ORDER :

“In the utilities, tax and economic regulation cases, there are good reasons for judicial self-restraint if not judicial deference to legislative judgment. The legislature after all has the affirmative responsibility. The courts have only the power to destroy, not to reconstruct. When these are added to the complexity of economic regulation, the uncertainty, the liability to error, the bewildering conflict of the experts, and the number of times the judges have been overruled by events - self-limitation can be seen to be the path to judicial wisdom and institutional prestige and stability”

FRANKFURTER, J (MOREY VS. DOUD)

"Taxes may be and often are oppressive, unjust, and even unnecessary but this can constitute no reason for judicial interference."

2. But such an interference is called for in these writ petitions, where amendment to Rule 15(1) (c) of the Tamil Nadu Village Panchayat (Assessment and Collection of Taxes) Rules 1999 vide G.O.Ms.No. 38, Rural Development and Panchayat Raj (PR-1) Department dated 05.03.2008 has been challenged as unconstitutional.

3. The writ petitioners are educational institutions established within Panchayat areas. As per the original Rule 15(c) the buildings used for educational purposes including hostels and libraries run by the Government or local bodies and institutions aided by the Government and public buildings used for charitable purpose for sheltering the destitutes and animals were exempted from tax. The petitioner institutions established within the Panchayat area and aided by Government were enjoying the tax exemption. Suddenly by an amendment to the above Rule 15(c), Government aided institutions for conducting self financing unaided courses were subjected to levy of house tax. In other words the exemption is taken away for unaided self financing courses conducted by Government aided institution.

4. This according to the petitioner is discriminatory as the object and purpose of providing tax exemption is only for usage of buildings for educational purposes and there cannot be any discrimination between aided and unaided courses in the same institution or Government aided institutions and private institutions. Hence, the amendment is unconstitutional as it offends Art. 14 of the Constitution of India. Further Art. 41,45 and 46 of the Constitution of India are concomitant to the fundamental rights enshrined under Part III of the Constitution, but the impugned amendment runs contrary to the directive principles and as such, the impugned amendment is violative of the fundamental right to education. All the educational institutions in these writ petitions are recognised by All India Council for Technical Education (AICTE) and affiliated to respective Universities. While so, exemption on the basis aided and unaided or self-financing institution or course is discriminatory and taking away the benefit of exemption enjoyed by the institutions for two decades all on a sudden by a discriminatory amendment is arbitrary and unreasonable. Further Sec.86(c) of the Tamil Nadu Municipalities Act provides for general exemption from payment of property tax. When similarly situated institutions in the Municipal areas are exempted, the institutions catering the need of rural area and downtrodden people were imposed with the levy of tax is again discriminatory and the Government is promissorily estopped from introducing such discriminatory amendment. The learned Senior Counsel appearing for the petitioners would rely on the judgment of the Division Bench of this Court in Sriram Educational Trust Vs. The President, 89, Perumal Pattu Panchayat Union, [2008 (1) CTC 449] wherein the very same Rule was challenged and decided in favour of the private educational institution. He would also rely on the following judgments:-

1. K.T.Moopil Nair Vs. State of Kerala, AIR 1961 SC 552

2. New Manek Chowk Spg and Wvg Mills Co. Ltd., etc Vs. Municipal Corporation of the City of Ahmedabad and other, AIR 1967 SC 1801

3. S.