JUDGMENT : The petitioner is the Manager of an Aided Upper Primary School for which approval of layout was granted by the Chief Town Planner, by Ext. P1 proceedings dated 27.05.2009 to reconstruct the existing 3-storied building by adding one more floor having an extent of 3100.84 sq. mtrs of plinth area. The building permit was issued on 15.05.2010, which was renewed upto 14.05.2019, which is seen from Ext.P2 building permit. The petitioner was issued with the demand notice under Rule 14 of the Kerala Municipality (Property Tax, Service Cess and Surcharge) Rules, 2011 (hereinafter referred to as the 'Surcharge Rules, 2011') demanding the same from 2016 to 2017 onwards. The petitioner approached the Corporation contending that their application for regularisation was pending before the Chief Town Planner and that the imposition of the property tax was not sustainable in view of Section 235(b) of the Kerala Municipality Act, 1994 (for short, the Act) since there is a total exemption from payment of property tax as the building in question is an aided school. 2. The petitioner was again issued a notice by Ext.P5 on 27.05.2022 stating that the building did not have the requisite setback. The petitioner replied to the same pointing out that the school was established more than 106 years back and that 1300 students are studying in 38 classrooms with 45 teaching staffs. The petitioner also disputed having received Ext.P5. As per the Ext.P9 order, dated 26.11.2022, the building was regularised as per the proceedings of the District Town Planner. The petitioner was directed to pay 10% of the compounding fee of Rs.52,005/-. The petitioner was also directed to remit half of the same to the local authority and the remaining half to the Government as per Ext.P9 order. 3. The petitioner had remitted the amounts so demanded in Ext.P9 as per Exts. P11 to P13. The petitioner submits that overlooking all the above, yet another demand notice was issued directing the petitioner to pay the property tax for the years from 2016-17 to 2023-2024, amounting to Rs.4,69,333/- 2,87,596/-, Rs.2,87,596/- and Rs.3,62,756/-, as per Ext.P14 notice dated 15.06.2023. The petitioner challenges Exts.P3, P5 and P14 and also for a declaration that the petitioner's institution is liable to get exemption from payment of taxes under Section 235(b) of the Act. 4. The petitioner challenges Exts.P3, P5 and P14 and also for a declaration that the petitioner's institution is liable to get exemption from payment of taxes under Section 235(b) of the Act. 4. A counter affidavit has been filed on behalf of the Secretary of the Kannur Municipal Corporation, wherein it is stated that the petitioner had admittedly constructed the buildings unauthorisedly and the unauthorised construction is measuring an area of 1587.91 square metres. This act of construction without getting permission is in violation of Rule 54(3)(iii) and Rule 104(2) of the Kerala Municipality Building Rules, 1999. The Corporation admits that the building was regularised, but their demand of property tax is for an area of 1587.9 square metres, during the period when the building remained unauthorised and which was being used. According to them, the said levy is lawful given Rule 20(3) of the Surcharge Rules, 2011. On the above basis, they sought to justify the demand. 5. The learned counsel appearing for the petitioner Sri. Mohanakannnan reiterated the contentions stated in the writ petition and contended that since the building is exempted from paying the tax going by Section 235(b) of the Act, there arises no question of making any payment even during the period when the building remained unauthorised. 6. Opposing the said contention, the learned Standing Counsel appearing for the Municipal Corporation, Smt. Meena John contends that because of Section 242 of the Act, there can be a levy of tax on a building constructed unlawfully without prejudice to any action that may be taken against the said person for such illegal construction and he will also be liable to pay the property tax had the said building been constructed lawfully. The learned counsel also relies on Rule 20(3) of the Surcharge Rules, 2011 which stipulates that for the buildings constructed unlawfully, property tax shall be assessed in the manner and rate fixed for them as per Section 242 of the Act and the demand notice requiring property tax shall be send to the owner of the said building and that they are liable to remit the property tax till the building get regularised or in other words, the tax is demanded for the period when the building remain unauthorised. 7. Having considered the learned counsel on either side, the wording of Rule 3 of the Surcharge Rules, 2011, which reads as follows needs consideration. “3. 7. Having considered the learned counsel on either side, the wording of Rule 3 of the Surcharge Rules, 2011, which reads as follows needs consideration. “3. Property tax to be levied to each building.— (1) The Secretary shall levy property tax as per Section 233 and as per these Rules for each building which has not been exempted from property tax as per Section 235 of the Act.” Reading of Rule 3 of the Surcharge Rules, 2011 shows that the liability is only to pay the property tax which has not been exempted under Section 235 of the Act. In the instant case, there is no contention on the part of the Municipal Corporation that the school building is not exempted from the payment of property tax. Even as per Rule 20(3) of the Surcharge Rules, 2011 relied on by the Municipal Corporation, it is relevant to note that for a building constructed unlawfully, the demand notice can be send to the owner of the property demanding property tax. Rule 3 and Rule 20(3) of the Surcharge Rules, 2011 stipulate that the demand is possible only when the owner is liable to pay the property tax and not when it is exempted under the provisions of the Act. 8. As regards Section 242 of the Act, the same speaks about the liability of the owner who constructed the building unlawfully to pay the sum of property tax that would have been paid, had the said building been constructed lawfully. In short, all the provisions relied on by the Municipal Corporation clearly show that if there is any liability for the person who constructed the building unlawfully to pay the property tax, the same shall be levied whenever it is put to use or as prescribed under Section 242 of the Act. In the instant case, as stated above, there is no liability of property tax on the building in question and the fact that the petitioner is not liable to pay the property tax is evident from the fact that for the rest of the floors except one where unauthorised construction was alleged and which was subsequently regularised, there is no demand to pay the property tax. 9. 9. Given the findings rendered above, I am inclined to hold that the petitioner is not liable to pay the property tax as it is exempted from payment of property tax going by the provisions of Section 235(b) of the Act. Consequently, the demand for property tax raised against the petitioner cannot be sustained. Accordingly, the same is quashed. There will be a further direction to the respondents to issue the occupancy certificate for the building in question, if the application is otherwise in order, within ten days from today. The Writ Petition is allowed as above.