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2021 (10) TMI 1356 - MADRAS HIGH COURTDemand of property tax in respect of two buildings owned by the petitioner - CHAD building - College building - eligibility for exemption in terms of Coimbatore City Municipal Corporation Act, 1981 - hospital comes within the description of a 'charitable hospital' or not - HELD THAT:- Reports for the periods 2018-2019 and 2019-2020 have been circulated along with statement of costs and statements indicating the break-up between the charitable work and the revenue generating work that the institution is engaged in. Orders of assessment as well as Certificate under Section 80 G of the Income Tax Act, 1961 have also been placed on record - Suffice it to say that the argument advanced by the respondents, that only an institution which has no revenue at all can be a charitable institution, is untenable as it ignores ground realities. Assuming that an institution was bereft of all revenue sources, such institution would itself be in a need of charity, and cannot hope to do charity. Though the grant of exemption is one that should be considered by the original authority and not a question in which the Court would be inclined to intervene under Article 226, in this case, it is believed that such intervention is justified. It is not in dispute that the hospital has been granted the benefit of exemption continuously from 1933. It is also not in dispute that the CHAD is part of the hospital and is engaged in charity and medical relief, both in the hospital and, as an extension to the neighbouring committees as well - there are no justification whatsoever to exclude the CHAD from the ambit of exemption from property tax and quash that portion of the impugned order denying such relief. Claim of exemption qua the buildings comprised in the educational institution - HELD THAT:- The amendment does overlook the charitable nature of the activity undertaken by a teaching college. It perhaps was intended to address prosperous educational institutions run on profit motive. A teaching institution, by definition, focuses on the dispensation of education in the arena of medicine, both subjects constituting public duty. The fee structure in the college is stated to a sum of Rs. 3000/- per annum only and no other charges are collected - The expenditure is wholly met from out of the fee collection from the hospital, which also treats a section of the society gratuitously. Thus, a distinction must be made between a teaching hospital which is service oriented and other Educational institutions where the dominant object is profit. Thus, it stands now, the petitioner is not entitled to exemption from property tax in regard to the college buildings. The impugned order is upheld to this extent - petition allowed in part.
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