Full Judgment Text
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PETITIONER:
MUNICIPAL COUNCIL, TIRUPATHI
Vs.
RESPONDENT:
TIRUMALAI TIRUPATHI DEVASTHANAM
DATE OF JUDGMENT06/02/1974
BENCH:
GOSWAMI, P.K.
BENCH:
GOSWAMI, P.K.
BHAGWATI, P.N.
CITATION:
1974 AIR 521 1974 SCR (3) 924
1974 SCC (1) 683
ACT:
Madras District Municipalities Act, 1920--S.
83(1)(b)--Whether Tirumalai Tirupathi Devasthanam New
Choultry is exempt from property tax.
HEADNOTE:
The plaintiff/respondent filed a suit in the court of
Subordinate Judge, for a declaration that the building,
known as "Tirumala Tirupathi Devasthanam New Choultry" is
exempt from property tax u/s. 83(1)(b) of the Madras
District Municipalities Act, 1920 and for directing the
defendant, the Municipal Council, Tirupathi, to refund the
sum of Rs. 22,306.40 paid under protest.
According to the plaintiff, the said building is a free
Devasthanam Choultry intended purely for the convenience of
the visiting pilgrims and therefore, exempt from property
tax. The defendants’ case is that while pilgrims are
accommodated in the ground floor free of charge, the rooms
in the first floor are rented out to pilgrims and others.
Further, the plaintiff was deriving a very large income from
the various stalls and shops situated inside the premises of
the choultry and therefore not exempt from tax.
The learned Sub-Judge dismissed the suit but on appeal, the
High Court reversed the judgment and decree of the trial-
court and decreed the plaintiff’s suit holding that the
plaintiff is entitled to exemption under s. 83 of the Act.
S. 83(1) of the Act provides as follows
"The following building and lands shall be: exempt from the
property tax:-
(a)
(b) choultries for the occupation of which no rent is
charged and choultries the rent charged for the occupation
of which is used exclusively for charitable purposes;"
Dismissing the appeal,
HELD:(i) The word "choultry" is not defined in the Act. The
word however, means a shelter or resting place for
travellers.
(Law Lexicon of British India compiled and edited by
Ramnatha Aiyar, 1940 Ed.)
(ii)Choultry is indeed an ancient institution and is
principally meant for lodging of pilgrims and travellers. it
is conceivable that in 1884, when the first Municipal
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Legislation was passed in Madras, such institutions were
some humble sheds; but in course of time, such institutions
grew in size and more and more demands were made of them for
comfort and convenience of the pilgrims. Therefore, it
would be necessary to look at the institution from the point
of view of the predominant intention which guides the
building up of the complex as a whole.
(iii)In the present case, the choultry cannot be divorced
from the other offices, shops and concerns which are mainly
located within its precincts in order to render much-needed
services to the pilgrims. It is clear that the entire
income is used exclusively for the purpose of the choultry
which is indeed a charitable purpose. Therefore, the case
falls squarely under sec. 81(1)(b) and therefore exempt from
property tax.
295
Kesarpalli Amaneyelu and another V. Eluru Municipality, by
its Executive Officer The commissioner and another, [1964]
I.L.R. Andhra Pradesh (Part IV) 379, Sri Kayakaparameswari
Anna Satram represented by the Secretary, Sri Batchu
Venkateswarlu v. The Vijayawada Municipality, represented
by its Executive Officer, The Municipal Commissioner [1959]
2 Andhra Weekly Reporter, 325; Kandandaram Pillai v. The
Municipal Council, Trichinopoly, [1933] 65 M.L.J. 678 and
Pandarasannadhi, Tiruvannamalai Adhinam v. The Corporation
of Madras[1941] 2 M.L.I. 544, referred to and distinguished.
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 568 of 1969.
From the judgment and decree dated the 27th February, 1968
of’ the Andhra Pradesh High Court in Appeal No. 117 of 1963.
M. Natesan, K. Jayaram and Y. Chandrasekheran, for the
appellant Krishnarao, E. Kalvanaram and G. N. Rao, for the
respondent.
The Judgment of the Court was delivered by
GOSWAMI, J.-This appeal by the dependent in the original
suit is by certificate granted by the High Court of Andhra
Pradesh to appeal against the judgment and decree of the
said Court of 27th February, 1968. The facts may briefly be
stated.
The respondent (hereinafter to be described as the
plaintiff) is the; Tirumalai Tirupathi Devasthanam
represented by its executive officer. The plaintiff
instituted a suit in the court of the Subordinate Judge,
Chittoor, on 10th March, 1961, praying for a declaration
that the building known as "Tirumala Tirupathi Devasthanam
New Choultry" situated within the area of the Municipal
Council Tirupathi (hereinafter described as the defendant)
bearing assessment No. 5361 of Tirupati Municipality, is
exempted from property tax under section 83 (1) (b) of the
Madras District Municipalities Act 1920 (Madras Act V of
1920), briefly the Act, and for directing the defendant to,
refund the sum of Rs. 22,306.40, the amount of tax so far
paid under protest. It appears that the plaintiff paid
property tax in respect of this budding for several years
under protest and without prejudice to its right to file a
suit. After the plaintiff failed to get redress from the
authorities, the suit was filed. The plaintiff states in
the plaint ,that the said building is a free Devasthanamas
choultry intended purely for the convenience of the pilgrims
visiting the famous Holy Shrine of Sri Venkateswara Swami at
Tirumala and other Devasthanams attached to the plaintiff
Devasthanams and is used solely and’ exclusively for the
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said purpose and no other". The plaintiff further inter
alia, avers in para 7 of the plaint as follows :-
"The defendant has failed to note and take
into consideration, as it ought to have the
fact that the canteen, the Firewood stores,
the Transport office Workshop, Garages, the
galvanized Iron Sheet sheds for parking the
Transport vehicles, the Railway Booking
Office, the Mysore Government Transport
Office, the Devastbanams Sanitary Inspector’s
Office, the Enquiry Office, Garages of cars,
shed for Water pump, Laundry, Hair-cutting
Saloon, the Post Office and
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Free Medical Dispensary, are all located
within the schedule mentioned premises only
with a view to providing conveniences which
the plaintiff is under a statutory obligation
to provide to the visiting pilgrims without
deriving any rents, returns, profits or other
receipts."
The defendant resisted the suit. It denied in the written
statement that the building "is an out and out free
Choultry". The defendant further avers that "while pilgrims
are accommodated in the ground .floor portion of the
Choultry free of charge, the rooms in the first floor are
rented out to Pilgrims and others. Further in the main
building. :as well as in the other buildings within the
compound of the choultry, there are several shops, stalls
and offices. There is the canteen, which ,admittedly caters
not only to the pilgrim visitors staying in the choultry but
also to the general public. There is a brass vessel shop, a
fire wood depot, a Transport Office, a motor workshop with 9
garages, a Railway Booking Room, a Mysore Transport Office
Room, the Sanitary Inspector’s Office Room, Enquiry Office,
6 garages, (2) residential portions for Superintendent, a
water pump shed, a laundry, a barber shop, and a Post
Office. It will be seen that the business in several of the
above shops and stalls and the amenities provided therein
are not solely connected with the purpose of either the
choultry or the worship in the temple. The plaintiff is
deriving a very large income from the said stalls and
shops........ The annual rental value of the ’building was
calculated only after excluding the portions that are- being
used for the purposes of the free choultry".
By consent of parties, a large number of documents were
marked as exhibits, and the plaintiff examined only the
Superintendent of the New Choultry as the sole witness while
the defendant did not adduce any oral evidence. The
Subordinate Judge dismissed the suit observing as follows :-
"On considering all these aspects I am of opinion that
neither the several offices and shops situated within the
premises of the choultry, nor the furnished rooms in the
main choultry are entitled to exemption from property tax
under section 83 of the Madras District Municipalities Act".
The Trial Court relied upon the decisions in Sri
Kanyakaparameswari Anna Satram, represented by the
Secretary, Sri Batchu Venkatesswar v. The Vijayawada
Municipality, represented by its Executive Officer, the
Municipal Commissioner(1) and Madura Municipal Council
through its Commissioner, Rajiah D. Paul v. Madura etc.,
Devasthanams represented by its Executive Officer, R. S.
Nayudu (2) and rejected the plaintiff’s claim. On appeal by
the plaintiff to the High Court of Andhra Pradesh, the
Division Bench reversed the judgment ,and decree of the
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Trial Court and decreed the plaintiff’s suit holding that
the plaintiff is entitled to exemption under section 83 or
the Act.
(1) 1959 (2) Andhra Weekly Reporter 325.
(2) A. I. R. 1942 Madras 658.
297
The evidence in the case is absolutely one sided and there
is no controversy about the facts. The High Court has found
that "there is only one institution, one building and that
building provides for rest of the pilgrims who visit the
place and the pilgrims are numerous to common knowledge. It
is not enough to have merely accommodation in building but
the people would like to ’have other amenities and it is the
other amenities that are provided as stated above.
Therefore we have to treat all these including the rooms as
one single unit which is intended for resting of the
pilgrims who visit the place and should not as the lower
court did, separate these amenities from the main
institution. No rent is charged except in one case where
there is one brass co-operative store which pays Rs. 30/-
per month towards rent. In this case the test laid down for
deciding whether the institution is a choultry or not is
fully satisfied as there is much accommodation in the ground
and first floor for resting place. What is objected to and
contended is that it ceases to be, a choultry with all these
amenities. provided there. In our opinion if the
institution is essentially one for providing rest and
shelter for pilgrims, the mere fact that there are amenities
attached to the institution should not detract from its
being, a choultry. On the other hand it amplifies and
provides more comforts to the pilgrims without charging
anything for them". The High Court also found that "the
amount collected for services and other amenities is far
less and it is not sufficient to meet the expenditure to run
the choultry.......... What is derived by the choultry is
only an amount of Rs. 15000/- and odd which is service
charges. But over and above that a large amount which
equals double the amount is spent. The charges, therefore,
must necessarily, have been spent and’ are spent, as
accounts show, for purposes of charity and whatever is
collected, whether from the cooperative society at the rate
of Rs. 30/per mensem or service charges levied from the
pilgrims, it is only a small amount. All this amount is not
sufficient to meet the annual’ expenditure of the
institution and the balance must come from the pocket of the
Devasthanam. It is therefore difficult to accept the con-
tention that there is no proof that the collections were
applied exclusively for the choultry. The expenditure is
one, the institution is one and the collections are also
exclusively for services connected with the institution and
not by way of rent. All these indicate and point to the
conclusion that the collections are applied only for
purposes of charity. It is not a business and the
institution is not making any profit and profit-motive is
not behind the actions of the Devasthanam in levying small
charges for the services rendered. All these charges are
meant mainly for the 30 rooms in the first floor."
The High Court came to the above findings and also noticed
"that the learned Subordinate Judge over-looked the fact
that there were rooms on the ground floor and they are also
used for the pilgrims".
Mr. Natesan, learned counsel for the appellant, submits that
the plaintiff cannot in law claim exemption under section 83
(1) (b) of the Act. We may, therefore, read the material
provisions in the section with which we are concerned :
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298
83(1) "The following buildings and lands shall
be exempt from the: property tax :-
x x
(b) choultries for the occupation of which
no rent is charged and choultries the rent
charged for the occupation of which is used
exclusively for charitable purposes;"
x x
The, word "choultry" is not defined in the
Act. The word is ,defined in the Law Lexicon
of British India compiled and edited by
Ramanatha Aiyar, 1940 edition, as follows :-
"Choultry : Chatram, A choultry is a
corruption of chavadi. It means a shelter or
resting place for travellers. A chathram
(corruption of the Sanskrit Sathram) is a
house where pilgrims and travellers are fed".
In the Shorter Oxford English Dictionary, choultry is
described as an Anglo-Indian word "being corruption of
Telugu chawadi" and its meaning is given as "A
caravanserai". In Wilson’s Glossary of Judicial and Revenue
Terms, second edition, page 108, "he word is given in
different forms such as Chawati or Chauti, corruptly,
Choltry or Choultry and the meaning is given as "A public
lodging place, a shelter for travellers".
The earliest Act on the subject in Madras is the Madras
DiStrict Municipalities Act of 1884. Even there under
section 63(1), amongst others, choultries were exempted from
payment of tax on buildings and lands. The word choultry
was not defined even in that Act. The present Act of 1920
has repealed the aforesaid old Act under section 2 read with
Schedule 1. In the absence of a statutory definition in the
Act, recourse has to be taken to the meaning attributed to
the word in the dictionaries and the law lexicons as well as
to the popular concept of the term. Choultry is indeed an
ancient institution and is principally meant for lodging of
pilgrims and travellers. It is conceivable that in 1884,
when the first municipal legislation was passed in Madras.
such institutions were some humble sheds and other
structures to enable, the pilgrims to stay for a short while
when they came to visit temples and other religious places.
This institution, like similar others elsewhere, has come to
stay as a symbol of religious and charitable disposition of
human mind translated into physical manifestation in the
shape of safe shelter for the pilgrims. As man advances and
ideas grow and expand, with his ever increasing desire for
comfort and convenience, the shape of the choultry must
needs also change. It is, therefore,only to be expected that
with the growing funds of the Devastbanams, such choultries
will be constructed in a modern way catering to the needs
and requirements of the, pilgrims and visitors of all
classes in a self-contained unit or complex. It would be
necessary to look at the institution from the point of view
of the predominant intention which guides the building up of
the complex as a. whole.
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The object for which a choultry is built is advanced and
facilitated by making provisions for so many incidental
conveniences which the visitors and pilgrims coming from far
and wide may need in order to make their short stay in the
neighbourhood of the temple comfortable and convenient from
all points of view so that they are not required to go to
and fro and face difficulties. The concept of a choultry
to-day may, therefore, be completely different from that
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with which one may be familiar a hundred years ago. There
must, however, be no idea of profit motive in running or
administering a choultry. Besides the expenditure for
running a choultry with amenities should not be made with an
idea to realise it from the visitors using the same. In
other words, the choultry must in truth and reality bear the
hall mark of a charitable institution and should not partake
of the character of a hotel run for profit. The appellant
concedes that the first floor as well as the ground floor of
the building which are used for lodging of the pilgrims may
be exempted from tax and indeed tax has not been realised in
respect of the rooms on the ground floor of the choultry.
The appellant, however, submits that the offices, shops and
other concerns some of which are located in the choultry and
others within the campus, cannot be considered as part and
parcel of the choultry and, therefore, are not exempt from
tax. We have examined the entire evidence in. this case and
have given careful consideration to the findings of the High
Court with regard to the same and are clearly of opinion
that the choultry cannot be divorced from the other offices,
shops and concerns which are mainly located within its
precincts in order to render much-needed and other necessary
services to the pilgrims coming to pay homage to the Holy
Shrine of Sri Venkateswara Swami. In the ’absence of a
precise definition of the word "choultry" in the Act
excluding such offices, shops and concerns in the precincts,
we are unable to restrict the term "choultry" in the context
of the economic development and improved standard of living
of our people, to only that portion of the building which is
directly used for lodging of visitors and pilgrims. We arc,
therefore, of the view that the High Court is right in
holding that the appellant is not entitled to charge tax on
the choultry as claimed.
Under section 81 of the Act, property tax is leviable if the
Municipal Council by resolution determines that it shall be
levied on buildings and lands within the municipal limits
save and except those exempted by or under the Act or any
other law. Then section 83 provides for general exemption
under various heads and categories. There are exceptions
within exceptions in section 83 itself with a proviso and
explanation with which we are not directly concerned in this
appeal. Some light is, however, thrown by explanation to
section 83 which it may be appropriate to quote
"Explanation-The exemption granted under this section shall
not extended to residential quarters attached to schools and
colleges not being hostels or to residential quarters
attached to hospitals, dispensaries and libraries".
Similarly there is a proviso in the section with reference
to clauses (a), (c) and (e) to the effect that nothing
contained in these clauses
300
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". Nothing similar to this has been superimposed
upon the exemption allowed under the Act to choultries under
section 8 3 (1) (b) and the matter is kept unabridged even
without attempting to define the word and there is no
carving out of any exception within the exception as in the
case of schools, hospitals, etc.
Even then a line will have to be drawn to distinguish
between what is incidental or subservient to the main object
and purpose of the choultry and the oblique motive of
profit-making to deprive the Municipality of its rightful
dues.
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It is well recognised that there is no equity or morality
about a tax and a taxing statute or provision has to be
construed strictly on its plain meaning where possible.
Similarly who so ever claims exemption from tax under the
law, has to establish his own case as falling within the
exemption clause. In case of any ambiguity the benefit
will, however, go to the tax payer.
Not being unmindful to the above principles, we are unable
to hold in this case that the New Choultry with its
expending beneficial complex, as established in the
evidence, not viable by itself but maintained in a
substantially large measure out of the Devasthanam funds
predominantly in the interest of numerous visiting pilgrims
from far and wide, is not exempt from tax under section 83
(1) (b).
In the view we have taken about the choultry in this case,
we hold that there is no evidence to show that any rent as
such is charged for the occupation of the choultry and the
minimal service charges even for the rooms in the first
floor cannot be treated as rent. There is only evidence of
realisation of rent of Rs. 30/- per month from the brass
cooperative store within the campus, but that is a very
insignificant item when we consider that everything else is
found by the High Court to be rent-free. The evidence has
established that the entire income from whatever sources
from the choultry is not sufficient for the maintenance of
the same. It is, therefore, obvious that the entire income,
including even the nominal rent charged from the brass co-
operative store, is used exclusively for the purpose of the
choultry which is indeed a charitable purpose. The case,
therefore, falls squarely under section 83 (1) (b) of the
exemption clause.
The appellant relied upon a decision of the Andhra Pradesh
High Court in Kesarapalli Anjaneyulu and Another v. Eluru
Municipality, by its Executive Officer, The Commissioner and
Another(1), where the question arose as to whether a portion
of choultry, which is used for shops, can be brought within
the purview of section 83 (1) (b) of this very Act. The
High Court held that the clause is attracted only to cases
where rent is charged in regard to a building used as a
choultry i.e. where rent is collected from persons who
temporarily occupy
(1) (1964) 1. L. R. Andhra Pradesh (Part IV) 379.
301
tile rooms, such as pilgrims and travellers, and it has no
application to cases where the building is not used as a
choultry. It is not possible to find from the very short
judgment in this case as to the entire circumstances with
regard to the connection of the shops with the choultry.
The decision is, therefore, not of much assistance to the
appellant and We express no opinion on its correctness.
The next decision cited by the appellant is in the case of
Sri Kanyakaparameswari Anna Satram (supra). In this case ten
buildings that were involved in the suit were situated
outside the choultry building. It was alleged in the plaint
that these ten buildings were rented and the income realised
therefrom was used and applied for maintaining the choultry.
The High Court held that "the exemption is only to choul-
tries and if a building does not satisfy the definition of a
choultry, it is not entitled to the exemption. Any building
or house property acquireed by the plaintiff-committee
cannot be called a choultry, and if the plaintiff-committee
should acquire a cinema-house and appropriate the income
therefrom for the charitable purpose", it cannot be said
that the cinema-house is a choultry. The High Court relied
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upon two decisions. If the Madras High Court in Kodandaram
Pillai v. The Municipal Council, Trichinopoly, (1) and
Pandarasannadhi, Tiruvannarnalai Adhinam v. The Corporation
of Madras(2). The facts of this case are entirely different
from those of the present case where shops, offices and
other concerns are intended to provide facilities and
amenities to pilgrims and travellers staying in the choultry
without there being any motive of profit-making and are
therefore part of the choultry.
The appellant also relied upon Municipal Council, Palni v.
Sri Dhandayuthapani Devasthanam Palni(3), where the High
Court was dealing with the words "places set apart for
public worship and either actually so used or used for
another purpose" under section 83(1) (a) of the Act with
which we are not concerned. The decision is, therefore, of
no assistance to the appellant. The appellant also relied
upon Rajahmundry Municipal Council v. Tripurari Malloya(4).
The High Court on the particular facts and circumstances of
the case held :
"If the property is a choultry when the
tax accrues due, then the tax cannot be
levied. If it is not a choultry on that date,
being used for other purposes, then the tax is
leviable even though in the Past the property
had been a choultry and might, become one
again in the future’.
This decision is also, therefore, of no
assistance to the appellant.
At any rate, we have looked at the matter from
an entirely different angle and have come to,
the conclusion that section 83 (1) (b) is
attracted in this case. The appeal is,
therefore, dismissed and the plaintiff’s suit
is decreed as held by the High Court. We
will, however, make no order as to costs in
this appeal.
S.C.
Appeal dismissed.
(1) A. I. R. 1933 Madras 782 (1933) 65 M. L. J. 678.
(2) A. I. R. 1941 Madras 908(1941) 2 M. L. J. 544.
(3) A. I. R. 1941 Madras 185. (4) A. I. R. 1938 Madras 923.
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