Justice K. Vinod Chandran of Kerala High Court observed that, Luxury Tax can be levied on Plinth Area under Kerala Building Tax Act, 1975.
The petitioner had constructed a building, for which Occupancy Certificate was issued by the local authority. As per the Occupancy Certificate, the petitioner’s building only has a total area of 265.26 square meters. The petitioner’s building was assessed on the basis of a measurement conducted by the Village Officer. The measurement revealed a plinth area of 288.26 square meters and hence luxury tax was levied.
While dismissing the Writ Petition, the Court relied on Lillykutty v. District Collector and Others and observed that, the plinth area has to be determined on the basis of Rule 8 of the Kerala Municipality Building Rules, 1999 which provide for exclusion of 50% of floor area of open spaces. The Division Bench merely referred to the provision in the Building Rules to calculate the floor area and the definition of plinth area in the Building Tax Act and directed a re-verification. There is no binding declaration made in Lillykutty.
The Court also noted that the only exemption that could be granted, in the determination of plinth area and levy of luxury tax as per the Building Tax Act, is with reference to the garage or any other erection or structure appurtenant to a residential building used for storage of firewood or for any non-residential purpose as has been specifically provided for in the proviso to sub-section (5) of Section 5 of the Kerala Building Tax Act.
Read the full text of the Judgment below.
