Manipal Academy Of Higher Education Turst vs. State Of Karnataka
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The petitioners, Manipal Academy of Higher Education Trust and Manipal Academy of Higher Education, challenged a demand challan dated 13.07.2021 issued by the Joint Director (Town Planning North), Bruhat Bengaluru Mahanagara Palike (BBMP). The challan demanded various fees including scrutiny fee, license fee, ground rent and GST, betterment fee, and security deposit. The petitioners also challenged a circular dated 14.08.2020 issued by the BBMP, provisions of Section 18-A of the Karnataka Town and Country Planning Act, 1961, and a notification dated 25.02.2020 concerning amended rules. The core of the dispute revolved around the legality and quantum of these demands, particularly those related to development and building permissions.
Held
The Court noted that the core issues raised in the present writ petition were substantially covered and decided by a coordinate bench in a reported judgment (W.P.No.23086/2022 and connected matters). The coordinate bench had partly allowed the writ petitions, quashing and setting aside the Karnataka Municipal Corporations and Certain Other Law (Amendment) Acts of 2021 and 2023. 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, were applicable only to development proposals for plots exceeding 20,000 square meters. The coordinate bench also held that if fees were previously collected for change of land use or layout plan approval, no further fee should be levied for subsequent development plans. The linkage of levies to market or guidance value under Section 45-B of the Karnataka Stamp Act was declared illegal, and all impugned circulars and demand notices were quashed. Clause 3.8 of the BBMP Building Bye-laws, 2003, imposing 'Ground Rent', was also struck down. Consequently, the present writ petition was allowed, the impugned demand notice was set aside, and the respondents were directed to issue a fresh/modified plan and process the application for building license and plan sanction strictly in accordance with law. The issuance of the license and plan approval was not to be withheld due to any contemplation of appeal by the BBMP, but would be subject to the outcome of any such appeal.
Key Issues
1. Whether the demand challan dated 13.07.2021, issued by the Joint Director (Town Planning North), BBMP, demanding various fees including scrutiny fee, license fee, ground rent and GST, betterment fee, and security deposit, is legal and valid? (Question of law and fact, concerning the interpretation and application of various statutory provisions and rules). 2. Whether the circular bearing No.He.Ka.Pa.Ko/P.R/320/2020-21 dated 14.08.2020 issued by the BBMP is legal and valid? (Question of law, concerning the authority and scope of the circular). 3. Whether the provisions of Section 18-A of the Karnataka Town and Country Planning Act, 1961, as brought into effect by Karnataka Act No.23 of 2004, are constitutional and legally applicable to the petitioners? (Question of constitutional law and statutory interpretation). 4. Whether the notification dated 25.02.2020, insofar as it amended Rule 37-A and Rule 37-C of the Karnataka Planning Authority Rules, 1965, is legal and valid? (Question of law, concerning delegated legislation and procedural fairness). 5. Whether Bye-law No.3.9 in the Bangalore Mahanagara Palike Building Bye-laws, 2003, providing for 'Ground Rent', is unconstitutional, arbitrary, illegal, and ultravires? (Question of constitutional law and statutory interpretation). Petitioner's arguments: The petitioners sought to quash the demand challan, circular, statutory provisions, and bye-laws, arguing they were illegal, arbitrary, and unconstitutional. They sought directions to issue building plan and license without insisting on the disputed payments. Revenue/State's arguments: The judgment does not explicitly record arguments from the respondents. However, the existence of the demand challan and the challenged provisions implies their defense of the legality of these demands and enactments.
Sections Cited
Section 18-A, Rule 37-A, Rule 37-C, Section 45-B, Bye-law No.3.9
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORAL ORDER The captioned petition is filed seeking the following reliefs: i) issue a writ of certiorari or similar writ or order or direction to quash the demand challan No.BBMP/EoBD/CH/8419/21-22, File No.PRJ/ 0067/ 20-21 dated 13.07.20221 at ANNEXURE-J issued by the respondent No.3 in so far as the demand of Rs.2,12,053/- towards Scrutiny Fee, Rs.42,41,059/- towards License Fee, Rs.39,32,068/- towards Ground Rent and GST, Rs.30,29,328/- towards betterment fee as per Rule 37-A(1) of KPA (Amendment) Rules 2019, Rs.30,29,328/- towards security deposit; ii) Issue a writ of certiorari or similar writ or order or direction to quash the Circular bearing No.He.Ka.Pa.Ko/P.R/320/2020-21 dated 14.08.2020 at Annexure-K issued by the 2nd respondent. iii) issue a writ of certiorari or similar writ or order or direction to quash provisions of Section18-A of Karnataka Town and Country Planning Act, 1961 brought into effect by Karnataka Act No.23 of 2004 by the 1st respondent at Annexure-L in so far as 18- HC-KAR NC: 2025:KHC:20957 A(i) and (iv) of Karnataka Act No.23 of 2004 is concerned. iv) 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-M insofar as the amended Rule 37-A and Rule 37-C are concerned; v) Issue a writ of Mandamus or any other appropriate writ or order or direction declaring that Bye-law No.3.9 in the Bangalore Mahanagara Palike Building Bye-laws, 2003 framed under the Karnataka Municipal Corporations Act as unconstitutional, arbitrary, illegal and ultravires; vi) Issue writ of Mandamus or similar writ or order or direction directing the respondent Nos.2 and 3 to issue building plan and license pursuant to the demand challan No.BBMP/EoBD/CH/8419/20-21, File No.PRJ/0067/20-21 dated 13.07.2021 at Annexure- J issued by the respondent No.3 without insisting for payment of demands stated above. vii) Issue any other appropriate writ or order or direction deemed fit in the circumstances of the case in the interest of justice and equity. HC-KAR NC: 2025:KHC:20957
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 HC-KAR NC: 2025:KHC:20957 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 Mahanagara Palike Building Bye- laws, 2003, HC-KAR NC: 2025:KHC:20957 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."
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 HC-KAR NC: 2025:KHC:20957 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 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 HC-KAR NC: 2025:KHC:20957 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.
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 13.07.2021 issued by respondent No.3 as per Annexure-J is hereby set-aside. (iii) Respondent Nos.2 and 3 are hereby directed to issue fresh/modified plan as the case may be. (iv) Respondent Nos.2 and 3 are hereby directed to forthwith process the petitioner's application seeking building HC-KAR NC: 2025:KHC:20957 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 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
KLY List No.: 2 Sl No.: 27
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.