Partly allowed

Icon Infra Shelters India Pvt. Ltd. v. the State of Karnataka

Karnataka HC4 Nov 2022WP/16074/2022

Case brief

AI extract

What is this about?

Writ petition challenging demand notice for building license fees. Court quashed upfront Labour Cess demand, ordered cess payment after 30 days of completion or assessment, and directed license issuance upon clearing other fees and executing a bond.

What did the court decide?

Quashed upfront Labour Cess demand; directed authority to recover cess after 30 days of completion/assessment; directed license issuance on payment of other fees and execution of bond.

Icon Infra Shelters India Pvt. Ltd. Vs the State of… — Property and Title | Karnataka HC (2022)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 4^TH DAY OF NOVEMBER, 2022

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BEFORE

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THE HON’BLE Mr. JUSTICE M.G.S. KAMAL

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WRIT PETITION No.16074 OF 2022 (LB-RES)

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BETWEEN:

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ICON INFRA SHELTERS INDIA PVT. LTD., 47/9 JAI PLAZA SYMPHONY 9^TH MAIN, 6^TH SECTOR HSR LAYOUT BENGALURU - 560 102 REPRESENTED BY ITS MANAGING DIRECTOR DR. P. MANMOHAN REDDY AGED ABOUT 44 YEARS

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...PETITIONER

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(BY SRI. HARISH H.V., ADVOCATE)

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AND:

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THE STATE OF KARNATAKA URBAN DEVELOPMENT DEPARTMENT VIKASA SOUDHA BENGALURU -560 001 REPRESENTED BY THE CHIEF SECRETARY.

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JIGANI MUNICIPALITY JIGANI HOBLI, ANEKAL TALUK BENGALURU URBAN DISTRICT - 560 105 REP. BY ITS CHIEF OFFICER.

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... RESPONDENTS

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(BY SRI. VENKATASATYA NARAYANA, HCGP FOR R1;

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SRI. NAGARAJ S. JAIN, ADVOCATE FOR R2)

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THIS PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED DEMAND NOTICE DATED:22.06.2022 BEARING NO.JI.PU.KAA/KA.P/C.R./01/2022-23 ISSUED BY THE R2 TO THE PETITIONER VIDE ANNEXURE-A AS REGARD THE DEMANDS MADE TOWARDS ISSUANCE OF BUILDING LICENSE FEE AT A TIME INCLUDING LABOUR CESS. DIRECT THE R2 TO ISSUE BUILDING LICENSE TO THE PETITIONER AS PER ITS REQUISITION IN THE INTEREST OF JUSTICE AND EQUITY IN ACCORDANCE WITH LAW.

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THIS PETITION COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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Present petition is filed by the petitioner challenging the demand made at Annexure-A by the respondent No.2 calling upon the petitioner to pay an aggregate sum of Rs.25,87,650/-. Details of the said demand i.e., demand towards Construction fee, Scrutiny fee, Security deposit and Labour Cess is produced as per Annexure-D.

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Learned counsel for the petitioner submits that the petitioner has no disputes with regard to demand

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made towards Construction Fee, Scrutiny Fee, Security Deposit. However, the grievance of the petitioner is with regard to demand made towards Labour Cess in a sum of Rs.20,52,500/-. Learned counsel submits that the said demand to make the payment upfront is unsustainable in view of the judgement of the Co-ordinate Bench of this Court passed in WP.No.4601/2020 and connecter matters. At paragraph 50 of the said judgment, this Court has held as under ;

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"50. The demand now made is undoubtedly payable by the petitioners but on completion of one year of the project within 30 days of such completion which is the mandate of the Welfare Cess Act and is to be strictly adhered to. Moreover, in the light of the fact that Rule 7 of the Rules mandates the employer to provide details of estimated cost of construction in Form No.I and the Assessing Officer would pass an order of assessment. A conjoint reading of Rules 4 and 7 makes it unmistakably clear that the local authority may either within 30 days of completion of the project or within 30 days from the date of assessment of cess payable is finalized, whichever is earlier, shall pay cess to the Cess Collector".

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Thus, learned counsel for the petitioner

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submits that the Labour cess becomes payable either within 30 days of completion of the project or within 30

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days from the date of assessment of cess payable is finalized, which ever is earlier. That the demand made by the respondents is therefore unsustainable.

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Learned counsel for the petitioner and respondents submits that since the petitioner is willing to pay the demand made by the respondents except demand towards Labour cess, it is submitted that the petition can be disposed of in terms of the aforesaid judgment of this Court. Submission is taken on record.

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The petition is disposed of with the following

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directions;

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a) The demand made in Annexures- A and D to the extent of upfront payment of Labour Cess is quashed.

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b) The respondents- authority shall recover the Labour Cess as held by this Court in the paragraph extracted hereinabove i.e., within 30 days from the date of completion of building or within 30 days from the date of assessment made.

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c) Petitioner shall pay the amount demanded towards Construction Fee, Scrutiny Fee and Security Deposit.

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d) The petitioner shall also execute a bond undertaking to make payment of Labour Cess in compliance with the terms of this Order. e) On payment of the aforesaid amounts and on execution of bond by the petitioner undertaking to make payment towards labour cess, respondents – authorities shall issue building licence to the petitioner. Accordingly, the petition is disposed of.

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Sd/JUDGE

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Icon Infra Shelters India Pvt. Ltd. v. the State of Karnataka

Case brief

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Icon Infra Shelters India Pvt. Ltd. v. the State of Karnataka

Case brief

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