of its contentions. **A.K.JAYASANKARAN NAMBIAR JUDGE** mns W.P.(C).No.7979 of 2009 5