No waiver of property tax for 60 pvt educational institutions in Madurai: HC
The Madurai bench of the Madras high court on Tuesday refused to quash notices issued by the Madurai Corporation to about 60 private educational institutions demanding about Rs. 20.85 crore property tax from them.
Justice R Mahadevan heard the pleas of the concerned educational institutions including St John’s Matriculation Higher Secondary School, Kochadai, Madurai, filed against corporation notices. Madurai Corporation’s counsel R Murali submitted that to avail exemption from payment of property tax, educational institutions, as per the Madurai City Municipal Corporation Act, should satisfy two conditions – running the institution on purely philanthropic line and the corporation council’s resolution approving the institution. Accepting the submission, the court said that schools are entitled to claim exemption from payment of property tax only in the event of approval of it by the corporation council.
The judge further said, “The petitioners – schools are not purely philanthropic institutions and it is also not the case of the petitioners that they are running the schools without receiving any fees or running the schools totally free to all the students. Thus, people seeking exemption should satisfy the condition.”
Accordingly, the judge disposed of the petitions by giving them liberty to approach the corporation within two weeks from the receipt of court order copy to seek approval of the corporation council. In the event of approval, the petitioners are entitled for exemption. Otherwise, it is for the corporation to take appropriate action to see that the property tax is collected from them without further delay, the judge said.
Last year, the deputy revenue officer of the corporation issued notices to the schools, after which the commissioner issued a final attachment notice stating that the amount should be paid within a certain period. If they fail, the movable properties would be seized from the schools and auctioned.
The corporation on April 8 last year issued notice demanding Rs 75.73 lakh from St John’s Matriculation school as property tax for the years 2008-09 to 2015-16. The schools claimed that no property tax was levied all these years, until the impugned notice issued. When the school buildings are for educational purposes and the building wholly belonged to the schools, there could not be any assessment, they claimed. But, the corporation said that the petitioners which are all private institutions impart education in a professional manner by collecting fees under various heads and therefore they could not claim that they are purely philanthropic.