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TMI Blog2015 (7) TMI 374X X X X Extracts X X X X X X X X Extracts X X X X ..... ls away the entire building then it has to be flat/apartment-wise calculation/computation, for every apartment owner is different than the others. Thus, the plinth area would be different. To clarify further, if a singular person purchases three flats, he will be liable on the basis of aggregate plinth area subject to the cap envisaged under Section 5A of the Act. - CIVIL APPEAL NO. 1640 of 2015 - - - Dated:- 1-7-2015 - Dipak Misra and Prafulla C. Pant, JJ . For the Petitioner : Ms. Liz Mathew, AOR For the Respondent : Mr. M. Gireesh Kumar, Adv.,Mr. Sriram P., Adv. Mr. Ankur S. Kulkarni, AOR CIVIL APPEAL NO. 1640 of 2015 JUDGMENT Dipak Misra, J. The respondent invoked the jurisdiction of the High Court of Kerala at Ernakulam under Article 226 of the Constitution assailing the demand of luxury tax imposed on a building that consists of 13 residential apartments. The Tahasildar who is the competent statutory authority under the Kerala Building Tax Act, 1975 (for brevity the Act ) imposed luxury tax on the building on the base of Section 5A of the Act vide order dated 1.10.2003 in Ref B4-6435/03 whereby he had measured the plinth area of all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d with each other and if one floor is of no use without the existence of another floor, then it has to be considered as one building. The Division Bench further proceeded to state that as there were 13 independent flats or apartments and each of the building could be used on its own without reference to the other apartment, the question of taking the measurement of another building to calculate the plinth area would not arise. The conclusion recorded by the Division Bench reads as follows:- For the purpose of calculating the plinth area, if the intention of the legislature was to adopt the entire Explanation (2) to clause (e) even with reference to proviso to 2(k) there was no need to mention the aggregate area where a building has more than one floor. The very reference to more than one floor of a building would explicitly mean, if read along with the proviso that whether the building is a single unit so far as functional use is concerned, or separate units, so far as functional utility of the building. If there is one building having more than one floor and they are interconnected with each other, in other words, if one floor is of no use without the existence of another flo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... building in Explanation II in Section 2(e) does not apply to a residential building. Learned counsel has drawn distinction between residential building and a building by drawing our attention to Section 2(l) of the Act. It is propounded by him that none of the 13 apartments individually have the plinth area of more than 278.7 sq. mts. and hence, the proviso to Section 5A of the Act is not applicable to the present case. It is contended that demand has to be made for the residential apartments and not for the owner who is holding the whole unit. Elaborating the said stand, it is submitted that there cannot be clubbing of the residential apartments together for the purpose of imposition of luxury tax. 7. To appreciate the rival submissions, it is necessary to extract the relevant part of Section 2(e), which defines building . It is as under:- Building means a house, out-house, garage or any other structure, or part thereof, whether of masonry, bricks, wood, metal or other material but does not include any portable shelter or any shed constructed principally of mud, bamboos, leaves, grass, thatch or a latrine which is not attached to the main structure. [...] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the residential apartments has the plinth area of less than 278.7 sq.mts., but when the entire plinth area of 13 apartments is taken by applying the method of clubbing or when the plinth area is aggregated, it exceeds 278.7 sq.mts. It is the admitted position that the building has been constructed after 1.4.1999, that is, the date provided in Section 5A of the Act. 12. Section 2(k) of the Act defines the term plinth area and Section 2(l) of the Act defines the term residential building . We have already quoted the aforesaid provisions. As we notice, the term plinth area means the area included in the floor of a building and where a building consists of more than one floor, aggregate area of all the floors and hence, the plinth area can include the entire construction, that is, the floor area of a multi-storied building. The question would still arise whether different apartments owned by separate persons can be clubbed and aggregated in a multi-storied building. The proviso thereto states that the plinth area of an entire building can be separated. It is postulated therein that in case of a building when Explanation II to Section 2(e) is attracted, the plinth area should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to analyse what is meant by residential building . The definition in clause 2(l), means a building or any other structure or part thereof used for residential purpose and house or out-house or garage appurtenant to a building for more beneficial enjoyment. It excludes hotels, boarding places, lodges and the like. Thus, the expression residential building cannot be interpreted without reference to the term building and Explanation II to Section 2(e) of the Act. Therefore, each residential building owned by single owner would be subjected to luxury tax, if it has the plinth area which exceeds 278.7 sq.mts. It makes no difference whether the residential building consists of one floor or it is two-storied or three-storied or consists of multiple flats or apartments. The entire plinth area in the residential building owned by a singular owner is required to be aggregated. It is noticeable that Section 5A does not refer to aggregate plinth area of all the floors. The intention of the legislature is apparent that if a person is the owner of the plinth area of 278.7 sq.mts or more in one building, even if it consists of separate or distinct apartments, he would be liable to pay the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submit that if there is initial booking and the persons have contributed for the construction definitely there shall be separate computation. The Explanation II has to be read with Section 5A which starts with a non-obstante clause. Section 5A as has been mentioned before refers to residential building having plinth area 278.7 sq. mts. or more and, therefore, the said provision also takes note of this definition. In view of the above, the contention advanced by the learned counsel for the State is difficult to accept. The definitions have to be given a proper construction. There can be a case where the owner erects a multi-storied building consisting 10 floors. He builds it at his own cost and thereafter he sells the apartments or flats to 10 persons and in that event he ceases to be the owner of the building. The 10 purchasers become the owners of flats and in such a situation it will lead to an absurdity because one single person who once owned the entire building or several apartments, though has ceased to be the owner in law yet is asked to pay the luxury tax solely on the ground that at the time of construction there was no contribution by the purchasers or to put it diffe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or object, whose imaginative discovery is judicial craftsmanship. We need not always cling to literalness and should seek to endeavour to avoid an unjust or absurd result. We should not make a mockery of legislation. To make sense out of an unhappily worded provision, where the purpose is apparent to the judicial eye `some' violence to language is permissible. 16. In Keshavji Ravji and Co. v. CIT (1990) 2 SCC 231 it has been held by this court that when in a taxation statute where literal interpretation leads to a result that does not sub-serve the object of the legislation another construction in consonance with the object can be adopted. 17. In the case at hand, as is noticeable, the learned Single Judge had remanded the matter to the revenue authority and the Division Bench has declined to interfere. The Division Bench has applied the functional unit test. We do not accept the same. The learned Single Judge, as we have reproduced a paragraph hereinbefore, has opined that when the plinth area of any residential apartment is above 278.7 sq. mts., then the authority can demand luxury tax for such apartment or flat. Be it noted, the learned Single Judge has held that e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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