IN THE HIGH COURT OF KERALA AT ERNAKULAM
WP(C).No. 30707 of 2010(K)
1. R.G.RAMASUBRAMANYAN,
... Petitioner
Vs
1. STATE OF KERALA, REPRESENTED BY
... Respondent
2. THE REVENUE DIVISIONAL OFFICER,
3. THE TAHSILDAR, PALAKKAD,
For Petitioner :SRI.JACOB SEBASTIAN
For Respondent : No Appearance
The Hon'ble MR. Justice C.K.ABDUL REHIM
Dated :11/10/2010
O R D E R
C.K. ABDUL REHIM, J
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WP(C) NO. 30707 OF 2010
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Dated this the 11th day of October, 2010
JUDGMENT
Petitioner is the builder of a residential apartment
complex consisting of 16 apartments. According to him,
even prior to starting construction of the complex, 14
agreements were entered with 14 intending purchasers
who came forward for buying apartments in the complex.
Ext.P1 is one of such agreements, wherein it is revealed
that the construction was undertaken by the builder on
behalf of the purchaser and the undivided share in the
land was transferred into his name. It is the specific case
of the petitioner that the cost of construction of the
apartments were met such individual owners jointly.
2. The petitioner had produced Ext.P2 series
documents which will indicate that each such persons
have paid tax due under the KVAT Act with respect to the
works contract undertaken.
3. It is stated that the 3rd respondent had
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completed assessment under the Kerala Building Tax Act,
1975 against the petitioner, treating the entire apartment
complex as a single unit, to the tune of Rs.2,93,400/-.
Aggrieved by the assessment the petitioner filed an appeal
before the second respondent. Ext.P5 is the order issued by
the appellate authority. The appeal was rejected finding
that the building in question is not liable to be assessed
under explanation 2 to Section 2 (e) of the Kerala Building
Tax Act. It is observed by the appellate authority that, it is
revealed from the records that the electricity bills and
municipality taxes are in the name of the petitioner and
separate bills are not available in the name of individual flat
owners.
4. The question raised by the petitioner is with
respect to claim for separate assessment on individual
owners of each apartments. Crucial aspect to be
considered is as to whether the petitioner had constructed
the entire building by expending his own funds or as to
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whether the individual purchasers have met the cost of
construction jointly. The criteria in allowing separate
assessment in such cases, on the basis of explanation 2 to
sub section (e) of Section 2 of the Kerala Building Tax Act,
has been considered elaborately by this Court in the
decision in M/s. Bava Sons Constructions Pvt. Ltd. Vs.
Tahsildar [2007 (3) KLT 101].
5. It is noticed that the assessment order Ext.P3
does not reflect any application of mind by the assessing
authority on the question regarding claim for separate
assessment. The said order is issued on a printed format
and it is not discernible as to whether any notice was issued
to the petitioner before finalising the assessment or as to
whether the petitioner had submitted any objections against
the assessment being completed against him. Going by
Ext.P5 it is evident that the appellate authority has also not
considered the matter in its real perspective. The reason
for rejecting the claim for separate assessment enumerated
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under Ext.P5 is not the real criteria to be looked into. As
stated above, the prime consideration ought to have been as
to whether the cost of construction was met by owners of
individual apartments jointly.
6. Under the above circumstances, I am of the view
that the matter requires reconsideration at the hands of the
assessing authority. Ext.P3 order of assessment as well as
Ext.P5 appellate order are hereby quashed. The 3rd
respondent Tahsildar is directed to finalise the assessment
afresh, after issuing notice to the petitioner as well as to all
the owners of the individual apartments, and after affording
them a reasonable opportunity of hearing.
7. The question whether the assessment need be
completed treating individual apartments as separate units
shall be decided on the basis of the observations made
above and having regard to the parameters fixed in the
decision of this Court cited above. Fresh assessment in this
regard shall be completed as early as possible, at any rate
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within a period of three months from the date of receipt of a
copy of this judgment. Needless to say that amount if any
remitted by the petitioner shall be appropriated in
accordance with outcome of the fresh assessment to be
completed.
C.K. ABDUL REHIM
JUDGE
dnc