Dr B M Nirmala vs. The State Of Karnataka
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The petitioners, represented by their GPA holder Monarch, a registered partnership firm, filed a writ petition challenging a demand notice dated March 4, 2025, issued by the Joint Director, Town Planning-North, Bruhat Bengaluru Mahanagara Palike (BBMP). The demand notice included levies for scrutiny fee (Rs. 9,37,846/-), ground rent (Rs. 1,10,53,181/-), and GST (Rs. 41,06,351/-), totaling Rs. 1,60,97,378/-. The petitioners sought to quash this demand. The State of Karnataka and the BBMP were the respondents. The petition was filed under Articles 226 and 227 of the Constitution of India.
Held
The Court held that the issues raised in the present writ petition are squarely covered by the binding decisions in "M/s Sapthagiri Shelters" and "Sunderam Shetty" cases. In "Sunderam Shetty," a co-ordinate bench had declared levies of Ground Rent, License Fee, Building License Fee, and Scrutiny Fee under relevant bye-laws as ultra vires the Act and quashed specific government circulars. Similarly, in "M/s Sapthagiri Shelters," a co-ordinate bench struck down certain Karnataka Acts and declared Clause 3.8 of the BBMP Building Bye-laws, 2003, pertaining to Ground Rent, as invalid. Consequently, the Court found that the present petition did not warrant separate adjudication. The impugned demand notice dated 04.03.2025 was set aside. The BBMP was directed to issue an Occupancy Certificate in accordance with law, strictly adhering to the approved building plan and to forthwith process the petitioner's application for the same. The issuance of the occupancy certificate was not to be withheld pending any appeal by the BBMP, but if issued, it would be subject to the outcome of any such appeal.
Key Issues
1. Whether the demand for scrutiny fee, ground rent, and associated GST, as per the impugned notice dated 04.03.2025, is legally sustainable in light of previous judgments of this Court? (Question of law) Petitioner's contention: The petitioners argued that the issues raised in their petition are squarely covered by binding decisions of this Court in "M/s Sapthagiri Shelters" and "Sunderam Shetty" cases. They contended that these judgments had already declared similar levies as ultra vires and quashed relevant government circulars and bye-laws. Therefore, the present demand should be quashed. Revenue/State's contention: The judgment records no specific arguments from the respondents. However, the court's decision implies that the respondents' demand was based on bye-laws and circulars that were previously set aside by coordinate benches.
Sections Cited
Section 45-B of the Karnataka Stamp Act, 1957, Rule 37-A of the Karnataka Planning Authority Rules, 1965, Clause 3.8 of the BBMP Building Bye-laws, 2003
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Cause title — parties, addresses and appearances
ORAL ORDER This petition is filed seeking the following reliefs:- “(i) Issue a writ of certiorari or similar writ or order of direction to quash the BBMP/ADDL.Dir/JD North/LP/0006/2019-20 dated 04.03.2025 at Annexure-B issued by the 3rd respondent in so far as the demand for scrutiny fee of Rs.9,37,846/-, ground rent of Rs.1,10,53,181/- along with GST of Rs.41,06,351/- amounting to a total of Rs.1,60,97,378/-.
(ii) Issue any other appropriate writ or order or direction deemed fit in the circumstances of the case in the interest of justice and equirty.”
The Co-ordinate Benches of this Court, in W.P.No.23086/2022 and connected matters(herein referred to as “M/s Sapthagiri Shelters”) as well as HC-KAR NC: 2025:KHC:25799 W.P.No.36017/2018 and connected matters(herein referred to as “Sunderam Shetty”), have comprehensively adjudicated the issue involved and settled the controversy.
In Sunderam Shetty and connected cases, the Co-ordinate Bench declared the levies of Ground Rent, License Fee, Building License Fee, and Scrutiny Fee under the relevant bye-laws as ultra vires the Act and quashed the Government Circulars dated 04.09.2015, 27.01.2017, and 30.03.2017. and similarly, in M/s Sapthagiri Shelters and connected matters, the Co- ordinate Bench struck down the Karnataka Act No.01 of 2022 and Karnataka Act No.37 of 2024, holding that linking fees under Rule 37-A of the Karnataka Planning Authority Rules, 1965 to market/guidance value under Section 45-B of the Karnataka Stamp Act, 1957 is illegal. It further quashed all related Circulars and declared Clause 3.8 of the BBMP Building Bye-laws, 2003, pertaining to Ground Rent, as invalid. HC-KAR NC: 2025:KHC:25799
The issues raised in the present writ petition are squarely covered by the above binding decisions, wherein the relevant bye-laws and government circulars have been set aside.
In light of the authoritative pronouncements, the present petition does not warrant separate adjudication and is liable to be allowed in terms of the operative directions issued in the aforesaid writ petitions.
Accordingly, this Court proceeds to pass the following: ORDER (i) The writ petition is allowed.
(ii) The impugned demand notice dated 04.03.2025 issued by respondent No.3 as per Annexure-B is hereby set- aside.
(iii) Respondent No.3 - BBMP is hereby directed to issue Occupancy Certificate in accordance with law in HC-KAR NC: 2025:KHC:25799 compliance of the construction strictly adhering to the approved building plan.
(iv) Respondent No.3 - BBMP is directed to forthwith process the petitioner’s application seeking occupancy certificate, strictly in accordance with law.
(v) It is made clear that the issuance of the occupancy certificate shall not be withheld merely on the ground that the BBMP is contemplating to file an appeal against the reported judgment.
(vi) If the occupancy certificate is issued, the same shall be subject to the outcome of any appeal that may be filed by the BBMP against the said judgment.
Pending applications, if any, are also disposed off. (SACHIN SHANKAR MAGADUM) JUDGE
NBM List No.: 2 Sl No.: 28
Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.