Inkel Ltd vs The Tahsildar, Aluva
2025 Latest Caselaw 489 Ker

Kerala High Court

Inkel Ltd vs The Tahsildar, Aluva on 2 July, 2025

                                                   2025:KER:48503


          IN THE HIGH COURT OF KERALA AT ERNAKULAM

                            PRESENT

               THE HONOURABLE MR. JUSTICE S.MANU

  WEDNESDAY, THE 2ND DAY OF JULY 2025 / 11TH ASHADHA, 1947

                    WP(C) NO. 22542 OF 2014

PETITIONER:

         INKEL LIMITED
         INKEL CENTRE, VALLATHOL JUNCTION,SEA-PORT AIRPORT
         ROAD, THRIKKAKARA, KOCHI-682021.
         REPRESENTED BY ITS COMPANY SECRETARY SHRI. K.
         PADMADASAN.


         BY ADVS.
         SRI.SAJI VARGHESE T.G
         SMT.MARIAM MATHAI



RESPONDENTS:

    1    THE TAHSILDAR, TALUK OFFICE,
         ALUVA-682140.

    2    THE DEPUTY SECRETARY
         REVENUE (SPECIAL CELL) DEPARTMENT,
         GOVERNMENT OF KERALA,
         THIRUVANANTHAPURAM-695001.


         BY ADV.

          SRI.SAYED M THANGAL, GP (TAX)

     THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
02.07.2025, ALONG WITH WP(C).5653/2017, THE COURT ON THE SAME
DAY DELIVERED THE FOLLOWING:
                                                       2025:KER:48503
                                        2
W.P.(C) Nos.22542 of 2014 and 5653 of 2017



              IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                    PRESENT

                  THE HONOURABLE MR. JUSTICE S.MANU

   WEDNESDAY, THE 2ND DAY OF JULY 2025 / 11TH ASHADHA, 1947

                          WP(C) NO. 5653 OF 2017

PETITIONER

             INKEL LIMITED
             AJIYAL COMPLEX, POST OFFICE ROAD, KAKKANAD,
             COCHIN- 682 030, REPRESENTED BY ITS COMPANY
             SECRETARY SHRI.K.PADMADASAN


             BY ADVS.
             SRI.SAJI VARGHESE T.G
             SMT.MARIAM MATHAI



RESPONDENTS:

     1       THE TAHSILDAR,
             TALUK OFFICE, ALUVA-683101

     2       THE SECRETARY
             REVENUE DEPARTMENT, GOVERNMENT OF KERALA,
             GOVERNMENT SECRETARIAT,
             THIRUVANANTHAPURAM-695001


             BY ADV.
             GOVERNMENT PLEADER

     THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
02.07.2025, ALONG WITH WP(C).22542/2014, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
                                                              2025:KER:48503
                                         3
W.P.(C) Nos.22542 of 2014 and 5653 of 2017


                              JUDGMENT

Petitioner has constructed two buildings in the land allotted

by the Government of Kerala at Ankamaly. The buildings were

designed and constructed with 40 modules for industrial units

engaged in manufacturing of products and ancillary services.

Some of the modules of the buildings were leased out to industrial

units engaged in manufacturing products.

2. The Tahsildar, Aluva issued assessment orders under

the provisions of the Kerala Building Tax Act. When the petitioner

received assessment order with respect to the first building

constructed, petitioner approached the District Collector under

Section 13 of the Kerala Building Tax Act invoking the revisional

jurisdiction. The Collector made a reference to the Government

and Ext.P3 communication was issued by the Government

thereafter. Government after considering the matter, issued Ext.P6

order dated 22.04.2014.

3. A reading of Ext.P6 shows that the Government was of

the view that the petitioner had constructed buildings in

Government property and was renting out the buildings to others.

The concerned authority observed that exemption under Section 2025:KER:48503

W.P.(C) Nos.22542 of 2014 and 5653 of 2017

3(1)(b) is not available to buildings rented out. Further it was

observed that the petitioner in its capacity as the owner of the

building was not directly running any industry or factory.

According to the Government as far as the petitioner is concerned,

the building was utilised for renting out and not for conducting any

industry or factory. Stating the said reason, the Government

decided that the petitioner is not entitled for the exemption under

Section 3(1)(b).

4. Petitioner approached this Court aggrieved by Ext.P6

order issued by the Government. Petitioner sought for quashing

the assessment order as well as the order issued by the

Government. When W.P.(C) No.22542 of 2014 was pending, the

Tahsildar concerned issued assessment orders with respect to the

second building constructed by the petitioner in the same

property. Petitioner filed W.P.(C) No.5653 of 2017 challenging the

assessment orders issued with respect to the second building.

Government filed separate counter affidavits in both cases.

5. The learned counsel for the petitioner referring to

Section 3(1)(b) of the Kerala Building Tax Act submitted that

buildings used principally for religious, charitable or educational 2025:KER:48503

W.P.(C) Nos.22542 of 2014 and 5653 of 2017

purposes or as factories or workshops(or cattle/pig/poultry farms

or poly houses) are exempted from the provisions of the Kerala

Building Tax Act. He submitted that buildings constructed by the

petitioner are used principally as factories. He hence contended

that the buildings of the petitioner are exempted under Section

3(1)(b). The learned counsel argued that the provisions of Section

3(1)(b) do not make any distinction between buildings put in own

use by the owner of the building and those which are rented out.

The learned counsel therefore contended that the distinction made

by the Government in Ext.P6 order is not legally sustainable. The

learned counsel placed reliance on a judgment of a Division Bench

of this Court in Biju M.K v. State of Kerala [2017 (1) KLT

991]. The learned counsel pointed out that identical issue was

considered by the Division Bench of this Court in the said

judgment. The Division Bench observed that there was no

indication in the provision of Section 3(1)(b) as to the need or

requirement that the owner should be the user to claim the

exemption. The learned counsel submitted that the decision taken

by the Government reflected in Ext.P6 is not legally sustainable

and the petitioner is entitled for exemption.

2025:KER:48503

W.P.(C) Nos.22542 of 2014 and 5653 of 2017

6. The learned Government Pleader on the other hand

contended that the buildings constructed by the petitioner were

not put to use for the purpose of running industries or factories at

the time of inspection conducted by the Tahsildar. Referring to the

averments in the counter affidavit, the learned Government

Pleader submitted that the petitioner was not engaged in running

any industry or factory and renting out building on lease to third

parties was the actual activity of the petitioner. The learned

Government Pleader therefore submitted that petitioner was not

entitled for exemption under Section 3(1)(b) and hence the

Government took a correct view while issuing Ext.P6. The learned

Government Pleader also submitted that the decision relied on by

the learned counsel for the petitioner is distinguishable on facts.

7. I have perused Ext.P6 which is under challenge in W.P.

(C) No.22542 of 2014. The only reason stated in Ext.P6 for

rejecting the claim for exemption is that the building was rented

out. According to the Government, the exemption under Section

3(1) was not applicable for buildings which are rented out. It

appears that the view of the Government was that the exemption

would apply only if the owner of the building was directly involved 2025:KER:48503

W.P.(C) Nos.22542 of 2014 and 5653 of 2017

in running an industry or factory. I am of the view that the said

reason is not sustainable in view of the law laid down by this Court

in Biju M.K. v. State of Kerala. The Division Bench of this Court

observed in the said judgment as follows:

"5. Clause (b) of S.3(1) of the Act provides that nothing in the Act shall apply to, buildings used, inter alia, as factories or workshops. There is no indication in that provision as to the need or requirement that the owner should be the user to claim the exemption under that provision. While the learned Senior Government Pleader is justified in saying that the facts and factors which may be relevant to decide a claim of exemption ought to be relatable to the date of levy on the basis of the charging provision, particularly when, the building tax imposed through the Act is a one time tax, that question has to be decided depending upon the user of the building at the time of completion and irrespective of whether the activity in the building at that relevant point of time is carried out by the owner or by any other person in possession or occupation. For this reason, we are of the view that Ext.P2 which was impugned before the learned Single Judge and the decision of the learned Single Judge holding that the fact that the writ petitioner has leased out the building will by itself be destructive of her claim for exemption cannot be upheld. We accordingly set aside Ext.P2 specifically on the ground that such order could not have been issued merely for the reason that the appellant / writ petitioner had leased out the building to another. Since 2025:KER:48503

W.P.(C) Nos.22542 of 2014 and 5653 of 2017

Ext.P2 does not decide any other relevant issue in the course of consideration of the application for exemption, we cannot but require the Government to decide on all other questions relevant to the application for exemption de novo. The learned counsel for the appellant also referred to the decision of this Court in Appukuttan v. State of Kerala, 2013 KHC 2735: 2013 (2) KLT 533. We have considered the said decision and we approve the ratio thereon.

For the aforesaid reasons, the impugned judgment is vacated and Ext.P2 is quashed holding that it does not stand on the reason stated therein. It is ordered that this judgment will not stand in the way of the Government reconsidering all other relevant factors. The Government shall take up the writ petitioner's application for exemption and consider the same de novo in the light of what is stated herein above. The petitioner is directed to mark appearance in the office concerned on 08/03/2017."

8. In view of the judgment of the Division Bench, I find

that Ext.P6 cannot be sustained. Therefore I set aside Ext.P6. The

Government shall consider the matter afresh and take a fresh

decision in tune with the judgment of the Division Bench of this

Court in Biju M.K. v. State of Kerala. However as observed by

the Division Bench in the said judgment, it will be open to the

Government to take into account all relevant facts and

circumstances while taking a fresh decision. An opportunity of 2025:KER:48503

W.P.(C) Nos.22542 of 2014 and 5653 of 2017

hearing shall be provided to the petitioner before a final decision is

taken by the Government. Further proceedings pursuant to

impugned assessment orders in both Writ Petitions shall be kept

on hold till a fresh decision is taken as directed above. As the

issue arose long ago, the competent authority shall make every

endeavor to take a fresh decision at the earliest.

With the above directions, these Writ Petitions are disposed

of.

Sd/-

S.MANU JUDGE PV 2025:KER:48503

W.P.(C) Nos.22542 of 2014 and 5653 of 2017

APPENDIX OF WP(C) 5653/2017

PETITIONER EXHIBITS

Exhibit-P1: TRUE COPY OF THE ASSESSMENT ISSUED BY THE 1ST RESPONDENT Exhibit-P2: TRUE COPY OF THE DEMAND NOTICE ISSUED BY THE 1ST RESPONDENT Exhibit P3 TRUE COPY OF THE BUILDING PERMIT NO.

D/2021/14/KDIS DATED 29.10.2014 ISSUED BY THE ANGAMALY MUNICIPALITY TO THE PETITIONER SHOWING THE CATEGORY OF THE BUILDING AS SMALL INDUSTRIAL TOGETHER WITH ENGLISH TRANSLATION Exhibit P4 TRUE COPY OF THE OCCUPANCY CERTIFICATE NO.PW2-BA(36648)/2016 DATED 14.10.2016 ISSUED BY THE ANGAMALY MUNICIPALITY SHOWING THE CATEGORY OF THE BUILDING A SMALL INDUSTRIAL 2025:KER:48503

W.P.(C) Nos.22542 of 2014 and 5653 of 2017

APPENDIX OF WP(C) 22542/2014

PETITIONER EXHIBITS

EXHIBIT P1 TRUE COPY OF THE NOTICE OF DEMAND AND ASSESSMENT NO.C 9-20275/13 DATED 19-11-13. EXHIBIT P2 TRUE COPY OF THE APPLICATION SUBMITTED BEFORE THE DISTRICT COLLECTOR, DATED 28-11-13. EXHIBIT P3 TRUE COPY OF THE LETTER DATED 27-1-2014 FROM 1ST RESPONDENT TO THE PETITIONER.

EXHIBIT P4 TRUE COPY OF THE LETTER DATED 30-1-2014 FURNISHED BY PETITIONER WITH DOCUMENTS. EXHIBIT P5 TRUE COPY OF THE LETTER TO THE PETITIONER FROM PRINCIPAL SECRETARY TO THE GOVERNMENT REVENUE DEPARTMENT DATED 20-2-2014.

EXHIBIT P6 TRUE COPY OF THE ORDER DATED 22-4-2014 OF THE DEPUTY SECRETARY TO THE GOVERNMENT, REVENUE DEPARTMENT.

EXHIBIT P7 TRUE COPY OF THE LEASE DEED EXECUTED BY A SMALL SCALE INDUSTRIAL UNIT DATED 14-10-2015 EXHIBIT P8 TRUE COPY OF THE LICENSE DATED 16-02-2017 EXHIBIT P9 TRUE COPY OF THE LICENSE ISSUED UNDER FACTORIES ACT DATED 30-12-2017 EXHIBIT P10 TRUE COPY OF THE LETTER DATED 19-11-2013 GIVEN TO THE 1ST RESPONDENT BY THE PETITIONER.

EXHIBIT P11 TRUE COPY OF THE CERTIFICATE ISSUED BY ANGAMALY MUNICIPALITY DATED 30-05-2013.