Mr. Udayakumar Vs the State of Karnataka

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1 - NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3^RD DAY OF DECEMBER, 2025

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BEFORE

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THE HON'BLE MR. JUSTICE R. NATARAJ WRIT PETITION NO. 33193 OF 2025 (LB-TAX)

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BETWEEN:

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MR. UDAYAKUMAR PRESIDENT SRI. SHANTINIKETANA VIDYA SAMSTHE (R) AGED ABOUT 50 YEARS

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MR. K.R. KESHAVAMURTHY SECRETARY SRI. SHANTINIKETANA VIDYA SAMSTHE (R) AGED ABOUT 47 YEARS HAVING REGD. OFFICE AT GURUKULA VIDYA MANDIRA KUDUR, BANGALORE SOUTH DISTRICT-561101

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…PETITIONERS

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(BY SRI. ASHOK HANDE, ADVOCATE)

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Digitally signed by MARKONAHALLI RAMU PRIYA Location: HIGH COURT OF KARNATAKA

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AND:

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THE STATE OF KARNATAKA DEPARTMENT OF RURAL DEVELOPMENT AND PANCHAYATH RAJ M.S. BUILDING, DR. AMBEDKAR ROAD, BENGALURU-560001 (REP. BY ITS PRINCIPAL SECRETARY)

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THE KUDUR GRAM PANCHAYAT MAGADI TALUK, BANGALORE SOUTH DISTRICT-561101 (REP. BY ITS PANCHAYAT DEVELOPMENT OFFICER)

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…RESPONDENTS

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2 -

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NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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(BY SRI. M.S.DEVARAJU, ADVOCATE FOR RESPONDENT NO.2; VIDE ORDER DATED 25.11.2025, NOTICE TO RESPONDENT NO.1 IS DISPENSED WITH)

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THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE PROPERTY TAX DEMAND NOTICE BEARING BILL NO. 1529003018/1529003018036/2025-26/02906/R02, IN RESPECT OF PROPERTY ID NO.152900301803621347, DATED 25.09.2025 IN FORM NO. 3 ANNEXURE-H1, ISSUED AGAINST PETITIONER NO.1 BY THE RESPONDENT NO.2 UNDER S.200(1) OF KARNATAKA GRAM SWARAJ AND PANCHAYATH RAJ, 1993 AND QUASH DEMAND NOTICE DATED 15.10.2025 ANNEXURE-J1 ISSUED AGAINST THE PETITIONER NO. 1 BY THE RESPONDENT NO.2 HEREIN AND ETC.

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THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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CORAM: HON'BLE MR. JUSTICE R. NATARAJ

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ORAL ORDER

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The petitioners have challenged the demand notices bearing Nos.1529003018/1529003018036/20252026/02906/R02 and 1529003018/1529003018036/20252026/02907/R04 dated 25.09.2025 (Annexures - H1 and H2) and a further notice dated 15.10.2025 (Annexure - J1) and the consequent reminder notice dated 15.10.2025 (Annexure - J2).

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3 - NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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The petitioner No.1 claims to be the absolute owner

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of land bearing Survey No.127/4 measuring 12 guntas and petitioner No.2 claims to be the absolute owner of land bearing Survey No.127/3 measuring 12½ guntas situate at Kudur Village, Kudur Hobli, Magadi Taluk, Ramanagar District. The petitioners have established a school named 'Gurukula Vidya Mandira', which lies within the limits of respondent No.2. The petitioners submitted a representation dated 19.03.2025 requesting respondent No.2 to extend the rebate in property tax in respect of the educational institution. Respondent No.2 refused to consider their request, vide reply dated 14.07.2025. Thereafter, respondent No.2 issued two separate tax demand notices dated 25.09.2025 to the petitioners and further issued another notice and reminder dated 15.10.2025 demanding tax. The petitioners being aggrieved by the same are before this Court.

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The learned counsel for the petitioners contend that

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the levy and collection of property tax by a panchayath are governed by Section 199 of the Karnataka Gram Swaraj and Panchayat Raj Act, 1993 (henceforth referred to as 'Act, 1993'

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4 - NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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for short) and the Karnataka Panchayat Raj (Grama Panchayat Taxes and Fees) Rules, 1994 (henceforth referred to as 'Rules, 1994' for short). He submits that the State Government, in exercise of the powers under Sections 199, 200 and 201 of the Act, 1993 has thereafter framed the Karnataka Grama Panchayat and Panchayat Raj (Taxes, Rates and Fees of Gram Panchayat) Rules, 2021 (henceforth referred to as 'Rules, 2021' for short). He submits that before issuing any demand for property tax, respondent No.2 is required to issue a prior notice, thereafter inspect the property between sunrise and sunset, and after such inspection determine the tax liability and proceed with collection. He submits that in the present case, respondent No.2 has straightaway issued the demand notices without conducting any inspection of the buildings and without extending the rebate provided under Rules 16(H) and 31 of the Rules, 2021. He therefore prays that the impugned notices be set at naught. In support of this contention he relied upon the judgment of a Co-ordinate Bench of this Court in W.P.No. 16323 of 2021 and other connected petitions.

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5 - NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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The petition is opposed by respondent No.2 who contends that the petitioner who claims rebate in property tax is required to first submit a representation furnishing all necessary particulars and thereupon respondent No.2 would take steps in accordance with law. He submits that in the instant case, the petitioners have not submitted any such representation and therefore the petitioners may be directed to file a representation with all relevant particulars, so as to enable respondent No.2 to determine the tax liability. In support of this submission, he relied upon the judgment of a Co-ordinate Bench of this Court in W.P. No.5695/2025 wherein a similar direction was issued to the property owner to submit a representation.

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I have considered the submissions of the learned counsel for the petitioner as well as the learned counsel for the respondent No.2.

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A perusal of the impugned demand notices indicate that there is no inspection of the petitioners' property. Respondent No.2 has proceeded to determine the tax on unknown considerations. The petitioners had submitted a

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6 - NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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representation dated 19.03.2025 seeking rebate in the property tax which respondent No.2 rejected vide reply dated 14.07.2025. As rightly contended by learned counsel for respondent No.2, a Co-ordinate bench of this Court, in similar circumstances while examining the manner of determination and demand of property tax, held as follows:

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10. Insofar as the demand of tax after 31.03.2022, it must be noticed that Rule 16(h) of Rules, 2021 would be applicable. Rule 16(h) reads as follows:

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"(h) 5 per cent exemption shall be given to the properties of educational institutions having self-governing separate civic facilities and tax exemption shall be given to the greening land."

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11. Accordingly, there should be finding by the Authority on the basis of the contentions made by the petitioners insofar as petitioners' eligibility for tax exemption upto 5%. The starting of the procedure for assessment of tax is in terms of Rule 32 of Rules, 2021. Rule 32 reads as follows:

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7 -

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NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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"32. Inspection of immovable property.For the purpose of determination, demand and collection of tax, rates or fees under Section 80 of the Act, within the premises of any immovable property subject to taxation within the limits of the Grama Panchayat area, after giving due notice, the officer/employee of the Grama Panchayat within the period between sunrise and sunset to enter, obtain and inspect building and vacant lot documents from the owner.

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(2) such area shall not be restricted by the owner of any immovable property for the purpose of taxation. If he is found to be restricting such entry, legal action will be taken against him."

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12. Accordingly, post 31.03.2022, the demand to be raised must be preceded by an inspection with due notice to the petitioners. Accordingly, the demand for tax pre 31.03.2022 and post 31.03.2022 which is the subject matter of Annexure-A requires to be reworked in terms of the observations made above.

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13. Accordingly, the demand notice at Annexure-A is set aside. The respondent - Panchayath is at liberty to raise demand after following the procedure adverted to above with

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8 - NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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respect to pre 31.03.2022 and post 31.03.2022. Insofar as the procedure to be followed post 31.03.2022, it is the Rules, 2021 that would be applicable and procedure to be followed while with respect to the demand prior to 31.03.2022, it is the Rules, 1994 that have to be followed. Liberty is reserved to the respondent - Panchayat to proceed with the matter in terms of the observations made above.

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14. Petitioners to be present before the Panchayat Development Officer on 05.05.2025 at 11.30 a.m. and the respondent to start the process in terms of inspection as contemplated under Rule 32 of Rules, 2021. Needless to state the petitioners to be present with all documents to enable the Panchayat to conduct proceedings in terms of Rule 6(c) of Rules, 1994 as well as Rule 16(h) of Rules, 2021 for different periods."

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7. In view of the fact that the facts of the present case

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are fully covered by the judgment of a Co-ordinate bench of this Court in W.P. No.5695/2025, this petition also deserves to be disposed off on similar terms.

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Accordingly, the writ petition is disposed off . The demand notices issued by the respondent No.2 which are

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9 - NC: 2025:KHC:50385 WP No. 33193 of 2025

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HC-KAR

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impugned in this petition (Annexure - H1, H2, J1 and J2) are quashed. The respondent No.2 is directed to inspect the property of the petitioners and thereafter determine the property tax payable, after extending such rebates as the petitioners may be entitled to in accordance with law, and thereafter issue a fresh demand notice. The petitioners shall then be bound to pay the property tax if the same is determined in accordance with law.

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Sd/(R. NATARAJ) JUDGE

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HJ

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List No.: 1 Sl No.: 19

Mr. Udayakumar v. the State of Karnataka

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Mr. Udayakumar v. the State of Karnataka

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