JUDGMENT : This writ petition is filed by a Private Limited Company seeking to quash Ext. P4 report of the Vigilance Department, Ext. P5 order of the Local Self Government Department and consequential Ext.P6 demand raised by the Thrikkakara Municipality dated 20.05.2016 directing the petitioner to remit an amount of Rs. 14,18,307/-towards the building permit fee for the area which was detected in the Vigilance Quick Verification Report; and for a further direction to the Thrikkakara Municipality -the first respondent to issue cutting permission for laying of electricity cable to the apartment building constructed by the petitioner as per Ext.P7 request. 2. Brief material facts for the disposal of the writ petition are as follows:- Petitioner is a Private Limited Company engaged in the development of residential properties and construction of villas and apartments. Petitioner entered into a joint venture agreement on 16.09.2006 with owners of properties in Kakkanad for construction of villas and three multi-storied apartments. The owners of the properties applied for permission from then Thrikkakara Grama Panchayat (thereafter, upgraded as Municipality) for making the construction. According to the petitioner, since the Kerala Municipality Act, 1994 (for short ‘the Act, 1994’) was not enforced within the Panchayat area, on 10.10.2006 as per Ext.P1 certificate the Panchayat informed that permission is not required for the construction. While so, as per G.O. (MS) No. 250/2006/LSGD dated 06.11.2006, the Municipality Building Rules was implemented in the Thrikkakara Panchayat on and with effect from 06.12.2006. Accordingly, an application was submitted by the land owners and the petitioner for permit on 19.12.2007. On 27.12.2007, building permit was issued after collecting an amount of Rs. 2,97,777/-towards compounding fee as per a Circular dated 03.07.2007 issued by the State Government – the third respondent. As per the said Circular, the Panchayat was authorized to regularize the permit of the buildings after collecting compounding fees. It is the case of the petitioner that the implementation of the structural plan in Thrikkakara Panchayat was made only on 16.01.2007, long after Ext.P1 building permit was regularised after accepting compounding fee. According to the petitioner, the compounding fee was realized to the total area of 595.435 cents with a Floor Area Ratio of 2.99. Thereafter, the Local Self Government Engineers verified the calculation of compounding fee and a further amount of Rs. 6,025.31/-was collected. Thus according to the petitioner, a total amount of Rs. According to the petitioner, the compounding fee was realized to the total area of 595.435 cents with a Floor Area Ratio of 2.99. Thereafter, the Local Self Government Engineers verified the calculation of compounding fee and a further amount of Rs. 6,025.31/-was collected. Thus according to the petitioner, a total amount of Rs. 3,03,797/-was realized from the petitioner for regularization of the building permit as per Ext.P2 towards compounding fee. Accordingly, the construction of the villas and two towers were completed and the construction of the third tower has reached six floors. While so, one Abdul Kareem, the Chairman, Standing Committee of the erstwhile Thrikkakara Grama Panchayat filed a complaint before the Court of Enquiry Commission and Special Judge, Thrissur against a former Panchayat Secretary alleging corruption in the issuance of building permit to the petitioner. Apparently, as per an order dated 23.12.2008, the Vigilance Court directed a quick verification by the Vigilance and Anti-corruption Bureau, Ernakulam Unit. The quick verification report was filed before the Vigilance Court on 26.07.2010 recommending, interalia departmental action against the Secretary and to recover additional compounding fee of Rs.7,17,979/-from the petitioner. The case of the petitioner is that all these were done without notice to the petitioner or the property owners. It is evident from the vigilance report that the permit was issued taking into account the total area of the land as 595.435 cents with a FAR of 2.99, which was incorrect. The actual area according to the Vigilance Department was only 586.648 cents with a FAR of 3.038. Anyhow, accepting the vigilance report, further proceedings were dropped by the Vigilance Court. However, based on the order of the Court dated 19.01.2016, Government wrote to the Thrikkakara Municipality for collecting additional compounding fee based on the recommendation of the Director, Vigilance and Anti-corruption Bureau, Thiruvananthapuram – the second respondent. Accordingly, on 20.05.2016, the petitioner was issued with demand notice from the first respondent for realization of an amount of Rs. 14,18,307/- with 18% interest from 27.12.2007, along with a Government letter evident from Exts. P4, P5 and P6. The case projected by the petitioner is that all these things were done behind the back of the petitioner and the petitioner was never given an opportunity to explain the circumstances. 14,18,307/- with 18% interest from 27.12.2007, along with a Government letter evident from Exts. P4, P5 and P6. The case projected by the petitioner is that all these things were done behind the back of the petitioner and the petitioner was never given an opportunity to explain the circumstances. It is also contended that the immediate consequence is that for getting electric connection from the Kerala State Electricity Board, the petitioner has applied for permission of the first respondent for laying underground cable evident from Ext.P7 application. However, the Thrikkakara Municipality has informed that permission can be granted only on remittance of the amount demanded under Ext.P6. The paramount contention advanced is that a reading of Ext.P4 shows that initially an amount of Rs. 7,17,979/-was decided to be recovered from the petitioner which is now enhanced to Rs. 17,22,104/-, and after deducting the compounding fee already collected, Rs.14,18,307/-is demanded with 18% interest from 27.12.2007 by the Thrikkakara Municipality. 3. The paramount contention advanced by the petitioner is that the claims raised by the Thrikkakara Municipality is barred as per Section 539 of the Act, 1994 since the amounts are not demanded within a period of three years. Other contentions are also raised. 4. A counter affidavit is filed for and on behalf of the Director of Vigilance and Anti-corruption Bureau wherein among other contentions, it is submitted that allegation was made against the former Secretary of the Thrikkakara Municipality who abused his official position as a public servant, committed criminal mis-conduct and issued building permit to the petitioner by diluting the procedure of calculation of floor area ratio thereby causing pecuniary advantage to the petitioner and corresponding loss to the Government by collecting less permit fee. Other circumstances with respect to the enquiry are all explained in the counter affidavit. It is also stated that the total extent of the land was only 586.652 cents with a FAR of 3.043. Thus according to the Director, the petitioner is liable to pay additional fee of Rs. 14,18,307/-, taking into account the total floor area constructed by the petitioner. The facts and figures leading to the conclusions are also narrated in the counter affidavit. 5. I have heard Sri. Brijesh Mohan, learned counsel for the petitioner, learned Senior Government Pleader Sri. Joby Joseph for the State of Kerala and the Director, Vigilance and Anti- corruption Bureau, and Sri. The facts and figures leading to the conclusions are also narrated in the counter affidavit. 5. I have heard Sri. Brijesh Mohan, learned counsel for the petitioner, learned Senior Government Pleader Sri. Joby Joseph for the State of Kerala and the Director, Vigilance and Anti- corruption Bureau, and Sri. S. Jamal, learned Standing Counsel for the Thrikkakara Municipality and perused the pleadings and material on record. 6. The learned counsel on either side advanced arguments on the basis of the contentions discussed above. On a perusal of Ext. P4 report submitted by the Director, Vigilance and Anti-corruption Bureau to the Additional Chief Secretary shows that the issue with respect to the foul play in the calculation of floor ratio were scrutinised in detail and recommended to take departmental action for major punishment against, the former Secretary for the Thrikkakara Municipality. The Director also recommended taking steps to collect the additional fee of Rs. 14,18,307/-with penal interest from 27.12.2007 which is the permit regularisation date. It is also made clear that the final report of the case on the basis of the directions issued by the Special Court was submitted before the Court on 01.01.2015. Ext.P4 further shows that the total floor area constructed by the petitioner, and it was accordingly that the facts and figures were arrived at by the Vigilance Department. In fact, going through the pleadings put forth by the petitioner it is clear and vivid, that, there is no much dispute with respect to the floor area ratio adopted by the petitioner for construction; the illegality found out by the Vigilance Department; and the additional permit fee calculated thereunder, except certain stray remarks in the writ petition. The main contention advanced by the petitioner is that, as per Section 539 of the Act, 1994 the demand under Exhibit P6 is barred by limitation and therefore cannot be recovered; the provision reads thus :- “539. Limitation for recovery of dues. The main contention advanced by the petitioner is that, as per Section 539 of the Act, 1994 the demand under Exhibit P6 is barred by limitation and therefore cannot be recovered; the provision reads thus :- “539. Limitation for recovery of dues. -(1) No distraint shall be made, no suit shall be instituted and no prosecution shall be commenced in respect of any sum due to a Municipality under this Act after the expiration of a period of three years from the date on which distraint might first have been made, suit might first have been instituted, or prosecution might first have been commenced, as the case may be, in respect of such sum: Provided that in the case of assessments made under section 282 the said period of three years shall be computed from the date on which distraint might have been made, suit instituted, or prosecution commenced, after the assessment under the said section shall have been made. (2) Where any amount due to the Municipality has been barred by limitation under subsection (1) due to the default of not taking steps at the appropriate time, and it is found in a lawful enquiry that it was lost due to the default of any officer or officers, the amount so lost to the Municipality shall be realised with twelve per cent interest thereon from such officer or officers.” It is true the provision makes it clear that under normal and ordinary circumstances after the expiration of a period of three years from the date on which distraint might first have been made, suit might first have been instituted or prosecution might first have been commenced as the case may be in respect of such sum, no demand can be raised or recovery can be made. But here is a case where the construction in question was started, within the Thrikkakara Grama Panchayat and therefore, the building Rules were not applicable to the said area, which was certified by the Secretary of the Grama Panchayat. But even according to the petitioner, the municipality building Rules were made applicable to the Thrikkakara Grama Panchayat in December, 2016 itself. Thereafter, a building permit was secured by the petitioner and the owners of the properties jointly, in which the area of the property and the floor area ratio was given in a distorted manner. 7. But even according to the petitioner, the municipality building Rules were made applicable to the Thrikkakara Grama Panchayat in December, 2016 itself. Thereafter, a building permit was secured by the petitioner and the owners of the properties jointly, in which the area of the property and the floor area ratio was given in a distorted manner. 7. Later the Grama Panchayat was upgraded as a Municipality. Anyhow, on the basis of a complaint filed by a former member of the Finance Standing Committee of the Grama Panchayat, the Vigilance Special Court has directed for a quick verification report. On the basis of the same an in-depth enquiry was conducted by the Vigilance Department and found that the actual area of the property was only 586.648 cents. However, the floor area ratio to be applied was 3.038. Therefore, the Vigilance found that the calculation made by the then Panchayat officials was illegal and it was accordingly that the entire floor area was measured and arrived at the conclusions in Ext.P4 report submitted before the Government dated 11.03.2015; that the actual fee ought to have been remitted for permit regularisation is Rs. 17,22,104/-and it was accordingly that the recommendation was made to recover an amount of Rs.14,18,307/-after deducting an amount of Rs.3,03,797/-, remitted by the land owners/petitioners. Therefore, it can be seen that the issue of the actual floor area constructed by the petitioner was identified while the enquiry was made by the Vigilance Department. To put it otherwise, the actual area of the property and the floor area ratio was suppressed when the permit was originally granted to the petitioner and the land owners, which in my considered opinion is a deceptive and fraudulent method employed by the owners of the properties and the builder. In fact, the Vigilance filed the final report before the Special Court to drop the proceedings since they could not gather sufficient evidence to prosecute the former Secretary of the Panchayat. Thus taking into account the totality of the circumstances, it can be seen that the petitioner and the owners of the property attempted to play fraud on the Grama Panchayat/Municipality in order to get unmerited financial advantage by suppressing the actual floor area ratio to be applied for construction of the multi-storied buildings and the actual floor area constructed. Thus taking into account the totality of the circumstances, it can be seen that the petitioner and the owners of the property attempted to play fraud on the Grama Panchayat/Municipality in order to get unmerited financial advantage by suppressing the actual floor area ratio to be applied for construction of the multi-storied buildings and the actual floor area constructed. The said aspect was revealed after a threadbare enquiry conducted by the Vigilance which is quite clear and evident from Ext.P4 report submitted by the Director before the Government dated 11.03.2015. 8. Taking into account the said aspects, it cannot be said that the limitation prescribed under Section 539 of the Act, 1994 can be applied in the instant case from the date of regularisation of the permit in the year 2007. It is, for the reason that the report of the Vigilance was intimated by the State Government as per Ext.P5 to the Secretary of the Thrikkakara Municipality only as per the letter dated 06.05.2016, and it was accordingly that Ext.P6 demand was issued by the Municipality on 20.05.2016 to the petitioner. In my considered opinion, the fraud, undue favouritism and corruption employed only hindered the Municipality from collecting the actual permit fee from the petitioner and the land owners. It is a very well settled position in law that fraud vitiates everything and every action, which principle is squarely applicable in the facts and circumstances of this case. 9. To draw an analogy, the proviso to Section 539(1) of the Act, 1994 makes it clear that in the case of assessments made under Section 282 of the Act, 1994, the period of three years prescribed under Section 539(1) of the Act, 1994 shall be computed from the date on which distraint might have been made, suit instituted or prosecution commenced after the assessment under the said Section shall have been made. Section 282 of the Act, 1994 dealing with taxation and fees, comes under Chapter XIV of the Act, 1994. Section 282 of the Act, 1994 dealing with taxation and fees, comes under Chapter XIV of the Act, 1994. However, it makes it clear that the Municipality is vested with power to assess in case of escape from assessment; which specifies that; notwithstanding anything to the contrary contained in this Act or the Rules made thereunder, where for any reason a person liable to pay any tax or fees leviable under this Chapter has escaped assessment in any half-year, the Secretary may at any time within four years from the date on which such person should have been assessed, serve on him a notice assessing to the tax or fee due and demanding payment thereof within fifteen days from the date of such service and thereupon, the provisions of this Act and the Rules made thereunder shall, so far as may be, apply as if the assessment was made in the half-year to which the tax or fee relates. Therefore, in my considered opinion the provisions contained under Section 539 of the Act, 1994 for demanding and recovery of any amount within a period of three years is not an absolutely abstract principle to suit each and every situation. True, normally and ordinarily, it would apply as such, but there can be extraordinary circumstances, by which the limitation may have to be applied as if to run, when the fraudulent act was detected. 10. The case on hand is one of such extraordinary nature since the Municipality would have lost a huge amount of more than Rs. 14 lakhs but for the enquiry conducted by the Vigilance Department and detected the fraud and deception played by the petitioner and owners of the property with respect to the floor area ratio and the actual floor area constructed. Therefore, the limitation has only to start from the date of Ext. P5 intimation made by the State Government. If that be so, Ext. P6 demand made by the Municipality is within a period of three years as prescribed under Section 539 of the Act, 1994. Thereafter, the said proceedings were stayed by this court on the petitioner remitting a portion of the amount demanded which is still in force. 11. P5 intimation made by the State Government. If that be so, Ext. P6 demand made by the Municipality is within a period of three years as prescribed under Section 539 of the Act, 1994. Thereafter, the said proceedings were stayed by this court on the petitioner remitting a portion of the amount demanded which is still in force. 11. In my considered opinion, merely because at the stage of quick verification report no opportunity was given by the Vigilance that by itself will not interfere with the rights of the petitioner because if at all there is any adverse impact on the report drawn by the Vigilance, it is only when the demand is raised by the Municipality against the petitioner for the amount in question. In fact, there is no force at all in raising such a contention for the fundamental reason that, the vigilance actually unearthed the issue by conducting physical measurement of the property and the building, which aspect stands undisputed, and the petitioner cannot be heard to say at this belated point of time that it was unaware of the same. 12. Taking into account all the above aspects, I am of the definite opinion that the petitioner is not entitled to get the proceedings of the Vigilance, the communication of the Government, and the demand, impugned in the writ petition quashed. The reliefs so sought are accordingly declined. 13. However, since the whole incident were unearthed after an in-depth Vigilance enquiry and since 18% interest is demanded against the amount recommended by the Vigilance Department, I think it is only fair and proper that an opportunity is provided to the petitioner to raise an objection to the facts and figures contained in Ext.P6 demand raised by the Secretary of the Municipality. 14. In that view of the matter, even though I decline the reliefs sought for by the petitioner in the writ petition, Ext.P6 demand notice issued by the Municipality is treated as a show cause notice and the petitioner is given the liberty to file an objection within one month from the date of receipt of a copy of this judgment to Ext.P6 and if the said objection is submitted by the petitioner as directed above, it shall be finalised by the Secretary of the Thrikkakara Municipality within one month thereafter. However, if the petitioner is not complying with the direction as above, the Municipality would be at liberty to recover the amount in accordance with law. The writ petition is disposed of accordingly.