W.A. No.1876 of 2022 1 2025:KER:26719 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR & THE HONOURABLE MR. JUSTICE EASWARAN S. THURSDAY, THE 27TH DAY OF MARCH 2025 / 6TH CHAITHRA, 1947 WA NO. 1876 OF 2022 AGAINST THE JUDGMENT DATED 1.7.2022 IN WP(C) NO.3603 OF 2016 OF HIGH COURT OF KERALA APPELLANTS/RESPONDENTS 1 AND 4 : 1 THE SECRETARY, KALAMASSERY MUNICIPALITY KALAMASSERY, ERNAKULAM, PIN - 682033 2 THE KALAMASSERY MUNICIPALITY, KALAMASSERY, PIN - 682033 REP. BY ITS SECRETARY. BY ADV M.K.ABOOBACKER RESPONDENTS/PETITIONER & RESPONDENTS 2 & 3 : 1 M/S.HOLMARC OPTO MECHATRONICS (P) LTD. 7/633, KAKKATTUCHIRA, FRIENDSVALLY, THRIKKAKKARA P.O., KAKKANAD, COCHIN-15, REP. BY ITS MANAGING DIRECTOR JOLLY CYRIAC., PIN - 682015 2 THE GENERAL MANAGER, DISTRICT INDUSTRIAL CENTRE, KAKKANAD, ERNAKULAM 682 030., PIN - 682030 3 STATE OF KERALA, REP. BY ITS SECRETARY, DEPARTMENT OF INDUSTRIES, THIRUVANANTHAPURAM,PIN-695001 W.A. No.1876 of 2022 2 2025:KER:26719 ADDL.R4 IMPLEADED ADDL.R4 THE STATE OF KERALA, REPRESENTED BY ITS ADDITIONAL CHIEF SECRETARY TO GOVERNMENT,LOCAL SELF GOVERNMENT DEPARTMENT, THIIRUVANANTHAPURAM-695001. IS IMPLEADED AS ADDITIONAL FOURTH RESPONDENT AS PER ORDER DATED 13/3/23 IN IA NO.2/23 IN W.A.1876/22. BY ADVS. JOBY CYRIAC KURIAN K JOSE(K/001510/2019) THIS WRIT APPEAL HAVING COME UP FOR HEARING ON 27.03.2025, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.A. No.1876 of 2022 3 2025:KER:26719 JUDGMENT Dr. A.K.Jayasankaran Nambiar, J. The Secretary of the Kalamassery Municipality is the appellant before us aggrieved by the judgment of a learned Single judge in W.P.(C) No.3603 of 2016 dated 1.7.2022. 2. The brief facts necessary for the disposal of this writ appeal are as follows: The writ petition was preferred by the respondent herein, a private limited company that owns a manufacturing unit in an industrial development area declared by the State Government, namely, the Kalamassery Industrial Development Area. The grievance projected in the writ petition was with regard to the notices issued against it demanding property tax for the period 2013-2014 to 2015-2016. The contention of the respondent/writ petitioner against the demand notices was essentially two-fold. Firstly, it was contended that in view of the exemption granted to industrial units in the State from the provisions of the Municipalities Act, there could not be a levy of property tax on them. Alternatively, it was contended that even if the property tax was payable, the municipality could not have demanded property tax at the rate applicable to unauthorised buildings since the issue as to whether or not the building was authorised or unauthorised had not been examined by the Municipality. 3. The learned Single Judge who considered the matter relied on W.A. No.1876 of 2022 4 2025:KER:26719 the provisions of Section 450 of the Kerala Municipalities Act and Section 6 of the Kerala Industrial Single Window Clearance Board and Industrial Township Area Development Act, 1999 (for short, ‘the Act 1999’) to find that the statutes in question granted the benefits to industrial establishments located within the notified industrial areas and hence the local body was precluded from taking any action including the levy of tax on the basis of the aforesaid provisions. The learned Judge was of the view that the exemption granted by the Statute as well as the State Government was with a view to promote industries within the State and to facilitate an easy mechanism for an industrialist to start the establishment without being saddled by the intricacies contained under various statutes and by resorting to the single window clearance methodology provided under the 1999 Act. The writ petition was therefore allowed by setting aside the demands made on the respondent/writ petitioner for recovery of property tax. 4. Before us, it is the submission of Sri. M.K.Aboobacker, the learned Standing Counsel appearing for the appellant/municipality that the learned Single Judge erred in assuming that the exemption provisions under the Municipalities Act read with the provisions under the 1999 Act exempted even the levy of property tax on eligible industrial units. He points out that while the exemption provisions under Section 450 of the Municipalities Act and Section 6 of the 1999 Act are essentially in relation to the permission required from the municipality W.A. No.1876 of 2022 5 2025:KER:26719 for the installation of machinery or manufacturing units or industrial units and from obtaining permits from the municipalities for the construction of the buildings for starting an industrial undertaking, there was no specific provision that granted an exemption to such units from payment of property tax under the statute. 5. We have also heard Sri. Joby Cyriac, the learned counsel appearing for the writ petitioner who points out that even if this Court is inclined to interfere with the judgment of the learned Single Judge, then the writ petitioner ought to be relegated to his remedy of approaching the municipality with the data that would establish that the buildings in question were not unauthorized as assumed by the municipality. 6. On a consideration of the rival submissions, we find force in the submission of the learned counsel for the appellant/municipality that the statutory provisions did not envisage an exemption for industrial units, similar to that of the respondent/writ petitioner, from the levy of property tax under the Municipalities Act. The exemption provisions relied upon by the learned Single Judge being exclusively in relation to certain activities, it could not have been stretched to include even an exemption from tax. Accordingly, we set aside the impugned judgment of the learned Single Judge and allow the writ appeal by dismissing the writ petition in its challenge on the aforesaid ground. 7. Taking note of the submissions of the learned counsel for the writ petitioner however, and in order to enable the municipality to arrive W.A. No.1876 of 2022 6 2025:KER:26719 at a correct assessment of property tax by looking at the nature of the buildings put up by the respondent/writ petitioner and ascertaining whether or not they were unauthorised, we set aside Exts.P10 and P11 demand notices. The appellant/municipality shall take a fresh decision with regard to the property tax liability of the respondent/writ petitioner after considering the materials produced before it by the respondent/writ petitioner to show the character of the buildings as to whether or not it was an unauthorized structure. The appellant shall also hear the respondent/writ petitioner before passing any final orders in the matter. The Writ appeal is allowed as above. Sd/- DR. A.K.JAYASANKARAN NAMBIAR JUDGE Sd/- EASWARAN S. JUDGE NS