Kerala High Court
Vadakara Muncipality, Vadakara vs The Muncipal Nikuthi Dayaka Samithi on 24 June, 2025
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE S.MANU
TUESDAY, THE 24TH DAY OF JUNE 2025 / 3RD ASHADHA, 1947
WP(C) NO. 2831 OF 2013
PETITIONER:
VADAKARA MUNCIPALITY,
VADAKARA, KOZHIKODE DISTRICT,
REPRESENTED BY ITS SECRETARY.
BY ADVS.
SRI.S.SHYAM KUMAR
SHRI.T.NAVEEN, SC, VADAKARA MUNICIPALITY
RESPONDENTS:
1 THE MUNICIPAL NIKUTHI DAYAKA SAMITHI
REP. BY THE CONVENOR, NADAKUTHAZHA.P.O.,-673 104,
VADAKARA, KOZHIKODE DISTRICT.
2 STATE OF KERALA
REPRESENTED BY THE SECRETARY TO GOVERNMENT,
LOCAL SELF GOVERNMENT DEPARTMENT, SECRETARIAT,
THIRUVANANTHAPURAM-695 001.
BY ADV SHRI.R.K.MURALEEDHARAN
ADV.RASHMI.K.M. - SR.G.P.
OTHER PRESENT:
ADV HARISHANKAR K V
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD
ON 24.06.2025, THE COURT ON THE SAME DAY DELIVERED THE
FOLLOWING:
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[CR]
S.MANU, J.
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W.P.(C).No.2831 of 2013
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Dated this the 24th day of June, 2025
JUDGMENT
Local Self-Government Department of the State
Government issued G.O.No.2414/2011/LSGD on 20.10.2011
directing all Local Self-Government Institutions to fix the rate of
property tax after classifying the areas into three zones, namely,
primary, secondary and tertiary. Government further directed
the Municipalities to follow the principles enumerated in the
Kerala Municipality (Property Tax, Service Cess and Surcharge)
Rules, 2011.
2. The petitioner Municipality, for implementing the
Government Order, entrusted a team of officers to conduct a
comprehensive analysis and obtained a report. The Municipal
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Council, after a detailed discussion on the report submitted,
approved the tentative zonal classification and rate of property
tax by resolution dated 29.10.2011. Municipality thereafter
published Ext.P3 notification. It was published in two dailies
having circulation in the local area. In response to the
notification, 67 complaints were received with regard to the
zonal classification and fixation of basic tax. Municipality hosted
several meetings and discussions to consider the complaints.
Later, the Municipality re-fixed zonal classifications and also the
basic tax for properties, taking into account the objections and
all other relevant aspects. A notification dated 30.3.2012 was
issued by the Municipality, re-fixing the zonal areas and basic
property tax. The entire Municipal area was classified into three
zones, namely, primary, secondary and tertiary in accordance
with the principles enshrined in the Kerala Municipality (Property
Tax, Service Cess and Surcharge) Rules, 2011. Boundaries of
each zones were stated in the notification.
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3. First respondent approached the Tribunal for Local
Self-Government Institutions in Appeal No.323 of 2012,
challenging the notification dated 30.3.2012. Convener of the 1 st
respondent was the 2nd appellant and the Convener in his
personal capacity was the 3rd appellant. The principal contention
raised before the Tribunal was that the notification was improper
and illegal for the alleged reason that the classifications of
various zones were not in accordance with the principles
followed in the Kerala Municipality (Property Tax, Service Cess
and Surcharge) Rules, 2011. It was contended that boundaries
of each zones were not clearly demarcated and specified.
Further, it was contended that when the boundaries are not
properly fixed and notified, the same would give rise to
confusion and uncertainty. The petitioner Municipality appeared
before the Tribunal and filed written statement. Municipality
contended that the notification is perfectly in tune with the
principles and provisions of the Kerala Municipality (Property
Tax, Service Cess and Surcharge) Rules, 2011. It was also
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pointed out by the Municipality that it received about 67
complaints and all complaints were properly examined, placed
before the Council and the Finance Committee to study the
matter in the light of the complaints and only after considering
the complaints and suggestions, the final decision was taken.
Several changes were made in the light of the complaints and
also as a result of re-examination of the matter by the Finance
Committee and the Council. Municipality therefore, submitted
before the Tribunal that there was no merit in the appeal.
4. The Tribunal examined the notifications issued by the
Municipality and accepted the contention of the appellants that
the boundaries of different zones were not properly fixed.
Therefore, the Tribunal concluded that the impugned notification
was illegal. The Tribunal allowed the appeal by setting aside the
notification and entire proceedings leading to the issuance of the
notification. The Secretary and the Municipal Council were
directed to reconsider the entire aspects and to proceed
properly for assessing the tax in compliance with the provisions
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of Kerala Municipality (Property Tax, Service Cess and
Surcharge) Rules, 2011.
5. Municipality approached this Court in the above writ
petition challenging the order passed by the Tribunal and this
Court granted interim stay on 30.1.2013. The order still
remains in force. Municipality therefore enforced Ext.P5 and
owners of buildings within the area of Municipality have been
paying property tax on the basis of it.
6. Learned Standing Counsel for the Municipality
submitted that the decision of the Tribunal was improper and
illegal for various reasons. The learned Standing Counsel,
referring to the provisions of the Kerala Municipality (Property
Tax, Service Cess and Surcharge) Rules, 2011, contended that
the appeal before the Tribunal was not maintainable. He made
reference to the provisions of Rule 16 and submitted that under
Rule 1, if the owner of the building has objection against
assessment by the Secretary, appeal can be preferred before
the Standing Committee for Finance. A revision will lie to the
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Tribunal, if there is objection against the decision taken by the
Standing Committee in the appeal. He submitted that the 1 st
respondent is an unregistered association and therefore, it was
not entitled to maintain any proceedings before the Tribunal.
The learned Standing Counsel submitted that the remedies
under Rule 16 are available only to individual building owners.
He further submitted that the scheme of the provisions of Rule
16 contemplate raising of objections by way of appeal by an
aggrieved building owner before the Standing Committee and
further challenge by way of revision before the Tribunal. He
therefore, contended that the proceeding was not maintainable
before the Tribunal at the instance of the respondent, an
unregistered association. Further elaborating his contention,
the learned Standing Counsel submitted that no individual
grievance was pointed out in the appeal filed before the Tribunal
and consideration of a general grievance is not contemplated
either in the appeal or revision provided under Rule 16.
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7. On merits, the learned Standing Counsel submitted
that the reasoning of the Tribunal that the boundaries of
different zones were not properly fixed was incorrect. He read
out the notification and pointed out that, the boundaries of
various areas coming within different zones were clearly
narrated in the notification. He submitted that there was no
room for any confusion in that regard and the very fact that for
last more than a decade, owners of buildings within the
jurisdiction of the Municipality are remitting tax following the
notification shows that the boundaries were properly fixed and
notified. He hence submitted that no genuine grievance actually
existed with respect to the fixation of boundaries of different
zones by Ext.P5 notification. The learned Standing Counsel
hence argued that the interference by the Tribunal was totally
illegal and improper in any view of the matter.
8. The learned counsel appearing for the 1st respondent
argued that the Municipality failed in its duty to fix the zones
properly. He pointed out various areas included in different
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zones and submitted that the boundaries were not properly
fixed and notified. He submitted that various parts of different
wards were included in different zones and therefore the same
gave rise to confusions. Though such categorization was
permissible it was incumbent on the Municipality to fix the
boundaries properly and notify the same. He also pointed out
the instance of Ward No.18 and submitted that classification or
categorization of the said ward into secondary zone was
incorrect. He submitted that similar mistakes were committed
by the Municipality in the case of many other wards too.
9. Regarding maintainability of the appeal, the learned
counsel submitted that under the Municipalities Act, appeal is
provided against the decisions of the Municipal Council to the
Tribunal and therefore, the appeal was proper and maintainable.
Referring to the expression ‘any person’ in sub-rule (7) of Rule
16 of the Kerala Municipality (Property Tax, Service Cess and
Surcharge) Rules, 2011, the learned counsel contended that any
person having objection against the decision taken by the
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Standing Committee can prefer revision petition before the
Tribunal. The learned counsel concluded his submissions by
asserting that the proceeding before the Tribunal was perfectly
maintainable and the reasoning of the Tribunal for setting aside
the decision of the Municipality was well justified.
10. As the learned Standing Counsel raised a contention
regarding the maintainability of the proceedings before the
Tribunal, it is required to consider the said issue first. Perusal
of the impugned order passed by the Tribunal shows that the 1 st
respondent had invoked the appellate jurisdiction of the
Tribunal. The proceeding was registered as an appeal. In this
regard, it is relevant to refer to Section 509 in Chapter XXIII of
the Kerala Municipality Act. The said provision is extracted
hereunder for ready reference:-
“509.APPEAL AND REVISION. — (1) An appeal may
be preferred to the Council against any notice issued
or any order passed or action taken by the
Chairperson or the Secretary under any of the
provisions of this Act other than Sections 390, 391,
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11395, 406 and 408 or the rules or bye-laws or
regulations made thereunder.
(2) An appeal against any notice or order of the
Secretary on the levy of tax, may be preferred to the
Standing Committee for Finance in the case of Town
Panchayat or Municipal Council and to the Standing
Committee for appeals on taxation in the case of
Municipal Corporation.
(3) Pending decision on an appeal filed under
sub-section (1) the Chairperson may, if an application
is made, stay the operation of the notice, order or
other proceedings on which the appeal is based.
(4) Every case in which an order has been
passed under sub-section (3) shall be reported to the
Council at its next ordinary meeting or at its next
meeting along with the reasons in full for passing
such order by the Chairperson and the Council shall
either ratify the said order with or without
modification or revoke it failing which it shall lapse.
(5) An appeal under sub-section (1) or sub-
section (2) shall be filed within thirty days from the
date of receipt of the order and dispose of the same
by the Council or the Standing Committee, as the
case may be, in the manner as it deems fit, within
sixty days from the date of its receipt.
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(6) Any person may file an appeal against any
notice issued or any order passed by the Secretary
under Sections 390, 391, 395, 406 and 408 to the
Tribunal Constituted for the Local Self Government
Institutions under Section 271S of the Kerala
Panchayat Raj Act, 1996 (13 of 1994), within thirty
days from the date of passing of such order.
(7) An appeal may be preferred to the
Tribunal, against any decision passed by the Council
or any order or notice issued by the Chairperson or
Secretary on the basis of such decision on any
matter provided in Sections 310 to 508 other than
Sections 390, 391, 395, 406 and 408 or the rules,
bye-laws or regulations made thereunder, within
thirty days from the date of passing of such
decisions, order or notice.
(8) Any person may prefer a revision petition to
the tribunal within thirty days against the decision in
an appeal filed before the Council or Standing
Committee, as the case may be, under sub-section
(1) or subsection (2), or against any order or notice
issued by the Chairperson or Secretary on the basis
of such decision.
(9) The Tribunal shall, as soon as possible, pass
appropriate order on an appeal or revision petition
filed before it and the order so passed shall be final.
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(10) The Tribunal may, during the pendency of
an appeal or revision petition before it, direct the
Council or the Secretary to stay all further
proceedings on the said subject, if it deems
necessary.
(11) No appeal or revision shall be filed against
the levy of tax, if he tax shown in the demand notice
has not been paid.
(12) Notwithstanding anything contained in this
section all appeals and revisions filed and pending
before any authority before the date of
commencement of the Tribunal shall be handed over
by such authority to the Tribunal”
[Emphasis added]
11. Sub-sections (6) and (7) deal with the appellate
jurisdiction of the Tribunal. Any person aggrieved by any notice
issued or any order passed by the Secretary under Sections
390, 391, 395, 406 and 408 may file an appeal to the Tribunal.
Under sub-section (7) an appeal can be filed to the Tribunal
against any decision passed by the Council or any order or
notice issued by the Chairperson or Secretary on the basis of
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such decision on any matter provided in Sections 310 to 508
other than Sections 390, 391, 395, 406 and 408 or the Rules,
bylaws or Regulations made thereunder. It is to be noted that
taxation and finance is dealt with under Chapter XIV of the
Municipality Act. Chapter XIV contains Sections 230 to 309. As
noted above, appeal under sub-section (7) can be filed with
regard to matters provided in Sections 310 to 508, except with
respect to the specific provisions mentioned in the Rules,
Sections 390, 391, 395, 406 and 408. Therefore, plain reading
of sub-section (7) of Section 509 of the Act shows that
provisions of Chapter XIV of the Act, dealing with taxation and
finance are not within the ambit of the said sub sub-section.
Hence, it must be held that appeal under Section 509(7) of the
Municipality Act is not maintainable against a resolution adopted
by the Municipal Council with respect to matters included in
12. Next question to be considered is as to whether the
1st respondent’s appeal was maintainable under the Kerala
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Municipality (Property Tax, Service Cess and Surcharge) Rules,
2011. Rule 16 provides for appeal and revision. The said
provision reads as under:-
“16. Appeal and Revision. (1) If the Secretary
has assessed the property tax of the building
as per sub-rule (4) or sub-rule (6) of rule 12
and if the owner of the building has objection
against such assessment of property tax,
appeal may be preferred within thirty days of
receipt of the demand notice of the secretary,
in the case of a Town Panchayat or Municipal
Council before the Standing Committee for
finance and in the case of a Municipal
Corporation, before Standing Committee for
appeals on taxation.
(2) Along with the appeal submitted before
the Standing Committee on the decision of the
Secretary, the owner of the building shall remit
the property tax (as assessed by the
Secretary) till the end of the half-year to which
appeal is preferred and proof as to it shall be
produced along with the appeal petition. If the
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16tax has not been remitted as such, the
Standing Committee shall reject the said
appeal.
(3) In the time limit stipulated for
submitting appeal to the Standing Committee,
the day on which the demand notice subjected
to it was received shall not not be included.
(4) If the Secretary has made assessment
of property tax not as per the criteria specified
in the Act and these rules and without following
the procedure, Standing Committee may, in
appeal, review the said assessment of property
tax and may allow the appeal and may
reassess the property tax as specified in the
Act and rules. If the Standing Committee is
satisfied that the secretary has assessed the
property tax as per the criteria specified in the
Act and rules and followed the procedure, the
appeal shall be rejected. If the appeal is allowed
or rejected the reasons for it shall be mentioned in
the decision of the Standing Committee.
(5) If the Standing Committee either on
complaint or suomoto has satisfied that the
Secretary has assessed the property tax of a
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17building in a lower rate contrary to the criteria,
the Standing Committee may review the
assessment of property tax as in an appeal by
serving notice to the owner of the building,
considering his objections and may reassess
the property tax in accordance with the criteria
(6) If the property tax of a building is being
reassessed by the Standing Committee, the
Secretary shall make modifications in the
property tax assessment register and the
property tax demand register accordingly and
fresh demand notice shall be given to the
owner of the building.
(7) Any person having objection against the
decision taken by the Standing Committee as per
sub-rule (4) or sub-rule (5), may, within thirty
days, prefer a revision petition before the Tribunal
for Local Self Government Institutions as per sub-
section (8) of section 509.”
13. It is to be noted that under sub rule (1), if the owner
of the building has objection against assessment of property tax
by the Secretary, appeal may be preferred in the case of a Town
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Panchayat or Municipal Council before the Standing Committee
for finance and in the case of a Municipal Corporation before
Standing Committee for appeals on taxation. Under sub rule (4)
the Standing Committee may in appeal review the assessment.
The Committee has the power to review the assessment and
also to reject the appeal, if it is found that the assessment by
the Secretary was proper. Sub rule (5) provides that on
complaint or suo motu, the Standing Committee can review the
assessment of property tax as in appeal. Sub rule (7) provides
that any person having objection against the decision taken by
the Standing Committee as per sub rule (4) or sub rule (5) may
within thirty days prefer a revision petition before the Tribunal
for LSGI as per sub-section (8) of Section 509. Hence no appeal
to the Tribunal is provided under the rules.
14. 1st respondent is an unregistered association. Going
by the scheme of Rule 16 of the Kerala Municipality (Property
Tax, Service Cess and Surcharge) Rules, 2011, as explained
above, remedies are available only to the owners of buildings
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who have objection against the assessment made by the
Secretary. Even the expression ‘any person’ in sub rule (7) has
to be understood in the context of the scheme of Rule 16. The
said expression in sub rule (7) can be considered only with
reference to owner of a building having objection against the
assessment made by the Secretary. This is for the reason that
the remedies under Rule 16 are intended for redressal of
grievances of owners of buildings. Revision is not an original
proceeding. A revision will lie against a decision taken by the
Standing Committee as per sub rule (4) or sub rule (5).
Therefore, the necessary corollary is that the revision under sub
rule (7) is a remedy provided to a person having objection
against the decision taken by the Standing Committee either on
an appeal under sub rule (1) or by a decision taken by the Sub
Committee either on a complaint or suo motu. Hence, the
Scheme of the Rule is very clear and it does not contemplate
submitting of appeals to Standing Committee by persons other
than aggrieved owners of buildings. The Standing Committee
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may proceed suo motu also and revise the assessment made by
the Secretary after issuing notice to the owner of the building.
In such a situation also, the person aggrieved will be the owner
of the building. Sub Rule (7) specifically refers to person having
objection against the decision taken by the Standing Committee
as per Sub Rule (4) or Sub Rule (5). Therefore, the expression
‘any person’ employed in Sub Rule (7) is obviously with
reference to a person having objection regarding the decision
taken by the Standing Committee under Sub Rule (4) or Sub
Rule (5). The expression ‘any person’ employed in the Sub Rule
cannot be given a wider interpretation as canvassed by the
learned counsel for the 1st respondent. Doing so will be against
the Scheme of the provision as explained above. Hence the
petitioner Association had no right to approach the Tribunal
invoking its revisional jurisdiction also. Even otherwise, it is to
be noticed that the 1st respondent filed an appeal and not a
revision before the Tribunal. Indisputably, provisions of the
Kerala Municipality (Property Tax, Service Cess and Surcharge)
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Rules, 2011 do not provide any statutory remedy to challenge a
resolution adopted by the Municipal Council regarding levy of
property tax. Hence in any view of the matter, the Tribunal
ought not have entertained the case of the respondent
association.
15. Outcome of the above discussion is that the appeal
filed by the 1st respondent before the Tribunal was incompetent
and the Tribunal went wrong in entertaining it. In view of this
finding, remaining contentions need not be addressed.
16. Accordingly, this writ petition is allowed. Order dated
14.11.2012 of the Tribunal for Local Self-Government
Institutions in Appeal No.323 of 2012 shall stand set aside.
Writ Petition is disposed of as above.
Sd/-
S.MANU
JUDGE
skj
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APPENDIX
PETITIONER’S EXHIBITS:
EXT.P1 TRUE COPY OF THE GOVERNMENT ORDER
DTD.20.10.2011.
EXT.P2 TRUE COPY OF THE ORDER OF THE PETITIONER,
MUNICIPALITY, APPOINTING A COUNCIL WITH REGARD
TO THE IMPLEMENTATION OF EXT.P1 GOVERNMENT
ORDER, VIDE ORDER NO.R1-17163/11 DTD.25.10.2011.
EXT.P3 TRUE COPY OF THE ZONAL CLASSIFICATION AND RATE
OF TAXATION, FIXED BY THE PETITIONER
MUNICIPALITY, IN PURSUANCE OF EXT.P1 GOVERNMENT
ORDER BY VIRTUE OF RESOLUTION DTD.29.10.2011.
EXT.P4 TRUE COPY OF THE GOVERNMENT ORDER
No.1398/D.D3/12/LSGD DTD.22.3.2012.
EXT.P5 TRUE COPY OF THE NOTIFICATION, R1.17163/11
DTD.30.3.2012, ISSUED BY THE PETITIONER
MUNICIPALITY RE-FIXING THE ZONAL AREA AND BASIC
PROPERTY TAX IN PURSUANCE OF EXT.P1 GOVERNMENT
ORDER.
EXT.P6 TRUE COPY OF THE ORDER OF THE TRIBUNAL FOR
LOCAL SELF GOVERNMENT INSTITUTIONS,
THIRUVANANTHAPURAM DTD. 14.11.2012.