Tax assessments must follow statutory procedures; failure to do so renders them unsustainable.

JUDGMENT

The petitioner is the Managing Partner of a Company which is running a cinema theatre in Ernakulam. The building was constructed in 1946 and in the year 2008, certain alterations of the building were affected. The said alteration resulted in several legal proceedings in connection with the unauthorized construction, change of occupancy, assessment of property tax, etc.

2. In this writ petition, the subject matter involved is the assessment of property tax in respect of the modified building and other issues are reportedly settled by the orders passed by the authorities concerned. As far as the issue of revision of property tax is concerned, Ext.P8 is the demand notice issued by the 1^st respondent Corporation, wherein the property tax was calculated based on the annual rental value of the building, which was the criterion applicable at the relevant time. Accordingly, the tax amount was fixed as Rs.1,35,675/-. The petitioner challenged Ext.P8, by filing an appeal before the Standing Committee for Appeals, but the same was rejected, confirming the same. The matter was taken up before the Tribunal for Local Self-Government institutions by filing R.P.No.134 of 2011. The said revision petition resulted in Ext.P9 order, in which, the Tribunal found that the rate of tax was fixed not in tune with the statutory procedure contemplated under Section 233 of the Kerala Municipality Act . Thus, the assessment of tax as evidenced by Ext.P8 was set aside, by granting liberty to the 2^nd respondent to re-assess the tax afresh, after passing a resolution by the 1^st respondent, as contemplated under of the read with the rules framed in this regard.

3. Even though Ext.P9 order was passed on 13.03.2012, the consequential demand/assessment was made by the respondents only as per Ext.P10 dated 30.03.2024. Ext.P10 was only an intimation to the petitioner with regard to the re- assessment of tax and in the said notice, an order dated 26.03.2024 was referred to as the basis of the said notice. Ext.P11 is the order dated 26.03.2024 referred to in Ext.P10, based on which, the re-assessment of the property tax of the petitioner was carried out. In Ext.P11 it is mentioned that, re- assessment was made, based on the Government Order dated 18.02.2015, which was referred to as item No.4 therein.

Ext.P12 is the said Government Order, which was relied on in Ext.P11, in which it is mentioned that, in case the rate of tax determined based on the plinth area is found to be lesser than the amount of tax already fixed based on the annual rental value, the Corporation/Municipality shall fix the amount of tax according to the annual rental value. The petitioner challenges Exts.P10 and P11 in this writ petition.

4. A counter affidavit was submitted by the respondents, controverting the averments contained in the writ petition and also disputing the reliefs sought. The circumstances under which the impugned notices are issued and the procedure that was followed by the Corporation while revising the rates of tax under the provisions of the Kerala Municipality (Property Tax, Service Tax and Surcharge) Rules, 2011, were also explained. It was pointed out that they have complied with all the necessary conditions contemplated in Rule

4 of the above Rules.

5. I have heard Sri.G.Harikumar (Gopinathan Nair), learned counsel for the petitioner and Sri.R.Harishankar, learned standing counsel for the respondents.

6. The main contention raised by the learned counsel for the petitioner is that, Exts.P10 and P11 are not legally sustainable for various reasons. It was pointed out that, first of all,