M/S Midas Developers vs. State Of Karnataka
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The petitioner, M/s. Midas Developers, filed a writ petition challenging a demand notice dated November 12, 2020, issued by the Joint Director, Town Planning (North), Bruhat Bangalore Mahanagara Palike (BBMP). The demand notice included various charges such as scrutiny fee, license fee, ground rent and GST, betterment fee, security deposit, labour cess, and contributions towards water supply schemes, ring road, slum improvement, and mass rapid transport system. The petitioner sought to quash these demands and declare Bye-law No. 3.9 of the Bangalore Mahanagara Palike Building Bye-laws, 2003, as unconstitutional. The petition also challenged specific government orders and provisions of the Karnataka Town and Country Planning Act, 1961, and related rules concerning the collection of fees and charges.
Held
The Court allowed the writ petition. It held that the issues raised in the present petition are squarely covered by binding decisions of co-ordinate benches in previous writ petitions, specifically "M/s Sapthagiri Shelters" and "Sunderam Shetty". In "Sunderam Shetty", the levies of Ground Rent, License Fee, Building License Fee, and Scrutiny Fee under the 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 Clause 3.8 of the BBMP Building Bye-laws, 2003, pertaining to Ground Rent, was declared invalid. Consequently, the impugned demand notice (Annexure-D) was set aside. The BBMP was directed to issue a fresh/modified plan and forthwith process the petitioner's application for building license and plan sanction strictly in accordance with law. The issuance of the license and plan approval shall not be withheld due to the BBMP contemplating an appeal, but will be subject to the outcome of any such appeal.
Key Issues
1. Whether the demand notice dated November 12, 2020, issued by the respondent No. 4, demanding various fees and charges including scrutiny fee, license fee, ground rent and GST, betterment fee, security deposit, labour cess, and contributions towards infrastructure schemes, is legal and valid, particularly in light of Bye-law No. 3.9 of the Bangalore Mahanagara Palike Building Bye-laws, 2003, and provisions of the Karnataka Town and Country Planning Act, 1961, and related rules? (Question of law and mixed law and fact, turning on Bye-law 3.9, Section 18-A of the Karnataka Town and Country Planning Act, 1961, and Rule 37-A and 37-C of the Karnataka Planning Authority Rules, 1965). Petitioner's Contention: The petitioner argued that the demand notice is illegal and arbitrary, and sought to quash it. They also contended that Bye-law No. 3.9, certain government orders, and provisions of the Karnataka Town and Country Planning Act and related rules are unconstitutional, arbitrary, illegal, and ultra vires. Revenue/State's Contention: The judgment does not record specific arguments made by the respondents.
Sections Cited
Section 18-A, Rule 37-A, Rule 37-C
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 notice No.1 dated nil signed on 12.11.2020 at Annexure-D issued by the respondent No.4 only in so far as the demand of Rs. 16,71,618/- towards scrutiny Fee, Rs.3,34,32,366/- towards License Fee, Rs.3,09,96,579/- towards the ground rent & GST, Rs.27,69,047/- towards Betterment fee for building, Rs.3,78,00,156/- towards betterment fee on site area, Rs.27,69,047/- towards security deposit, Rs.41,49,000/-towards Labour cess, surcharge of Rs.47,88,020/- towards water supply scheme (BWSSB), Rs.47,88,020/- towards Ring Road(BDA), Rs.23,94,010/- towards improving slums (KSCB), Rs. 1,19,70,049/- towards Mass Rapid Transport System(BDA), are concerned;
ii) Issue a writ of Mandamus or any other appropriate writ of order or direction declaring that Bye-law No.3.9 in the Bangalore Mahanagara Palike Building Bye-laws, 2003 as unconstitutional, arbitrary, illegal and ultravires;
iii) Issue Writ of Certiorari quashing the Government Order issued by the 2nd Respondent bearing G.O.No.LD 300 LET 2006 dated 18.01.2007 and the corrigendum bearing No. LD 300 LET 2006 dated 28.02.2007 directing upfront collection of labour welfare cess, as contained in ANNEXURE - E.
iv) Issue a writ of certiorari or similar writ or order or direction to quash provisions of section 18-A of Karnataka Town and Country Planning Act, 1961 brought into effect by Karnataka Act No.23 of HC-KAR NC: 2025:KHC:21110 2004 by the 1™ Respondent at Annexure-G in so far as 18-A(i) and (iv) of 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 TPP 2015dated 25.02.2020 as contained in ANNEXURE-H in so far as the amended Rule 37-A and Rule 37-C are concerned;
vi) Issue writ of mandamus or similar writ or order or direction directing the respondent Nos. 3 and 4 to issue building plan and license pursuant to the demand notice No.1 dated nil signed on 12.11.2020 at Annexure -D respondent No.4 without insisting for payment of aforesaid demands. issued by the vii) Issue any other appropriate writ or order or direction as deemed fit in the 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 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 HC-KAR NC: 2025:KHC:21110 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.
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 HC-KAR NC: 2025:KHC:21110 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 issued by respondent No.4 as per Annexure-D is hereby set-aside. (iii) Respondent - BBMP is hereby directed to issue fresh/modified plan as the case may be. (iv) Respondent - BBMP is 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 of the plan shall not be withheld merely on the ground that the BBMP is contemplating to file an appeal against the reported judgment. HC-KAR NC: 2025:KHC:21110 (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
DH List No.: 2 Sl No.: 2
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