Smt R Bhagyalakshmi vs. The Bruhath Bangalore Mahanagara Palike
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The petitioner, Smt. R. Bhagyalakshmi, filed a writ petition challenging demand notices dated December 22, 2022, issued by the Assistant Director, Town Planning, South Zone, Bruhath Bangalore Mahanagara Palike (BBMP). These notices demanded payment towards ground rent (including GST) and labour cess. The petitioner sought to quash these demand notices. The court noted that the issue was previously dealt with by a coordinate bench in W.P. No. 23086/2022 and connected matters, which had set aside the Karnataka Municipal Corporations and Certain Other Law (Amendment) Acts of 2021 and 2023.
Held
The Court held that the present writ petition was substantially covered by the authoritative pronouncement of a coordinate bench in W.P. No. 23086/2022 and connected matters. The coordinate bench had quashed and set 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 on plots exceeding 20,000 square meters. 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, imposing 'Ground Rent', was also struck down. Therefore, the controversy in the present petition no longer survived independently. The Court allowed the writ petition, set aside the impugned demand notices, and directed the BBMP to issue a fresh sanction plan and process the petitioner's application for a building license strictly in accordance with law. The issuance of the license and plan 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 demand notices issued by the Assistant Director, Town Planning, BBMP, demanding payment of ground rent (including GST) and labour cess are liable to be quashed? This issue turns on the validity of the Karnataka Municipal Corporations and Certain Other Law (Amendment) Acts of 2021 and 2023, and the applicability of 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, and Clause 3.8 of the Bengaluru Mahanagara Palike Building Bye-laws, 2003. Petitioner's Contention: The petitioner argued that the demand notices should be quashed, relying on the judgment of a coordinate bench that had set aside the relevant amendment acts and declared certain provisions and bye-laws illegal. Respondents' Contention: The respondents (BBMP and State of Karnataka) did not present separate arguments but were bound by the previous judgment of the coordinate bench.
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 petitioner is seeking for the following reliefs. HC-KAR NC: 2025:KHC:20513 "a) Issue a Writ of Certiorari or any other appropriate Writ of like nature, or direction, quashing the Demand Notices dated 22-12-2022 bearing Nos. BBMP/EoDB/CH/42430/22-23 and BBMP/EoDB/CH/42431 /22-23, both issued by the Respondent No.3 demanding payment towards Ground Rent (including GST) and Labour cess amount and other additional charges and levies at ANNEXURE-A and B.
b) Grant such other and further relief/s as this Hon'ble Court deems fit in the facts and circumstances of the case in the interests 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; HC-KAR NC: 2025:KHC:20513 "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 ‘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 HC-KAR NC: 2025:KHC:20513 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."
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 HC-KAR NC: 2025:KHC:20513 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 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 HC-KAR NC: 2025:KHC:20513 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.
In view of the above, this Court proceeds to pass the following; ORDER (i) The writ petition is allowed. HC-KAR NC: 2025:KHC:20513 (ii) The impugned demand notices dated 22.12.2022 issued by respondent No.3 as per Annexures-A and B are hereby set-aside.
(iii) Respondent Nos.1 and 3 - BBMP are hereby directed to issue fresh sanction plan.
(iv) Respondent Nos.1 and 3 - BBMP are 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 the outcome of any appeal HC-KAR NC: 2025:KHC:20513 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.: 9
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.