Can't Levy Betterment Charges Under Town Planning Act For Mere 'Alterations' To Existing Building: Karnataka HC Grants Relief To 150-Yrs Old School

A single judge bench of Justice M Nagaprasanna allowed the petition filed by Good Shepherd Convent and quashed the order dated 07-07-2014 issued by the corporation demanding an amount of Rs Rs.69,70,520.

Case Details:

The petitioner-school, established in the year 1854, is situated in about 23 acres land in the heart of the city. Owing to increase in number of students and necessity for creation of few more class rooms, an application was made to BBMP in June 2014, seeking building licence for construction of additional four floors on the existing school campus. In reply, a demand of Rs.69,70,520/- was raised by the BBMP towards betterment charges.

Senior Advocate D.L.N.Rao appearing for the petitioner contended that the building was constructed about 100 years ago with all the necessary payments made thereon at that point of time. Further, betterment charges under Section 18 or 18A of the Karnataka Town and Country Planning Act would become payable only when change of land use is sought or the land is being developed for the first time. Both these instances are absent in the case at hand.

Advocate K.N.Putte Gowda for BBMP submitted that the petitioner, right from the date on which the Act came into existence, has not even applied for any licence or paid any betterment fee. None of the statutory fee was paid by the petitioner on the ground that it is a very old institution and all fees that were necessary to be paid earlier have been paid. He added that Section 18A of the KTCP Act empowers the BBMP to demand betterment charges and no fault can be found with the demand that is raised by the BBMP.

Court findings:

The bench noted Section 18A (of KTCP Act) empowers the BBMP, while granting permission for development of land or building, to levy and collect from the owner of such building, a cess for carrying out water supply scheme; surcharge for formation of ring road; cess for the purpose of improving slums and surcharge for the purpose of establishing Mass Rapid Transport System.

It observed, "The permission sought should be for development of land or building. The application of the petitioner was unequivocal for alteration and addition of four floors on the existing building."

It noted that the petitioner had nowhere applied for change of land use, for the BBMP to demand betterment fee/charge by taking recourse to Section 18(1) of the Act.

The court then opined, "The petitioner has not applied for change of land use, but has in its application clearly spelt out, in the nature of sanction that is sought for, as 'addition and alteration'. There is no application even made under Section 14A of the Act."

It then held ,"Therefore, a conjoint reading of Section 505 of the KMC Act 1976, sections 18 and 18A of the KTCP Act and the Rules would lead to an unmistakable inference that the demand made by the BBMP runs counter to law."

Further it said, "The submission of the learned counsel for the BBMP that the petitioner which is established long ago has not applied for any such sanction or has paid any betterment fee and the BBMP has no other alternative except to raise a demand under Section 18A of the KTCP Act read with Rule 37A of the Rules sans countenance, as charge or fee or imposition of any impost in law can only be in accordance with law. If there is no provision to charge a fee there can be no demand and if there is no provision for imposition of impost, there can be no impost, is the settled principle of law."

The court clarified that, "This would not preclude the BBMP in inspecting the property and raising any demand strictly in consonance with law."

Appearance: Senior Advocate D.L.N.RAO, a/w Advocate ANIRUDH ANAND, for petitioner. Advocate NITHYANANDA K.R., HCGP FOR R1. Advocate K.N.PUTTEGOWDA, FOR R2 AND R3.

Case Title: GOOD SHEPHERD CONVENT v STATE OF KARNATAKA and Others

Case No: WRIT PETITION No.47882 OF 2014 (LB-BMP)

Citation: 2022 LiveLaw (Kar) 163

Date of Order: 10TH DAY OF MAY, 2022

Click Here To Read/Download Order