M/S. LISIE MEDICAL INSTITUTIONS versus THE STATE OF KERALA AND ORS.

Citation: [2023] 6 S.C.R. 354 · Decided: 09-02-2023 · Supreme Court of India · Bench: D.Y. CHANDRACHUD · Disposal: Reference answered
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Judgment (excerpt)

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SUPREME COURT REPORTS
[2023] 6 S.C.R.
M/S. LISIE MEDICAL INSTITUTIONS
v.
THE STATE OF KERALA AND ORS.
(Civil Appeal No. 6799 of 2017)
FEBRUARY 09, 2023
[DR. DHANANJAYA Y CHANDRACHUD, CJI,
PAMIDIGHANTAM SRI NARASIMHA AND
J. B. PARDIWALA, JJ.]
Kerala Building Tax Act, 1975 – s.3(1) – Interpretation of the
provision for exemptions contained in s.3(1) – The two judge Bench
in Lisie Medical Institutions v. State of Kerala has doubted the
correctness of certain observations contained in an earlier decision
of two Judges in SH Medical Centre Hospital vs State of Kerala –
While construing the provisions of s.3(1)(b) of the Kerala Building
Tax Act 1975, the two Judge Bench in SH Medical Centre Hospital,
has incorporated the observations which suggests that the
Explanation to Section 3(1) to mean that a ‘charitable purpose’ is
confined only to relief of the poor and free medical relief – Held:
This observation of the two-Judge Bench in SH Medical Centre
Hospital does not accord with the plain meaning of the Explanation
to Section 3(1) – The two judge bench in SH Medical Centre Hospital
conflated the use of the word ‘include’ with ‘means’ – The
Explanation goes to indicate that ‘charitable purposes’ includes
and is, therefore, not confined to the relief of the poor and free
medical relief – Consequently, the decision in SH Medical Centre
Hospital to the extent of the interpretation which is placed on the
Explanation to Section 3(1)(b) of the Kerala Building Tax Act 1975
does not correctly reflect the position in law – The decision in SH
Medical Centre Hospital is, therefore, overruled to the above extent.
SH Medical Centre Hospital v. State of Kerala (2014)
11 SCC 381 – Overruled.
Case Law Reference
(2017) 14 SCC 533
overruled
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354
[2023] 6 S.C.R. 354
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CIVIL APPELLATE JURISDICTION: Civil Appeal No. 6799
of 2017.
From the Judgment and Order dated 18.07.2016 of the High Court
of Kerala at Ernakulam in CRP No. 1386 of 2016 and WPC No. 20448
of 2016.
R. Basant, Sr. Adv., K. V. Mohan, Jijo Paul Kallookkaran, K. V.
Balakrishnan, Rahul Kumar Sharma, Vishnu P., Advs. for the Appellant.
V. Giri, Sr. Adv., C. K. Sasi, Abdulla Naseeh V T, Ms. Meena K
Poulose, Ramesh Babu M. R., Advs. for the Respondents.
The Judgment of the Court was delivered by
DR. DHANANJAYA Y CHANDRACHUD, CJI
1. The present reference to a three Judge Bench has been
occasioned in a referring judgment of a two Judge bench in Lisie Medical
Institutions Vs State of Kerala1. The two judge Bench has doubted the
correctness of certain observations contained in an earlier decision of
two Judges in SH Medical Centre Hospital vs State of Kerala2.
2. We have heard Mr R Basant, senior counsel appearing on
behalf of the appellant and Mr V Giri, senior counsel appearing on behalf
of the respondents.
3. The issue turns on the interpretation of the provision for
exemptions contained in Section 3(1) of the Kerala Building Tax Act,
1975, which is extracted below:
“3. Exemptions – (1) Nothing in this Act shall apply to
(a) buildings owned by the Government of Kerala or the
Government of India or any local authority; and
(b) buildings used principally for religious charitable or educational
purposes or as factories or workshops.
Explanation.– For the purpose of this sub-section, “Charitable
purpose” includes relief of the poor and free medical relief.”
4. Clause (b) of sub-Section (1) of Section 3 of the Kerala Building
Tax Act 1975 stipulates that nothing in the enactment shall apply to
1 (2017) 14 SCC 533
2 (2014) 11 SCC 381
M/S. LISIE MEDICAL INSTITUTIONS v. THE STATE OF KERALA
AND ORS.
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SUPREME COURT REPORTS
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buildings used “principally for ... Charitable ... purposes”. The Explanation
[now Explanation (1)] indicates that for the purpose of the sub-section
‘charitable purpose’ includes “relief of the poor and free medical relief”.
Clearly, therefore, the Explanation indicates that the meaning of the
expression ‘charitable purpose’ is not confined to relief of the poor and
free medical relief as is evidenced by the use of the expression ‘includes’.
When a statute uses the expression ‘includes’, it is a well settled principle
of interpretation that the elucidation is not intended to be exhaustive.
5. However, while construing the provisions of Section 3(1)(b) of
the Kerala Building Tax Act 1975, the two Judge Bench in SH Medical
Centre Hospital (supra), has incorporated the following observations in
Paragrap
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