Assessment of property tax under S.100 of the Kerala Municipalities Act, 1960 is dependent on the completion and occupation of the building.

1. A question of considerable importance as far as Municipal taxation is concerned arises for consideration in this case. The question is whether a new building constructed is assessable to property tax under S.100 of the Kerala Municipalities Act, 1960, for short the Act, before it is completed and occupied. The petitioner in this Original Petition started construction of a building in Ward No. VIII of the Muvattupuzha Municipality of which the respondent is the Commissioner, in June 1970. Though initially sanction was obtained only for the ground-floor and first-floor, immediately after the slab concrete of the first-floor the petitioner applied for sanction for the construction of the second-floor also. The structure of the three-floors of the building was over and the plastering and other finishing works were going on. Then the petitioner got Ext. P-1 notice from the respondent assessing the building to property tax for the first half of 1971-72. The assessment was in respect of the first two-floors of the building under construction. The petitioner filed Ext. P-2 objection.

2. But the petitioner received Ext. P-3 demand bill for a sum of Rs. 542/- in respect of the first and second half years 1971-72. Subsequently, the petitioner was served with Ext. P-4 order revising the assessment and fixing the half yearly rate of tax at Rs. 271/-. As no reasons were stated in Ext. P-4 the petitioner applied for the actual order and the petitioner on 29 31972 received Ext. P-5 order which is the real order making the assessment in respect of the building.

3. The case of the petitioner is that by the time Ext. P-5 was received, the time for appeal from Ext P-4 to the Municipal Council had expired and hence the petitioner did not file an appeal. It is under the above circumstances that the petitioner has approached this Court with this Original Petition to quash Exts. P-1, P-3, P4 and P-5. The main contention raised in the Original Petition is that as the building is not complete and no portion of it has been put to any use or occupation, no assessment to property tax can be made under the Act. It is also contended that assessment can be made only after completion of the construction of the entire building and notice thereof is given to the respondent-Commissioner.

4. The stand taken in the counter-affidavit filed by the Commissioner is that the construction of the ground-floor and the first-floor of the building was completed on 1-61971 and under the Act that building is liable to be assessed for property tax and the assessment in question was made accordingly. It is further contended that it cannot be said that a building becomes complete only after it is occupied or only after sanitary and electrical fittings had been installed. But the moment a building becomes usable, it is liable to property tax and in this case the building became usable as a lodge as on 161971 and hence it was liable to be assessed to property tax from that date. It is averred in Para.6 of the counter-affidavit that from 26 21973 a hotel called "Everest Tourist Home" is run in the building.

5. Counsel for the petitioner contends that unless a building is completed and is occupied no property tax can be levied for that building by the respondent. In this case, neither the construction of the building was completed nor notice under S.107 of the Act given to the respondent. In the case of a new building put up, before it is occupied, no question of assessment to property tax under S.100 of the Act arises. In support of his contentions, the counsel for the petitioner relies on a decision of the High Court of Bombay in Polychem Ltd. v. Municipal Corporation of Greater Bombay (ILR. 1970 Bom.102). This case arose in respect of an assessment to property tax of some land situated within the Municipal Corporation of Greater Bombay. One of the questions that arose for consideration was whether that portion of land which was in the course of being built upon could b