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Property tax held to be properly imposed on a warehouse
Property tax held to be properly imposed on a warehouse
1 Indian Oil Corporation Limited had a plant in the Chinnachowk Grama Panchayat and property tax was demanded under the Andhra Pradesh Panchayat Raj Act, 1994. The High Court dismissed IOCs writ petitions and held that property tax is payable. The Supreme Court, dismissing the appeal, held that property tax is liable on a warehouse, and it may not be necessary that such place is capable of frequent visits by humans or fit for human occupations.-500167
1. Indian Oil Corporation Limited had a plant in the Chinnachowk Grama Panchayat and the property tax for the Assessment Year 1998-99 was fixed at Rs.9,11,380.60. This property tax was collected on the basis of cost of machinery equipment, which according to IOC do not form part of any 'building'. Andhra Pradesh Industrial Infrastructure Corporation Limited, had taken the stand that IOC is liable to pay the property tax on the value of storage and water tanks of the IOC situated in the industrial development area of Cuddapah (A.P.) and in the demand notices, specific demand was made for payment of the property tax on the said storage tanks. The property tax was demanded under The Andhra Pradesh Panchayat Raj Act, 1994.
2. IOC challenged the common judgment of the High Court of Judicature, Andhra Pradesh at Hyderabad in the two writ petitions which were filed by the IOC. The High Court dismissed the writ petitions of the IOC holding that property tax is payable under the provisions of the aforesaid Act.
3 On appeal the Supreme Court held as under:
When we read the definition of 'house' in the context of meaning that is to be assigned to 'warehouse', it is clear that a place where goods are stored would be 'warehouse' which is specifically mentioned in the definition of house contained in Section 2(19) of the Act. It would, thus, follow that it may not be necessary that such a place is capable of frequent visits by the human beings or fit for human occupations. The High Court has rightly pointed out that as per the said definition, the requirement that a house should be fit for human occupations is only for huts which is defined under Section 20 of the Act.
The Legislature has provided a particular definition to 'house' and levied property tax thereupon. It is this fictional definition of 'house' which is to be kept in mind for the purpose of levy of tax.
We, thus, do not find any merit in this appeal as well as writ petition which are accordingly dismissed with cost.
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