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2025 Supreme(Online)(Ker) 44562
IN THE HIGH COURT OF KERALA AT ERNAKULAM
Ziyad Rahman A. A, J
REV.FR.DR.ABRAHAM THALOTHIL – Appellant
Versus
STATE OF KERALA – Respondent
WP(C) NO. 24012 OF 2023 | WP(C) NO. 11697 OF 2025 | WP(C) NO. 24150 OF 2023 | WP(C) NO. 34856 OF 2023 | WP(C) NO. 9941 OF 2024 | WP(C) NO. 10344 OF 2024
For the Appellants/Petitioners: SHRI.H.RAMANAN, SHRI.ALAN PHILIP ALEX, SRI. DEVASSY CHIRAKEL
For the Respondents: SMT.DEEPA K.R.
Court upheld the legality of amendments to property tax exemptions for educational institutions, reinforcing classifications based on ownership and public funding.
Headnote:The petitioners, all unaided educational institutions, challenged the amendment to the Kerala Panchayat Raj Act, 1994 and the Kerala Municipality Act, 1994. The amendments removed their exemption from property tax on educational buildings. The court found no unreasonable classification violating Article 14 of the Constitution, emphasizing the government's rationale for different tax treatment based on funding and purpose of the institutions. The final outcome was dismissal of the petitions.
| Table of Content |
|---|
| 1. challenge to legislation affecting tax exemptions for education. (Para 2) |
| 2. basis for constitutional validity and discrimination arguments. (Para 3 , 4) |
| 3. court's assessment of classification rationale. (Para 5 , 6 , 12) |
| 4. justification for differential tax treatment. (Para 15 , 16) |
| 5. final ruling on the petitions. (Para 19) |
JUDGMENT
[WP(C) Nos.24012/2023, 11697/2025, 24150/2023, 34856/2023, 9941/2024, 10344/2024]
...
In all these cases, the petitioners are unaided schools or the trust/organizations conducting unaided educational institutions, which are imparting education upto the standard twelve. The common issue raised in all these writ petitions, pertains to the amendment made to the provisions of the Kerala Panchayat Raj Act , 1994 and Kerala Municipality Act , 1994, which deal with the exemption from paying the property tax, to the buildings exclusively used for educational purposes or educational allied purposes under the ownership of such educational institutions. The relevant provisions are Sections 207 of the and Section 235 of the . Those provisions, before the amendment, as per the Kerala Finance (No.2) Act , 2023 with effect from 01.04.2023 stood as follows:
Kerala Panchayath Raj Act, 1994 “207. Exemption from Tax, Cess etc.- (1) The following buildings and lands shall be exempted from property tax as may be levied under Section 203 and service cess as may be levied under sub-section (2) of Section 200, namely:-
(a) xxxx xxxx xxxx xxxx
(b) building exclusively used for educational purposes or allied purposes under the ownership of educational institutions owned by the Government, aided or functioning with the financial assistance of the Government and the hostel buildings wherein the students of the said institutions reside;
(ba) building exclusively used for educational purposes under the ownership of educational institutions having the recognition of the Government and upto the level of Higher Secondary and hostel buildings in which the students of such institutions reside;
(c) xxxx xxxx xxxx Kerala Municipality Act , 1994
235. Exemption from property tax, service cess etc.- The following buildings and lands shall be exempted from the property tax as may be levied under section 233 and service cess as may be levied under sub-section (4) of section 230, namely:-
(a) buildings set apart for public worship and actually so used or used for incidental purposes, religious study centres.
(b) buildings exclusively used for educational purposes or allied purposes under the ownership of educational institutions owned by the Government, aided or functioning with the financial assistance of the Government and the hostel buildings wherein the students of the said institutions reside.
(ba) buildings exclusively used for educational purposes and upto the level of Higher Secondary under the ownership of educational institutions having recognition of the Government and hostel buildings in which the students of such institutions reside (c) xxxx xxxx xxxx xxxx Now as per the Amendment Act (Act 18 of 2023), amendments were made in the said provisions as follows:
In section 207 sub section 1(b) was substituted with the following:
“(b) buildings exclusively used for educational purposes or educational allied purposes under the ownership of educational institutions, owned by the Central Government or State Government, aided or functioning with the financial assistance of the Central Government or the State Government, and the hostel buildings wherein the students of the said institutions reside.
Apart from the above clause (ba) of sub section (1) of section 207 was omitted.”
Similar, amendments were made in clause (b) of section 235 and clause (ba) of section 235 of Municipality Act was omitted.
2. The consequence of such amendment as far as the petitioners are concerned is that, they were deprived of the exemption from payment of building tax for the buildings in which they are conducting educational institutions. In other wor
