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HVK Archives: Temple cottages not hotels, rules HC

Temple cottages not hotels, rules HC - The Hindu

Posted By Krishnakant Udavant (kkant@bom2.vsnl.net.in)
October 15, 1998

Title: Temple cottages not hotels, rules HC
Publication: The Hindu
Date: October 15, 1998

The Madras High Court has held that cottages run by the temples
for stay of pilgrims could not be classified as hotels for being
taxed under the Tamil Nadu Taxes on Luxuries in Hotels and
Lodging Houses Act.

Setting aside the assessment orders issued by the Commercial
Taxes Department to Arulmigu Ramanathaswami Devasthanam,
Rameswaram, Mr. justice S. S. Subramani said that to attract the
provisions of this Act the main activity of the assessee must be
business. If the assessee had no business at all of any kind,
merely because it allowed the pilgrims to occupy the cottages
for few hours on rent basis, that could not be treated as
business by the temple.

If the temple was only doing service to pilgrims and letting out
was not a business or incidental to the main business, there was
no scope of applicability of the Act, the judge said. Also under
the Hindu law, there was no distinction between religion and
charity. Whatever was religious was also considered charity and
whatever was charity was also considered religious. The temples
only looked after the welfare of the pilgrims and members of the
public who visit for the purpose of worship and only for that
buildings had been constructed by the temples. it was only
service which could not be called ancillary to business, the
judge said.

The petitioner temple was assessed under the TNTLHLH Act for the
years 1987-88 to 1991-92 and a total tax of Rs. 1,56,769.80 was
levied on the temple. One of the oldest Devasthanams in India,
it had cottages for providing service to the pilgrims.
Contending that it was not doing any business and the cottages
run by it would not come within the purview of this Act, it
filed the present revision petitions to quash the assessment

On behalf of the authorities it was submitted that business of
any kind would fall within the ambit of this Act and it was not
necessary that the assessee should earn a profit.

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