The petitioner is a Company which owns a factory at Perambra in Thrissur District. It had put up buildings including structures that housed a factory as well as canteens, rest rooms, factory office etc. all of which were required to be maintained as part of their obligations under the Factories Act. When steps were taken by the respondents to levy building tax on the buildings put up by the petitioner for its factory at Perambra, the petitioner approached this Court by filing O.P. 38544/2002, challenging the proposal to levy building tax on the buildings used as factory. By Ext.P1 judgment the said O.P. was disposed clarifying that the exemption under Section 3 of the Kerala Building Tax Act would apply to those buildings put up by the petitioner as were principally used as factories or workshops. In Ext.P1 judgment it was also clarified as to which of those buildings would come within the extended meaning of factories for the purposes of the exemption under the Kerala Building Tax Act. Pursuant to Ext.P1 judgment, the first respondent proceeded to pass Ext.P2 order levying tax on the buildings that were used for the Workers' Society, Factory, Administrative Building, Guest House, Security Quarters and Car shed etc. The main factory building and other buildings that were closely associated to the activities in the factory were exempted. Aggrieved by Ext.P2 order, the petitioner preferred an appeal before the 2nd respondent who vide Ext.P4 order dated 6-8-2005 allowed the appeal by way of remand. The first respondent thereafter passed Ext.P5 order dated 18-10-2006, based on the directions of the 2nd respondent in Ext.P4 order. While the petitioner was of the bonafide belief that the assessment proceedings had culminated with the passing of Ext.P5 order by the first respondent, it was served with Ext.P6 order dated 4-9-2007 of the first respondent indicating that Ext.P4 order had been cancelled by the 2nd respondent by order dated 18-8-2007. It is apparent, however, that there was no notice issued to the petitioner before the said cancellation by the 2nd respondent and further that the said order dated 18-8-2007 was never communicated to the petitioner. The petitioner, subsequently, obtained a copy of the said order dated 18-8- 2007 and it is produced as Ext.P7 in the Writ Petition. In the Writ Petition, Exts.P6 and P7 are impugned inter alia on the ground that they are vitiated by an error of jurisdiction. 2. A counter affidavit has been filed on behalf of the 2nd respondent wherein the sequence of events leading to the issuance of Ext.P7 order and Ext.P6 consequent order is narrated. It is pointed out that Ext.P7 order was based on the directions given in the audit report received from the Principal Accountant General (Audit) and the 2nd respondent was constrained to cancel Ext.P4 order and pass Ext.P7 order taking note of the audit objection. In the counter affidavit it is also the stand of the respondents that by issuing Ext.P7 order the 2nd respondent was only rectifying a mistake that had occurred while passing Ext.P4 order.
3. I heard Sri.Saji Varghese, the learned counsel appearing for the petitioner as well as Smt. Lilly, the learned Government Pleader .
4. On a consideration of the facts and circumstances of the case and also the submissions made across the Bar, I am of the view that the Writ Petition, in its challenge against Exts.P6 and P7 orders, must necessarily succeed. Ext.P7 order dated 18-8- 2007 is passed by the 2nd respondent and has the effect of cancelling Ext.P4 order earlier passed by the 2nd respondent. The provisions of the Kerala Building Tax Act clearly state, in Sec. 11 (8) thereof, that orders passed by the 2nd respondent in an appeal shall, subject to the provisions of Sections 13 and 14 be final and shall not be liable to be questioned in a court of law. Section 13 deals with the power of revision of the District Collector and Sec. 14 deals with the power of revision of the Government. In the instant case, the powers under Sections 13 and 14 have not been exercised by the District Collector or the Government while cancelling Ext.P4 order passed by the 2nd respondent. Ext.P7 order that cancels Ext.P4 order is also passed by the 2nd respondent and is stated to be based on an audit objection received by the said respondent. In that view of the matter, therefore, Ext.P7 order can only be seen as a result of an exercise of the power of rectification under Section 15 of the Act or an exercise of a power of review that is not available to the 2nd respondent under the Kerala Building Tax Act, 1975. It is trite that under the guise of exercising a power of rectification, the authority concerned cannot exercise a power of review that is not specifically conferred on it under the statute. In the instant case it is seen that while passing Ext.P7 order, the 2nd respondent has virtually nullified Ext.P4 order and has proceeded to issue directions that change the very basis of the assessment that was completed against the petitioner. In that view of the matter, the exercise of power by the 2nd respondent, if it is traced to Sec. 15 of the Act, has to be quashed as one passed in excess of the jurisdiction conferred on the 2nd respondent. If on the other hand, it is the stand of the respondent that Ext.P7 order is one passed in exercise of the power of review then, that is a power which was not available to the 2nd respondent under the Kerala Building Tax Act, 1975 and hence, Ext.P7 order would be liable to be quashed on that ground also. Thus, in any view of the matter, Ext.P7 order, as also Ext.P6 order of the first respondent, cannot be legally sustained. I therefore, quash both the said orders and declare that the building tax assessment on the petitioner Company, in respect of the factory at Perambra, shall stand governed by Ext.P5 order passed by the first respondent.
This Writ petition is allowed as above.
Sd/- A.K.JAYASANKARAN NAMBIAR JUDGE
Ani/3/12/
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P.S.Judge