The Hindu 02.09.2010
BBMP can't tax post offices, court says
Staff Reporter
BANGALORE: The Karnataka High Court has held that post offices, as per the definition of the Bangalore Development Authority (BDA) Act 1976, is a civic amenity and that no tax or charge may be imposed on them by the State Government or its agencies.
Justice Ananda Byrareddy delivered this judgment recently when dealing with a petition by the Postmaster-General challenging the Bruhat Bangalore Mahanagara Palike's decision (BBMP) to impose service charge on post offices in Bangalore.
The BBMP, the Department of Posts said, had issued a notice on April 12, 2005, asking it to pay 25 per cent of the property tax as service charge. The Department of Posts challenged the notification saying the service charge was nothing but tax and that all Central installations are exempt from paying it.
The BBMP argued saying that it was not levying tax but charging for services it rendered such as supplying water, providing roads and drains and removing debris and garbage.
But Justice Anand Byrareddy rejected the civic body's contention and said the concept of service charge runs foul of Article 256 (1) of the Constitution.
