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TMI Blog2012 (1) TMI 334X X X X Extracts X X X X X X X X Extracts X X X X ..... development and for the making and execution of town planning schemes. Therefore, the State Legislature enacted the Mysore Town and Country Planning Act, 1961 (for short, 'the Town Planning Act'). The objectives of that Act were : (i) to create conditions favourable for planning and replanning of the urban and rural areas in the State of Mysore, with a view to providing full civic and social amenities for the people in the State; (ii) to stop uncontrolled development of land due to land speculation and profiteering in land; (iii) to preserve and improve existing recreational facilities and other amenities contributing towards balanced use of land; and (iv) to direct the future growth of populated areas in the State, with a view to ensuring desirable standards of environmental health and hygiene, and creating facilities for the orderly growth of industry and commerce, thereby promoting general standards of living in the State. 3. The State of Mysore was renamed Karnataka in 1973. Thereupon, necessary consequential changes were made in the nomenclature of various enactments including the Town Planning Act. 4. Section 4 of the Town Planning Act envisages constitution of a State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e date of commencement of this Act, prepare and publish in the prescribed manner an outline development plan for such area and submit it to the State Government, through the Director, for provisional approval: Provided that on application made by a Planning Authority, the State Government may from time to time by order, extend the aforesaid period by such periods as it thinks fit. 12. Contents of Outline Development Plan.-(1) An outline development plan shall generally indicate the manner in which the development and improvement of the entire planning area within the jurisdiction of the Planning Authority are to be carried out and regulated. In particular it shall include,- (a) a general land-use plan and zoning of land-use for residential, commercial, industrial, agricultural, recreational, educational and other public purposes; (b) proposals for roads and highways; (c) proposals for the reservation of land for the purposes of the Union, any State, any local authority or any other authority established by law in India; (d) proposals for declaring certain areas as areas of special control, development in such areas being subject to such regulations as may be made in regard to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich these responsibilities are proposed to be met. 26. Making of town planning scheme and its contents.-(1) Subject to the provisions of this Act, a Planning Authority, for the purpose of implementing the proposals in the Comprehensive Development Plan published under sub-section (4) of section 22, may make one or more town planning schemes for the area within its jurisdiction or any part thereof. (2) Such town planning scheme may make provisions for any of the following matters namely,- (a) the laying out or re-laying out of land, either vacant or already built upon; (b) the filling up or reclamation of low-lying, swamp or unhealthy areas or levelling up of land; (c) lay-out of new streets or roads; construction, diversion, extension, alteration, improvement and stopping up of streets, roads and communications; (d) the construction, alteration and removal of buildings, bridges and other structures; (e) the allotment or reservation of land for roads, open spaces, gardens, recreation grounds, schools, markets, green belts and dairies, transport facilities and public purposes of all kinds; (f) drainage inclusive of sewerage, surface or sub-soil drainage and sewage disposal; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the 1976 Act. Simultaneously, Section 81-B was inserted in the Town Planning Act for deemed dissolution of the City Planning Authority in relation to the area falling within the jurisdiction of the BDA. The preamble of the 1976 Act and the definitions of "Authority", "Amenity", "Civic amenity", "Bangalore Metropolitan Area", "Development", "Engineering operations", "Local Authority", "Means of access" contained in Section 2 thereof are reproduced below: "An Act to provide for the establishment of a Development Authority for the development of the City of Bangalore and areas adjacent thereto and for matters connected therewith 2. Definitions.- In this Act, unless the context otherwise requires,- (a) "Authority" means the Bangalore Development Authority constituted under section 3; (b) "Amenity" includes road, street, lighting, drainage, public works and such other conveniences as the Government may, by notification, specify to be an amenity for the purposes of this Act; (bb) "Civic amenity" means,- (i) a market, a post office, a telephone exchange, a bank, a fair price shop, a milk booth, a school, a dispensary, a hospital, a pathological laboratory, a maternity home, a child ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmoveable property, whether within or outside the area under its jurisdiction, to carry out building, engineering and other operations and generally to do all things necessary or expedient for the purposes of such development and for purposes incidental thereto. 15. Power of Authority to undertake works and incur expenditure for development, etc.- (1) The Authority may,- (a) draw up detailed schemes (hereinafter referred to as "development scheme") for the development of the Bangalore Metropolitan Area ; and (b) with the previous approval of the Government, undertake from time to time any works for the development of the Bangalore Metropolitan Area and incur expenditure therefor and also for the framing and execution of development schemes. (2) The Authority may also from time to time make and take up any new or additional development schemes,- (i) on its own initiative, if satisfied of the sufficiency of its resources, or (ii) on the recommendation of the local authority if the local authority places at the disposal of the Authority the necessary funds for framing and carrying out any scheme; or (iii) otherwise. (3) Notwithstanding anything in this Act or in any other law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of this section "property tax" means a tax simpliciter requiring no service at all and not in the nature of fee inquiring service. 28-C. Authority is deemed to be a Local Authority for levy of cesses under certain Acts.- Notwithstanding anything contained in any law for the time being force the Authority shall be deemed to be a local authority for the purpose of levy and collection of,- (i) education cess under sections 16.17 and 17A of the Karnataka Compulsory Primary Education Act, 1961 (Karnataka Act 9 of 1961); (ii) health cess under sections 3,4 and 4A of the Karnataka Health Cess Act, 1962 (Karnataka Act 28 of 1962); (iii) library cess under section 30 of the Karnataka Public Libraries Act, 1965 (Karnataka Act 10 of 1965); and (iv) beggary cess under section 31 of the Karnataka Prohibition of Beggary Act, 1975 (Karnataka Act 27 of 1975). 32. Forming of new extensions or layouts or making new private streets.- (1) Notwithstanding anything to the contrary in any law for the time being in force, no person shall form or attempt to form any extension or layout for the purpose of constructing buildings thereon without the express sanction in writing of the Authority and exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore sanctioning the application such further sums in addition to the sums referred to in the sub-section (5) to meet such portion of the expenditure as the Authority may determine towards the execution of any scheme or work for augmenting water supply, electricity, roads, transportation and such other amenities within the Bangalore Metropolitan Area. 65. Government's power to give directions to the Authority.- The Government may give such directions to the Authority as in its opinion are necessary or expedient for carrying out the purposes of this Act, and it shall be the duty of the Authority to comply with such directions. 65-B. Submission of copies of resolution and Government's power to cancel the resolution or order.- (1) The Commissioner shall submit to the Government copies of all resolutions of the Authority. (2) If the Government is of opinion that the execution of any resolution or order issued by or on behalf of the Authority or the doing of any act which is about to be done or is being done by or on behalf of the Authority is in contravention of or in excess of the powers conferred by this Act or any other law for the time being in force or is likely to lead to a b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the power vested in it under Section 4-A(1) of the Town Planning Act, the State Government issued Notifications dated 1.11.1965 and 13.3.1984 declaring the areas specified therein to be the "Local Planning Areas". By the first notification, the State Government declared the area comprising the city of Bangalore and 218 villages enumerated in Schedule I thereto to be the "Local Planning Area" for the purposes of the Town Planning Act and described it as the Bangalore City Planning Area. The limits of the planning area were described in Schedule II appended to the notification. By the second notification, the area comprising 325 villages around Bangalore (as mentioned in Schedule I) was declared to be the Local Planning Area for the environs of Bangalore. The limits of the city planning area were indicated in Schedule II. At the end of Schedule II of the second notification, the following note was added: "This excludes the Bangalore City Local Planning Area declared (by) Government Notification No. PLN/42/MNP/65/SO/3446 dated 1-11-1965." 8. A third notification was issued on 6.4.1984 under Section 4- A(3) of the Town Planning Act amalgamating the Local Planning Areas of Bangalore d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the State and it was decided that with a view to avoid escalation in the cost, the funds may be collected from other sources including the BDA because substantial quantity of water was required for the layouts which were being developed by it or likely to be developed in future. In furtherance of that decision, the State Government issued order dated 25.03.1987 and directed the BDA to make a grant of ₹ 30 crores to BWSSB to be paid in installments from 1987-88 to 1989-90 by loading an extra amount as water supply component at the rate of ₹ 10,000/- on an average per site for all the layouts to be formed thereafter. 13.In compliance of the directions given by the State Government, the BDA started collecting ₹ 10,000/- per site. Later on, the levy under the Cauvery Scheme was increased to ₹ 1 lac per acre. By 1992, it was realised that the BDA had not been able to develop and distribute sites as expected. Therefore, a proposal was submitted by the Commissioner, BDA to the State Government that contribution towards the Cauvery Scheme may be distributed among those applying for change of land use and the private layouts to be developed by the house building ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12.11.1992. 16.The respondent challenged the conditional sanction of its layout in Writ Petition No.11144/1993 and prayed for quashing the demand of ₹ 2 lacs per acre towards the Cauvery Scheme and ₹ 1 lac as Ring Road surcharge by making the following assertions: (i) The order passed by the State Government was applicable only to the sites to be formed by the BDA and not the layout of private House Building Societies because as per the Chairman of BWSSB, it will not be possible to take up the responsibility of providing water supply and underground drainage to such layouts and the societies had to make their own arrangements. (ii) The Cauvery Scheme will be able to meet the requirements of only the citizens residing within the municipal area and some newly formed layouts adjacent to the city. (iii) There is no provision in the Bangalore Water Supply and Sewerage Act, 1964 (for short, 'the 1964 Act') under which the burden of capital required for the execution of schemes could be passed on to the private House Building Societies and, in any case, the BWSSB can recover the cost by resorting to Section 16 of the 1964 Act. (iv) Under the 1976 Act, the Government is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,14,876.00 (0-50 per sq. mtrs.) (iv) Slum Clearance Development ₹ 20,74, 365.00 Charges (Rs. 25,000 per hectare) (v) M.R.T.S. Tax ₹ 1,02,51, 875.00 (Rs. 50,000 per acre) (vi) Miscellaneous ₹ 7,189.00 20.The respondent challenged the conditional approval of civil work in Writ Petition No. 25833/1998 on the ground that the 1976 Act does not authorize such levies and that the legislature has not laid down any guideline for creating such demand from the private House Building Societies. An additional plea taken by the respondent was that the BDA has applied the provisions of Section 32 of the 1976 Act under a mistaken impression that the layout was within its jurisdiction. According to the respondent, no notification had been issued by the State Government for including the villages of North and South Talukas within the Bangalore Metropolitan Area. Another plea taken by the respondent was that the State Government has already collected conversion fine and, as such, the BDA does not have the jurisdiction to levy betterment fee. Similar plea was raised in respect of Mass Rapid Transport System Cess and the Slum Clearance charges. 21.The other House Building Coop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he societies had formed layouts cannot be treated as part of the Bangalore Metropolitan Area. The Division Bench referred to the definition of the expression "Bangalore Metropolitan Area" contained in Section 2(c) of the 1976 Act, the contents of Notification dated 1.3.1988 and held that the description of the area given in the notification was in consonance with the definition of the Bangalore Metropolitan Area because reference had been made to the villages in Schedule I to Notification dated 13.3.1984 and the boundaries of the planning environs area as per Schedule II of the said notification. The Division Bench opined that if Notifications dated 13.3.1984 and 1.3.1988 are read together, it cannot be said that the particular villages do not form part of the Bangalore Metropolitan Area. 24.The Division Bench did not decide the plea of the respondents that some of the villages were not included in the Schedules by observing that determination of this question involves investigation into a question of fact and this can be considered at the time of approval of the layout plan of the particular society. 25.The argument that while dealing with the issue raised in Writ Petition No.13 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the ratio in Ram Krishna Dalmia v. Shri Justice S.R. Tendolkar and Ors. AIR 1958 SC 538, Jyoti Pershad v. The Administrator for The Union Territory of Delhi, AIR 1961 SC 1602; Devi Das Gopal Krishnan v. State of Punjab, AIR 1967 SC 1895, State of Kerala v. M/s. Travancore Chemicals and Manufacturing Company (1998) 8 SCC 188 and observed: "In the present case, sub-section (5-A) of Section 32 of the Act, does not appear to provide any guidelines so as to determine as to what exact portion of the expenditure should the applicant be required to deposit. No doubt, the entire expenditure cannot be fastened on the applicant. It does not provide any guidelines in this regard. It does not provide the portion of the amount the applicant maybe required to deposit shall bear any percentage on the basis of enjoyment of the benefit by the applicant or the applicant likely to enjoy the benefit qua enjoyment by total area or its population. It also does not provide that the applicant before being required to pay will have opportunity of disputing that claim and challenging the correctness of the portion proposed by the authority to be fastened on him. Really the section appears to confer unbrid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tement made by Shri Dave, the Court directed the Commissioner and/or Secretary of the BDA to file a detailed and specific affidavit giving the particulars of contribution made by the BDA towards the Cauvery Scheme and the amount demanded and/or collected from those who applied for sanction of the private layouts as also the allottees of the sites in the BDA layouts. In compliance of the Court's direction, Shri Siddaiah, the then Commissioner, BDA, filed affidavit dated 11.11.2009, paragraphs 2 to 5 of which are extracted below: "2. The Government of Karnataka formed the Cauvery Water IIIrd Stage Scheme in 1984. However, the Government directed the Bangalore Development Authority to contribute Rs. Thirty crores towards the Cauvery Water IIIrd Stage Scheme by its order No. HUD 97 MNI 81, Bangalore dated 25th March, 1987. The Bangalore Development Authority started collecting Cauvery Water Cess from 1988. However, the Government by its order No. UDD 151 Bem.Aa.Se 2005, dated 03.05.2005 directed the Bangalore Development Authority to stop collection of the Cauvery Water Cess and Ring RoadCess and MRTS Cess. A copy of the order of the Government Order dated 03.05.2005 directing not col ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thority would collect about 300 crores are speculative. It is submitted with respect after the directions of the Government in 2005, all the above collections have been stopped. Hence, this affidavit. BANGALORE DEVELOPMENT AUTHORITY BANGALORE THE COLLECTION OF CAUVERY WATER CESS & PAID TO BWSSB AS MENTIONED BELOW (INR in Lakh) SL NO CHEQUE NO. DATE AMOUNT 1 FROM FEB 1988 TO APRIL 1992 2,130.00 2 705908 02.11.1996 150.00 3 718093 21.01.1997 100.00 4 737303 15.03.1997 100.00 5 753086 06.07.1997 100.00 6 756449 30.12.1997 150.00 7 650002 18.03.1998 50.00 8 759664 20.07.1998 50.00 9 502441 22.01.1999 50.00 10 769862 15.09.1999 75.00 11 653066 04.06.2005 500.00 TOTAL 3,455.00 (Rupees Thirty Four Crores and Fifty Five Lakh) Sd/- Accounts Officer BDA, Bangalore ANNEXURE-II YEAR WISE RING ROAD CESS (INR in Lakh) YEAR COLLECTIONS CHARGED TO RING ROAD EXPEND. BALANCE 1992-93 (Feb 93 on wards) 63.39 63.39 - 1993 -94 183.89 183.89 - 1994-95 217.87 217.87 - 1995-96 331.14 331.14 - 1996-97 162.08 162.08 - 1997-98 180.79 180.79 - 1988-99 84.23 84.23 - 1999-00 50.49 50.49 - 2000-01 19.48 19.48 - 2001 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government order dated 25.03.1987 the BDA was empowered to levy and collect amount towards the Cauvery Water Supply Scheme also from the Applicants who apply for change in land use and for formation of Group Housing/other major developments and for formation of Private Layouts. The BDA has not disclosed the details of such Applicants or the amount recovered from them in terms of the Government order dated 25.03.1987. 4. I say that in the affidavit under reply the BDA has stated that it has approved layouts involving about an extent of 5668 acres and 15 ¾ guntas from 1984 till 2005. The extent of area involved in respect of each of the Societies is more than 10 acres in each layout. In terms of the Government Order the BDA has demanded towards the Cauvery Water Supply Scheme at the rate of ₹ 3,00,000/- (Rupees Three Lakhs Only) per acre. Therefore, at a conservative estimate the BDA has raised demand of more than ₹ 170/- crores (5668 x ₹ 3 lakhs). This amount pertains to only Housing Societies. As stated above the BDA has not disclosed the total number of layouts formed by it and the total number of site allotted in the said layouts to its allottees. I say ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayout West part of the city with approach road from Nagarabhavi Road 9696 1764 11460 9696 6 SMV further extension 3615 650 4265 3615 7 Arkavath 20000 8600 28600 8813 True copy of the layout information published by BDA in its official website: http://www.bdabangalore.org/layout.htm as at 2007 is filed as ANNEXURE A-1 to this affidavit. The true typed copy of Annexure A-1 is filed as ANNEXURE A- 2. 5. I say that if the total number of sites allotted by the BDA in the layout formed by it if taken as 2 lakhs sites as stated in the BDA publication the amount levied and collected by BDA from such allottees will come to ₹ 200 crores (2,00,00,000 x ₹ 10,000/-). As stated in the BDA publication in the last decade itself more than 73503 sites have been allotted by the BDA in the layouts formed by itself. The amount levied and collected by the BDA from these allottees in the last one decade at the rate of ₹ 10,000/- per site in terms of the Government Order dated 25.03.1987 towards the Cauvery Water Supply Scheme itself will come to ₹ 73,50,30,000/- (Rs.10,000 per site x 73503 sites). 6. I say that apart from the amount levied and collected by BDA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he area in which the respondents have formed layouts fall within the Bangalore Metropolitan Area. In the impugned order, the Division Bench has recorded brief reasons for negating the respondents' challenge to Notification dated 1.3.1988. The conclusion recorded by the Division Bench and similar view expressed by another Division Bench of the High Court in the Commissioner, Bangalore Development Authority v. State of Karnataka ILR 2006 KAR 318 will be deemed to have been approved by the three Judge Bench of this Court in Bondu Ramaswamy v. Bangalore Development Authority (2010) 7 SCC 129, which referred to Notifications dated 1.11.1965 and 13.3.1984 issued under Section 4A(1) of the Town Planning Act and Notification dated 1.3.1988 issued under Section 2(c) of the 1976 Act and observed: "A careful reading of the Notification dated 1-3-1988 would show that the clear intention of the State Government was to declare the entire area declared under the Notification dated 1-11-1965 and the Notification dated 13-3-1984, together as the Bangalore Metropolitan Area. The Notification dated 1-3-1988 clearly states that the entire area situated within the boundaries indicated in Schedule II t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the State Government was to include the entire area within the boundaries described in Schedule II, that is, the area declared under the two Notifications dated 1-11-1965 and 13-3-1984, as the Bangalore Metropolitan Area. In fact ever since 1988 everyone had proceeded on the basis that the Bangalore Metropolitan Area included the entire area within the boundaries mentioned in Schedule II to the Notification dated 13-3-1984. Between 1988 and 2003, BDA had made several development schemes for the areas in the first concentric circle around Bangalore City (that is, in the 218 villages described in First Schedule to the Notification dated 1-11-1965) and the State Government had sanctioned them. None of those were challenged on the ground that the area was not part of Bangalore Metropolitan Area." The Bench then considered the argument that the language of notification dated 1.3.1988 cannot lead to a conclusion that the areas specified in the Schedule were made part of the Bangalore Metropolitan Area, referred to the doctrine of casus omissus, the judgment of the Constitution Bench in Padma Sundara Rao v. State of T. N. (2003) 5 SCC 533 and proceeded to observe: "Let us now re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tification dated 13-3-1984. It would mean that the three areas, namely, the central core area, the adjoining 218 villages constituting the first concentric circle area and the next adjoining 325 villages forming the second concentric circle are all included within the Bangalore Metropolitan Area. What is already specifically included by Section 2(c) of the BDA Act cannot obviously be excluded by Notification dated 1-3-1988 while purporting to specify the additional areas adjoining to the areas which were already enumerated. Therefore, the proper way of reading the Notification dated 1-3- 1988 is to read it as specifying 325 villages which are described in the First Schedule to the Notification dated 13-3-1984 to be added to the existing metropolitan area and clarifying that the entire areas within the boundaries of Second Schedule to the Notification dated 13-3-1984 would constitute the Bangalore Metropolitan Area. There is no dispute that the boundaries indicated in the Notification dated 13-3-1984 would clearly include the 16 villages which are the subject-matter of the acquisition." 32. In view of the judgment in Bondu Ramaswamy v. Bangalore Development Authority (supra), we ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Hegde and other learned counsel appearing for the respondents supported the conclusion recorded by the High Court that Section 32(5A) is violative of Article 14 of the Constitution by emphasizing that the impugned provision has resulted in hostile discrimination between the allottees of sites in the layouts of the house building societies and other people living in the Bangalore Metropolitan Area. Learned counsel submitted that while the benefit of the Cauvery Scheme, Ring Road, etc. will be availed by all the residents of the Bangalore Metropolitan Area, the cost of amenities have been loaded exclusively on the allottees of the sites of the private layouts and to some extent the BDA layouts and in this manner similarly situated persons have been discriminated. Shri Venugopal referred to the averments contained in paragraphs 4 to 6 of the amendment application filed in Writ Petition No. 11144/1993 to drive home the point that the BDA has loaded its share towards the Cauvery Scheme and Ring Road exclusively on the allottees of the private layouts leaving out the remaining population of the Bangalore Metropolitan Area. 36. In our view, the High Court committed serious error by rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in order to sustain the presumption of constitutionality the Court may take into consideration matters of common knowledge, matters of common report, the history of the times, and may assume every state of facts which can be conceived existing at the time of legislation." 39. In Ram Krishna Dalmia v. Justice S.R. Tendolkar (supra), to which reference has been made in the impugned order, this Court laid down various propositions including the following: "(b) that there is always a presumption in favour of the constitutionality of an enactment and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles; (e) that in order to sustain the presumption of constitutionality the court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation;" 40. In R.K. Garg v. Union of India (1981) 4 SCC 675 the Constitution Bench reiterated the well-settled principles in the following words: "While considering the constitutional validity of a statute said to be violative of Article 14, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and other amenities. However, the fact of the matter is that with a view to cater to the new areas, and for making the concept of planned development a reality qua the layouts of the private House Building Societies and those involved in execution of large housing projects, etc., the BDA and other agencies/instrumentalities of the State incurred substantial expenditure for augmenting the water supply, electricity, etc. There could be no justification to transfer the burden of this expenditure on the residents of the areas which were already part of the city of Bangalore. In other words, other residents could not be called upon to share the burden of cost of the amenities largely meant for newly developed areas. Therefore, it is not possible to approve the view taken by the High Court that by restricting the scope of loading the burden of expenses to the allottees of the sites in the layouts developed after 1987, the legislature violated Article 14 of the Constitution. Question (2) 43. Learned senior counsel for the BDA and the counsel appearing for the State assailed the finding recorded by the High Court that Section 32(5A) is a piece of excessive delegation by pointing out that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be loaded only on the private layouts. Learned counsel relied upon the judgments in Daymond v South West Water Authority (1976) 1 All England Law Reports 39, The State of West Bengal v. Anwar Ali Sarkar (1952) SCR 284, Devi Das Gopal Krishnan and Ors. v. State of Punjab and Ors. (supra) and A.N. Parasuraman and others v. State of Tamil Nadu (1989) 4 SCC 683 to support the conclusion recorded by the High Court that Section 32 (5A) is a piece of excessive delegation. 45. The issue relating to excessive delegation of legislative powers has engaged the attention of this Court for the last more than half century. In Devi Das Gopal Krishnan and Ors. v. State of Punjab and Ors. (supra), Kunnathat Thathunni Moopil Nair v. State of Kerala ( 1961) 3 SCR 77 and A.N. Parasuraman and others v. State of Tamil Nadu (supra), the Court did not favour a liberal application of the concept of delegation of legislative powers but in a large number of other judgments including Jyoti Pershad v. the Administrator for the Union Territory of Delhi (supra), Ajoy Kumar Banerjee v. Union of India (1984) 3 SCC 127, Maharashtra State Board of S.H.S.E. v. Paritosh Bhupeshkumar Sheth (1984) 4 SCC 27, Kishan P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manner which is legal and constitutional, the fact that Parliament could possibly have made more detailed provisions, could obviously not be a ground for invalidating the law." (emphasis supplied) 47. In Maharashtra State Board of S.H.S.E. v. Paritosh Bhupeshkumar Sheth, (supra), the Court while dealing with the issue of excessive delegation of power to the Board of Secondary Education observed: "So long as the body entrusted with the task of framing the rules or regulations acts within the scope of the authority conferred on it, in the sense that the rules or regulations made by it have a rational nexus with the object and purpose of the statute, the court should not concern itself with the wisdom or efficaciousness of such rules or regulations. It is exclusively within the province of the legislature and its delegate to determine, as a matter of policy, how the provisions of the statute can best be implemented and what measures, substantive as well as procedural would have to be incorporated in the rules or regulations for the efficacious achievement of the objects and purposes of the Act. It is not for the Court to examine the merits or demerits of such a policy because its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wing words: "The legislatures in India have been held to possess wide power of legislation subject, however, to certain limitations such as the legislature cannot delegate essential legislative functions which consist in the determination or choosing of the legislative policy and of formally enacting that policy into a binding rule of conduct. The legislature cannot delegate uncanalised and uncontrolled power. The legislature must set the limits of the power delegated by declaring the policy of the law and by laying down standards for guidance of those on whom the power to execute the law is conferred. Thus the delegation is valid only when the legislative policy and guidelines to implement it are adequately laid down and the delegate is only empowered to carry out the policy within the guidelines laid down by the legislature. The legislature may, after laying down the legislative policy, confer discretion on an administrative agency as to the execution of the policy and leave it to the agency to work out the details within the framework of the policy. When the Constitution entrusts the duty of law-making to Parliament and the legislatures of States, it impliedly prohibits them to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e noted precedents is that while examining challenge to the constitutionality of a statutory provision on the ground of excessive delegation, the Court must look into the policy underlying the particular legislation and this can be done by making a reference to the Preamble, the objects sought to be achieved by the particular legislation and the scheme thereof and that the Court would not sit over the wisdom of the legislature and nullify the provisions under which the power to implement the particular provision is conferred upon the executive authorities. 52. The policy underlying the 1976 Act is clearly discernable from the Preamble of the Town Planning Act and the 1976 Act and the objects sought to be achieved by the two legislations, namely, development of the City of Bangalore and areas adjacent thereto. The Town Planning Act was enacted for the regulation of planned growth of land use and development and for the making and execution of town planning schemes in the entire State including the City of Bangalore. By virtue of Section 67 of the 1976 Act and with the insertion of Section 81-B in the Town Planning Act by Act No.12 of 1976, the BDA became the Local Planning Authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to promote and secure the development of the Bangalore Metropolitan Area and for that purpose, the BDA shall have the power to acquire, hold manage and dispose of movable and immovable property, whether within or outside the area under its jurisdiction. "Bangalore Metropolitan Area" has been defined under Section 2(c) of the 1976 Act. It consists of the following areas: (a) area comprising the City of Bangalore as defined in the City of Bangalore Municipal Corporation Act, 1949 which is now replaced by the Karnataka Municipal Corporations Act, 1976, (b) the areas where the City of Bangalore Improvement Act, 1945 was immediately before the commencement of the 1976 Act in force, and (c) such other areas adjacent to the aforesaid as the Government may from time to time by notification specify. Section 15 empowers the BDA to draw up detailed schemes and undertake works for the development of the Bangalore Metropolitan Area and incur expenditure for that purpose. It can also take up any new or additional development scheme on its own, subject to the availability of sufficient resources. If a local authority provides necessary funds for framing and carrying out any scheme, then too, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ricity, roads, transportation and such other amenities within the Bangalore Metropolitan Area. 53. The above survey of the relevant provisions of the 1961 and the 1976 Acts makes it clear that the basic object of the two enactments is to ensure planned development of the areas which formed part of the Bangalore Metropolitan Area as on 15.12.1975 and other adjacent areas which may be notified by the Government from time to time. The BDA is under an obligation to provide "amenities" as defined in Section 2(b) and "civic amenities" as defined in Section 2(bb) of the 1976 Act for the entire Bangalore Metropolitan Area. In exercise of the powers vested in it under Sections 15 and 16, the BDA can prepare detailed schemes for the development of the Bangalore Metropolitan Area and incur expenditure for implementing those schemes, which are termed as development schemes. The expenditure incurred by the BDA in the implementation of the development schemes can be loaded on the beneficiaries of the development schemes. By virtue of Notifications dated 1.11.1965 and 13.3.1984 issued under Section 4A(1) of the Town Planning Act and notification dated 1.3.1988 issued under Section 2(c) of the 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he BDA to demand an unspecified amount from those desirous of forming private layouts. It is needless to say that the exercise of power by the BDA under Section 32(5A) is always subject to directions which can be given by the State Government under Section 65. We may add that it could not have been possible for the legislature to make provision for effective implementation of the provisions contained in the 1961 and 1976 Acts for the development of the Bangalore Metropolitan Area and this task had to be delegated to some other agency/instrumentality of the State. 55. The above discussion leads to the conclusion that Section 32(5A) does not suffer from the vice of excessive delegation and the legislative guidelines can be traced in the Preamble of the 1961 and 1976 Acts and the object and scheme of the two legislations. Question (3) 56. The next question which calls for determination is whether the demand of charges under the Cauvery Scheme, etc. amounts to imposition of tax and is, therefore, ultra vires the provision of Article 265 of the Constitution. 57. The debate whether a particular levy can be treated as 'fee' or 'tax' and whether in the absence of direct evidence of qui ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that the amount is being spent for rendering services to those on whom falls the burden of the fee. (7) At least a good and substantial portion of the amount collected on account of fees, may be in the neighbourhood of two-thirds or three-fourths, must be shown with reasonable certainty as being spent for rendering services of the kind mentioned above." 59. The ratio of the aforesaid judgment was substantially diluted in Southern Pharmaceuticals and Chemicals, Trichur and others v. State of Kerala and others (1981) 4 SCC 391. In the latter decision, the Court considered the constitutional validity of Sections 12-A, 12-B, 14(e) and (f) and 68-A of the Kerala Abkari Act 1077. One of the questions considered by the 3-Judge Bench was whether the levy of supervisory charges under Section 14 (e) of the Act and Rule 16(4) of the Kerala Rectified Spirit Rules, 1972 could be regarded as fee even though there was no quid pro quo between the levy and the services rendered by the State. The Bench referred to the distinction between tax and fee highlighted in the Commissioner, Hindu Religious Endowments, Madras v. Lakshmindra Thirtha Swamiar of Shirur Mutt (1954) SCR 1005 and proceeded to o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rily absent in every tax."" (emphasis supplied) The three Judge Bench also referred to the Constitution Bench judgment in Kewal Krishna Puri v. State of Punjab (supra) and observed: "To our mind, these observations are not intended and meant as laying down a rule of universal application. The Court was considering the rate of a market fee, and the question was whether there was any justification for the increase in rate from ₹ 2 per every hundred rupees to ₹ 3. There was no material placed to justify the increase in rate of the fee and, therefore, it partook the nature of a tax. It seems that the Court proceeded on the assumption that the element of quid pro quo must always be present in a fee. The traditional concept of quid pro quo is undergoing a transformation." 60. The test laid down in Kewal Krishna Puri v. State of Punjab (supra) was again considered in Sreenivasa General Traders v. State of A.P. (1983) 4 SCC 353. In that case, the petitioners had challenged the constitutional validity of the increase in the rate of market fee levied under the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966 from 50 paise to ₹ 1/- on every ₹ 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expected is one of general character and not of mathematical exactitude. All that is necessary is that there should be a "reasonable relationship" between the levy of the fee and the services rendered." 61. In Kishan Lal Lakhmi Chand v. State of Haryana 1993 Supp (4) SCC 461, while dealing with the constitutionality of the levy of cess under the Haryana Rural Development Act, 1986, the three Judge Bench referred to the scheme of the Act and held that from the scheme of the Act it would be clear that there is a broad, reasonable and general corelationship between the levy and the resultant benefit to the producer of the agricultural produce, dealer and purchasers as a class though no single payer of the fee receives direct or personal benefit from those services. Though the general public may be benefited from some of the services like laying roads, the primary service was to the producer, dealer and purchaser of the agricultural produce. 62. In Krishi Upaj Mandi Samiti v. Orient Paper & Industries Ltd. (1995) 1 SCC 655 the two Judge Bench reviewed and analysed various precedents including the judgments in Commissioner, Hindu Religious Endowments v. Sri Lakshmindra Thirtha Swamiar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Karnataka 1985 (Supp) SCC 476, another three Judge Bench considered the validity of levy and collection of market fee from sellers of specified agricultural produce. Sabyasachi Mukharji, J. (as he then was), with whom Fazal Ali, J. (as he then was) agreed, laid down the following principles: "(1) there should be relationship between service and fee, (2) that the relationship is reasonable cannot be established with mathematical exactitude in the sense that both sides must be equally balanced, (3) in the course of rendering such services to the payers of the fee if some other benefits accrue or arise to others, quid pro quo is not destroyed. The concept of quid pro quo should be judged in the context of the present days - a concept of markets which are expected to render various services and provide various amenities, and these benefits cannot be divorced from the benefits accruing incidentally to others, (4) a reasonable projection for the future years of practical scheme is permissible, and (5) services rendered must be to the users of those markets or to the subsequent users of those markets as a class. Though fee is not levied as a part of common burden yet service and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ring Road surcharge, the Cauvery Water Cess and MRTS Cess should not be levied till appropriate decision is taken, we do not consider it necessary to adjudicate the controversy, more so, because in the written arguments filed on behalf of the BDA it has been categorically stated that the Government has to take a decision about the pending demands and the Court may issue appropriate direction in the matter, which the BDA will comply. In our view, ends of justice will be served by directing the State Government to take appropriate decision in the light of communication dated 03.05.2005. 67. So far as the levy of supervision charges, improvement charges, examination charges, slum clearance development charges and MRTS cess is concerned, it is appropriate to mention that the High Court has not assigned any reason for declaring the levy of these charges to be illegal. Therefore, that part of the impugned order cannot be sustained. Nevertheless, we feel that the State Government should take appropriate decision in the matter of levy of these charges as well and determine whether the same were disproportionate to the expenses incurred by it, the BDA or any other agency/instrumentality o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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