The Madras High Court has dismissed a batch of more than 75 writ petitions filed by realtors, property developers, public limited companies and charitable educational trusts, challenging the levy of Infrastructure and Amenities (IAA) charges under Section 63B and 63C of the Tamil Nadu Town and Country Planning Act, 1971.
Justice K. Chandru rejected their contention that the government was not empowered to collect money under the head IAA charges when it was already collecting development charges under section 59 of the same Act.
They also claimed that it was the local bodies and not the State government which creates infrastructure.
Pointing out that both the government and local bodies are responsible for developing infrastructure and amenities to ensure planned development, the judge said that the fees collected by local bodies for approving building plans could not be confused with IAA charges under the enactment.
“It is not the question of merely providing water, electricity supply and sewerage but also other amenities that are set out in the objects and reasons of the Act… Though there may be overlapping of meaning between the three terms development, infrastructure and amenities, the last two are more comprehensive than the normal term development.”
The judge referred to the government's submission that the money had been used for creating infrastructure in Coimbatore for the World Tamil Conference, implementing water supply scheme for Manapakkam and installing pumping stations along the IT corridor in Chennai.
It was also used to install grade separators on Anna Salai, creating facilities for Chennai Metro Rail and laying Tirunelveli bypass road among other works.
A total of Rs.990.85 crore was available under the IAA fund. Of that, Rs.740.89 crore had already been spent and commitments had been made for another Rs.74.88 crore. The balance available was Rs.175.08 crore.
Pointing out that the Act, the rules framed under it and the subsequent government orders list the quantum of IAA charges to be levied on different categories of buildings, the judge said that neither the companies situated in Special Economic Zones nor educational institutions could seek exemption from payment.
50 per cent paid
Further pointing out that most of the petitioners had paid 50 per cent of IAA charges at the time of obtaining building plan approval itself and had given bank guarantees for the rest of the amount in two instalments within 18 months, the judge said that they could not suddenly resile from their obligation and challenge the levy.
On their contention that the money was extracted under the threat of refusing to grant planning permission, the judge said: “The said argument cannot be accepted. First of all, the petitioners are not men of no means. They are huge builders knowing fully the consequences of such undertakings and execution of bond and creation of bank guarantees. If there are any illegalities, they can always approach the court.”
