ST SEBASTINS VISITATION HOSPITAL Vs. STATE OF KERALA

JUDGEMENT

(1.) The question raised is whether the Government was justified in declining building tax exemption to petitioner's hospital building for the reason that medical service is not rendered free of cost in such building. We have heard counsel for the petitioner and Government Pleader for the respondents.

(2.) Counsel for the petitioner has relied on Division Bench judgment of this court in Mercy (Sr. ) v. Secretary to Govt. of Kerala, 2011 2 KerLT 15 where the Division Bench has allowed exemption in respect of a hospital building owned by a charitable institution even though medical relief was not rendered free of cost. Government Pleader, however, referred to Full Bench judgment of this Court in Unity Hospital (P) Ltd. & Anr. v. State of Kerala & Ors., 2011 1 KerLT 236 wherein the Full Bench has held as follows:

(3.) Counsel for the appellant submitted that the appellant is a charitable institution and so much so, the hospital building is entitled to building tax exemption. However, what we notice is that building tax exemption under Section 3(1)(b) is geared to nature of use of the building and not to the objectives of the organization owning the building. In other words, if the building is used for charitable purposes, then it is entitled to building tax exemption, no matter the owner of the building is not engaged in any other charitable activity other than allowing the use of the building for charitable purpose. So much so, even a business concern is entitled to building tax exemption for any building used for charitable purpose. "Charitable purpose" is given an inclusive definition under the Explanation. However, what is made clear is that medical relief is understood as charity by the Legislature only when it is rendered free. In other words, a charitable institution rendering medical relief on chargeable basis is not entitled to exemption from building tax for the hospital building where medical relief is not rendered free of cost. Even though counsel for the appellant contended that the Full Bench has not considered exemption for hospital building and the findings should be treated only as obiter, we are unable to accept this contention because when the Section was dissected and interpreted, the Full Bench explained the nature and scope of exemption provided under the Act for hospital buildings. So much so, the findings of the Full Bench are not obiter but should be taken as laying down the law on the subject which binds the Division Bench. We, therefore, reject this contention. We, therefore, do not find any merit in the Writ Appeal and accordingly the same is dismissed.