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Judgment
Ram Mohan Reddy, J.—The petitioner - an educational institution having made an application for exemption from payment of municipal taxes u/s 110(1)(i)(b) of the Karnataka Municipal Corporations Act, 1976 (''Act'' for short), followed by furnishing the audited profit and loss account, met with the order dated 17-8-2009 of the 2nd respondent-Assistant Revenue Officer declining grant of exemption on the premise that the educational institution is imparting education in English medium and earning income therefrom.
A plain reading of Annexure-K discloses non-application of mind, lack of reasons and not a speaking order while being cryptic:
The giving of reasons in support of their conclusions by judicial and quasi-judicial authorities when exercising initial jurisdiction is essential for various reasons. First it is calculated to prevent unconscious unfairness or arbitrariness in reaching the conclusions. The very search for reasons will put the authority on the alert and minimise the chances of unconscious infiltration of personal bias or unfairness in the conclusion.
This is the law laid down in Woolcombers of India Ltd. Vs. Woolcombers Workers Union and Another, .
Suffice it to state, that the order Annexure-K suffers from the non-assigning of reasons, tantamounting to denial of justice and cannot be sustained.
The petitioner, in its letter dated 25-1-2008 Annexure-El, volunteered to pay tax at a reduced rate of 25% and in that view of the matter, it has bound itself to pay that amount of tax, until such time the authority takes a decision over its claim for exemption. The tax for the immovable property in question is assessed and notice-cum-special notice u/s 147 of the Act Annexure-C, dated 15-7-2006 is issued. Therefore, the petitioner on its own volition, is liable to pay 25% of the said tax until a decision is taken by the authorities over the exemption.
Though the notice-cum-special notice u/s 147 dated 15-7-2006 Annexure-C is called in question in this petition, since the petitioner having exercised its right by way of an appeal by letter dated 16-8-2006 Annexure-C1 of the respondent declined to consider the appeal without depositing the tax due. Hence it is incumbent on the part of the respondent to consider the appeal and pass orders, in accordance with law, until which time, the petitioner cannot be said to be aggrieved.
In the result, the writ petition is allowed in part. The order dated 17-8-2009 Annexure-K is quashed and the proceeding remitted for consideration afresh after extending reasonable opportunity of hearing to the petitioner. The respondent is directed to consider the petitioner''s appeal against the notice-cum-special notice u/s 147 dated 15-7-2006 Annexure-C, and pass orders thereon, in any event, within a period of two months from today. In the meanwhile, petitioner is directed to pay 25% of the disputed tax determined in the notice dated 15-7-2006 Annexure-C which is subject to the decision over the application for exemption.
It is needless to state that if the petitioner is granted an exemption from a retrospective date, the petitioner would be entitled to refund of the amounts deposited.