VPK Motors Pvt. Ltd Vs State of Kerala (Kerala High Court)
The petitioner owned a building used for operating a Toyota vehicle dealership, comprising a showroom, workshop, and service center. The dispute concerned whether the building qualified for exemption from building tax under Section 3(1)(b) of the Kerala Building Tax Act, 1975. An assessment order imposed a building tax liability of ₹31,52,700. The petitioner applied to the Government seeking exemption and simultaneously challenged the assessment before the High Court, which directed the petitioner to pursue the statutory appellate remedy.
An appeal filed before the appellate authority was rejected on the ground that the plinth area used as a showroom was larger than the area used as a workshop, leading to the conclusion that the principal use of the building was not as a factory or workshop, and therefore exemption was not available. A revision petition was then filed, which was dismissed on the reasoning that only the Government was competent to decide the question of exemption, and hence the revisional authority could not entertain the claim.
Before the Kerala High Court, the petitioner contended that once a claim for exemption under Section 3(1)(b) was raised, the statutory authorities were bound under Section 3(2) of the Act to refer the matter to the Government for decision, without adjudicating on the exemption themselves. The petitioner argued that despite having already approached the Government for exemption, the authorities proceeded to assess and reject the claim without making the mandatory reference.
