Point of Law: Section 3 of Act, 1975 does not necessarily exclude carrying on activities for which charges are levied on those who can pay, and what is relevant is whether building is principally used for charitable purpose.

JUDGMENT :

The writ petition is filed by the Managing Trustee of Arya Vaidya Sala, Kottakkal, challenging Exhibit P9 order of assessment and demand notice dated 02.07.2014 issued by the Tahsildar, Kanayannur Taluk — the 4th respondent, assessing the building tax in respect of a building within the limits of the Thrikkakara Municipality, Ernakulam District, for an amount of Rs.8,11,800/-as per the provisions of the Kerala Building Tax Act, 1975 ("Act, 1975' for short) and the Rules thereto.

2. The paramount contention advanced is that Arya Vaidya Sala is a public trust for charitable purposes established under the Will dated 30.10.1939 (In Exhibit P1 Will, date is not mentioned) executed by the founder of the institution and therefore, he is entitled to get exemption under Section 3(1) of the Act, 1975.

3. The case put forth to support the said contention is that the business of manufacturing and marketing medicines by the Trust itself is part of the Charitable activity; and that the entire income generated by whatever activities of the Trust has to be spent purely for charitable purpose stipulated in the Will. Therefore, according to the Managing Trustee, it would be evident from various judicial pronouncements of the Hon’ble Apex Court as well as this Court with respect to the interpretation of the Will executed by the foundation of the institution. It is further pointed out that when Arya Vaidya Sala constructed a nursing home at Kottakkal, the question as to whether the building was entitled to get exemption under the provisions of the Act, 1975, was examined by the Government, which by Exhibit P3 order, held that the said building was not liable to be taxed under the provisions of the Act, 1975.

4. It is further stated that similarly, the Kottakkal Panchayat, Malappuram District, had assessed the building of the petitioner at Kottakkal to tax under Section 66 of of the Kerala Panchayat Raj Act, 1994 and the same was confirmed by the Government in the revision preferred. However, the said orders were interfered with by Exhibit P10 judgment dated 24.11.1989 in O.P. No. 1505 of 1984, which was affirmed by Exhibit P11 judgment dated 15.02.1990 in W.A. No. 511 of 1989, which in turn was affirmed by the Apex Court as per Exhibit P12 order dated 06.05.1996 in SLP (Civil) No. 12603 of 1990.

5. The further case of the petitioner is that the trust constructed a building at Thrikkakara for the purpose of starting an ayurvedic hospital and research center. On completion of the said building in the year 2008, the petitioner, while filing the statutory return of completion, had submitted Exhibit P5 representation before the Tahsildar, Kanayannoor Taluk, Ernakulam, respondent No.4, requesting to exempt the building from the provisions of the Act, 1975. However, the same was dismissed as per Exhibit P6 order. It seems, the said order was challenged in W.P.(C) No. 10929 of 2014. But, during the pendency of the said writ petition, the assessment was made and Exhibit P9 demand was raised. It is, thus, challenging the legality and correctness of Exhibit P9, the writ petition is filed.

6. Heard learned Senior Counsel Sri. Krishnanunni assisted by Sri. Ashwin Sathyanath for the petitioner and the learned Government Pleader Smt. M.M . Jasmine, and perused the pleadings and material on record.

7. The learned Senior Counsel for the petitioner submitted that after issuing Exhibit P6 order of assessment dated 16.01.2014 by the second respondent rejecting the exemption claimed by the petitioner, the Tahsildar ought to have issued a pre-assessment notice and an opportunity should have been given to the petitioner to file objections and for personal hearing before finalising and completing the assessment proceedings. Therefore, it is contended that the order of assessment is violative of the principles of natural justice and the same is arbitrary and illegal.

8. That apart, it is submitted that there is no basis for assessing the petitioner’s building to such