Predominant charitable use is essential for building tax exemption where a hospital's main activity is commercial.

Exemption from building tax under section 3(1)(b) of the Kerala Building Tax Act depends on the building being used mainly or predominantly for charitable purposes. Reading the memorandum of association as a whole, the hospital company's main object was to establish and run hospitals and allied facilities, while the clauses relied on by the assessee were only enabling powers. The annual report also showed that free treatment formed only a small part of expenditure, indicating that the institution's predominant activity was commercial rather than charitable. The building was therefore not entitled to exemption, and the tax assessment was upheld.

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Issues: Whether the hospital building was used principally for charitable purposes so as to qualify for exemption from building tax under section 3(1)(b) of the Kerala Building Tax Act, 1975.

Analysis: The exemption under section 3(1)(b) depends on the building being used mainly, chiefly, or predominantly for charitable purposes. Reading the memorandum of association as a whole, the stated main object of the company was to establish and run hospitals and allied facilities, while the clauses relied on by the petitioner were only enabling powers and not the real objects of the company. The annual report also showed that free treatment formed only a small part of the expenditure, indicating that the institution's predominant activity was to earn profit rather than to function as a charitable institution.

Conclusion: The building was not used principally for charitable purposes and was not entitled to exemption; the finding was against the assessee.

Final Conclusion: The challenge to the denial of exemption failed, and the building tax assessment was upheld.

Ratio Decidendi: For exemption under section 3(1)(b), the building must be principally used for charity, and enabling powers in the memorandum or incidental free medical services do not establish predominant charitable use when the institution's main object is commercial.

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