1. The Court: The petitioners constructed about 12,480 sq. ft. on the terrace of the tenth floor of a multi-storeyed building known as “Air Conditioned Market” at Shakespeare Sarani without obtaining any sanction from the Municipal authority. Such construction was raised in early 1980. The annual valuation of such illegal construction was assessed by the Municipal authority for the first time for the Assessment Period commencing from GR4/84-85. Rates and taxes in respect of such unauthorised construction has also been realised regularly by the Municipal authority from the petitioners since then.

2. Subsequently, a demolition proceeding being Demolition Case No. 137-D/2002-2003 was initiated under section 400(1) of the Kolkata Municipal Corporation Act by the Municipal authority. The said proceeding was disposed of by the Special Officer, Building on 18th February, 2003 with the following orders:

“1.(a) The P.Rs shall retain the impugned construction shown in red colour in the D/Sketch of D/Case No. 137-D/2002-2003 of Bor.-VII subject to payment of erection/re-erection charges at commercial rates.

(b) The P.Rs shall pay for non-provision of 16 Nos. of car parking spaces to be charged @ Rs. 60,000/- per car parking space.

2. The P.Rs shall carry out the orders within one month from the date of its communication failing which the orders shall become inoperative and all the impugned constructions marked in red colour in the D/Sketch of D/Case No. 137-D/2002-2003 shall be subject to demolition at the cost and risk of the P.Rs

3. The P.Rs shall swear an affidavit before Magistrate 1st Class to the effect that they shall abide by the existing rules and regulations of CMC and shall not take recourse to anything which may tantamount to violation of the CMC Act, 1980 and Building Rules, 1990 and shall also be held responsible for any misrepresentation of records.

4. The P.Rs shall submit a certificate obtained from CMC empanelled Structural Engineer certifying therein the aspect of structural stability as well as the workmanship and quality of materials so far used in the construction of the premises.

5. The copy of the order shall be communicated to the P.Rs as well as the E.E Bor.-VII for information and necessary action. Each page of the order is signed and the D/Sketch as well as precis countersigned.”

3. Admittedly the said order was accepted by the petitioners as well as by the Municipal authority.

4. Subsequently, a dispute arose when the Municipal authority in pursuance of the order of demolition passed by the Special Officer (B) dated 18 February, 2003 in a proceeding under section 400(1) of the Kolkata Municipal Corporation Act, 1980, raised a bill of charges and/or fees upon the petitioners for payment thereof as a condition for retention of such unauthorised construction. The following charges were demanded from the petitioners towards the retention fees of the unauthorised construction:

“(1) Sanction of fees : Rs. 55,50,923.00 (2) Drainage Dev. fees : Rs. 1,11,532.00 (3) (WT+ST+W.S) : Rs. 3,17,865.00 (4) Surcharge Dev. fees : Rs. 6,13,423.00 (5) Short fall of 16 Nos. Car Park : Rs. 9,60,000.00 (6) D/Sketch fees : Rs. 8,000.00 Total : Rs. 75,61,743.00”

5. The legality of the aforesaid demand has been challenged by the petitioners in this writ petition on the ground that such demand was not raised in conformity with the order passed by the Special Officer (B) on 18th February, 2003.

6. Mr. Mukherjee, learned Senior Advocate, appearing for the petitioners, submitted that Article 265 of the Constitution of India imposes a restriction on levy and collection of taxes except by authority of law. Relying upon a decision of the Hon'ble Supreme Court in the case of Ahmedabad Urban Development Authority v. Sharadkumar, reported in AIR 1992 SC 2038, Mr. Mukherjee submitted that in the absence of express provision, a delegated authority cannot impose tax or fees. According to Mr. Mukherjee, such power of imposition of tax and/or fees by delegated authority must be very specific and as such, there is no scope of implied authority for imposition of such tax and fees. The delegated authority must act strictly within the parameters of the authority delegated to it under the Act and it will not be proper to bring the theory of implied intent or the concept of incidental and ancillary power in the matter of exercise of fiscal power.

7. By referring to section 543(2) of the said Act, Mr. Mukherjee submitted that under the said provision, the Municipal authority for regularisation of such unauthorised construction, may demand erection/re-erection charges, i.e, building permit fees at such rate which was fixed by the Municipal Commissioner with the sanction of the Mayor-in-Council for the period during which such unauthorised construction was raised.

8. Mr. Mukherjee further submitted that the building permit fees can be realised as per the mode as prescribed under Rules 38 and 39 of the Building Rules, 1990. Mr. Mukherjee contended that apart from realisation of the building permit fees in the manner as aforesaid, the Municipal authority is not authorised under the statute to realise any amount on any other head even for regularisation of unauthorised construction.

9. By referring to a decision of this Hon'ble Court in the case of Scotts (P) Ltd. v. Corporation of Calcutta, reported in 79 CWN 883, Mr. Mukherjee submitted that the Corporation has no power to do anything unless those powers are conferred on it by the statute which creates it. Mr. Mukherjee further contended that since the statute does not empower the Municipal authority to realise any other charges and/or fees from the petitioners towards regularisation of the unauthorised construction, the Municipal authority cannot claim any amount under any of the heads, as mentioned in the demand notice excepting sanction fees from the petitioners.

10. Mr. Mukherjee further complained that even the sanction fee was not charged and/or calculated as per the provision of the statute. According to Mr. Mukherjee, the Municipal authority can only realise the building permit fees from the petitioners at the rate applicable to the business building as prescribed at the relevant time, i.e, when such unauthorised construction was raised.

11. Mr. Mukherjee, thus, contended that the charges which was levied on account of (i) drainage development fees, (ii) WT+ST+WS, (iii) surcharge development fees, (iv) shortfall of 16 No. of car park and (v) D/sketch fees, cannot be realised from the petitioners as the Municipal authority imposed such charges and/or fees in excess of its jurisdiction.

12. Mr. Mukherjee, however, ultimately submitted that in addition to the building permit fees, his clients are agreeable to pay the car parking fees in terms of the order passed by the Special Officer (B) on 18th February, 2003.

13. Mr. Mukherjee, thus, invited this Court to quash the demand raised by the Municipal authority vide Annexure ‘P-13’ to this writ petition at page 94 with a further direction upon the Municipal authority to raise a bill of charges payable by the petitioners in terms of the order passed by the Special Officer (B) on 18 February, 2003.

14. Mr. Ghosh, learned Advocate, appearing for the Kolkata Municipal Corporation, refuted the said submission of Mr. Mukherjee by contending, inter alia, that the petitioners who raised such massive construction without any sanctioned plan, cannot claim regularisation of such unauthorised construction on payment of normal fees on account of building permit fees in terms of Rules 38 and 39 of the Building Rules.

15. Mr. Ghosh further contended that illegal construction cannot be regularised as a matter of course. However, under certain circumstances, such construction can be regularised upon payment of the building permit fees at a penal rate together with the other incidental and/or ancillary charges.

16. By producing the schedule of fees and charges for the year of 2005-2006, Mr. Ghosh tried to impress upon this Court that the demand, raised by the Municipal authority by the impugned notice, is legal and valid as the said bill was raised on the basis of the schedule of fees and charges for the year 2005-2006 circulated vide office circular No. 01 of 2005-2006 dated 18th April, 2005 by the Building Department.

17. Mr. Ghosh further contended that since the building consists of shops and market, the rate prescribed for the mercantile building, has been charged for regularising such unauthorised construction. Mr. Ghosh pointed out that the other fees which were demanded from the petitioners under different heads were also charged as per the said schedule of fees and charges.

18. Mr. Ghosh in his usual fairness ultimately submitted before this Court that instead of raising the demand on the basis of the schedule of fees and charges notified for the year 2005-2006, the Municipal authority should have raised such demand on the basis of the schedule of fees and charges notified for the year 2002-2003 as the unauthorised construction was regularised by the Hearing Officer (Building) in 2003 by his order dated 18 February, 2003.

19. According to Mr. Ghosh, the charges should be levied at the rate which was prevalent at the time of regularisation of unauthorised construction and not at the rate as prevalent at the time of raising such unauthorised construction as contended by Mr. Mukherjee. In support of such submission, Mr. Ghosh relied upon a decision of the Hon'ble Supreme Court in the case of Usman Gani J. Khatri v. Cantonment Board reported in 2002 (2) SCC 455.

20. Since Mr. Mukherjee ultimately, on instructions from his client, submitted before this Court that his clients are agreeable to pay the building permit fees at the rate as prescribed for the period of 2002-2003 in addition to the car parking fees for not making provision for 16 car parking spaces at the rate as mentioned in the order of the Special Officer (B) dated 18 February, 2003 and further since Mr. Ghosh also contended that charging of fees at the prescribed schedule rate of 2005-2006 cannot be justified, this Court is not required to consider as to whether the petitioners are required to pay the building permit fees at the rate as prescribed for the period 2005-2006 or at the rate which was prescribed at the relevant time of raising such unauthorised construction.

21. Let me now consider the other points of dispute involved in this writ petition.

22. I have already indicated above that neither the petitioners nor the Municipal authority challenged the legality and/or validity of the order of the Special Officer (B) passed in the aforesaid demolition proceeding on 18 February, 2003. Thus, the said order is binding upon both the parties. By the said order, the unauthorised construction was allowed to be retained subject to payment of the following charges:

“1. (a) The P.Rs shall retain the impugned construction shown in red colour in the D/Sketch of D/Case No. 137-D/2002-2003 of Bor.-VII subject to payment of erection/re-erection charges at commercial rates.

(b) The P.Rs shall pay for non-provision of 16 Nos. of car parking spaces to be charged @ Rs. 60,000/- per car parking space.”

23. Mr. Mukherjee also intimated this Court that his clients are agreeable to pay both the aforesaid charges as indicated above, but at the same time Mr. Mukherjee contended that his clients cannot be compelled to pay any other charges which the Municipal authority is not authorised to charge under the statute for regularising such unauthorised construction.

24. Let me now consider as to how far such submission of Mr. Mukherjee can be accepted.

25. Section 392 of the Kolkata Municipal Corporation Act, 1980 prohibits erection and/or commencement of construction of any building without any sanctioned plan. Section 396 of the said Act provides for grant of sanction and/or provisional sanction for construction of a building. Section 543(2) of the said Act provides for charging of fees for grant of permission and/or sanction for such construction. Rule 15(2) of the Building Rules of 1990 provides that building permit fees are payable for obtaining the building permit from the Municipal authority. Rules 38 and 39 of the said rules read with section 131(3) of the Kolkata Municipal Corporation Act authorise the Municipal authority to declare the schedule of rate at which building permit fee and fee for sanction of the revised plan can be levied and the mode of calculation of the building fees at such prescribed rate.

26. Since the Kolkata Municipal Corporation Act authorises the Municipal authority to demand building permit fees for grant of sanction for construction, the said Corporation can realise the building permit fees from the petitioners for regularising the unauthorised construction.

27. Furthermore, since the learned Counsel appearing for both the parties basically accepted that building permit fees is realisable at the rate prescribed at the time of regularising the unauthorised construction, this Court directs the Municipal authority to raise the bill on account of building permit fees at the normal rate which was notified in the schedule of fees and charges for the year 2002-2003 during which the unauthorised construction was regularised by the Municipal authority,

28. This Court, however, does not find any substance in the submission of Mr. Mukherjee to the effect that since the disputed construction is not utilised for any mercantile purpose, the fees/charges cannot be realised at the rate which was applicable to the mercantile building. Even assuming that the disputed construction is not used for any mercantile purpose, still then the building which consists of shops and market, can be classified as mercantile building and as such, for regularisation of any unauthorised construction in such building, building permit fees can be demanded at the commercial rate which is applicable to a mercantile building.

29. With regard to the charges which were demanded on other heads, this Court does not find any legal sanction behind such demand as the statute which created the said Corporation does not authorise the Corporation to raise such demand for regularising the unauthorised construction. In this regard, reliance may be placed on the decision of the Hon'ble Supreme Court in the case of Ahmadabad Urban Development Authority v. Sharadkumar (supra) as well as on the decision of this Hon'ble Court in the case of Scotts (P) Ltd. v. Corporation of Calcutta (supra).

30. Even the building permit fees cannot be charged at the penal rate, as the Municipal authority is not authorised under the statute to realise such fees at the penal rate for regularising any unauthorised construction.

31. Article 265 of the Constitution of India imposes a restriction on the statutory authority on levy and/or collection of charges except by authority of law.

32. This Court, however, makes it clear that in addition to the building permit fees, the petitioners are also required to pay the car parking fees for not making provision of car parking spaces for 16 cars, in terms of the order of the Special Officer (B) passed on 18 February, 2003 irrespective of the fact that such fees is legally realisable from the petitioners or not, as challenge with regard to car parking spaces, cannot be entertained by this Court at this stage in view of the fact that the order of the Special Officer (B) attained its finality, as nobody challenged the same in higher forum.

33. The impugned bill/demand which was raised by the Municipal authority vide Annexure ‘P-13’ to this writ petition at page 94 stands quashed. The Municipal authority is directed to raise a demand afresh in the light of the observations made hereinabove.

34. Before parting with, this Court also feels it necessary to deal with another submission of Mr. Ghosh regarding the authority of the Corporation to impose penalty upon the person responsible for raising such unauthorised construction. Mr. Ghosh submitted that section 610 of the said Act authorises the Municipal authority to impose penalty at the rate prescribed in Schedule VI thereunder for raising such unauthorised construction. It is no doubt true that the said Act recognises the power and/or authority of the Corporation to impose penalty upon the person whoever contravenes any provision of any section, sub-section, clause or provisos or any other provision of the said Act mentioned in column 1 of Schedule VI. Erection of unauthorised construction without obtaining sanction under sub-section (2) of section 392 is punishable as per the said Schedule.

35. But here in the instant case the disputed construction was raised before the Kolkata Municipal Corporation Act, 1980, came into operation. As such, imposition of penalty upon the person responsible for such construction by resorting to section 610 of the said Act is doubtful. Of course, section 537 of the Calcutta Municipal Act also provides for imposition of penalty for construction in violation of provision of section 381(6) of the said Act. This Court, however, is not required to decide the said issue as to which provision can be resorted to here, inasmuch as, such an issue is neither involved in this writ petition nor this Court was addressed on the said issue by either of the parties.

36. However, this Court can say this much that the citation relied upon by Mr. Ghosh in the case of Mahendra Baburao Mahadir v. Subhash Krishna Kanitkar, reported in 2005 AIR SCW 1579 supports such contention of Mr. Ghosh. In the said decision, it was held by the Hon'ble Supreme Court that payment of development charges by itself, therefore, did not lead to exoneration from the consequences of commission of an offence or regularisation of unauthorised construction. Following the said principle, this Court holds that the person responsible for such unauthorised construction in the instant case is not exonerated from the consequences of commission of offence.

37. The writ petition, thus, stands allowed. There will be, however, no order as to costs.

38. Urgent xerox certified copy of this order, if applied for, be given to the parties, as expeditiously as possible.

Jyotirmay Bhattacharya, J.:

Writ petition allowed.

A.D