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Karnataka HC, Real Estate News, ET RealEstate

Karnataka HC, Real Estate News, ET RealEstate
BENGALURU: In a setback for Bruhat Bengaluru Mahanagara Palike, the Karnataka high court has termed the byelaws under which ground rent, licence fee, building licence fee, scrutiny fee and security deposit are sought to be levied “ultra vires of the Karnataka Municipal Corporation Act and unenforceable” and added that linking of levies to the guidance value has led to the “bleeding of citizens”.

Hundreds of property owners, apartment dwellers and builders had challenged the levy of fees based on byelaws.

“Even a rupee cannot be taken from a citizen as fee except in accordance with law,” Justice M Nagaprasanna has observed in his order, citing judgements of the Supreme Court and high courts, which say fees can be charged for services rendered for the benefit of individuals and that if no service is rendered, then such a fee would take the character of tax.

Petitioners entitled to refund: Court

Declining to accept the BBMP’s argument that the city and roads must be kept clean and the levies are valid since they go into the BBMP’s fund which is regulated under the Act, the Judge has said these are rendered “unsustainable” as the power for imposition of such levy is unavailable under the Act.

“Linking the impugned levies to the guidance value … has led to the bleeding of citizens. The (BBMP) argument is unacceptable,” the judge has observed, quashing BBMP’s September 4, 2015 circular on levy of fees.

The Judge has, however, added that the state government or the BBMP is not precluded from bringing levies under the Act or the rules by making suitable amendments.

The BBMP claimed it has power under Section 295 (1)(a) and (b) to make byelaws relating to buildings and the fees under challenge have been levied by exercising the power.

The judge has said petitioners who had deposited the demand amount as per interim orders of the court are entitled for a refund. Those who have paid to the BBMP must also get a refund. As far as all other payments are considered, citizens can approach BBMP, which can consider a refund as per the law and findings of the court in 12 weeks.

Lake fee circular quashed

The high court quashed the January 27, 2017 and March 30, 2017 circulars demanding lake rejuvenation fee and said only the planning authority – BDA – can levy fee under the Town and Country Planning Act.


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