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1994 DIGILAW 28 (KER)

Ummerkutty v. State of Kerala

1994-01-19

T.L.VISWANATHA IYER

body1994
Judgment :- There is no merit in this original petition. The building in question was constructed in the year 1984. Petitioner was one of the two co-owners of the building, the other co-owner being his sister's husband, one Vazhayil Mammootty. The petitioner has since transferred his share in the building to his sister, by deed of assignment marked Ext.Pl dated June 3,1993. 2. The petitioner filed return for purpose of assessment to tax under the Kerala Building Tax Act, 1975 (hereinafter referred to as the act). The assessment proceedings dragged on, and eventually the petitioner was called upon to appear before the assessing authority, namely the second respondent, on September 22, 1993. By that time, the petitioner had transferred his share in the building to his sister as mentioned earlier. He took up the stand before the assessing authority that he was no longer liable for payment of tax under the Act, as he had ceased to be the owner of the building. This was not acceptable to the assessing authority, who completed the assessment Ext.PS on September 23,1993 and made demand by Ext.P4 for an amount of Rs.12,000/- by way of tax payable in four quarterly instalments commencing from October 23, 1993. Petitioner did not challenge the assessment in appeal, though an appeal is provided by S.I 1 of the Act; nor did he make payment of the tax due. He has filed this writ petition when he was faced with proceedings under the Revenue Recovery Act and the notice Ext.PS was issued to him for payment of the first instalment of the tax which had been fallen due on October 23, 1993. The petitioner states that he made a representation Ext.P6 to the assessing authority seeking to rectify a mistake in the assessment, under S.15 of the Act, the mistake alleged being that he is only a co-owner, that the other co-owner Vazhayil Mammootty should also be made liable, and that, in any case, the tax should be recovered from this Mammootty and his wife Rukhia, the petitioner's sister. 3. Petitioner's contention in this writ petition is that he has ceased to be the owner of the building after the transfer to his sister on June 3,1993, by the deed of assignment Ext.Pl and therefore, no portion of the tax could be recovered from him, the liability for tax being only that of the owner under the Act. 3. Petitioner's contention in this writ petition is that he has ceased to be the owner of the building after the transfer to his sister on June 3,1993, by the deed of assignment Ext.Pl and therefore, no portion of the tax could be recovered from him, the liability for tax being only that of the owner under the Act. The question is whether this contention is correct. 4. The charging section, namely S.5(1), (before its amendment by Act 3 of 1992), imposed a tax in respect of every building, the construction of which was completed on or after April 1, 1973 and the capital value of which exceeded Rs.75,000/- at the rate specified in the schedule. Sub-section (6) of the section made the tax payable by the "owner" of the building. The definition of "owner" in S.2(i) is an inclusive one to bring in a large number of persons within its ambit - evidently to facilitate easy collection of the tax due for a building. Petitioner has no case that he was not one of the owners of the building when it was constructed in 1984. S.7 requires the owner of a newly constructed building to furnish a return containing the prescribed particulars within a period of two months, from the date of completion of the construction (see sub-sec lion (2) of the section). S.9 prescribes the procedure for assessment. If the assessing authority is satisfied that the return is correct and complete, it shall assess the amount payable by the owner as building tax on the basis of the return. If on the other hand, he is not so satisfied, he shall serve a notice on the assessee and afford him an opportunity to produce or cause to be produced any evidence on which he may rely in support of the return, hear him and then assess the amount payable as the building tax. (Vide sub-sections 2, and 3 of S.9). " Assessee" is defined in S.2(c) as meaning a person by whom building tax or any other sum of money is payable under the Act, including every person in respect of whom any proceeding under the Act has been taken for the assessment of the building tax payable by him. (Vide sub-sections 2, and 3 of S.9). " Assessee" is defined in S.2(c) as meaning a person by whom building tax or any other sum of money is payable under the Act, including every person in respect of whom any proceeding under the Act has been taken for the assessment of the building tax payable by him. The person who is called upon to produce evidence in support of the return, namely the assessee may thus be the person who filed the return or he may be any other person who is liable to pay the tax under the Act, A combined reading of sub-sections (1) and (6) of S.5 and S.7 of the Act makes it clear that the owner of the building at the time the construction was completed is fixed with the liability for payment of the tax under the Act, though others like the current owner, are also liable as owners. It must also be noted that the tax payable is a first charge on the building under S.19(2). 5. Petitioner was admittedly the owner of the building. He had constructed it. The taxable event under the Act is the construction of the building. It is the completion of the construction that gives rise to the liability under the Act. The liability is cast the moment the construction of the building is complete. It is the owner, (which includes the title holder of the property at the time of completion of the construction), who is called upon by S.7 to file the return within two months of the date of completion of the construction. The liability under the Act is thus fastened on the person who completed the construction. As pointed out earlier, others also are made Habile, including the current owner, but the liability of the original owner is not in any manner discharged by his transferring the building. The petitioner thus became liable for payment of the building tax due as soon as the building was constructed in 1984. The delay on the part of the assessing authority in quantifying the tax does not absolve the petitioner of his liability under S.5 of the Act. The petitioner thus became liable for payment of the building tax due as soon as the building was constructed in 1984. The delay on the part of the assessing authority in quantifying the tax does not absolve the petitioner of his liability under S.5 of the Act. It is nowhere provided that a person on whom a liability has been cast by S.5 on his completing the construction of the building and who is obliged to file the return under S.7, is exonerated from liability the moment he transfers the building. There is no warrant for this proposition anywhere in the provisions of the Act. I am therefore unable to accept the petitioner's contention that merely because he transferred the building nine years after the construction was over, he stands exonerated from liability by virtue of that transfer. The original petition is therefore without any merit. The petitioners liability continues to subsist despite the transfer effected by him by Ext.Pl. 6. The petitioner has an alternate contention that he is only a co-owner of the building and that Mammootty should also be made liable for the tax. If he has any such case, he should have raised it in statutory appeal before the appellate authority. Petitioner has filed a representation Ext.P6 purporting to be under S.15 of the Act and he seeks a direction for disposal of that representation. I do not find any reason to issue any such direction as the very maintainability of such a petition is a moot question. I refuse to issue any such direction. The original petition is accordingly dismissed.