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TMI Blog2008 (2) TMI 953X X X X Extracts X X X X X X X X Extracts X X X X ..... ing free, subsidised and charitable service or aid to the poor, needy, distressed and disabled and also to establish research Centres for the study of the diseases of mankind. They are running and maintaining the hospital in an area of nearly 20,425 sq.ft. 1.3. The respondent Hospital states that they receive only nominal amount to meet the heavy cost and expenditure incurred while treating the patients. According to them, cost of the expenditure is partially received from the patient. Hence, they claim exemption under Section 86(e) of the Tamil Nadu District Municipalities Act and now under Section 123(e) of the Tiruchirappalli City Municipal Corporation Act, after the appellant Corporation become the Municipal Corporation. 1.4. However, the appellant Corporation, by proceedings dated 16.5.1995, raised a demand for ₹ 17,409/- for half yearly, with effect from October 1993. Hence, the writ petition. 1.5. The writ petition was resisted by the appellant Corporation disputing the character and status of the respondent Hospital, as the respondent Hospital, in reality, was running on profit motive. Rent was collected from the patients who were admitted, fees were also rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Coimbatore Municipal Corporation Act has been made applicable to the Tiruchirappalli Corporation. Section 123 of the Coimbatore Municipal Corporation Act, which is applicable to Tiruchirappalli Corporation, reads as under: Section 123: The following buildings and lands shall be exempt from property tax. (a) ... (b) ... (c) ... (d) ... (e) Charitable Hospitals and dispensaries but not including residential quarters attached thereto; Provided that nothing contained in clauses (a), (c) and (e) shall be deemed to exempt from property tax any building or land for which rent is payable by the person or persons using the same for the purposes referred to in the said clauses. 3.3. It is true, the scope of exemption from the payment of property tax with reference to the building owned as buildings and lands of charitable hospitals and dispensaries not including the residential quarters attached thereto mentioned under Section 123(e) of the Act referred to above came up for consideration before a Division Bench in S.N.R. Sons Charitable Trust, Coimbatore v. The Commissioner, Coimbatore City Municipal Corporation, Coimbatore [1993 10 WLR 769], wherein a Division Bench ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all is construed as may . The term shall in its ordinary significance is mandatory and the court shall ordinarily give that interpretation to that term unless such an interpretation leads to some absurd or inconvenient consequence or be at variance with the intent of the legislature, to be collected from other parts of the Act. The construction of the said expression depends on the provisions of a particular Act, the setting in which the expression appears, the object for which the direction is given, the consequences that would flow from the infringement of the direction and such other considerations. 4.5. In view of the above, the proviso that nothing in Section 123(a), (c) and (e) of the Act shall be deemed to exempt from property tax any building or land for which rent is payable by a person or persons using the same for the purpose of Section referred to in the said clause, would make it clear that the exemption granted in the main provision, viz. 123(e) of the Act is not automatic. 5.1. Accordingly, as observed by the Division Bench, the property tax leviable on annual value is based on the gross annual rent on the basis of letting from month to month or year to yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cipal Corporation, Coimbatore [1993 10 WLR 769] is helpful only to the limited extent to decide that the receipt of payment by the respondent Hospital from the patients would not, by itself, amount to rent and the same cannot be a ground to quash the impugned demand. 5.6. Our view is fortified with the decision of a Division Bench of this Court in Coimbatore Masonic Charity Trust rep. by its Trustee and Secretary, Coimbatore v. The Commissioner, Coimbatore Corporation, Coimbatore [W.A.Nos.1832 to 1834 of 2000 dated 1.12.2000] where a charitable hospital claimed exemption from the payment of property tax demanded by Coimbatore Corporation under Section 123(e) of the Act, the Division Bench directed the assessee to pay a portion of the property tax demanded and directed the Corporation to consider and pass orders in the representation of the assessee claiming exemption, based on the materials furnished by the assessee and in accordance with law. 6.1. The next reason that weighed the learned single Judge is that the respondent hospital, having obtained exemption under Section 80G of the Income Tax Act, are entitled to the exemption of property tax. Section 80G of the Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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