Taxation Officer and another,
Syed A.B.M. Hussain CJ
Ahsanuddin Choudhury J
D. C. Bhattacharya J
Kemaluddin Hossain J
Fazle Munim J
Taxation Officer and another……….Respondent
June 2, 1977
Cases Referred to:
Parsu Dhondi Vs. Trustees of the Port, Bobbay, AIR 1930 Bombar 44; Commissioner of Taxation Vs. Trustees of St. Mark’s Glebe, 1902 Appeal Cases 416; Norman Vs. Norman, 1950 (1) All England Law Reports 1082.
Ahmad Sobhan, Senior Advocate instructed by Abu Backkar, Advocate-on-Record-For the appellant.
K A. Bakr Attorney-General, instructed by B. C. Panday, Advocate-on-Record—For the respondents.
Civil Appeal No. 29 of 1976
(On appeal from the Judgment and the Order dated 4th May, 1970 passed by the erstwhile High Court of East Pakistan in Writ Petition No. 127 of 1970)
Mahmud Hossain, CJ.—This appeal by special leave arises out of a judgment passed by the then Dacca High Court in Writ petition No. 127 of 1970 filed by the appellant challenging the orders of the respondents imposing urban tax amounting to Tk. 1,11,481.00 for the years 1964-65 to 1968-69 under section 3 of the Urban Immovable Property Tax Act, 1957 (hereinafter referred to as the Act).
2. The appellant is a Society for charitable and religious purposes registered under the Societies Registration Act 1960. The aim and objects of the Society are to establish and maintain mosques, Schools, libraries, boarding houses, orphanages etc. and for dissemination of knowledge of the Holy Quran and for charitable purposes. The appellant constructed buildings and structures and let out the same as shops and offices to monthly tenants and derives income therefrom and it, is claimed that the entire income arising from the said buildings and structures are exclusively spent for religious and charitable purposes and for no other purposes whatsoever. A demand for tax under the Act was made from the appellant for the shops and offices let out and the appellant challenged the legality of the demand by filing a Writ petition in the then Dacca High Court claiming exemption from payment of Tax under section 6(a) of the said Act. The learned Judges of the High Court dismissed the Writ petition summarily and special leave was granted by a Bench of the Supreme Court to consider as to whether the appellant must be in occupation of the building in order to get exemption under clause (a) of section 6 of the Act which runs thus:
“6. The Urban Immovable Property Tax shall not be leviable in respect of the following:—
(a) building and lands or portions there of exclusively occupied for religious or charitable purposes;”
3. Mr. Ahmad Sobhan, learned Counsel for the appellant contended that the lands and buildings occupied by the appellant being exclusively for religious and charitable purposes, the same should be exempted under section 6(a) of the Act from levy and imposition of the tax and/or from urban tax and as such the assessment of tax by the respondents is without jurisdiction, void and inoperative. It has been further contended but the word ‘occupied’ occurring in section 6(a) of the Act does not necessarily mean physical occupation for religious and charitable purposes. The Urban Immovable Property Tax Act, 1957 was enacted to impose tax on lands and buildings in urban areas. Section 6 of the Act makes certain exemption and those words occurring in the section should be strictly construed since the legislation is not for giving a general relief to the lands and buildings which are not exclusively occupied for religious and charitable purpose.
4. Mr. Sobhan submitted that the ultimate purpose of letting of the lands and buildings is to utilise the income for charitable purposes and although the occupation was not by the appellant himself even then he is entitled to the benefit of the exemption clause 6(a) of the Act. It may be noted that the exemption clause does not speak in general term exempting the Trust. The exemption has been given in respect of land and buildings in exclusive occupation for religious and charitable purpose. It cannot be said that section 6 is enacted to protect the appellant from taxation. Occupation in section 6 means occupation by the applicant himself. Section 11 of the Act runes thus:
“11. The Urban immovable property Tax shall be paid by the owner of the holding in respect of which it has been levied.”
5. So, if section 6 is read with section 11 of the Act, it would be evident that the relief intended by the Legislature will be available to the appellant only when he is found to be in occupation for the purpose of religious or charitable purposes and not by letting out the holdings and thereafter utilizing the income from letting for religious or charitable purpose.
6. Mr. Sobhan referring to a passage in Bindra’s Interpretation of Statutes, 6th Edition contended that the words ‘for the purpose of’ occurring in section 6(a) should be interpreted very liberally and not in a restricted sense. But we do not find any cogent reason to accept this contention from the language of the Act since it is meant for levy of tax on lands and buildings m urban areas, which are not exclusively occupied for religious or charitable purposes.
7. Mr. Sobhan relying on the case of Parsu Dhondi Vs. Trustees of the Port, Bobbay, AIR 1930 Bombar 44, contended that protection under the Act has been given to the lands and buildings used for religious or charitable purposes. It will appear from the facts of the case that protection under the Workmen’s Compensation Act is meant for the workmen who are actually engaged in the process of handling bales so as to transfer them from the wharf to the hold of a ship which has been actually loaded. But if workman is injured while stacking certain bales alongside the wharf then it cannot be said that he was engaged for the purpose of loading the ship. So when the Legislature made specific mention of the purpose for which exemption has been provided, it cannot be extended in a circuitous method, that is to say, in claiming exemption of tax on lands and buildings owned by trustees but let out on rental basis to others. The reference to Bindra’s Interpretation of Statute by Mr. Sobhan is on the basis of the case we find no principle therein for application in this case.
8. In support of his contention Mr. Sobhan has also referred to the following passage from the Maxwell’s Interpretation of Statutes:—
“Statutes imposing Burdens.- Statutes which impose pecuniary burdens, also, are subject to the same rule of strict construction. It is well settled rule of law that all charges upon the subject must be imposed by clear and unambiguous language, because in some degree they operate as penalties.”
But we find the passage quite against him. In section 6 of the Act the legislature exempted imposition of taxes only when the owner uses the lands and buildings for religious and charitable purpose. So, on a simple construction of the enactment it will appear that the appellant is not entitled to exemption since the lands and buildings are let out to different persons, even if the income yielding therefrom has been used charitable use. The intention of the legislature seems to be that if the owner uses the land and building for religious and charitable purpose, then and then only he can get exemption but not otherwise. The property must be used for such purposes as specifically mentioned by the legislature. It should not be used for earning income.
9. Mr. Sobhan referring to the following passage in Maxwell’s Interpretation of Statutes, Eleventh Edition, “Lord Ellenborough, remarked that the cases to which a duty attached ought to be fairly marked out and that a liberal construction ought to be given to words of exception confining the operation of the duty”, submitted that the words exclusively occupied for religious or charitable purposes must be liberally construed. But the quotation cited above does not give scope for liberal construction as contended by Mr. Sobhan, since the words “exclusively occupied for religious and charitable purposes” have got a plain meaning and it cannot be twisted to mean income arising out of letting out those lands and buildings.
10. We get support to our view in the case Commissioner of Taxation Vs Trustees of St. Mark’s Glebe reported in 1902 Appeal Cases 416 wherein a similar question arose. The decision of the question depends on the construction of section 11, sub-section (5) of the Land and Income Tax Assessment Act of 1895 which runs thus:—
Part II. Land Tax
Sec.11. The lands and classes of lands hereinafter specified are exempted from assessment for taxation under this Act, namely:—
(5) Lands occupied or used exclusively for or in connection with public pounds, public hospitals, whether supported wholly or partly by grants from the consolidation Revenue Fund or not, and which are not a source of profit or gain to the users or owners thereof, benevolent institutions, public charitable purposes, churches, chapels for public worship, universities, affiliated colleges, the Sydney Grammar School, mechines, institutes and schools of arts, and lands on which are erected public markets, town halls or municipal council chambers, or any lands the property of or vested in any council or municipality, public hospital, university, or affiliated college.”
Their Lordships of the Privy Council held that glebe lands by crown grant vested in the trustees for parochial church purposes in connection with the Church of England but let on building leases or sub-divided for that purpose were not exempt from assessment for land tax as being lands occupied or used exclusively in connection with public charitable purposes, or a church. Although the rents and profits of those lands might be so used by the trustees, yet so far as the lands were let on building leases they were not so used by the lessees, and so far as they were not occupied or used for any purpose.
11. The case of Norman Vs. Norman, reported in 1950 (1) All England Law Reports 1082 cited by Mr. Sobhan is on different facts and has no application in the facts and circumstances of the present case. There is no denying of the fact that the provision of the statute must be read so as to give a sense and to remedy the mischief or fill up the gap in the scheme of things which already existed. It is impossible to make a different meaning to the words “exclusively occupied” for religious and charitable purposes so as to include a case of letting the lands and building and thereafter making out a case of use of income for religious and charitable purposes as that will be giving a different meaning which the legislature did not intend thereby. We find no substance in the contention of Mr. Sobhan.
The appeal is dismissed without any order as to costs.
Source: 1978, (AD)