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2024 DIGILAW 100 (KER)

St. George Church v. State of Kerala

2024-01-24

DINESH KUMAR SINGH

body2024
JUDGMENT : The petitioner, a Catholic Church, has filed the present writ petition impugning the orders rejecting its claim for exemption of the building from payment of building tax and luxury tax. Ext.P1 is the order of the Tahsildar dated 26.10.2015 assessing the area of the petitioner's building as 282.28 sq.metres and demanding onetime tax and luxury tax for the year 2015-16 onwards. Even though the petitioner filed appeal against Ext.P1, the Sub Collector referred the matter vide Ext.P3 dated 6.2.2016 to the Government for deciding the question of exemption of petitioner's building from payment of tax. The Government, vide Ext.P4 dated 7.2.2022, rejected the claim of the petitioner and restored Ext.P1 order of the Tahsildar. Hence, the petitioner is before this Court in the present writ petition challenging the aforesaid Exts.P1, P3 and P4 orders. 2. The petitioner has constructed the building having a plinth area of 277.84 sq.metres. On report of the concerned Village Officer, notices were issued to the petitioner for assessing one time building tax on the said building. However, despite service of notices, no objections were filed. Thereafter, the charge officer made measurement and reported that the plinth area of the building is 282.29 sq.metres. Since the threshold limit is 278.7 sq.metres, the petitioner's building was also assessed for luxury tax for the year 2015-16, vide the assessment order in Ext.P1 dated 26.10.2015. The petitioner aggrieved by the said assessment order filed appeal before the Sub Collector, Perinthalmanna. The petitioner filed objection in the appeal before the Sub Collector that the petitioner's building was exempted from payment of building tax, in view of Section 5 of the Kerala Building Tax Act, 1975 ('Act', for short) and the matter should be referred to the Government to take a decision underSection 3(1)(b) of the Act regarding exemption from payment of building tax on the building constructed by the petitioner. Thus the matter was referred to the State Government for considering the claim of the petitioner for exemption from payment of building tax under Section 3(1)(b) of the Act. 3. According to the petitioner, the Vicar of the Church, the building is owned by St.George Church, Kalikkavu, which comes under the Archdiocese of Thamarassery. The cellar portion of the building is covered and in that hall portion Bible classes are being conducted. The children of parishners numbering about 50 are attending the classes. 3. According to the petitioner, the Vicar of the Church, the building is owned by St.George Church, Kalikkavu, which comes under the Archdiocese of Thamarassery. The cellar portion of the building is covered and in that hall portion Bible classes are being conducted. The children of parishners numbering about 50 are attending the classes. The ground floor portion of the building is used for stay of the Vicar of the Church. The Church has no means to pay the tax on the building and therefore, exemption has been claimed. 4. However, the Tahsildar reported that he had made inspection of the building. All sides of the cellar portion is covered with provision for entrance. The plinth area of that hall is 119.5 sq.metres. The said portion of the building is used for conducting Sunday classes and the portion above hall portion is used for stay of Vicar of the Church. 5. The Government examined the contentions of the petitioner as well as the reports of the Tahsildar. On the basis of the report of the Tahsildar, the total plinth area of the building owned by St.George Church is 282.28 sq.metres. Out of the said area, 158.34 sq.metres portion is used 6. The Government has been of the opinion that the building, where Sunday school classes are conducted, will not come under Section 3(1)(b) of the Act for the purpose of granting exemption. Therefore, the claim of the petitioner for exemption from payment of the building tax under Section 3(1)(b) of the Act was rejected, against which the present writ petition has been filed. 7. Learned counsel for the petitioner submits that the building is integrally connected with the religious or education purpose and therefore the said building is also liable to be exempted from payment of building tax under the provisions of the Act. He further submits that the Hon'ble Supreme Court has considered this aspect in the case of Government of Kerala and Another v. Mother Superior Adoration Convent [ (2021) 5 SCC 602 ]. He further submits that considering the said judgment, the order passed by the State Government in Ext.P4 is not only against the provisions of Sections 3 and 5A of the Act, but also against the judgment passed by the Hon'ble supreme Court in Mother Superior Adoration Convent (supra). He further submits that considering the said judgment, the order passed by the State Government in Ext.P4 is not only against the provisions of Sections 3 and 5A of the Act, but also against the judgment passed by the Hon'ble supreme Court in Mother Superior Adoration Convent (supra). He, therefore, submits that taking note of the provisions of the Act and the judgment of the Hon'ble Supreme Court, the view taken by the Government to decline the request of the petitioner for exemption from payment of the building tax is erroneous and the order passed in Ext.P4 is liable to be set aside. 8. On the other hand, Smt.Jasmine M.M., learned Government Pleader, submits that the residence and the classes conducted on the building cannot be considered to be religious purposes. The residence and the classes are not integrally connected with the religious purpose of the Church and if a building is not integrally connected with the religious or educational purpose, such building is not entitled for exemption under Section 3(1)(b) of the Act. Learned Government Pleader has supported the order in Ext.P4 and has submitted that the writ petition is liable to be dismissed. 9. I have considered the submissions and perused the writ petition. 10. The Hon'ble Supreme Court in the judgment in Mother Superior Adoration Convent (supra) has considered the scope of Sections 3(1)(b) and 5, the charging provisions. The fact that the building constructed by the petitioner is used for the residence of the Vicar of the Church as well as for imparting religious instruction to the students, is not in dispute. The question is whether the residence of the Vicar of the Church and the imparting of religious instruction to the students are the activities integrally connected with the religious purpose of the Church or not. The Hon'ble Supreme Court in paragraph Nos.12 and 13 of the judgment in the case of Mother Superior Adoration Convent (supra) has considered this aspect and has held as under: “12. A reading of the provision would show that the object for exempting buildings which are used principally for religious, charitable or educational purposes would be for core religious, charitable or educational activity as well as purposes directly connected with religious activity. A reading of the provision would show that the object for exempting buildings which are used principally for religious, charitable or educational purposes would be for core religious, charitable or educational activity as well as purposes directly connected with religious activity. One example will suffice to show the difference between a purpose that is directly connected with religious or educational activity and a purpose which is only indirectly connected with such activity. Take a case where, unlike the facts in Civil Appeal No.202 of 2012, nuns are not residing in a building next to a convent so that they may walk over to the convent for religious instruction. Take a case where the neighbouring building to the convent is let out on rent to any member of the public, and the rent is then utilised only for core religious activity. Can it be said that the letting out at market rent would be connected with religious activity because the rental that is received is ploughed back only into religious activity? Letting out a building for a commercial purpose would lose any rational connection with religious activity. The indirect connection with religious activity being the profits which are ploughed back into religious activity would obviously not suffice to exempt such a building. But if on the other hand, nuns are living in a neighbouring building to a convent only so that they may receive religious instruction there, or if students are living in a hostel close to the school or college in which they are imparted instruction, it is obvious that the purpose of such residence is not to earn profit but residence that is integrally connected with religious or educational activity. 13. A reading of the other provisions of the Act strengthens the aforesaid conclusion. “Residential building” is defined separately from “building” in Section 2(l). A “residential building” means a building or any other structure or part thereof built exclusively for residential purpose. It is important to note that “residential building” is not the subject matter of exemption under Section 3 of the Act. Quite the contrary is to be found in Section 5A of the Act, which starts with a non-obstante clause, and which states that a luxury tax is to be charged on all residential buildings having a plinth area of 278.7 square meters and which have been completed on or after 1.4.1999. Quite the contrary is to be found in Section 5A of the Act, which starts with a non-obstante clause, and which states that a luxury tax is to be charged on all residential buildings having a plinth area of 278.7 square meters and which have been completed on or after 1.4.1999. If we were to accept the contention of the State, buildings in which nuns are housed and students are accommodated in hostels which have been completed after 1.4.1999 and which have a plinth area of 278.7 square meters would be liable to pay luxury tax as these buildings would now no longer be buildings used principally for religious or educational purposes, but would be residential buildings used exclusively for residential purposes. This would turn the object sought to be achieved in exempting such buildings on its head. For this reason also, we cannot countenance a plea by the State that buildings which are used for purposes integrally connected with religious or educational activity are yet outside the scope of the exemption contained in Section 3(1)(b) of the Act. We may now examine the case law.” 11. It is not the case of the State that the building is used for any commercial purposes. In view of the judgment of the Hon'ble Supreme Court, I am of the opinion that the residence of the Vicar of the Church and imparting of religious instruction to the students are activities integrally connected with the religious purpose of the Church, and therefore, prima facie, the view taken by the State Government does not appear to be correct. 12. In view of the above, the present writ petition is allowed and the impugned order at Ext.P4 dated 7.2.2022 is set aside and the matter is remitted back to the State Government to decide the issue afresh, after taking into account the decision of the Hon'ble Supreme Court in the case of Mother Superior Adoration Convent (supra). The petitioner should be issued a notice of hearing and after hearing the petitioner, necessary orders will be issued. Pending interlocutory application, if any, in the present writ petition stands dismissed.