Point of Law : Section 3(1)(b) of Act buildings used principally for religious, charitable or educational purposes or as factories or workshops or cattle/pig/poultry farms or poly houses.

JUDGMENT :

Mathrubhumi Printing & Publishing Co. Ltd./the petitioner, a public limited company, has filed the present writ petition through its Managing Director, challenging the Ext.P3 order wherein the building tax has been imposed on 6159.97 sq m, area of factory premises of the petitioner situated in Ramanattukara Village, Kozhikode District.

2. The petitioner is one of the leading printing and publishing unit that publishes weekly, fortnightly, monthly and annual magazines, papers, yearbooks, etc., having wide circulation, besides printing a number of books on various topics of selected authors. The petitioner had constructed a building for housing its printing unit in Ramanattukara Village, Kozhikode District.

3. The petitioner has been granted a license under the Factories Act in respect of the said building. The 1st respondent, vide impugned order dated 06.02.2023 in Ext.P3, had divided the factory building into two parts, i.e., (i) 14503.03 sq m as factory and the balance of 6159.97 sq m as the area used for ‘other purposes’. While rejecting the application of the petitioner for exemption for payment of building tax under Section 3(1)(b) of the Kerala Building Tax Act 1975 (for short, ‘the Act’), has imposed the building tax in respect of 6159.97 sq m.

3. The short question which falls for consideration in the present writ petition is whether some area which is used in relation to the factory can be excluded from granting exemption from payment of the building tax under Section 3(1)(b) of the Act.

4. Learned Counsel for the petitioner submits that if the use of the building predominantly is for the factory purpose and some area is used for ancillary purposes of the factory, such area cannot be excluded from exemption from payment of the building tax under the provisions of Section 3(1)(b) of the Act. He further submits that the godown, security room and news bureau office are part of the printing and publishing unit and the work is carried out from the factory premises. Exclusion of the said area from exemption from payment of the building tax is against the spirit of Section 3(1)(b) of the Act.

4.1 It is furthermore submitted that the authority is required to consider whether the building is used principally for factory purposes or not. If the building is predominantly and principally used for factory purposes, some area which is used ancillary to the main purposes cannot be excluded from the purview of Section 3(1)(b) of the Act. It is therefore submitted that the impugned Ext.P3 order is unsustainable and against Section 3(1)(b) of the Act.

5. On the other hand, Ms Jasmin M M, learned Government Pleader, submits that the area used as the news bureau office, security room, and godown cannot be considered to be part of the factory, and these areas, as they are not part of the factory, have been excluded from exemption from payment of building tax under Section 3(1)(b) of the Act. She supports the impugned Ext.P3 order and submits that there is no ground to interfere with the impugned order inasmuch as the authority has not granted exemption only in respect of that area, which is not part of the factory.

6. To consider the question involved in the writ petition, the Court is required to examine the scope of Section 3(1)(b) of the Act, which is reproduced as follows :

“3. Exemptions – (1) Nothing in this Act shall apply to –

(a) ……

(b) buildings used principally for religious, charitable or educational purposes or as factories or workshops or cattle/pig/poultry farms or poly houses.”

6.1 The word ‘principally’ has to be assigned some meaning while examining an order denying the exemption from payment of building tax in respect of the factory. ‘Principally’ means predominantly. If the predominant purpose of the building is the factory, in my considered view, the ancillary purposes carried out in relation to the factory, in a part of the building which houses the factory, cannot be excluded from the exemption of payment of building