Ison George Vs State of Kerala (Kerala High Court)
Kerala High Court, in the case of Ison George Vs State of Kerala, has ruled that Section 5A of the Kerala Building Tax Act, 1975, which levies a tax on residential buildings exceeding a certain plinth area, remains constitutionally valid. However, the court has concurrently limited the period for which such tax can be recovered, stating that demands extending beyond three years prior to the notice date cannot be legally sustained.
The ruling came in an appeal filed by Ison George, challenging a single judge’s dismissal of his writ petition. George, owner of a residential building with a plinth area of 289.22 sq.m., had contested a demand notice dated December 4, 2019 (Ext.P2), which sought to recover “luxury tax” under Section 5A for assessment years ranging from 2007-2008 to 2020-2021. This notice was reportedly the first demand for luxury tax served on the appellant.
The primary contention in George’s writ petition was that Section 5A of the Kerala Building Tax Act was ultra vires, illegal, unconstitutional, and void. The appellant argued that the 101st amendment to the Constitution of India had altered Entry 62 of List II of the 7th Schedule, effectively removing “taxes on luxuries” from the State Legislature’s purview. Consequently, George contended that the State lacked the power to levy or collect luxury tax under Section 5A after this amendment. He sought to quash the demand notice and prevent further recovery of such tax.
