Merchants Association vs. State Of Kerala - Kerala High Court, 05 March 2020

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS THUR AY, THE 05TH DAY OF MARCH 2020 / 15TH PHALGUNA, 1941 WP(C).No.6237 OF 2020(D) PETITIONER/S: 1 MERCHANTS ASSOCIATION, CHENGANNUR, KERALA VYAPARI VYAVASAI EKOPANA SAMITHI REG.NO.262/81, E.K.R.BUILDING, MARKET ROAD, CHENGANNUR, ALAPPUZHA-689121, REPRESENTED BY ITS PRESIDENT RAJEEV N.V. @ BABUJI. 2 JOHN THACHAN, PROPRIETOR, JAI BEAUTY PARLOR, BETHAL JN.554, MC ROAD, CHENGANNUR, ALAPPUZHA-689121. 3 JACOB SCARIA, PROPRIETOR, CITIZEN WATCH HOUSE, 13/363, MC ROAD, CHENGANNUR, ALAPPUZHA-689121. 4 ANIL KUMAR, PROPRIETOR, SREE BHADRA TRADERS, OPPOSITE TO KSRTC, CHENGANNUR.P.O., ALAPPUZHA-686121. 5 ASHRAF ALI, PROPRIETOR, 13/367, MILAN MENS WEAR AND READY MADE, OPPOSITE KSRTC, NEW WARD 24/574, CHENGANNUR, ALAPPUZHA-689121. 6 SARATH, PROPRIETOR, HI LOOK MOBILE WORLD, OPPOSITE MAMMEN MEMORIAL HOSPITAL, CHENGANNUR, ALAPPUZHA-689121. 7 JIJI JACOB, PROPRIETOR, UNITED TRADING COMPANY, KARIMPUMKALAYIL BUILDING, ENGINEERING COLLEGE JUNCTION, CHENGANNUR, ALAPPUZHA-689121. 8 RETNAKUMAR, PROPRIETOR, R.K.ALUMINUM, ITI JUNCTION, CHENGANNUR, ALAPPUZHA-689121. 9 P.P.KARUNAN, PROPRIETOR, BEST BAKERY 13/272, MC ROAD, CHENGANNUR, ALAPPUZHA-689121. 10 THOMAS.M.G.,

WP(C).No.6237 OF 2020(D) 2 PROPRIETOR, MELEPANDIYIL STORES, MELEPANDIYIL BUILDING, CHENGANNUR, ALAPPUZHA-689121. 11 V.K.KUMARASWAMY, PROPRIETOR, VINAYAKA RESTAURANT, M.C.ROAD, CHENGANNUR, ALAPAPUZHA-689121. 12 REEJA SUSHAMA RAMAKRISHNAN, PROPRIETOR, SARADA TRADING, WARD NO.XXIX, 50-1, OPPOSITE MUNDENCAVU SCHOOL, M.C.ROAD, CHENGANNUR, ALAPAPUZHA-689121. 13 JOHN BABY, PROPRIETOR, BABY COFFEE, 13/288, M.C.ROAD, CHENGANNUR, ALAPPUZHA-689121. 14 ASHOK KUMAR.P.K., PROPRIETOR, SHAJI C D SHOP, 13/379, MC ROAD, CHENGANNUR, ALAPPAUZHA - 689121. 15 GEORGE ABRAHAM, PROPRIETOR, MAX SHOE MART, 602-3, RITZ SHOPPING COMPLEX, PUTHENKAVU, CHENGANNUR, ALAPPUZHA-689121. 16 SUSAMMA CHAKO, PROPRIETOR, 14/78, HANNAHS COLLECTIONS, DANAMPADICKAL BUILDING, CHENGANNUR, ALAPPUZHA- 689121. 17 KOSHI P MATHEW, PROPRIETOR, 16/51, NISHA TWO WHEELER AGENCY, BETHEL ROAD, CHENGANNUR, ALAPPUZHA-689121. 18 THOMAS MATHEW, PROPRIETOR, 17/89-1, VALLYATH TRADERS, NEAR PADINJARENADA, CHENGANNUR, ALAPPUZHA-689121. 19 MADHU.K.V., PROPRIETOR, QUEEN BAKERY, KSRTC BUILDING, THITTAMEL, CHENGANNUR, ALAPPUZHA-689121. 20 DON JOSEPH, PROPRIETOR, COTTON PARK, 75, 76, PULIMOOTTIL BUILDING, MC ROAD, CHENGANNUR, ALAPPUZHA-689121. 21 P.V.APPAPPU, PROPRIETOR, ERNAKULAM FOOT WEAR, 584, MC ROAD, CHENGANNUR, ALAPPUZHA-689121. 22 RAJEEV.N.V., PROPRIETOR, JAI HIND DUTY PAID SHOP, 13/372,

WP(C).No.6237 OF 2020(D) 3 OPPOSITE KSRTC, CHENGANNUR, ALAPPUZHA-689121. BY ADVS. SRI.C.S.AJITH PRAKASH SRI.T.K.DEVARAJAN SMT.T.N.SREEKALA SRI.PAUL C THOMAS SRI.M.B.SOORI SHRI.BABU M. SMT.ANCY THANKACHAN SHRI.NIDHIN RAJ VETTIKKADAN SRI.FRANKLIN ARACKAL RESPONDENT/S: 1 STATE OF KERALA, REPRESENTED BY PRINCIPAL SECRETARY TO GOVERNMENT, LOCAL SELF GOVERNMENT DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM. 2 CHENGANNUR MUNICIPAL COUNCIL, CHENGANNUR MUNICIPALITY, CHENGANNUR, ALAPPUZHA- 689121, REPRESENTED BY ITS SECRETARY. 3 THE SECRETARY, CHENGANNUR MUNICIPALITY, CHENGANNUR, ALAPPUZHA- 689121. R2-3 BY SRI.S.HARIKRISHNAN,SC,CHENGANNUR MUNICI OTHER PRESENT: SRI.S.HARIKRISHNAN,SC ,SMT.K.AMMINIKUTTY, GOVT.PLEADER THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 05.03.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C).No.6237 OF 2020(D) 4 ALEXANDER THOMAS, J. ----------------------------------------- W.P.(C.) No. 6237 of 2020 ----------------------------------------- Dated this the 5th day of March, 2020 JUDGMENT The case set up in the above W.P.(C.) is as follows : That the 1st petitioner is a merchant association and other petitioners numbering to 21 are traders and merchants conducting business in the municipal territory of Chengannur Municipality. They are doing the business after regularly renewing the trade license and with other statutory licence required as per the nature of business. During the last year, there was an attempt on the part of the Municipality to enhance the rate of trade licence fee without any notification. When it was opposed the petitioners were asked to remit a license fee with a 10% enhancement from the existing rate. During this year again the respondent Municipality is demanding trade license fee with a steep increase of 400% enhancement. That is from Rs.500/- to Rs.2000/- range. The enhancement is made without complying with the mandates of Section 447 of the Kerala Municipality Act and without adhering to the provisions of Rule 7 of the D&O Rules, 2011. Therefore, the petitioner is challenging steep increase to the extent of 400% increase from the existing license fee rate without authority of law.

WP(C).No.6237 OF 2020(D) 5 It is in the light of these averments and contentions that the petitioner has filed the instant W.P.(C.) with the following prayers :

To declare that the demand for license fee at the enhanced rate to the tune of 400% from the existing rate is unreasonable, unjust and without authority of law and hence violative of Article 14, 19(1)(g) and 21 of Constitution of India.

To declare that the demand for license fee at the enhanced rate to the tune of 400% from the existing rate is ultravires to Section 447 of the Kerala Municipalities Act and Rules, 2011 framed for fixing trade license fee.

Issue a writ of in the nature of mandamus or any other appropriate writ or direction commanding the respondent to renew the trade license of the petitioners 2 to 22 without insisting for enahanced license fee for the current licensing year (2020-21) or to fix a reasonable fee for renewal of license.

Issue such other writ, order or direction including interim orders as that are necessary in the circumstances of the case.”

Heard Sri.C.S.Ajith Prakash, learned counsel appearing for the petitioner, Sri.S.Harikrishnan, learned counsel appearing for R2 and R3 -Chengannur Municipality and Smt.K.Amminikutty, learned Government Pleader appearing for R1. 3. Sri.C.S.Ajith Prakash, learned counsel appearing for the petitioners has made submissions broadly in tune with the pleadings in this W.P.(C.). Sri.S.Harikrishnan, learned standing counsel appearing for R2 and R3 – Chengannur Municipality would submit that pending finalization of the refixation of the license fee based on the categorization of the trades made in the Kerala Municipalities (Issue of license to Dangerous and Offensive Trades and Factories) Rules, 2011, the 2nd respondent Chengannur Municipality has taken a decision as an interim arrangement that the license fee for consideration of the application for renewal of the license could be demanded only at the enhanced rate of 10% of the existing amount of the current year's license fee and that the objections, if any of

WP(C).No.6237 OF 2020(D) 6 the petitioners against the fee hike will be considered by the respondent Chengannur Municipality etc.

The learned counsel appearing for the petitioners would submit that a detailed objections will be filed by the petitioners to the 3rd respondent regarding the proposed revision and hike of the trade license fee without much delay, preferably within a period of one week from the date notified for the certified copy of this judgment. Taking note of this aspect, it is ordered that the competent authority of respondents 2 and 3 will ensure that the objections so filed by the petitioner against the proposed hike of the license fee could be duly considered, after affording reasonable opportunity of being heard to the petitioners through the authorised representative/counsel, if any, will render a considered decision, without much delay, within a period of one month from the date of production of the certified copy of this judgment. In the meanwhile, it is ordered that purely as an interim arrangement, application for renewal of license of the petitioners 2 to 22 in this case may be considered by the respondent –Chengannur Municipality subject to their paying adhoc enhanced license fee, which may be hiked upto 10% of the existing license fee.

The contentions of the petitioners based on Sec. 447 of the Kerala Municipality Act and the Rule (6) of the Kerala Municipalities (Issue of license to Dangerous and Offensive Trades and Factories) Rules, 2011

WP(C).No.6237 OF 2020(D) 7 may be duly forwarded and considered by the respondent Municipality authorities, while they takes a decision on the objections as aforestated. The abovesaid measures will be subject to the final decision taken by the respondents on the objections of the petitioners as aforestated. With these observations and directions, the above W.P.(C.) will stand disposed of. ALEXANDER THOMAS, JUDGE SKS

WP(C).No.6237 OF 2020(D) 8 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 AOF THE GST REGISTRATION CERTIFICATE NO.32ABLPT541RH2ZHJ DATED 17.7.2018 ISSUED TO THE 2ND PETITIONER. EXHIBIT P2 AOF THE LICENSE FEE RECEIPT ISSUED BY THE 1ST RESPONDENT MUNICIPALITY DATED 19.2.2019 TO THE 2ND PETITIONER. EXHIBIT P3 AOF THE GST REGISTRATION CERTIFICATE DATED 21.9.2017 OF THE SHOP ISSUED TO THE 3RD PETITIONER. EXHIBIT P4 AOF THE TRADE LICENSE RECEIPT FOR RS.500/- FOR THE LICENSING YEAR 2019-20 ISSUED TO THE 3RD PETITIONER. EXHIBIT P5 AOF THE GST REGISTRATION CERTIFICATE DATED 17.7.2018 ISSUED TO THE 4TH PETITIONER. EXHIBIT P6 AOF THE LICENSE FEE RECEIPT ISSUED BY THE 1ST RESPONDENT MUNICIPALITY DATED 5.2.2020 FOR THE LICENSING YEAR 2020- 21 FOR THE CONDUCT OF BUSINESS IN ANGADIMARUNNU. EXHIBIT P7 AOF THE LICENSE FEE REMITTED ON 4.2.2019 BY THE 4TH PETITIONER FOR THE SALE OF AURVEDIC MEDICINE ISSUED BY THE 1ST RESPONDENT MUNICIPALITY. EXHIBIT P8 AOF THE GST REGISTRATION CERTIFICATE DATED 17.7.2018 ISSUED TO THE 5TH PETITIONER. EXHIBIT P9 AOF THE LICENSE FEE RECEIPT ISSUED BY THE 1ST RESPONDENT MUNICIPALITY DATED 5.2.2020 FOR THE LICENSING YEAR 2020- 21 ISSUED TO THE 5TH PETITIONER. EXHIBIT P10 AOF THE GST REGISTRATION CERTIFICATE DATED 28.6.2017 ISSUED TO THE 6TH PETITIONER. EXHIBIT P11 AOF THE LICENSE FEE RECEIPT ISSUED BY THE 6TH PETITIONER BY THE 1ST

WP(C).No.6237 OF 2020(D) 9 RESPONDENT MUNICIPALITY DATED 20.3.2019 FOR THE LICENSING YEAR 2019. 20. EXHIBIT P12 AOF THE GST REGISTRATION CERTIFICATE DATED 28.6.2017 ISSUED TO THE 7TH PETITIONER. EXHIBIT P13 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 7TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 14.5.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P14 AOF THE GST REGISTRATION CERTIFICATE DATED 17.7.2018 ISSUED TO THE 8TH PETITIONER. EXHIBIT P15 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 8TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 6.3.2019 FOR THE LICENSING YEAR 2019-2021. EXHIBIT P16 AOF THE GST REGISTRATION CERTIFICATE DATED 24.9.2018 ISSUED TO THE 9TH PETITIONER. EXHIBIT P17 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 9TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 12.3.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P18 AOF THE GST REGISTRATION CERTIFICATE NO.32AETPG6576Q1ZL DATED 17.7.2018 ISSUED TO THE 10TH PETITIONER. EXHIBIT P19 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 10TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 22.2.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P20 AOF THE TRADE LICENSE NO.271 DATED 18.11.2019 ISSUED BY THE CHENGANNUR MUNICIPALITY TO THE 11TH PETITIONER. EXHIBIT P21 AOF THE GST REGISTRATION CERTIFICATE NO.32CVHPR3934E1ZM DATED 30.5.2019 ISSUED TO THE 12TH PETITIONER. EXHIBIT P22 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 13TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 12.2.2019 FOR THE LICENSING YEAR 2019-20. WP(C).No.6237 OF 2020(D) 10 ISSUED TO THE 14TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 28.2.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P24 AOF THE GST REGISTRATION CERTIFICATE NO.32AFWPA2678B1ZM DATED 17.7.2018 ISSUED TO THE 15TH PETITIONER. EXHIBIT P25 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 15TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 2.2.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P26 AOF THE GST REGISTRATION CERTIFICATE NO.32ATFPC1478C2Z9 DATED 28.6.2017 ISSUED TO THE 16TH PETITIONER. EXHIBIT P27 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 16TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 28.2.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P28 AOF THE GST REGISTRATION CERTIFICATE NO.32ASEPK6171G1ZH DATED 17.7.2018 ISSUED TO THE 17TH PETITIONER. EXHIBIT P29 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 17TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 5.3.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P30 AOF THE GST REGISTRATION CERTIFICATE NO.32AJOPM5878R1Z4 DATED 28.6.2017 ISSUED TO THE 18TH PETITIONER. EXHIBIT P31 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 18TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 22.2.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P32 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 19TH PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 13.2.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P33 AOF THE GST REGISTRATION CERTIFICATE NO.32BIFPJ5581H1ZA DATED 17.11.2017 ISSUED TO THE 20TH PETITIONER. EXHIBIT P34 AOF THE GST REGISTRATION CERTIFICATE NO.32AATV9747N1ZH DATED 21.9.2017 ISSUED TO THE 2ST PETITIONER.

WP(C).No.6237 OF 2020(D) 11 EXHIBIT P35 AOF THE LICENSE FEE RECEIPT ISSUED TO THE 22ND PETITIONER BY THE 1ST RESPONDENT MUNICIPALITY DATED 19.3.2019 FOR THE LICENSING YEAR 2019-20. EXHIBIT P36 AOF THE RECEIPT ISSUED BY 1ST RESPONDENT MUNICIPALITY TO THE 3RD PETITIONER DATED 20.2.2020. EXHIBIT P37 AOF THE SCHEDULE IS PRODUCED HEREWITH AND MARKED AS. EXHIBIT P38 AOF THE TRADE LICENSE FEE REMITTANCE EFFECTED BY ONE MOLY MATHEW DATED 14.2.2020 IN THIRUVALLA MUNICIPALITY.