DHARMA SASTHA TRUST Vs. STATE OF KERALA

JUDGEMENT

(1.) Writ Appeal is filed against judgment of the learned Single Judge declining to interfere with Government Orders rejecting appellant's claim for exemption from building tax on the Auditorium constructed by it. Appellant claims to be a charitable institution which constructed the Auditorium. Exemption from building tax claimed under Section 3 (2) of the Kerala Building Tax Act was rejected by the Government because appellant was letting out the building on rent for marriage purposes. The appellant's contention that it is entitled to exemption as a charitable institution was turned down by the Government, which was confirmed by the learned Single Judge. We have heard counsel for the appellant and Government Pleader for the respondents.

(2.) The contention of the appellant is that the appellant is a charitable institution and the building is essentially used for running classes for students, holding meetings and even conducting marriages. Even though counsel for the appellant submitted that rent is not charged for giving the building for use by others, Government Pleader referred to the Government Order wherein appellant conceded that during the year of construction at least reasonable rent was charged for letting the building for use by marriage parties. Government Pleader specifically referred to the statutory provision which entitles building for exemption only when it is used for charitable purposes.

(3.) The learned Single Judge has held against the appellant by following our judgment in St. George Orthodox Church v. State of Kerala,2009 4 KerLT 702 wherein this court explained the distinction between exempted persons and exempted buildings. The exemption provided under Section 3 of the Act is with reference to the use of the building and not with reference to the ownership of the building. In other words, even religious and charitable institutions will be liable to pay building tax if the building is used for commercial purpose, no matter the income may ultimately be used for religious or charitable purpose. If the Legislature intended to grant exemption to buildings owned by charitable or religious institutions, it could have said so. On the other hand, exemption is geared to the nature of use to which building is put and unless the building is used for the purposes stated in the Section i.e. charitable, religious, educational or running as workshops or factories, building is not entitled to exemption. Therefore, the appellant's claim of exemption based on objectives of owner of the building was rightly found to be untenable. We see no merit in the Writ Appeal and consequently the same is dismissed.