Chennai Metropolitan Development ... vs Prestige Estates Project Ltd.

Premium FSI 3 DR 2 The appellant, as the planning authority, was requested to take up further action for issuance of a planning permission.

4 The appellant, which is a planning authority under the provisions of the Tamil Nadu Town & Country Planning Act 19714, was required to consider the application for the grant of planning permission under Section 49. The Chennai Metropolitan Water Supply and Sewerage Board5 addressed a letter on 6 February 2012 to the respondent stating that it would consider the issuance of its No Objection Certificate6 subject to the acceptance of the following conditions:

5 On 2 March 2012, the respondent addressed a communication to the appellant, stating that it had accepted the conditions imposed by Sewerage Board by its letter dated 18 February 2012 and that a formal NOC was expected shortly. The appellant was requested to process the planning permission and to issue a notice of demand for development charges in order to enable the respondent to arrange for the funds required. The respondent, in its above letter dated 2 March 2012 stated :

6 On 7 March 2012, the appellant requested the Sub-Registrar, Chennai South to furnish the guideline value of urban land for the survey numbers where development was proposed by the respondent for assessing the Premium FSI charges in relation to the development proposal. This was furnished by the Sub- Registrar on 7 March 2012.

4 7 On 27 March 2012, the appellant issued a demand notice requiring the respondent to deposit the following charges in order to facilitate the processing of its application:

One of the conditions subject to which the State government had granted its approval to the respondent was the obtaining of an NOC from the Sewerage Board. On 28 March, 2012, G.O.Ms No. 86 was issued by the Housing and Urban Development Department whereby the I & A charges for different categories and buildings falling under the jurisdiction of the appellant and of the Commissioner of Town and Country Planning were to stand increased by 50 per cent over the then prevailing rates. The Sewerage Board issued its NOC on 30 March 2012, subject to the condition that the respondent execute a gift deed in respect of a piece of land. This requirement was complied with on 27 April 2012. When the file pertaining to the grant of planning permission to the respondent was under consideration, guideline values were revised by the State government with effect from 1 April 2012. A demand notice was issued on 22 August 2012 by the appellant by which the demand was revised for charges under two heads:

(b) Clause (i) of the Office Order dated 16 April 2012, states that revised I & A charges shall be applicable for demands made on or after 28 March 2012. Hence, the revised charges would not be applicable to the respondent against whom a demand had been raised on 27 March 2012 by the appellant.

24 On 27 March 2012, while issuing a demand notice to the respondent, it was made clear by the appellant that the planning permission was still to be issued. The submission of the application for permission and the steps taken by the respondent to comply with the conditions and the deposit of the charges did not confer a vested right in the respondent for the grant of planning permission. The grant of planning permission would only ensue upon the appellant 21 scrutinizing the application and determining that the permissions which were sought were in accordance with the development regulations and all other planning requirements holding the field. Before the planning permission was issued, the revised charges for Premium FSI came to be enforced. Once the revised charges came into force with effect from 1 April 2012, the respondent, as the applicant for planning permission, was bound to pay the revised charges. As on 1 April 2012, the respondent had no planning permission in its favour. The submission of the respondent that planning permission was issued in May 2012 evidently will not advance the case of the respondent. The grant of any permission post the revision of the Premium FSI charges would necessarily be subject to the revised charges. Hence, in raising the demand on the basis of the revised charges on 22 August 2012, the appellant was acting in accordance with law.

27 For the above reasons, we allow these appeals in part by setting aside the impugned judgment and order of the High Court insofar as it quashed the 16 (2005) 10 SCC 203 25 demand raised by the appellant on 22 August 2012 for the levy of Premium FSI charges.

28 The appellant, in our view, was justified in demanding Premium FSI charges at the revised rates and would be entitled to enforce its demands. However, we maintain the order of the High Court insofar as the demand for I & A charges is concerned.

29 The appeals are disposed of. There shall be no order as to costs.

July 29, 2019 26