TMI Blog2017 (1) TMI 581X X X X Extracts X X X X X X X X Extracts X X X X ..... ven under the Constitution to legislate is large and wide and must be construed as such - The duty of the court is only to interpret the provisions of the Constitution in a liberal spirit and to achieve the purposes and ideals set out in the Statute. As changes come in political and social life, the legislature is competent to adopt and evolve the Statutes in such a manner so as to answer such changes. Even though the powers granted do not change, the manner of its exercise would always depend upon the evolving socio- economic and political scenario but emotions, sentiments, unfounded suspicions, wild apprehensions and imaginary threats would obtain no place while assessing the validity of such legislation. We have no doubt that the legislature has taken into consideration various criterion like the experience over the time, the mischief that is sought to be redressed, the requirements that are sought to be achieved and the purpose for which a tax is imposed. The classification of such accommodation and amenities as 'luxury', if it costs Rupees one thousand or more per day, is, therefore, made by the legislature for constitutionally sound principles and cannot, therefore, be ob ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re and interiors have been spruced up to give the patients and bystanders all the comforts and luxuries as are possible. The focus of hospitality in hospital is more on the interior design, trained staff and technologies like Televisions and inter connectivity and such other facilities and patients are willing to pay for all these. The harbinger of these changes was the advent of what is known as medical/ hospital tourism. Patients travel from other countries and States for medical procedures on account of the high costs and waiting lists in their home town or home country coupled with availability of avant- garde technologies, skills and marketing of the medical care industry in Kerala. This has led to virtual globalisation of the health care market place. 4. These changes were obviously noticed by the Legislature of Kerala and by Kerala Finance Act, 2008 amendments were brought into the Kerala Tax on Luxuries Act, 1976 ('the Act' for brevity), bringing into its purlieus 'luxury' provided in a hospital and making it mandatory that every hospital having not less than five rooms for accommodation of patients and which charges ₹ 1,000/- or more per room, excl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... factors, dismissed the writ petitions and repelled the challenge against the constitutionality of the impugned amendments holding it to be within the legislative competence of the State Legislature and finding it to be intra vires the constitutional mandate. 7. We have heard these appeals in detail and we are in conformity with the findings of the learned Single Judge for the reasons, as we will presently state, which are not in variance with those given by the learned Single Judge, but complementary to it. We are also in conclusion that the amendments made to the Act, bringing into its sweep luxury in hospitals, do not suffer from any constitutional infirmity and is intra vires the legislative competence of the State Legislature in making such amendments. 8. A multitude of judgments of the Hon'ble Supreme Court mirrors that there is presumption in favour of validity of the Statute. The courts are to presume that a particular law is intra vires and not ultra vires. The courts are also expected to construe the provisions of a Statute in such a way so as not to make it ultra vires but intra vires. If certain provisions of law, construed in one way, would make them consiste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hatically in its observations contained therein, which, for easy reference, is extracted as below: The power of Parliament or for that matter, the State Legislatures is restricted in two ways. A law made by Parliament or the legislature can be struck down by courts on two grounds and two grounds alone, viz., (1) lack of legislative competence and (2) violation of any of the fundamental rights guaranteed in Part II of the Constitution or of any other constitutional provision. There is no third ground. ..... ........ It is enough for us to say that by whatever name it is characterised, the ground of invalidation must fall within the four corners of the two grounds mentioned above. In other words, say, if an enactment is challenged as violative of Article 14, it can be struck down only if it is found that it is violative of the equality clause/equal protection clause enshrined therein. Similarly, if an enactment is challenged as violative of any of the fundamental rights guaranteed by clauses (a) to (g) of Article 19 (1), it can be struck down only if it is found not saved by any of the clauses (2) to (6) of Article 19 and so on. No enactment can be struck down by just saying tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ever, by the Finance Act, 1994, the words 'provided in the hospitals and lodging houses' were omitted and thus the Act was re-cast to be one for the levy and collection of tax on luxury. The fact that the State Legislature is competent to legislate on luxuries is obvious from Entry 62 List II of VII Schedule of the Constitution. The assertions essentially, in these writ appeals, impelled by the appellants are that there is no luxury in hospitals and that therefore, nothing can be taxed under the Act. This contention is further sought to be invigorated by them avouching that hospitals provide nothing intended to be luxury and that by artificially defining 'luxury provided in a hospital', as is done by the impugned amendments, the legislature has professed contrary to the field of legislative power under Entry 62 List II of VII Schedule of the Constitution. The appellants would, however, concede, when asked pointedly, that if there is any luxury, within its meaning as is defined under the Act, provided by hospitals, then it would be within the constitutional ambit of the legislature to bring it to the sweep of the Act. 14. The word luxury is not one of easy definit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of law thus made by the Hon'ble Supreme Court is found in paragraph 85 of the judgment, which deserves a complete reading and is, therefore, reproduced below: Hence on an application of general principles of interpretation, we would hold that the word luxuries in entry 62 of List II means the activity of enjoyment or indulgence in that which is costly or which is generally recognised as being beyond the necessary requirements of an average number of society and not articles of luxury. 16. The Hon'ble Supreme Court also applied the principle of 'noscitur a sociis' with respect to the construction of Entry 62 List II of VII Schedule of the Constitution and concluded unambiguously that the words appearing therein 'including taxes on entertainments, amusements, betting and gambling' were not restrictive in its application to define luxury but that the words have been deliberately used in order to make the scope of the defined word correspondingly wider. The Hon'ble Supreme Court on this locus observed: In the context of entry 62 of List II this would not mean that the word luxuries would be restricted to entertainments, amusements, bett ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow or restrictive sense. In construing an entry in a list conferring legislative powers, the widest possible construction, according to their ordinary meaning, must be put upon the words used therein (see Punjab Distilling Industries Ltd. v. CIT (AIR 1965 SC 1862) and Balaji v. Income-tax Officer, Akola (AIR 1962 SC 123)). In Check-post Officer v. Abdulla (AIR 1971 SC 792), these principles were re- stated very powerfully. It was unequivocally affirmed that a legislative entry does not merely enunciate powers; it specifies a field of legislation and widest import and significance be attached to it. The power to legislate on a specified topic includes power to legislate in respect of matters which may fairly and reasonably be said to be comprehended therein. 19. The impugned amendments to the Act define luxury provided in a hospital under Section 2(fb) as accommodation for residence for use of amenities and services provided in a hospital, the rate of charges of which, excluding charges of food, medicine and professional services, is one thousand rupees per day or more''. Section 4 of the Act further deals with levy and collection of luxury tax and specifies in sub-claus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ber of society and not articles of luxury. Hence, such activity which is intended to provide comfort and pleasure beyond the requirements of the constitutive facilities of a hospital ,which are essentially in the nature of food, medicine and professional services and a basic accommodation, would then satisfy the definition and tests of luxury laid down by the Hon'ble supreme Court in Godfrey Phillips (supra). The tax levied is not on the article providing luxury but on the experience of such luxury. To employ a simple analogy - tobacco is an article of luxury and smoking is the luxury. In such view of the matter, it is irrefutable that the amendments impugned in these appeals do not seek to tax any article of luxury per se but only the experience of the luxury relating to good accommodation and other amenities not linked directly to therapeutic, sanative or ameliorative constituents or components of the services given to a patient under its care by the hospitals. As we have already noticed above, the word 'luxury' has been defined in the Act itself and, therefore, that definition would prevail and it is competent on the part of the legislature to give it a wide meaning ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in the socio-economic and cultural categories of people and it should be presumed that such legislation has been made taking into account all the relevant criterion including the economic one so as to cater not to a particular class but the entire citizenry. Legislation stems from the experience of the evils and should not, therefore, be impeded by the particular beliefs or opinion that certain classes of people would hold. The wisdom of legislature has to be respected as being for the good of the citizenry at large and not to the sentiments of a few. The power given under the Constitution to legislate is large and wide and must be construed as such. The famous words of Justice Holmes in Bain Peanut Co. v. Pinson (282 US 499) is to be remembered that the machinery of government would not work if it were not allowed a little play in its joints . The duty of the court is only to interpret the provisions of the Constitution in a liberal spirit and to achieve the purposes and ideals set out in the Statute. As changes come in political and social life, the legislature is competent to adopt and evolve the Statutes in such a manner so as to answer such changes. Even though the powers g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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