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Judgment
Petitioner, Udupi-Puttur Sri Laxmivenkatesh Temple, a juristic person, duly administered by its trustees is before this Court represented by its Managing Trustee for a declaration, to declare that Entry No. 20-O to the Schedule appended to Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976 (the ''Act'' for short) as amended by Act No. 5 of 1992 as not applicable to the petitioner. Incidentally, they have also sought for quashing the notice dated 31-5-1994, issued by Profession Tax Officer, II Circle, Udupi. The said notice is in the form of an intimation to the petitioner to pay a sum of Rs. 5,700/- being the amount of tax under the Act with interest of Rs. 700/- within 15 days from the date of receipt of the notice, failing which appropriate action would be taken against the petitioner to recover the said amount.
The learned Counsel for the petitioner would submit that the charging provisions under the Act is not applicable to the petitioner-temple, which owns a Kalyana Mantap since it permits performance of religious and cultural activities in the Kalyana Mantap without any commercial interest and purpose but with the sole intention of invoking the blessings of ''God Almighty''. Secondly the learned Counsel contends that since the respondents have misinterpreted the charging provisions and the Entry 20-O of the Schedule appended to the Act, the same requires to be declared as not applicable to the petitioner-temple.
To understand the submissions of the learned Counsel, it is useful to notice the relevant provisions of the Act. The Act provides by Section 3 for imposition of tax on professions, trades, callings and employments in the State. The said section is in the following terms:
"Section 3. Levy and charge of tax.- (1) there shall be levied and collected a tax on profession, trades, callings and employments for the benefit of the State.
(2) Every person who exercises any profession or calling or is engaged in any trade or holds any appointment, public or private, or is employed in any manner in the State, specified in the Second column of the Schedule, shall be liable to pay to the State Government the tax at the rate mentioned in the corresponding entry in the third column of the said Schedule:
Provided that no tax shall be payable by persons referred to in Sl. Nos. 2, 2-C and 8 of the Schedule who have attained sixty-five years of age:
Provided further that the levy and collection of tax from any person under this section shall be subject to the restriction specified in clause (2) of Article 276 of the Constitution:
Provided that, no tax shall be payable by a person in respect of any year if the period during which he exercises such profession or calling or is engaged in the trade or holds the appointment or is employed does not exceed one hundred and twenty days in that year."
The charging section under the Act is relatable to Entry 60 of List II of the Seventh Schedule which reads:
"60. Taxes on Professions, Trades, Callings and Employments."
The Act provides for levy of tax on profession, trade, calling and employment and it is not a tax on income arising from a profession, trade, calling or employment. The tax under the Act is levied on every person exercising any profession or calling or is engaged in any trade or holds any appointment, public or private as specified in the Schedule to the Act. Person is defined in the Act to mean ''any person'' and includes a Hindu Undivided Family, a firm, company, corporation or other corporate body, any society, club or association but does not include any person who earns wages on a casual basis. The assessee under the Act is a ''person''. A ''person'' itself has been both natural person and any artificial legal person. Person for the purpose of law is some one or something who or which, as recognised by law is capable of having rights and duties. The most common example is a natural person or an individual, who is a human being. All other persons recognised by law as capable of having rights and duties are artificial persons.
In Jogendra Nath Naskar v Commissioner of Income-tax, Culcutta, (1969)74 ITR 33 (SC), the Supreme Court set at rests doubts, if any, in regard to whether the expression "individual" as it appeared in Section 3 of 1922 Act comprised a Hindu deity. It was held that there was no reason for limiting the scope of the expression ''individual'' only to natural person. A Hindu deity, it was observed fell within the meaning of the word ''individual'' as appearing in Section 3 of 1922 Income Tax Act, and it could be assessed in the status of an individual and the assessment could be made on the deity through its shebaits'' who are entrusted with the possession and management of the property.
In view of the well-settled principles, temple is a juridical person administered by its trustees and falls within the inclusive definition of ''person'' in the Act.
Now the next question which requires to be considered and decided is whether the petitioner-temple is engaged in any profession or calling or in any trade?
The Entry 20-O in the Schedule appended to the Act speaks of class of person/persons and the rate of tax payable under the Act. It says persons owning Marriage Halls/Kalyana Mantaps are to pay tax under the Act at the rate of Rs. 2,500/- per annum. It is not in dispute petitioner-temple owns a Kalyana Mantap. The only assertion by the petitioner before this Court is that the temple permits celebration of marriages and other religious and cultural activities without any profit motive or without any other commercial intention or purpose but with the sole intention of invoking the blessings of God.
The Act provides for the levy and collection of tax on professions, trades, callings and employments in the State. In may view, the object of putting all these activities is to ensure that no particular category of persons being eliminated from the net of the Act. The liability under the Act arises as soon as a person sets up a profession or business though he earns no income or even run into losses. The tax is not on Kalyana Mantap nor on the income derived from Kalyana Mantap but on practicing of a particular profession or calling or trade. The meaning of the expression profession, trade or calling is not defined under the Act, but the Supreme Court in the case of Sodan Singh and Others v New Delhi Municipal Committee and Another, AIR 1989 SC 1988, was pleased to observe:
"Profession means an occupation carried on by a person by virtue of his personal and specialised qualifications, training or skill. The word ''occupation'' has a wide meaning such as any regular work, profession, job, principal activity, employment, business or calling in which an individual is engaged".
Keeping in view the widest meaning given to the expression ''profession'', it can safely be said that the petitioner-temple through its trustees is doing the regular work of permitting the devotees to perform religious or cultural activities in the Kalyana Mantap owned by it, may be without a profit motive or without any commercial intention. Even then in my view charging provisions under the Act is attracted. Even if for any reason, the activity does not come within the meaning of the expression ''profession'' it can still come under the expression ''trade'' since the word trade as explained by Supreme Court in the case of State of Bihar and Others v Harihar Prasad Debuka and Others, AIR 1989 SC 1119, that the trade or business would mean some real substantial and systematic or organised course of activity or conduct with a set purpose. In that view of the matter, just because petitioner-temple is letting out the Kalyana Mantap on no profit basis would not take it away from chargeability to tax under the Act.
In so far as the manner and method adopted by profession Tax Officer in directing the petitioner-temple to pay the professional tax is concerned, the learned Counsel for the petitioner submits that the impugned notice is in contravention of the Act and it is therefore liable to be quashed.
In my view the impugned notice is in the form of intimation to the petitioner-temple to pay the professional tax as required under the charging provision read with Schedule appended to the Act. By that intimation, Profession Tax Officer has directed the petitioner to pay certain amounts by way of professional tax. In case petitioner fails to pay the amounts, the officer has stated that appropriate action will be taken against the petitioner for recovery of the said amounts. In my view the notice is only in the form of a show-cause notice to the petitioner and the petitioner-temple could have certainly brought to the notice of respondent-authority that they are not liable to tax under the Act and also could have informed him about the wrong procedure adopted for making the demand for payment of tax under the Act. Even if it is assumed that the impugned notice is a demand notice for payment of tax under the Act, the petitioner-temple has a right of statutory appeal which is not only effective but efficacious remedy provided under the Act itself and at any rate petitioner could not have filed this petition calling in question the impugned notice issued by the 1st respondent. In that view of the matter, even the Second contention of the petitioner cannot be accepted.
For the reasons stated, petition is liable to be dismissed. Accordingly it is dismissed. In the facts and circumstances of the case parties to bear their own costs.