Apex court upholds BDA right to levy charges

Apex court upholds BDA right to levy charges

The Supreme Court has upheld the right of the Bangalore Development Authority (BDA) to impose taxes and charge land allottees for the amenities provided to the residents of Bangalore Metropolitan Area.

A bench of Justices G S Singhvi and A K Ganguly set aside the judgment of the High Court of Karnataka, which had declared a particular provision of the BDA Act, 1976, as “violative of Article 14 (right to equality) of the Constitution, void and inoperative.”

The provision in question, Section 32 (5A), allowed BDA to sanction residential layout plans, seek deposits and levy various charges. “Under the 1976 Act, the BDA is obliged to provide different types of amenities to the population of the Bangalore Metropolitan Area, including the allottees of sites in layouts formed by house building societies.”

“It is quite possible that they may not be the direct beneficiaries of one or the other amenities made available by BDA, but this cannot detract from the fact that they will certainly benefit by the construction of the Outer Ring Road, Intermediate Ring Road, Mass Rapid Transport System, etc.

They will also be the ultimate beneficiaries of the Cauvery Scheme, because availability of an additional 270 MLD of water to Bangalore will enable Bangalore Water Supply and Sewerage Board (BWSSB) to spare water for the private layouts,” the court said.

Not unconstitutional

Thus, the charges demanded by BDA under Section 32(5A) cannot be termed as tax and declared unconstitutional, the apex court held.

The bench allowed the appeal filed by BDA against the HC’s verdict saying it was not possible to agree with the counsel representing the Aircraft Employees Cooperative Society Limited and others, that the Section conferred power on the BDA to demand an unspecified amount from those desirous of forming private layouts.

The court refused to go into the question of whether the charges demanded by BDA for contribution towards Cauvery Water Scheme, Ring Road and Mass Rapid Transport system, etc, were disproportionate, after noting that the State government has decided for the time being not to levy them.

It, however, said the State government would decide within three months whether the levy of supervision, improvement, examination and slum clearance development charges at the rates specified by BDA were excessive.