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2010 Supreme(Mad) 2804
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE T.S. SIVAGNANAM
Coimbatore Masonic Charity Trust, Rep. by its Trustee, Coimbatore
Versus
The Corporation of Coimbatore, Rep. by its Commissioner, Coimbatore
W.P. No. 1422 of 2003 & W.P. M.P. Nos. 1773 of 2003, 34802 & 3380 of 2005
Decided on : 14-07-2010
For the Petitioner:K. Priya, Advocate.
For the Respondent:R. Sivakumar, Advocate.
The main legal point established in the judgment is the requirement for the respondent to consider the charitable nature of the hospital and conduct an inspection of the premises before deciding on the property tax exemption. The relevance of the exemption granted under Section 80G of the Income Tax Act as evidence of the trust's charitable nature was also emphasized.
Headnote:
Property Tax Exemption - Charitable Hospital - Coimbatore City Municipal Corporation Act, Section 123(e) - The court considered the statutory exemption under Section 123(e) of the Coimbatore City Municipal Corporation Act, which provides exemption for charitable hospitals and dispensaries. The court emphasized the need for the respondent to consider the charitable nature of the hospital and conduct inspection of the premises before deciding on the exemption. The court also highlighted the relevance of the exemption granted under Section 80G of the Income Tax Act as evidence of the charitable nature of the trust.
Fact of the Case:
The petitioner, a charitable trust running a hospital, sought property tax exemption under Section 123(e) of the Coimbatore City Municipal Corporation Act. The respondent rejected the exemption claim, leading to the petitioner filing a writ petition challenging the decision.
Finding of the Court:
The court found that the respondent had not adequately considered the charitable nature of the hospital and had not conducted a necessary inspection of the premises. The court emphasized the relevance of the exemption granted under Section 80G of the Income Tax Act as evidence of the trust's charitable nature.
Issues: The main issue was whether the petitioner's hospital qualified for property tax exemption under Section 123(e) of the Coimbatore City Municipal Corporation Act, based on its charitable nature.
Ratio Decidendi: The court held that the respondent must consider the charitable nature of the hospital and conduct an inspection of the premises before deciding on the exemption. The court also emphasized the relevance of the exemption granted under Section 80G of the Income Tax Act as evidence of the trust's charitable nature.
Final Decision: The writ petition was allowed, the impugned order was set aside, and the matter was remanded to the respondent for fresh consideration. The petitioner was granted liberty to file a comprehensive fresh representation, and the respondent was directed to decide the matter within a specified timeframe, taking into account the law laid down by the court in a previous judgment.
The prayer in the writ petition is for issuance of a writ of certiorarified mandamus to quash the proceedings of the respondent in Ref. Roc.No.009294/99/EA7 dated 012. 2002.
2. The petitioner is the Coimbatore Masonic Charity Trust, which was established as a Public Charitable Trust on 010. 1978. The petitioner purchased the subject property, by sale deed dated 28.02.1979, for the purpose of activities of the trust and the Income Tax Department has granted exemption under Section 80-G of the Income Tax Act, in favour of the petitioners trust. In the land purchased by the petitioners trust, initially it established an Outpatient Medical Center during 1982, and subsequently with the aid of the donation received, put up additional buildings and as on date, it is fully fledged hospital. According to the petitioner, the buildings belongs to the trust, and being used for hospital and dispensaries, are exempted from the payment of property tax in terms of Section 123 (e) of the Coimbatore City Municipal Corporation Act. The petitioner had challenged the notice issued by the respondent Corporation, demanding property tax, by filing writ petitions before this Court and the writ petitions were dismissed and the petitioner filed Writ Appeal Nos.1832 to 1834 of 2000 dated 012. 2000 and the Division Bench of this Court, directed the Competent Authority to consider the representation made by the petitioner and the petitioner was directed to pay a sum of Rs.3,65,380/-. The petitioner is stated to complied with the direction issued by the Honourable Division Bench. Thereafter, the respondent by letter dated 03.03.2001, stated that though the petitioner had forwarded various documents such as deed of trust, exemption certificate under Section 80 G of the Income Tax Act, Abstract of Statement of Income and Expenditure for the financial year 312. 2000, copy of the building plan, etc, the materials are not sufficient to consider the petitioners claim for exemption and requested to furnish further documents in the form of Property Tax details at the time of purchase of the property, plan, area of the building, contribution made by the life members of the trust from its inspection and details about the members of the building committee and their contribution to the Coimbatore Masonic Charity Trust and the details about the Ex-officio members of the Coimbatore lodges and relationship to the petitioner, inspection report of the company etc. According to the petitioner, the particulars sought for, are irrelevant and the petitioner sent a reply on 19.04.2001, giving details to the extent possible. Thereafter, the respondent again by communication, dated 28.02.2002, called for various others particulars to which the petitioner submitted a detailed reply on 19.08.2002, stating that the petitioners trust is a Charitable Institution registered under Section 12(A) of the Income Tax Act and also exempted under Section 80 G of the Act. In spite of such reply, the respondent by order dated 012. 2002, rejected the request for exemption. Aggrieved by such order, the petitioner is before this Court by way of the present writ petition.
3. The learned counsel for the petitioner would contend that the respondent corporation has overstepped its authority and the exemption contemplated is a statutory exemption in respect of property and the petitioner satisfied the requirement of various sub-clauses of Section 123 and the only issue to be considered by the respondent is whether the hospitals/dispensaries run by the petitioner is charitable one or not so as to qualify for statutory exemption. It is further contended that the exemption granted under the provision of the Income Tax Act is a valuable evidence to show that the petitioner is a true and bonafide charitable institution. Further, it is submitted that the respondent did not considered any of the documents submitted by the petitioner, therefore, the impugned order is liable to be set aside.
4. The lea
