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2025 Supreme(Online)(Kar) 16033
KARNATAKA HIGH COURT
SACHIN SHANKAR MAGADUM, J
M/S.EMBASSY CONSTRUCTION PRIVATE LIMITED – Appellant
Versus
THE STATE OF KARNATAKA – Respondent
WRIT PETITION NO.13814 OF 2021
For the Appellants/Petitioners: SRI KEMPEGOWDA, SRI SANJAY NAIR
For the Respondents: SMT.SPOORTHY V., HCGP, SMT.SARITHA KULKARNI
The court ruled that earlier collected fees cannot be reimposed for subsequent approvals, emphasizing adherence to established statutory provisions.
Headnote:(A) Karnataka Municipal Corporations Act, 1976 - Karnataka Town and Country Planning Act, 1961 - The amendments under Karnataka Act No.01 of 2022 and Karnataka Act No.37 of 2024 were quashed along with illegal fee provisions related to smaller plots, establishing that previous collected fees for land use changes cannot be levied again for subsequent plans. (Para 2, 3, 4, 5)
(B) Legal issues of land use fees and validity of bye-laws - The legality of linking fees to market value under the Karnataka Stamp Act, was ruled illegal which reaffirms that local authorities must follow established regulations without imposing unlawful fees. (Paras 5, 6)
Facts of the case:
The petitioner contested demand notices for fees perceived as excessive and inconsistent with existing laws, leading to determinations around building bylaws and municipal amendments.
Findings of Court:
The writ petition was allowed, setting aside the erroneous notice and mandating processing of the petitioner’s application according to law.
Issues: The primary issue was whether the impugned bye-law and associated fees violated the Municipal Corporations Act and other relevant legislations.
Ratio Decidendi: The court emphasized that fees based on non-applicable market values infringe established statutory provisions, and prior fees collected must exempt further impositions.
Result: Writ petition allowed.
| Table of Content |
|---|
| 1. court addresses demands related to building fees. (Para 1 , 2) |
| 2. writ petition relies on co-ordinate bench judgments. (Para 3) |
| 3. prior rulings govern legality of municipal fees. (Para 4 , 5 , 6) |
| 4. final order allows the writ petition and mandates license processing. (Para 7) |
ORAL ORDER
The petitioner is seeking for the following reliefs:
"a) Issue a writ of certiorari, or any other appropriate Writ, Order or Direction, declaring Bye Law No.3.9 of the Bengaluru Mahanagara Palike Building Bye Laws 2003 (Annexure-A), is ultra vires of and inconsistent with the Karnataka Municipal Corporations Act, 1976 and also ultra vires of and inconsistent with Bye Laws No.3.8 and 3.10 of the Bengaluru Mahanagara Palike Building Bye Law 2003;
b) Issue a Writ of Certiorari, or any other appropriate Writ, Order or Direction, quashing the Demand Notice dated 16.07.2021, bearing No.BBMP/Addl.Dir/JDNORTH/0023/ 20-21 (Annexure-B), issued by Respondent No.4 in so far as it relates to demanding payment of:
Rs.8,22,637/- towards Scrutiny Fee;
Rs.1,64,52,737/- towards License Fee;
Rs. 1,52,54,037/- towards Ground Rent and GST payable on Ground Rent;
Rs.87,44,014/- towards Betterment charges on building u/s 18 of KTCP Act;
Rs. 87,44,014/- towards Security Deposit;
Rs.22,51,982/- towards 1% Service Charges payable to BBMP from Labour Welfare Fund;
and Rs. 1,34,02,000/- towards Labour Welfare Fund;
Totally amounting to Rs.6,56,71,421/- (Rupees Six Crore Fifty Six Lakh Seventy One Thousand Four Hundred and Twenty One only); and c) Award Cost of this Writ Petition;
d) Grant such other and further reliefs as this Hon'ble Court deems fit and proper under the facts and circumstances of the case, in the interest of justice and equity."
2. It is brought to the notice of this Court that across the Bar, the issue is dealt by the Co-ordinate Bench in the reported judgment in W.P.No.23086/2022 and connected matters. The Co-ordinate Bench, while deciding the issue, has set-aside the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.01 of 2022) and the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2023, (Karnataka Act No.37 of 2024). Therefore, this Court deems it fit to cull out the operative portion of the order, which reads as under;
ORDER
i) The writ petitions are partly allowed.
ii) The Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.01 of 2022), is hereby quashed and set aside.
iii) The Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2023, (Karnataka Act No.37 of 2024), is hereby quashed and set aside.
iv) It is hereby declared that the provisions contained in Section 18-A of the Karnataka Town and Country Planning Act, 1961 , read with Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, are applicable only in respect of ‘Development Plan’ containing the proposal for construction on plots measuring more than 20,000 square meters in extent and not in respect of plots measuring less than
20,000 square meters.
v) It is hereby declared that if fee has been earlier collected for change of land use or while approving a layout plan, fee shall not be collected for subsequent ‘Development Plan’ in terms of the ‘Note’ found below TABLE I of Rule 37-A of the Karnataka Planning Authority Rules, 1965.
vi) It is hereby declared that the linking of the fee leviable under Rule 37-A of the Karnataka Planning Authority Rules, 1965, to the ‘market value’ or ‘guidance value’ as determined under Section 45-B of the Karnataka Stamp Act, 1957 , is illegal. However, liberty is reserved to the respondent-State Government and the BBMP to re-fix a standard after collecting empherical data.
vii) Consequently, all the impugned Circulars which seek to give effect to the Rules 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, are hereby quashed and set aside.
viii) It is hereby declared that Clause 3.8 of the Bengaluru Ma
