GOVERNMENT OF KERALA & ANR. versus MOTHER SUPERIOR ADORATION CONVENT

Citation: [2021] 3 S.C.R. 26 · Decided: 01-03-2021 · Supreme Court of India · Bench: R.F. NARIMAN · Disposal: Disposed off

Cited by 7 judgment(s) · cites 10 · see the full citation network in Lexace

Judgment (excerpt)

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SUPREME COURT REPORTS
[2021] 3 S.C.R.
   [2021] 3 S.C.R. 26
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GOVERNMENT OF KERALA & ANR.
v.
MOTHER SUPERIOR ADORATION CONVENT
(Civil Appeal No. 202 of 2012)
MARCH 01, 2021
[R. F. NARIMAN AND B. R. GAVAI, JJ.]
Kerala Building Tax Act, 1975 – s.3(1)(b) – Exemption from
building tax – The State claims that no exemption from building tax
should be granted to residential accommodation for nuns, priests
or hostel accommodation for students, as these have no direct
connection with religious/educational activity – It was contended
that assuming there is ambiguity in s.3(1)(b), in that a purpose
connected with the religious/educational activity may be included,
yet the ambiguity has to be resolved in favour of the State – Held: A
reading of s.3(1)(b) would show that the object for exempting
buildings which are used principally for religious, charitable or
educational purposes would be for core religious, charitable or
educational activity as well as purposes directly connected with
religious activity – Nuns living in a neighbouring building to a
convent only so that they may receive religious instruction there, or
if students are living in a hostel close to the school or college in
which they are imparted instruction, it is obvious that the purpose
of such residence is not to earn profit but residence that is integrally
connected with religious or educational activity – An exemption
provision should be liberally construed in accordance with the object
sought to be achieved if such provision is to grant incentive for
promoting economic growth or otherwise has some beneficial reason
behind it – One must first ask what is the object sought to be achieved
by the provision, and construe the statute in accord with such object
– And on the assumption that any ambiguity arises in such
construction, such ambiguity must be in favour of that which is
exempted – Therefore, the buildings in question exempted from
building tax.
Disposing the appeals, the Court
HELD: 1. A reading of the provision would show that the
object for exempting buildings which are used principally for
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religious, charitable or educational purposes would be for core
religious, charitable or educational activity as well as purposes
directly connected with religious activity. One example will suffice
to show the difference between a purpose that is directly
connected with religious or educational activity and a purpose
which is only indirectly connected with such activity. Take a case
where, unlike the facts in Civil Appeal No. 202 of 2012, nuns are
not residing in a building next to a convent so that they may walk
over to the convent for religious instruction. Take a case where
the neighbouring building to the convent is let out on rent to any
member of the public, and the rent is then utilised only for core
religious activity. Can it be said that the letting out at market
rent would be connected with religious activity because the rental
that is received is ploughed back only into religious activity?
Letting out a building for a commercial purpose would lose any
rational connection with religious activity. The indirect connection
with religious activity being the profits which are ploughed back
into religious activity would obviously not suffice to exempt such
a building. But if on the other hand, nuns are living in a
neighbouring building to a convent only so that they may receive
religious instruction there, or if students are living in a hostel
close to the school or college in which they are imparted
instruction, it is obvious that the purpose of such residence is
not to earn profit but residence that is integrally connected with
religious or educational activity. [Para 12][40-E-H; 41-A-B]
2. A reading of the other provisions of the Act strengthens
the aforesaid conclusion. “Residential building” is defined
separately from “building” in Section 2(l). A “residential building”
means a building or any other structure or part thereof built
exclusively for residential purpose. It is important to note that
“residential building” is not the subject matter of exemption
under Section 3 of the Act. Quite the contrary is to be found in
Section 5A of the Act, which starts with a non-obstante clause,
and which states that a luxury tax is to be charged on all residential
buildings having a plinth area of 278.7 square meters and which
have been completed on or after 1.4.1999. If the contention of
the State is accepted, buildings in which 

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