Akkalmadam P.O., Pamban-623 521, Ramnad District. ... Petitioner
-vs-
1. The Government of Tamil Nadu, Rep. by its Special Commissioner and Secretary, Rural Development and Panchayat Raj Department, Fort St.George, Chennai-09.
2. The District Collector, Ramnad District, Ramnad.
3. The Block Development Officer (Village Panchayat), Block Development Office, Mandapam Union.
4. The President / Executive Authority, Pamban Panchayat, Pamban-623 521. ... Respondents PRAYER: Writ Petitions are filed under
Article 226 of the Constitution of India praying to issue a Writ of Certiorarified Mandamus, calling for the records pertaining to the Amendment to Rule 15(1)(c) of the Tamil nadu Village Panchayat (Assessment and Collection of Taxes) Rulels 1999 vide G.O.Ms.No. 38 Rural development and Panchayat Raj (PR1) Dept dated 05/03/08 on the file of the 1st respondent in respect of the petitioner school and the consequential Demand Notice dated 16/01/2011 for a payment of Rs. 32 221/- as House tax and Library cess for Door. No. 3/1802 in Ward No. III in Form 1 by Assessment No. 2545 on the file of the 4th respondent and quash the same and directing the respondents to grant exemption for the payment of House Tax to the petitioner school.
!For Petitioners : Mr.FR.A.Xavier Arulraj (in W.P.(MD) Nos.3289, 3290, 3300, 1322 and 1419 of 2011) Mr.S.Kadarkarai (in W.P.(MD) Nos.4817 and 6415 of 2011) For Respondents : Mr.S.Kumar, AGP (for R1 & R2 in W.P.(MD) Nos. 3289, 3290, 3300, 1322/2011, for R1 to R3 in W.P.(MD) No.1419/2011, for R1 to R5 in W.P.(MD) No. 4817/2011 and for R1 to R4 in W.P.(MD) No. 6415/2011) Mr.N.S.Karthikeyan, AGP (for R3 & R4 in W.P.(MD) Nos.3289 & 3290/2011) Mr.D.Muruganandam, AGP (for R3 & R4 in W.P.(MD) 3300/2011) Mr.B.K.Rajendran (for R3 & R4 in W.P.(MD) 1322/2011) Mr.A.Haja Mohideen, AGP (for R4 in W.P.(MD) No.1419/2011) No Appearance (for R6 in W.P.(MD) No.4817/2011 and for R5 & R6 in W.P.(MD) No.6415/2011) :COMMON ORDER The issue involved in all these writ petitions is one and the same and therefore, all these matters are taken up together for final disposal by way of this common order.
2. For the sake of brevity, the facts are being taken from W.P.(MD) No.3289 of 2011, in which, the petitioner challenges the Amendment to Rule 15(1)(c) of the Tamil nadu Village Panchayat (Assessment and Collection of Taxes) Rules 1999 introduced vide G.O.Ms.No.38 Rural development and Panchayat Raj (PR1) Dept. dated 05.03.2008 on the file of the 1st respondent and also the consequential Demand Notice dated 16.01.2011 for payment of Rs.32,221/- as House tax and Library Cess for Door.No.3/1802 in Ward No.III in Form 1, by Assessment No. 2545 on the file of the 4th respondent and quash the same. The petitioner also sought a direction to the respondents to grant exemption for the payment of House Tax imposed on the petitioner school.
3. Heard the learned counsel for the parties, except R6 in W.P.(MD) No. 4817 of 2011 and R5 & R6 in W.P.(MD) No.6415 of 2011, as none represented on behalf of them.
4. The petitioner-school (in short ?the school?), which is a Matriculation School managed by the Congregation of Sisters of St.Anne, is a religious, charitable and educational society and dedicated for the development of the children in the locality. The school is situated in a total extent of 5 acres of land and the same was exempted from house-tax under Rule 15(c) of the Tamil Nadu Panchayats (Assessment and Collection of Taxes) Rules, 1999 (hereinafter referred to as ?the Rules?). While so, the 1st respondent, by notification dated 05.03.2008 amended the Rule 15 (c) of the Rules, which reads as under:
?(1) for clause (c), the following clause shall be substituted, namely:-
?(c) buildings used for educational purposes including hostels and libraries run by the Government or local bodies and institutions aided by the Government and public buildings used for charitable purpose of sheltering the destitutes or animals;?;
(2) in the first proviso, for the expression ?clauses (a) and (c)?, the expression ?clause(a)? shall be substituted;
(3) after the second proviso, the following proviso shall be inserted, namely:-
?Provided also that the buildings used for educational purposes by Government ? aided institutions, for conducting self-financing unaided courses shall be subject to levy of house-tax?
5. It is the grievance of the school that pursuant to the above amendment, the 4th respondent had issued a demand notice dated 16.01.2011 for payment of Rs.32,221/- as House Tax for the buildings situated in the school. It is the case of the school that it is a non-profit institution in the field of education and the denial of grant of exemption of House Tax would certainly jeopardize the interest of the school and create financial crisis. Hence, the petitioner is before this Court with the above prayer.
6. The learned counsel for the petitioners would submit that the schools were mechanically forced to pay the House Tax based on the amendment, which was brought in force. The deprivation of exemption would amount to denial of free and compulsory education for the children, falling under poor and the downtrodden category. Hence, the amendment and the consequential demand notice are highly arbitrary, illegal and a colourable exercise of power and therefore, the impugned order of demand is liable to be set aside at the threshold.
7. On the other hand, the respondents have contended that the issue involved in this case is no longer res integra, as the issue has already attained finality in the case decided by this Court in Kaamadhenu Arts and Science College vs. The State of Tamil Nadu, Chennai and others [W.P.(MD) Nos.26999 of 2008 etc. batch] decided on 30.07.2010, wherein this Court had considered all the aspects and dismissed the writ petitions in toto. Therefore, it is the contention of the respondents that there is no interference warranted by this Court in all these writ petitions and the same have to be dismissed in limine. The respondents also relied upon the Full Bench decision in the case of The President, K.Vellakulam Panchayat vs. Kamaraj College of Engineering and Technology, Virudhunagar, reported in 2009 (5) CTC 289 in support of his contentions.
8. The short point for consideration in all these writ petitions is whether the educational institutions, which have started self-financing courses in their campus are liable for house tax in terms of the Rules. In the matter of exemption of a taxing statute, it is for the State to make proper classification and it cannot be said that such classifications are hit by
Article 14 either on the ground of it being a class legislation or that such a tax will amount to arbitrary exercise of power. This Court, in the judgment relied upon by the respondents has taken into consideration all the aspects, cited various judgments of the Hon'ble Supreme Court, rendered a detailed finding with regard to grant of exemption to educational institutions and ultimately dismissed the batch of writ petitions.
9. Thus, the legal position is very obvious that there is no fundamental right to get an exemption from Property Tax, as the aided institutions, which start self-financing courses will be subject to payment of property tax and the same cannot be questioned by such institutions. Therefore, finding force in the contention raised by the respondents and following the judgment of this Court (cited supra), this Court is of the view that all the writ petitions are liable to be dismissed.
10. In fine, all these writ petitions are dismissed accordingly. No costs. Consequently, connected miscellaneous petitions are closed.
To:
1. The Special Commissioner and Secretary, Government of Tamil Nadu, Rural Development and Panchayat Raj Department, Fort St.George, Chennai-09.
2. The District Collector, Ramnad District, Ramnad..