Smt. Sangeetha Poddar vs. The State Of Karnataka
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The petitioners, Smt. Sangeeta Poddar and Sri Basant Poddar, filed a writ petition challenging Section 18-A of the Karnataka Town and Country Planning Act, 1961, as amended, and various notifications and circulars issued by the State of Karnataka and Bruhat Bengaluru Mahanagara Palike (BBMP). Specifically, they sought to quash Section 18-A(i) and (iv) of the Act, Rule 37-A and 37-C of the Karnataka Planning Authority Rules, 1965, a circular dated 14/08/2020 and another dated 24/06/2021 issued by BBMP, and a demand notice dated 02/09/2021 issued by the Assistant Director (Town Planning-Bommanahalli) of BBMP. The demand notice included charges such as Ground rent, GST on Ground rent, License fee, scrutiny fee, Betterment charges, security deposit, and various cesses and surcharges. The petitioners also sought a mandamus directing BBMP to issue a sanction plan without insisting on these charges.
Held
The Court noted that the core issue raised in the present writ petition was substantially covered by a coordinate bench's judgment in W.P.No.23086/2022 and connected matters. Following that judgment, the Court held that the Karnataka Municipal Corporations and Certain Other Law (Amendment) Acts of 2021 and 2023 are quashed and set aside. It was declared that 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 to development proposals on plots exceeding 20,000 square meters, not smaller plots. The Court also declared that if fee was already collected for change of land use or layout plan approval, no further fee should be collected for subsequent development plans, as per the 'Note' below TABLE I of Rule 37-A. The linkage of levies to market or guidance value under Section 45-B of the Karnataka Stamp Act was declared illegal, and consequently, all impugned circulars and demand notices were quashed. Clause 3.8 of the BBMP Building Bye-laws, 2003, concerning 'Ground Rent', was also struck down. The impugned demand notice dated 02.09.2021 (Annexure-D) was set aside. The 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 license and plan approval shall not be withheld due to any contemplation of appeal by BBMP, but will be subject to the outcome of any appeal filed.
Key Issues
1. Whether Section 18-A(i) and (iv) of the Karnataka Town and Country Planning Act, 1961, as amended by Karnataka Act No. 23 of 2004, are ultra vires and liable to be quashed? The petitioners argued that these provisions, along with inserted Rules 37-A and 37-C, are illegal and arbitrary, leading to the demand of various charges including GST on ground rent, which they contend is not permissible. They relied on the principle that GST is a tax on supply of goods and services, and ground rent, in this context, might not constitute a taxable supply or is being levied without proper legislative backing. 2. Whether the notifications and circulars issued by the State and BBMP, giving effect to Section 18-A and Rules 37-A and 37-C, are illegal and liable to be quashed? The petitioners contended that these subordinate legislations and administrative instructions are beyond the scope of the parent Act and Rules, and that the demand notice issued by BBMP demanding various fees and charges, including GST on ground rent, is without jurisdiction. The respondents, represented by the State and BBMP, would likely argue for the validity of the statutory provisions and the consequent notifications and demands, asserting that these are necessary for urban development and revenue generation.
Sections Cited
Section 18-A, Rule 37-A, Rule 37-C, Section 45-B
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Cause title — parties, addresses and appearances
ORAL ORDER
Caption petition is filed seeking the following reliefs :- "i) 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) as contained in (ANNEXURE-G1) insofar as Section 18-A(i) and (iv) of the Karnataka Act No. 23 of 2004 is concerned;
ii) 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 as contained in (ANNEXURE-G) insofar as the inserted Rule 37-A and 37-C is concerned;
iii) 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.4 (Annexure-H) in so far the Petitioners are concerned. HC-KAR NC: 2025:KHC:23240 iv) 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-J) insofar as the inserted Rule 37-A and 37-C is concerned;
v) 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.4 (Annexure-K) in so far the Petitioners are concerned.
vi) issue a writ or order by way of certiorari quashing the demand notice dated 02/09/2021, bearing No.BBMP/Ad.Com/BMH/1352/20-21, issued by the Respondent No.5 (Annexure-D) for demanding in so far it is concerned to Ground rent, GST on Ground rent, License fee, scrutiny fee, Betterment charges for building, Betterment charges 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, Labour cess and etc., as illegal, without juri iction and arbitrary.
vii) issue a writ or order or direction by way of mandamus directing the Respondent No.4 and 5 BBMP to issue the sanction plan for construction of HC-KAR NC: 2025:KHC:23240 the Building in the Schedule Property without insisting the Ground rent, GST on Ground rent, License fee, scrutiny fee, Betterment charges for building, Betterment charges 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, Labour cess and etc., and viii)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."
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). HC-KAR NC: 2025:KHC:23240 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 HC-KAR NC: 2025:KHC:23240 ‘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 Mahanagara Palike Building Bye- laws, 2003, providing for ‘Ground Rent’, is illegal and are accordingly quashed and set aside. (ix) Consequently, all the impugned Demand Notices raised by the respondent-BBMP, in respect of the writ petitioners herein are also quashed and set aside. It would be advisable that the BBMP may come out with a scheme for ‘One Time Settlement’ and settle the levy and collect the fee generally acceptable to the citizens of Bengaluru. This would also augment the present situation." HC-KAR NC: 2025:KHC:23240
In the present writ petition, the core issue raised stands substantially covered and decided by the authoritative pronouncement of the coordinate bench, wherein the writ petitions were partly allowed and several consequential reliefs were granted. The Hon’ble Court, in unequivocal terms, quashed and set aside the Karnataka Municipal Corporations and Certain Other Law (Amendment) Acts of 2021 and 2023 (Karnataka Act Nos.01 of 2022 and 37 of 2024 respectively).
The Court further declared that the provisions under 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 to development proposals concerning plots exceeding 20,000 square meters, and not to smaller plots. Importantly, it was also held that if a fee has been previously collected for change of land use or approval of layout plan, no further fee shall be levied for subsequent HC-KAR NC: 2025:KHC:23240 development plans, in view of the explanatory 'Note' to Table I of Rule 37-A.
The Court declared illegal the linkage of such levies to market or guidance value under Section 45-B of the Karnataka Stamp Act, and consequently, quashed all Circulars and demand notices issued to give effect to such unlawful interpretations. Clause 3.8 of the BBMP Building Bye-laws, 2003, imposing 'Ground Rent', was also struck down.
In view of these comprehensive declarations and findings, it is submitted that the controversy raised in the present writ petition no longer survives for adjudication independently, as it is squarely covered by the binding judgment of the coordinate bench. In the light of the law laid down in the reported judgment substantially covering the issue, which is raised in the captioned writ petition, the writ petition is liable to be allowed strictly aligning to the operative portion of the said writ petition. HC-KAR NC: 2025:KHC:23240
In view of the above, this Court proceeds to pass the following; ORDER (i) The writ petition is allowed. (ii) The impugned demand notice dated 02.09.2021 issued by respondent No.5 as per Annexure-D is hereby set-aside. (iii) Respondent- BBMP hereby directed to issue fresh/modified plan as the case may be. (iv) Respondent- BBMP is hereby directed to forthwith process the petitioner's 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 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 subjected to HC-KAR NC: 2025:KHC:23240 the outcome of any appeal that may be filed by the BBMP against the judgment.
Pending applications, if any, are also disposed off. (SACHIN SHANKAR MAGADUM) JUDGE
NG List No.: 2 Sl No.: 19
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