M/S Bren Corporation vs. The State Of Karnataka
Original PDF →Facts
The petitioner, M/s. Bren Corporation, filed a writ petition challenging the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.1/2022), and various notifications and circulars issued by the State and Bruhat Bangalore Mahanagara Palike (BBMP). The petitioner sought to declare these enactments and actions as ultra vires the Constitution and contrary to previous High Court decisions. Specifically, the petitioner challenged the imposition of various fees and charges, including Goods and Services Tax (GST) on ground rent, license fees, scrutiny fees, betterment fees, security deposits, and various cesses and surcharges, as demanded by BBMP in an office order and a demand notice. The petitioner sought a direction to issue a sanction plan for their residential apartment building without insisting on these charges.
Held
The Court held that the issues raised in the present writ petition were squarely covered by previous binding decisions of coordinate benches in W.P.No.23086/2022 (M/s Sapthagiri Shelters) and W.P.No.36017/2018 (Sunderam Shetty). In Sunderam Shetty, levies of Ground Rent, License Fee, Building License Fee, and Scrutiny Fee under relevant bye-laws were declared ultra vires the Act, and government circulars were quashed. In M/s Sapthagiri Shelters, Karnataka Act No.01 of 2022 and Karnataka Act No.37 of 2024 were struck down for illegally linking fees to market/guidance value, and related circulars and Clause 3.8 of BBMP Building Bye-laws, 2003, pertaining to Ground Rent, were quashed. Consequently, the Court found no need for separate adjudication and allowed the petition in terms of the operative directions issued in the aforesaid writ petitions. The impugned demand notice was set aside, and BBMP was directed to issue a fresh/modified plan and process the petitioner's application for building license and sanction of the building plan strictly in accordance with law. The issuance of the license and plan was not to be withheld due to BBMP contemplating an appeal, but would be subject to the outcome of any such appeal.
Key Issues
1. Whether the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.01 of 2022) is ultra vires the Constitution in its application to the petitioner? 2. Whether Karnataka Act No.01 of 2022 is in violation of or contrary to the decision of this Hon'ble Court in W.P.No.4601/2020? 3. Whether Section 18-A of the Karnataka Town & Country Planning Act, 1961, specifically sub-sections (i) and (iv), is liable to be quashed? 4. Whether the Notification bearing No.UDD 3 TTP 2015 dated 25/02/2020, inserting Rule 37-A and 37-C, and the Notification bearing No.UDD 23 TTP 2020 (E) dated 21/06/2021, inserting Rule 37-A and 37-C, are liable to be quashed? 5. Whether the Office Order No.HaNiNaYo/PR/461/2021-22 dated 09/12/2021, the circular dated 14/08/2020 (No.He.Ni.Ka.Pa.Ko/P.R/320/2020-21), and the circular dated 24/06/2021 (No.He.Ni.Na.Yo/P.R/320/2020-21) issued by BBMP are liable to be quashed? 6. Whether the demand notice demanding ground rent, GST on ground rent, license fee, scrutiny fee, betterment fees, security deposit, cesses, surcharges, and service charges is illegal, without jurisdiction, and arbitrary? Petitioner's Arguments: The petitioner contended that the impugned Act, notifications, and circulars were ultra vires the Constitution and contrary to established High Court precedents. They argued that the levies were illegal and arbitrary, and sought quashing of the demand notice and directions for sanction plan issuance without these charges. Respondents' Arguments: The judgment does not explicitly record arguments from the respondents. However, the court's decision implies that the respondents' actions were based on the impugned legislation and notifications.
Sections Cited
Section 18-A, Rule 37-A, Rule 37-C, Section 45-B
AI-generated summary — verify with the full judgment below
Heard together (2 matters)
Read from the judgment's own cause title. This page is filed under one of them.
Cause title — parties, addresses and appearances
ORAL ORDER
The captioned petition is filed seeking following reliefs: “i) Grant an order declaring that the entire Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.01 of 2022) notified on 13/01/2022 produced at ANNEXURE-Q as being ultra vires the Constitution in so far the Petitioner is concerned in so far the Petitioners are concerned.
ii) To declare that Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No.01 of 2022) notified on 13/01/2022 produced at ANNEXURE-Q is in violation/contrary to the decision of this Hon'ble Court in W.P.No.4601/2020. Vide ANNEXURE-M.
iii) Grant an order, direction or writ in the nature of certiorari quashing the Office Order No.HaNiNaYo/PR/461/2021-22 dated 09/12/2021 issued by Respondent No.3 as contained in ANNEXURE-P in so far the Petitioners are concerned.
iv) Grant an order, direction or writ in the nature of Certiorari quashing Section 18-A of the Karnataka Town & Country Planning Act, 1961 brought into effect by Karnataka Act No.23 of 2004 (Karnataka Town & Country Planning (Amendment) Act, 1998) insofar as HC-KAR NC: 2025:KHC:23159 Section 18-A(i) and (iv) of the Karnataka Act No.23 of 2004 is concerned;
v) Grant an order, direction or writ in the nature of Certiorari quashing the Notification issued by the 1st Respondent bearing No.UDD 3 TTP 2015 dated 25/02/2020 produced at ANNEXURE-G insofar as the inserted Rule 37-A and 37-C is concerned;
vi) Issue a writ or order by way of certiorari quashing the circular dated 14/08/2020, bearing No.He.Ni.Ka.Pa.Ko/P.R/320/2020-21 issued by the Respondent No.3 produced at Annexure-J in so far the Petitioners are concerned.
vii) Grant an order, direction or writ in the nature of Certiorari quashing the Notification issued by the 1st Respondent bearing No.UDD 23 TTP 2020 (E) dated 21/06/2021 as contained in ANNEXURE-K insofar as the inserted Rule 37-A and 37-C is concerned;
viii) Issue a writ or order by way of certiorari quashing the circular dated 24/06/2021, bearing No.He.Ni.Na.Yo/P.R/320/2020-21 issued by the Respondent No.3 at Annexure-L in so far the Petitioner is concerned.
ix) Issue a writ or order by way of certiorari quashing the demand notice dated nil, bearing L.P. No.BBMP/Addl.Dir/JDSOUTH/0029/21-22, issued by the Respondent No.4 produced at Annexure-C for demanding in so far it is concerned to Ground rent, GST HC-KAR NC: 2025:KHC:23159 on Ground rent, License fee, scrutiny fee, Betterment fee for building, Betterment fee for site, security deposit, Cess for water supply scheme, Surcharge for formation outer ring road, Cess for improvement of slum, Surcharge for Mass Rapid Transport System, 5% levy service charges payable to BBMP and upfront labour cess and 1% service chargers on labour cess to BBMP as illegal, without juri iction and arbitrary.
x) issue a writ or order or direction by way of mandamus directing the Respondent No.3 and 4 BBMP to issue the sanction plan for construction of the Residential Apartment Building in the Schedule Property without insisting the Ground rent, GST on Ground rent, License fee, scrutiny fee, Betterment fees for building, Betterment fees for site, security deposit, Cess for water supply scheme, Surcharge for formation outer ring road, Cess for improvement of slum and Surcharge for Mass Rapid Transport System, 5% levy service charges payable to BBMP and upfront labour cess and 1% service chargers on labour cess to BBMP and xi) pass any such other order(s) as this Hon'ble Court deems fit in the facts and circumstances of the case in the interest of justice and equity”
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:23159 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. 4. 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.
The issues raised in the present writ petition are squarely covered by the above binding decisions, wherein the HC-KAR NC: 2025:KHC:23159 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 NIL bearing no. L.P.No.BBMP/Addl.Dir/ JDSOUTH/0029/21-22,
issued by respondent No.4 as per Annexure-C is hereby set-aside.
(iii) Respondent-BBMP is hereby directed to issue fresh/modified plan as the case may be.
(iv) Respondent-BBMP are hereby directed to forthwith process the petitioner’s HC-KAR NC: 2025:KHC:23159 application seeking building license and sanction of the building plan, strictly in accordance with law.
(v) It is made clear that the issuance of the building license and approval of the plan shall not be withheld merely on the ground that the BBMP is contemplating to file an appeal against the reported judgment.
(vi) If the building license and sanction plan are 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
MBM List No.: 2 Sl No.: 1
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.