HOTEL AGASTHIYA PRIVATE LTD Vs. PRINCIPAL DISTRICT COURT

JUDGEMENT

(1.) The petitioner is a hotel represented by its Managing Director. They are running the hotel in the name and style of Hotel Agasthiya Private Limited situated at North Marret Street, Madurai. The hotel has 81 lodging rooms and has restaurant, conference hall and an attached bar. In this writ petition, they have challenged an order dated 21.6.2006 passed by the Principal District Court, Madurai in C.M.A.No.1 of 2003 confirming and modifying the order of the second respondent Taxation Appellate Tribunal, Madurai, dated 23.12.2001 and the demand notice dated 29.04.2008 issued by the third respondent Corporation of Madurai.

(2.) The writ petition was admitted on 18.06.2008. Pending the writ petition, an interim injunction was granted subject to condition that the petitioner continues to pay Rs.76,000/- per half year. It was brought to the notice of this court on 16.07.2010 that the petitioner has not complied with the condition from 2009 to first half year of 2010 amounting to Rs.2,28,000/-. When the corporation wanted to vacate the interim order, the learned counsel for the petitioner prayed for extension of time for complying with the interim order. Since the petitioner has not obeyed the interim order without any justification, the interim injunction was vacated and the application for interim injunction was dismissed. The Corporation was given liberty to initiate execution proceedings to recover the amount.

(3.) It is seen from the records that the Corporation which was initially levied Rs.52,784/- per semester had increased the property tax to Rs.1,11,908/-. The petitioner had filed an appeal before the Taxation Appellate Tribunal, Madurai in Tax Appeal No.1506 of 2000. They contended that it was improper on the part of the Corporation to levy tax in respect of lodging portion as well as bar and the other canteen facilities. They have also calculated 81 rooms as being in occupation, whereas 6 rooms were meant for rest room, manager room and godown. They have not made any alteration in the building. Therefore, having originally levied tax on the basis of the existing rate, now double the amount on general revision of tax was improper. The Tribunal found that the revision of tax made was fully justified. During the year 1996, the lodging house was only on the ground floor and even rooms which are not occupied and used for other purpose may be considered as miscellaneous occupancy liable for tax. Thus, the Tribunal had dismissed the appeal by an order dated 23.12.2001.