Shri R.A. Boga and another vs The State of Punjab and others

Surinder Singh, J.—The sole point which requires consideration in this Writ Petition filed by R.A. Boga, Proprietor Messrs Amritsar Ice Factory and Cold Storage, and another, under Articles 226/227 of the Constitution of India, is as to whether the Assessing Authority under the Punjab Urban Immovable Property Tax Act, 1940 (hereinafter referred to as the Act) and the Rules framed thereunder, is competent to recover property tax from the petitioners, who are running Cold Storage. The case of the petitioners as urged in the Writ Petition, is that the premises in which the Cold Storage is being run, falls within the definition of a factory, and hence under clause (g) of section 4(1) of the Act, such a building is exempt from payment of tax. The petitioners a/so relied upon the definition of the word factory as contained in Rule 18(1) of the Rules framed under the Factories Act, reproduced in para 7 of the Writ Petition They further seek assistance from the definition of the words ''manufacturing process" in clause (x) of section 2 of the Factories Act, 1948 reproduced in para 9 of the Writ Petition.

The contention, as noticed above, has been controverted by the respondents in their return and it is averred that the impugned order passed by the Assessing Authority (Copy Annexure ''C'') is quite correct and should be maintained.

The two contentions advanced on behalf of the petitioners may now be noticed. It is submitted that in view of the exemption granted to the buildings which are categorised as factories under clause (g) of section 4(1) of the Act, no property tax is recoverable in regard to the business carried on in such buildings. There is however, a basic lacuna in this argument, as in the Writ Petition there are no facts mentioned from which it can be inferred that the building falls within the definition of a factory, as provided in Rule 18(1) of the Rules under the Factories Act. According to the said Rule, ten or more workers have to be shown to be working during the period preceding twelve months from the time when the question of determination of the character of the building arises, and it has also to be shown that a manufacturing process has been going on in such building for a continuous period of six months. In the alternative, it has to be alleged and proved that twenty or more workers had worked in the building on any day preceding six months and a manufacturing process was being carried on therein involving the use of power No such allegation is forthcoming in the writ petition and it is, therefore, not possible to hold that the premises of the petitioners are factory premises.

As regards the second contention that the manufacturing process had been going on in the said building, the Learned Counsel for the petitioner has submitted that their case would fall under clause (K)(l) of section 2 of the Factories Act, which may be reproduced for ready reference, as below:--

(K) "Manufacturing Process" means any process for,

(l) making, altering, reparing, ornamenting, finishing, packing, oiling, washing, cleaning, breaking up, demolishing or otherwise treating or adapting any article of substance with a view to its use, transport, delivery, or disposal or........

The argument is that the agricultural products which are stored in the Cold Storage, are subjected to some type of application of chemicals to act as preservatives and the stock is to be kept at a low temperature, to avoid its putrefaction. None of these processes, however, falls within the categories mentioned in clause (K) (l), above, which clause is, in fact, meant for those goods which are subjected to certain processes for the purpose of use, transport, delivery or disposal. It is not the case of the petitioners that they are storing their own produce in the Cold Storage for the purpose of subsequent transportation of delivery, or disposal. As such, there is no basis for the argument that a manufacturing process is carried out in a Cold Storage.

The Learned Counsel for the respondents has cited New Taj Mahal Cafe Ltd, Mangalore v. Inspector of Factories, Mangalore AIR 1956 Mad. 600, where the point under consideration was, as to whether the presence of Frigidaire, i.e. a Refrigerator in the restaurant, would make the premises fall within the definition of a factory. It was observed in the said authority that no doubt a Frigidaire is worked by an electric power, but every place where a Frigidaire is used, will not become a factory, as the vital question which had to be considered was, as to whether any manufacturing process was carried on with the aid of the Refrigerator. It was further observed that normally a Refrigerator is used for the purpose of storage and merely because some articles are kept in the Refrigerator, it will not be a part of the manufacturing process, as defined under the Factories Act. The authority may not be directly concerned with the case of a Cold Storage, but the observations made therein are equally applicable for such a case. After giving the matter may careful consideration. I find that from the facts as alleged in the pleadings of the parties, there is no material to held that the premises of a Cold Storage fall within the definition of a factory, nor can it be said that any manufacturing process is conducted in the premises The impugned order passed by the Assessing Authority is, therefore, quite correct and does not require any interference.

The writ petition is dismissed, but with no order as to costs.