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High Court of Judicature at Madras
R. BANUMATHI & T.S. SIVAGNANAM, JJ.
D. Manikandan & Another
Versus
State of Tamil Nadu, Rep. by The Secretary to Government Housing & Urban Development Department & Others
Writ Appeal No. 1809 of 2011, W.A. Nos. 1856, 1858 & 1974 of 2011, 2020 of 2011, 2021 of 2011, 334 of 2012, W.P. Nos. 16116 of 2013, 11171, 10736, 12227 & 14365 of 2011, 22752 to 22754 of 2009, 5190 of 2013, 10091 of 2011, 25996 of 2009, 35405, 35430 & 33712 of 2012, W.P. No. 5190 of 2013
Decided on : 27-08-2013
The Court upheld the constitutional validity of the impugned provisions of the Tamil Nadu Town and Country Planning (Second Amendment) Act, 2007, and the rules framed thereunder, which levied infrastructure and amenity charges (I&A charges) on certain categories of buildings and developments. The Court held that the State Government had legislative competence to enact the impugned provisions under various entries in List II and List III of the Seventh Schedule to the Constitution of India, read with Articles 243X and 243H of the Constitution. The Court also held that the levy of I&A charges was not a multiple levy, as it was distinct from the development charges levied under Section 59 of the Act. Further, the Court held that the impugned provisions did not suffer from excessive delegation of legislative power, as they provided sufficient guidelines to the delegate. The Court also held that the levy of I&A charges was justified, as it was for special benefits conferred on the development of a distinct category of buildings having a special burden on the services to be extended consequent on such special benefit. Finally, the Court held that the test of quid pro quo was satisfied, as the funds collected as I&A charges were utilized for the purpose of providing infrastructure and basic amenities to meet the impact of development.
Fact of the Case:
The petitioners, who were developers and property owners, challenged the constitutional validity of the impugned provisions of the Tamil Nadu Town and Country Planning (Second Amendment) Act, 2007, and the rules framed thereunder, which levied infrastructure and amenity charges (I&A charges) on certain categories of buildings and developments. The petitioners contended that the State Government lacked legislative competence to enact the impugned provisions, that the levy of I&A charges was a multiple levy, that the impugned provisions suffered from excessive delegation of legislative power, that the levy of I&A charges was not justified as it was for the performance of statutory duties, and that there was no quid pro quo for the levy of I&A charges.
Finding of the Court:
The Court upheld the constitutional validity of the impugned provisions. The Court held that the State Government had legislative competence to enact the impugned provisions under various entries in List II and List III of the Seventh Schedule to the Constitution of India, read with Articles 243X and 243H of the Constitution. The Court also held that the levy of I&A charges was not a multiple levy, as it was distinct from the development charges levied under Section 59 of the Act. Further, the Court held that the impugned provisions did not suffer from excessive delegation of legislative power, as they provided sufficient guidelines to the delegate. The Court also held that the levy of I&A charges was justified, as it was for special benefits conferred on the development of a distinct category of buildings having a special burden on the services to be extended consequent on such special benefit. Finally, the Court held that the test of quid pro quo was satisfied, as the funds collected as I&A charges were utilized for the purpose of providing infrastructure and basic amenities to meet the impact of development.
Issues: 1. Whether the State Government had legislative competence to enact the impugned provisions? 2. Whether the levy of I&A charges was a multiple levy? 3. Whether the impugned provisions suffered from excessive delegation of legislative power? 4. Whether the levy of I&A charges was justified as it was for the performance of statutory duties? 5. Whether there was quid pro quo for the levy of I&A charges?
Ratio Decidendi: 1. The State Government had legislative competence to enact the impugned provisions under various entries in List II and List III of the Seventh Schedule to the Constitution of India, read with Articles 243X and 243H of the Constitution. 2. The levy of I&A charges was not a multiple levy, as it was distinct from the development charges levied under Section 59 of the Act. 3. The impugned provisions did not suffer from excessive delegation of legislative power, as they provided sufficient guidelines to the delegate. 4. The levy of I&A charges was justified, as it was for special benefits conferred on the development of a distinct category of buildings having a special burden on the services to be extended consequent on such special benefit. 5. The test of quid pro quo was satisfied, as the funds collected as I&A charges were utilized for the purpose of providing infrastructure and basic amenities to meet the impact of development.
Final Decision: The Court dismissed the writ petitions and writ appeals challenging the vires of the impugned enactment. No costs. Consequently, connected miscellaneous petitions were closed.
R. Banumathi, J. & T.S. Sivagnanam, J.
1. The Government of Tamil Nadu during 2007 examined a proposal on the fixation of infrastructure and amenities charges in the context of the rapid developments that were taking place in the State. On consideration of such proposal, the Government was of the view that for ensuring sustainable development leading to formation of well planned urban areas and growth centres provision of adequate basic amenities have become essential and there was a necessity to provide adequate funds by establishing an infrastructure and amenities fund with adequate sources of revenue. Accordingly, by a Government order in G.O.Ms.No.191, dated 01.06.2007, the Government decided to collect infrastructure and basic amenity charges at the rates specified, giving power to the Director of Town and Country Planning to fix different rates for each of the categories of buildings for different areas taking into account the various aspects of developments including infrastructural needs. The ceiling of the rates was fixed in the said Government Order and the amount payable depended upon the type of building. By a subsequent Government order in G.O.Ms.No.215, dated 02.07.2007, the non-FSI and parking area were excluded from the levy of infrastructure and basic amenity charges and the applicants applying for building plan approval were required to pay 50% of the charges at the first instance and the balance 50% to be collected in two equal installments for which irrevocable Bank Guarantee was to be furnished. By G.O.Ms.No.4, dated 04.01.2008, a clarification was issued as regards the mode and method of payment. At that juncture, the Government realised that the Government orders, which have been passed for levying and collecting, these charges did not have any statutory backing. Accordingly, the Government introduced the Tamil Nadu Town and Country Planning (Second Amendment) Act, 2007, inserting new Section 63B and 63C in the Town and Country Planning Act, 1971, which dealt with levy of infrastructure and amenity charges and constitution of State Infrastructure and Amenities Fund respectively. In terms of Section 3 of the Amending Act, the levy of infrastructure and amenity charges any time between 01.06.2007 and the date of publication of the Amending Act in the Government Gazette was deemed to be and to have always been validity levied or collected in accordance with law, as if the Principal Act as amended by the Amending Act 2007 had been in force at all material times. The Government by G.O.Ms.No.22, dated 25.01.2008, framed rules under Section 63B of the Amending Act, namely the Tamil Nadu Town and Country Planning (Levy of Infrastructure and Amenity Charges) Rules, 2008.
2. In these batch of cases, there is challenge to the newly inserted provisions Section 63B & 63C and the Rules framed under Section 63B namely the Tamil Nadu Town and Country Planning (Levy of Infrastructure and Amenity Charges) Rules 2008. A few of the petitioners have not questioned the vires of the Amended Act or Rules, but have questioned the levy alone.
3. Few cases in these batch are writ appeals arising out of a common order in W.P.Nos.21402 of 2010 etc., batch dated 30.06.2011, by which the writ Court dismissed the writ petitions challenging the vires of Section 63B & 63C of the Act and the Rules and the individual writ petitions challenging the various orders passed pursuant to the amended provisions were also dismissed. Certain cases, which are tagged along with the batch of writ appeals are writ petitions filed by promoters and property developers after the order dated 30.06.2011 by which the batch of cases were dismissed by the writ Court. Therefore, broadly we have three category of cases before us
(i) Writ Appeals challenging the common order dated 30.06.2011 in W.P.No.21402 of 2010, etc., batch
(ii) Writ Petitions filed challenging the vires of Section 63B & 63C and the Rules and
(iii) Writ Petitions challenging the levy
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