B G Vasudeva vs. The State Of Karnataka
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The petitioners, represented by their General Power of Attorney holder, Concorde Housing Corporation Pvt Ltd, filed a writ petition challenging the Karnataka Municipal Corporations and Certain Other Law (Amendment) Act, 2021 (Karnataka Act No. 01 of 2022). They also sought to quash an office order and a demand notice issued by the Bruhat Bengaluru Mahanagara Palike (BBMP). The demand notice, dated July 29, 2024, included fees for ground rent with GST, scrutiny fee, and license fee. The petitioners sought a declaration that the Amendment Act was ultra vires the Constitution and prayed for the issuance of an occupancy certificate without insistence on the disputed fees.
Held
The Court held that the core issue in the present writ petition was substantially covered by a coordinate bench's judgment in W.P.No.23086/2022 and connected matters. Consequently, the Court quashed and 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). 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, apply only to development plans for plots exceeding 20,000 square meters. The linkage of fees to market or guidance value was declared illegal. Clause 3.8 of the BBMP Building Bye-laws, 2003, concerning 'Ground Rent', was also struck down. The impugned demand notice dated July 29, 2024, was set aside. The BBMP was directed to issue the Occupancy Certificate in accordance with law, strictly adhering to the approved building plan, and to process the application forthwith. The issuance of the occupancy certificate was not to be withheld pending any appeal by the BBMP, but would be subject to the outcome of such an appeal.
Key Issues
1. Whether 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) are ultra vires the Constitution, as contended by the petitioners. The petitioners argued that these acts, along with related rules and bye-laws, imposed illegal and unconstitutional fees. 2. Whether the demand notice dated July 29, 2024, issued by the BBMP, which includes fees such as ground rent with GST, scrutiny fee, and license fee, is legally sustainable. The petitioners argued that these fees were levied based on an unconstitutional amendment and an illegal linkage to market/guidance value. 3. Whether the petitioners are entitled to an occupancy certificate without payment of the disputed fees. The respondents did not appear to have made specific arguments on these issues, as the court relied on a coordinate bench's judgment.
Sections Cited
Section 18-A, Rule 37-A, Rule 37-C, Section 45-B, Clause 3.8
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORAL ORDER The petitioners are seeking for the following reliefs.
"a. 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 as contained in ANNEXURE-E as being ultra vires the Constitution.
b. grant an order, direction or writ in the nature of certiorari quashing the Office Order No. HaNiNaYo/PR/461/2021-22 dated 09/03/2022 issued by Respondent No. 2 as contained in ANNEXURE-G.
c. grant an order, direction or writ in the nature of mandamus directing the Respondent Nos. 2 to issue occupancy certificate to the Petitioner without insistence of the fees specified at Sl. No. 2 (i.e., ground rent with GST), Sl. No. 3 (i.e., Scrutiny Fee), Sl. No. 4 (i.e., License Fee) of the Calculation Sheet in demand notice bearing no. BBMP/Addl.Dir/JD SOUTH/0234/17-18 dated 29/07/2024, as contained in ANNEXURE-H.
d. grant an order, direction or writ in the nature of Mandamus, directing the Respondents to issue the Occupancy Certificate with respect to the Schedule Property to the Petitioner without insisting for payment of amounts demanded in the impugned demand notice. HC-KAR NC: 2025:KHC:20502 e. grant an order, direction or declare that the various fees levied on the basis of the guidance value of the property are all bad in law and unconstitutional; and
f. grant such other relief or reliefs as this Hon'ble Court may deem fit to grant, including cost of the Petitioner, 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). 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. HC-KAR NC: 2025:KHC:20502 (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 ‘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 HC-KAR NC: 2025:KHC:20502 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."
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 HC-KAR NC: 2025:KHC:20502 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 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 HC-KAR NC: 2025:KHC:20502 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.
In view of the above, this Court proceeds to pass the following; ORDER (i) The writ petition is allowed. HC-KAR NC: 2025:KHC:20502 (ii) The impugned demand notice dated 29.07.2024 issued by respondent No.3 as per Annexure-H is hereby set-aside. (iii) Respondent Nos.2 and 3 is hereby directed to issue Occupancy Certificate in accordance with law in compliance of the construction strictly adhering to the approved building plan. (iv) Respondent Nos.2 and 3 are hereby 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 occupancy certificate 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:20502 (vi) If the occupancy certificate is 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
NBM List No.: 2 Sl No.: 19
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